Exhibit 10.1

MANAGEMENT AGREEMENT

 

This AGREEMENT made as of February 1, 2018, is by and among CERES MANAGED
FUTURES LLC, a Delaware limited liability company (“CMF”), CERES TACTICAL
CURRENCY L.P., a Delaware limited partnership (the “Partnership”) and AE CAPITAL
PTY LIMITED, a Victoria, Australia limited proprietary company (“AE Capital” or
the “Advisor”).

W I T N E S S E T H :

WHEREAS, CMF is the general partner of the Partnership, a limited partnership
organized for the purpose of speculative trading of commodity interests,
including futures contracts, options, forward contracts, swaps and other
derivative instruments with the objective of achieving substantial capital
appreciation; and

WHEREAS, such trading to be conducted directly or through investment in CMF AE
Capital Master Fund LLC, a Delaware limited liability company (the “Master
Fund”) of which CMF is the trading manager and AE Capital is the advisor; and

WHEREAS, the Fourth Amended and Restated Agreement of Limited Partnership of the
Partnership, dated as of October 31, 2017 (the “Partnership Agreement”), permit
CMF to delegate to one or more commodity trading advisors CMF’s authority to
make trading decisions on behalf of the Partnership; and

WHEREAS, the Advisor is registered as a commodity trading advisor with the
Commodity Futures Trading Commission (“CFTC”) and is a member of the National
Futures Association (“NFA”) and is registered with and regulated by the
Australian Securities and Investments Commission; and

WHEREAS, CMF is registered as a commodity trading advisor and a commodity pool
operator with the CFTC and is a member of the NFA; and

WHEREAS, CMF, the Partnership and the Advisor wish to enter into this Agreement
in order to set forth the terms and conditions upon which the Advisor will
render and implement advisory services in connection with the conduct by the
Partnership of its commodity interest trading activities during the term of this
Agreement.

NOW, THEREFORE, the parties agree as follows:

1.        DUTIES OF THE ADVISOR. (a) For the period and on the terms and
conditions of this Agreement, the Advisor shall have sole authority and
responsibility, as one of the Partnership’s agents and attorneys-in-fact, for
directing the investment and reinvestment of the assets and funds of the
Partnership, whether directly or indirectly through the Master Fund, allocated
to it from time to time by CMF in commodity interests, including commodity
futures contracts, options on futures contracts, spot and forward contracts. The
Advisor may also engage in swap transactions and other derivative transactions
on behalf of the Partnership with the prior written approval of CMF. All such
trading on behalf of the Partnership shall be in accordance with the trading
strategies and trading policies set forth in the Partnership’s

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Confidential Private Placement Memorandum and Disclosure Document dated as of
October 31, 2017, as supplemented from time to time (the “Memorandum”), and as
such trading policies may be changed from time to time upon receipt by the
Advisor of prior written notice of such change, and pursuant to the trading
strategy selected by CMF to be utilized by the Advisor in managing the
Partnership’s assets allocated to it. CMF has initially selected the Advisor’s
AE Systematic FX Fund Program (the “Program”), as described in Appendix A
attached hereto, to manage the Partnership’s assets allocated to it. Any open
positions or other investments at the time of receipt of such notice of a change
in trading policy shall not be deemed to violate the changed policy and shall be
closed or sold in the ordinary course of trading. The Advisor may not deviate
from the trading policies set forth in the Memorandum without the prior written
consent of the Partnership given by CMF. The Advisor makes no representation or
warranty that the trading to be directed by it for the Partnership will be
profitable or will not incur losses.

(b)     CMF acknowledges receipt of the description of the Program, attached
hereto as Appendix A. All trades made by the Advisor for the account of the
Partnership, whether directly or indirectly through the Master Fund, shall be
made through such commodity broker or brokers as CMF shall direct, and the
Advisor shall have no authority or responsibility for selecting or supervising
any such broker in connection with the execution, clearance or confirmation of
transactions for the Partnership or for the negotiation of brokerage rates
charged therefor. However, the Advisor, with the prior written permission (by
original, fax copy or email copy) of CMF, may direct any and all trades in
commodity futures and options to a futures commission merchant or independent
floor broker it chooses for execution with instructions to give-up the trades to
the broker designated by CMF, provided that the futures commission merchant or
independent floor broker and any give-up or floor brokerage fees are approved in
advance by CMF. The Advisor, with the prior written permission (by original, fax
copy or email copy) of CMF, may enter into swaps and other derivative
transactions with any swap dealer it chooses for execution with instructions to
give-up the trades to the broker designated by CMF, provided that the swap
dealer and any give-up or other fees are approved in advance by CMF. All give-up
or similar fees relating to the foregoing shall be paid by the Partnership after
all parties have executed the relevant give-up agreements (via EGUS or by
original, fax copy or email copy).

(c)     The initial allocation of the Partnership’s assets to the Advisor shall
be made to the Program, as described in Appendix A. In the event the Advisor
wishes to use a trading system or methodology other than or in addition to the
Program in connection with its trading for the Partnership, either in whole or
in part, it may not do so unless the Advisor gives CMF prior written notice of
its intention to utilize such different trading system or methodology and CMF
consents thereto in writing. In addition, the Advisor will provide five days’
prior written notice to CMF of any change in the trading system or methodology
to be utilized for the Partnership which the Advisor deems material. If the
Advisor deems such change in system or methodology or in markets traded to be
material, the changed system or methodology or markets traded will not be
utilized for the Partnership without the prior written consent of CMF. In
addition, the Advisor will notify CMF of any changes to the trading system or
methodology that would require a change in the description of the trading
strategy or methods described in Appendix A or the Memorandum to be materially
inaccurate. Further, the Advisor will provide the Partnership with a current
list of all commodity interests to be traded for the Partnership’s account and
the Advisor will not trade any additional commodity interests for such account

 

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without providing notice thereof to CMF and receiving CMF’s written approval.
The Advisor also agrees to provide CMF, on a monthly basis, with a written
report of the assets under the Advisor’s management together with all other
matters deemed by the Advisor to be material changes to its business not
previously reported to CMF. The Advisor further agrees that it will convert
foreign currency balances (not required to margin positions denominated in a
foreign currency) to U.S. dollars no less frequently than monthly. U.S. dollar
equivalents in individual foreign currencies of more than $100,000 will be
converted to U.S. dollars within one business day after such funds are no longer
needed to margin foreign positions.

(d)     The Advisor agrees to make all material disclosures to the Partnership
regarding itself and its principals as defined in Part 4 of the CFTC’s
regulations (“principals”), its officers, directors, employees and
shareholder(s), their trading performance and general trading methods, its
customer accounts (but not the identities of or identifying information with
respect to its customers) and otherwise as are required in the reasonable
judgment of CMF in good faith to be made in any filings required by federal or
state law or NFA rule or order. Notwithstanding Sections 1(d) and 4(d) of this
Agreement, the Advisor is not required to disclose the actual trading results of
proprietary accounts of the Advisor or its principals unless CMF reasonably
determines that such disclosure is required in order to fulfill its fiduciary
obligations to the Partnership or the reporting, filing or other obligations
imposed on it by federal or state law or NFA rule or order. The Partnership and
CMF acknowledge that the trading advice to be provided by the Advisor is a
property right belonging to the Advisor and that they will keep all such advice
confidential.

(e)     The Advisor understands and agrees that CMF may designate other trading
advisors for the Partnership and apportion or reapportion to such other trading
advisors the management of an amount of Net Asset Value of the Partnership (as
defined in Section 3(b) hereof) as it shall determine in its absolute
discretion. The designation of other trading advisors and the apportionment or
reapportionment of Net Asset Value of the Partnership to any such trading
advisors pursuant to this Section 1 shall neither terminate this Agreement nor
modify in any regard the respective rights and obligations of the parties
hereunder.

(f)     CMF may, from time to time, in its absolute discretion, select
additional trading advisors and reapportion funds among the trading advisors for
the Partnership as it deems appropriate. CMF shall use its best efforts to make
reapportionments, if any, as of the first day of a calendar month. The Advisor
agrees that it may be called upon at any time promptly to liquidate positions in
CMF’s sole discretion so that CMF may reallocate the Partnership’s assets, meet
margin calls on the Partnership’s account, fund redemptions, or for any other
reason, except that CMF will not require the liquidation of specific positions
by the Advisor. CMF will use its best efforts to give two business days’ prior
notice to the Advisor of any reallocations or liquidations.

(g)     The Advisor shall assume financial responsibility for any errors
committed or caused by it in transmitting orders for the purchase or sale of
commodity interests for the Partnership’s account, to the extent such errors
result from its negligence, bad faith, recklessness or intentional misconduct,
including payment to the brokers of the floor brokerage commissions, exchange,
NFA fees, and other transaction charges and give-up charges incurred by the
brokers on such trades. The Advisor’s errors shall include, but not be limited
to, inputting

 

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improper trading signals or communicating incorrect orders to the commodity
brokers. In the event of an error by a broker or third party, the Advisor agrees
to use commercially reasonable efforts to pursue an appropriate financial remedy
on CMF’s and the Partnership’s behalf with the relevant broker or third party.
The Advisor shall have an affirmative obligation to promptly notify CMF in
accordance with the provisions of Section 8(a)(iii) of any errors with respect
to the account, and the Advisor shall use its best efforts to identify and
promptly notify CMF of any order or trade which the Advisor reasonably believes
was not executed in accordance with its instructions to any broker utilized to
execute orders for the Partnership.

2.       INDEPENDENCE OF THE ADVISOR. For all purposes herein, the Advisor shall
be deemed to be an independent contractor and, unless otherwise expressly
provided or authorized, shall have no authority to act for or represent the
Partnership in any way and shall not be deemed an agent, promoter or sponsor of
the Partnership, CMF, or any other trading advisor. The Advisor shall not be
responsible to the Partnership, CMF, any trading advisor or any limited partners
or any other person whatsoever for any acts or omissions of any other trading
advisor to the Partnership.

3.       COMPENSATION. (a) In consideration of and as compensation for all of
the services to be rendered by the Advisor to the Partnership under this
Agreement, the Partnership shall pay the Advisor (i) an incentive fee payable
quarterly equal to 20% of New Trading Profits (as such term is defined below)
earned by the Advisor for the Partnership (the “Incentive Fee”) and (ii) a
monthly fee for professional management services equal to 1.5% per year of the
beginning of the month Net Asset Value of the Partnership allocated to the
Advisor (computed monthly by multiplying the Net Asset Value of the Partnership
allocated to the Advisor as of the first day of each calendar month by 1.5% and
dividing the result thereof by 12) (the “Management Fee”).

(b)     “Net Asset Value of the Partnership” shall have the meaning set forth in
Section 7(d)(1) of the Partnership Agreement and, unless the Advisor consents in
writing, without regard to further amendments thereto, provided that in
determining the Net Asset Value of the Partnership on any date, no adjustment
shall be made to reflect any distributions, redemptions, administrative fees or
incentive fees accrued or payable as of the date of such determination.

(c)     “New Trading Profits” shall mean the excess, if any, of Net Asset Value
of the Partnership managed by the Advisor at the end of the fiscal period over
Net Asset Value of the Partnership managed by the Advisor at the end of the
highest previous fiscal period or Net Asset Value of the Partnership allocated
to the Advisor at the date trading commences by the Advisor for the Partnership,
whichever is higher, and as further adjusted to eliminate the effect on Net
Asset Value of the Partnership resulting from new capital contributions,
redemptions, reallocations or capital distributions, if any, made during the
fiscal period decreased by interest or other income, not directly related to
trading activity, earned on the Partnership’s assets during the fiscal period,
whether the assets are held separately or in margin accounts. Ongoing expenses
shall be attributed to the Advisor based on the Advisor’s proportionate share of
Net Asset Value of the Partnership. Ongoing expenses shall not include expenses
of litigation not involving the activities of the Advisor on behalf of the
Partnership. No Incentive Fee shall be paid to the Advisor until the end of the
first full calendar quarter of the Advisor’s trading for the

 

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Partnership, which fee shall be based on New Trading Profits (if any) earned
from the commencement of trading by the Advisor on behalf of the Partnership
through the end of the first full calendar quarter of such trading. Interest
income earned, if any, will not be taken into account in computing New Trading
Profits earned by the Advisor. If Net Asset Value of the Partnership allocated
to the Advisor is reduced due to redemptions, distributions or reallocations
(net of additions), there shall be a corresponding proportional reduction in the
related loss carryforward amount that must be recouped before the Advisor is
eligible to receive another Incentive Fee.

(d)     Quarterly Incentive Fees and monthly Management Fees shall be paid
within twenty (20) business days following the end of the period for which such
fee is payable. In the event of the termination of this Agreement as of any date
which shall not be the end of a calendar quarter or a calendar month, as the
case may be, the quarterly Incentive Fee shall be computed as if the effective
date of termination were the last day of the then current quarter and the
monthly Management Fee shall be prorated to the effective date of termination.
If, during any month, the Partnership does not conduct business operations or
the Advisor is unable to provide the services contemplated herein for more than
two successive business days, the monthly Management Fee shall be prorated by
the ratio which the number of business days during which CMF conducted the
Partnership’s business operations or utilized the Advisor’s services bears in
the month to the total number of business days in such month.

(e)     The provisions of this Section 3 shall survive the termination of this
Agreement.

4.       RIGHT TO ENGAGE IN OTHER ACTIVITIES. (a) The services provided by the
Advisor hereunder are not to be deemed exclusive. CMF on its own behalf and on
behalf of the Partnership acknowledges that, subject to the terms of this
Agreement, the Advisor and its officers, directors, employees and
shareholder(s), may render advisory, consulting and management services to other
clients and accounts. The Advisor and its officers, directors, employees and
shareholder(s) shall be free to trade for their own accounts and to advise other
investors and manage other commodity accounts during the term of this Agreement
and to use the same information, computer programs and trading strategies,
programs or formulas which they obtain, produce or utilize in the performance of
services to CMF for the Partnership. However, the Advisor represents, warrants
and agrees that it believes the rendering of such consulting, advisory and
management services to other accounts and entities will not require any material
change in the Advisor’s basic trading strategies and will not affect the
capacity of the Advisor to continue to render services to CMF for the
Partnership of the quality and nature contemplated by this Agreement.

(b)     If, at any time during the term of this Agreement, the Advisor is
required to aggregate the Partnership’s commodity positions with the positions
of any other person for purposes of applying CFTC- or exchange-imposed
speculative position limits, the Advisor agrees that it will promptly notify CMF
in writing if the Partnership’s positions are included in an aggregate amount
which exceeds the applicable speculative position limit. The Advisor agrees
that, if its trading recommendations are altered because of the application of
any speculative position limits, it will not modify the trading instructions
with respect to the Partnership’s account in such manner as to affect the
Partnership substantially disproportionately

 

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as compared with the Advisor’s other accounts. The Advisor further represents,
warrants and agrees that under no circumstances will it knowingly or
deliberately use trading programs, strategies or methods for the Partnership
that are inferior to strategies or methods employed for any other client or
account and that it will not knowingly or deliberately favor any client or
account managed by it over any other client or account in any manner, it being
acknowledged, however, that different trading programs, strategies or methods
may be utilized for differing sizes of accounts, accounts with different trading
policies, accounts experiencing differing inflows or outflows of equity,
accounts that commence trading at different times, accounts that have different
portfolios or different fiscal years, accounts utilizing different executing
brokers and accounts with other differences, and that such differences may cause
divergent trading results.

(c)     It is acknowledged that the Advisor and/or its officers, employees,
directors and shareholder(s) presently act, and it is agreed that they may
continue to act, as advisor for other accounts managed by them, and may continue
to receive compensation with respect to services for such accounts in amounts
which may be more or less than the amounts received from the Partnership.

(d)     The Advisor agrees that it shall make such information available to CMF
respecting the performance of the Partnership’s account as compared to the
performance of other commodity trading accounts managed by the Advisor or its
principals, if any, as shall be reasonably requested by CMF. The Advisor
presently believes and represents that existing speculative position limits will
not materially adversely affect its ability to manage the Partnership’s account
given the potential size of the Partnership’s account and the Advisor’s and its
principals’ current accounts and all proposed accounts for which they have
contracted to act as trading advisor.

5.       TERM. (a) This Agreement shall continue in effect until December 31,
2018 (the “Initial Termination Date”). If this Agreement is not terminated on
the Initial Termination Date, as provided for herein, then, this Agreement shall
automatically renew for an additional one-year period and shall continue to
renew for additional one-year periods until this Agreement is otherwise
terminated, as provided for herein. At any time during the term of this
Agreement, CMF may terminate this Agreement upon five days’ notice to the
Advisor. At any time during the term of this Agreement, CMF may elect to
immediately terminate this Agreement if (i) the Net Asset Value per Unit shall
decline as of the close of business on any day to $4.00 or less; (ii) the Net
Asset Value of the Partnership allocated to the Advisor (adjusted for
redemptions, distributions, withdrawals or reallocations, if any) decline by 20%
or more as of the end of a trading day from the previous highest Net Asset Value
of the Partnership; (iii) limited partners owning not less than a “Majority of
Units in the Partnership” (as defined in Section 4(a)(1) of the Partnership
Agreement) shall vote to require CMF to terminate this Agreement; (iv) the
Advisor fails to comply with the terms of this Agreement; (v) CMF, in good
faith, reasonably determines that the performance of the Advisor has been such
that CMF’s fiduciary duties to the Partnership require CMF to terminate this
Agreement; (vi) CMF reasonably believes that the application of speculative
position limits will substantially affect the performance of the Partnership;
(vii) the Advisor fails to conform to the trading policies set forth in the
Partnership Agreement or the Memorandum as they may be changed from time to
time; (viii) the Advisor merges, consolidates with another entity, sells a
substantial portion of its

 

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assets, or becomes bankrupt or insolvent; (ix) Lyle Pakula dies, becomes
incapacitated, leaves the employ of the Advisor, ceases to control the Advisor
or is otherwise not managing the trading programs or systems of the Advisor;
(x) the Advisor’s registration as a commodity trading advisor with the CFTC or
its membership in the NFA or any other regulatory authority, is terminated,
suspended or not renewed, or limited or qualified in any respect; or (xi) CMF
reasonably believes that the Advisor has or may contribute to any material
operational, business or reputational risk to CMF or CMF’s affiliates. This
Agreement will immediately terminate upon dissolution of the Partnership or upon
cessation of trading by the Partnership prior to dissolution.

(b)     The Advisor may terminate this Agreement by giving not less than 30
days’ written notice to CMF (i) in the event that the trading policies of the
Partnership as set forth in the Memorandum are changed in such manner that the
Advisor reasonably believes will adversely affect the performance of its trading
strategies; (ii) after the Initial Termination Date; or (iii) in the event that
CMF or the Partnership fails to comply with the terms of this Agreement. The
Advisor may immediately terminate this Agreement if CMF’s registration as a
commodity pool operator or its membership in NFA is terminated or suspended.

(c)     Except as otherwise provided in this Agreement, any termination of this
Agreement in accordance with this Section 5 shall be without penalty or
liability to any party, except for any fees due to the Advisor pursuant to
Section 3 hereof.

6.       INDEMNIFICATION. (a)(i) In any threatened, pending or completed action,
suit, or proceeding to which the Advisor was or is a party or is threatened to
be made a party arising out of or in connection with this Agreement or the
management of the Partnership’s assets by the Advisor or the offering and sale
of units in the Partnership, CMF shall, subject to subsection (a)(iii) of this
Section 6, indemnify and hold harmless the Advisor against any loss, liability,
damage, fine, penalty, obligation, cost, expense (including, without limitation,
attorneys’ and accountants’ fees, collection fees, court costs and other
reasonable legal expenses), judgments and awards and amounts paid in settlement
actually and reasonably incurred by it in connection with such action, suit, or
proceeding if the Advisor acted in good faith and in a manner reasonably
believed to be in or not opposed to the best interests of the Partnership, and
provided that its conduct did not constitute negligence, bad faith,
recklessness, intentional misconduct, or a breach of its fiduciary obligations
to the Partnership as a commodity trading advisor, unless and only to the extent
that the court or administrative forum in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all circumstances of the case, the Advisor is fairly and reasonably
entitled to indemnity for such expenses which such court or administrative forum
shall deem proper; and further provided that no indemnification shall be
available from the Partnership if such indemnification is prohibited by
Section 14 of the Partnership Agreement. The termination of any action, suit or
proceeding by judgment, order or settlement shall not, of itself, create a
presumption that the Advisor did not act in good faith and in a manner
reasonably believed to be in or not opposed to the best interests of the
Partnership.

(ii)     Without limiting subsection (i) above, to the extent that the Advisor
has been successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in subsection (i) above, or in defense of any claim,
issue or matter therein, CMF shall indemnify the Advisor against the expenses
(including, without limitation, attorneys’ and accountants’ fees) actually and
reasonably incurred by it in connection therewith.

 

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(iii)     Any indemnification under subsection (i) above, unless ordered by a
court or administrative forum, shall be made by CMF only as authorized in the
specific case and only upon a determination by independent legal counsel in a
written opinion that such indemnification is proper in the circumstances because
the Advisor has met the applicable standard of conduct set forth in subsection
(i) above. Such independent legal counsel shall be selected by CMF in a timely
manner, subject to the Advisor’s approval, which approval shall not be
unreasonably withheld. The Advisor will be deemed to have approved CMF’s
selection unless the Advisor notifies CMF in writing, received by CMF within
five days of CMF’s telecopying to the Advisor of the notice of CMF’s selection,
that the Advisor does not approve the selection.

(iv)     In the event the Advisor is made a party to any claim, dispute or
litigation or otherwise incurs any loss or expense as a result of, or in
connection with, the Partnership’s or CMF’s activities or claimed activities
unrelated to the Advisor, CMF shall indemnify, defend and hold harmless the
Advisor against any loss, liability, damage, fine, penalty, obligation, cost or
expense (including, without limitation, attorneys’ and accountants’ fees)
incurred in connection therewith.

(v)     As used in this Section 6(a), the term “Advisor” shall include the
Advisor, its principals, officers, directors, employees and shareholder(s) and
the term “CMF” shall include the Partnership.

(b)     (i) The Advisor agrees to indemnify, defend and hold harmless CMF, the
Partnership and their affiliates against any loss, liability, damage, fine,
penalty, obligation, cost or expense (including, without limitation, attorneys’
and accountants’ fees, collection fees, court costs and other legal expenses),
judgments and awards and amounts paid in settlement reasonably incurred by them
(A) as a result of the breach of any representations and warranties or covenants
made by the Advisor in this Agreement, or (B) as a result of any act or omission
of the Advisor relating to the Partnership if (i) there has been a final
judicial or regulatory determination, or a written opinion of an arbitrator
pursuant to Section 14 hereof, to the effect that such acts or omissions
violated the terms of this Agreement in any material respect or involved
negligence, bad faith, recklessness or intentional misconduct on the part of the
Advisor (except as otherwise provided in Section 1(g)), or (ii) there has been a
settlement of any action or proceeding with the Advisor’s prior written consent.

(ii)     In the event CMF, the Partnership or any of their affiliates is made a
party to any claim, dispute or litigation or otherwise incurs any loss or
expense as a result of, or in connection with, the activities or claimed
activities of the Advisor or its principals, officers, directors, shareholder(s)
or employees unrelated to CMF’s or the Partnership’s business, the Advisor shall
indemnify, defend and hold harmless CMF, the Partnership or any of their
affiliates against any loss, liability, damage, fine, penalty, obligation, cost
or expense (including, without limitation, attorneys’ and accountants’ fees,
collection fees, court costs and other legal expenses), judgments, awards and
amounts including amounts paid in settlement incurred in connection therewith.

 

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(c)     In the event that a person entitled to indemnification under this
Section 6 is made a party to an action, suit or proceeding alleging both matters
for which indemnification can be made hereunder and matters for which
indemnification may not be made hereunder, such person shall be indemnified only
for that portion of the loss, liability, damage, cost or expense incurred in
such action, suit or proceeding which relates to the matters for which
indemnification can be made.

(d)     None of the indemnifications contained in this Section 6 shall be
applicable with respect to default judgments, confessions of judgment or
settlements entered into by the party claiming indemnification without the prior
written consent, which shall not be unreasonably withheld or delayed, of the
party obligated to indemnify such party.

(e)     The provisions of this Section 6 shall survive the termination of this
Agreement.

7.       REPRESENTATIONS, WARRANTIES AND AGREEMENTS.

(a)     The Advisor represents and warrants that:

(i)     All information with respect to the Advisor and its principals and the
trading performance of any of them that has been provided to CMF, including,
without limitation, the description of the Program contained in Appendix A, is
complete and accurate in all material respects and such information does not
contain any untrue statement of a material fact or omit to state a material fact
which is necessary to make the statements and information not misleading. All
references to the Advisor and its principals, if any, in the Memorandum or a
supplement thereto will, after review and approval of such references by the
Advisor prior to the use of such Memorandum in connection with the offering of
Partnership units, be accurate in all material respects, except that with
respect to pro forma or hypothetical performance information in such Memorandum,
if any, this representation and warranty extends only to any underlying data
made available by the Advisor for the preparation thereof and not to any
hypothetical or pro forma adjustments.

(ii)     The information with respect to the Advisor set forth in the actual
performance tables in the Memorandum, if any, is based on all of the customer
accounts managed on a discretionary basis by the Advisor’s principals and/or the
Advisor during the period covered by such tables and required to be disclosed
therein, and such tables have been prepared by the Advisor or its agents in
accordance with applicable CFTC and NFA rules and guidance, including, but not
limited to, CFTC Rule 4.25. The Advisor’s performance tables have been examined
by an independent certified public accountant and the report thereon has been
provided to CMF. The Advisor will have its performance tables so examined no
less frequently than annually during the term of this Agreement.

(iii)     The Advisor will be acting as a commodity trading advisor with respect
to the Partnership and not as a securities investment adviser and is duly
registered with the CFTC as a commodity trading advisor, is a member of the NFA
and is in compliance with any such other registration and licensing requirements
as shall be necessary to enable it to perform its obligations hereunder. The
Advisor agrees to maintain and renew such registrations and licenses during the
term of this Agreement, including, without limitation, registration as a
commodity trading advisor with the CFTC and membership in the NFA.

 

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(iv)     The Advisor is a limited proprietary company duly organized, validly
existing and in good standing under the laws of Victoria, Australia and has full
limited proprietary company power and authority to enter into this Agreement and
to provide the services required of it hereunder.

(v)     The Advisor will not, by acting as a commodity trading advisor to the
Partnership, breach or cause to be breached any undertaking, agreement,
contract, statute, rule or regulation to which it is a party or by which it is
bound.

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

(vii)     At any time during the term of this Agreement that an offering
memorandum or prospectus relating to the Partnership is required to be delivered
in connection with the offer and sale thereof, the Advisor agrees upon the
request of CMF to promptly provide the Partnership with such information as
shall be necessary so that, as to the Advisor and its principals, such offering
memorandum or prospectus is accurate.

(b)     CMF represents and warrants for itself and the Partnership that:

(i)     CMF is a limited liability company duly organized, validly existing and
in good standing under the laws of the State of Delaware and has full limited
liability company power and authority to perform its obligations under this
Agreement.

(ii)     CMF and the Partnership have the capacity and authority to enter into
this Agreement on behalf of the Partnership.

(iii)     This Agreement has been duly and validly authorized, executed and
delivered on CMF’s and the Partnership’s behalf and is a valid and binding
agreement of CMF and the Partnership enforceable in accordance with its terms.

(iv)     CMF will not, by acting as general partner to the Partnership and the
Partnership will not, breach or cause to be breached any undertaking, agreement,
contract, statute, rule or regulation to which it is a party or by which it is
bound which would materially limit or affect the performance of its duties under
this Agreement.

(v)     CMF is registered as a commodity pool operator and is a member of NFA
and it will maintain and renew such registrations and membership during the term
of this Agreement.

(vi)     The Partnership is a limited partnership duly organized and validly
existing under the laws of the State of Delaware and has full limited
partnership power and authority to enter into this Agreement and to perform its
obligations under this Agreement.

 

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(vii)     The Partnership is a qualified eligible person as defined in CFTC Rule
4.7.

8.       COVENANTS OF THE ADVISOR, CMF AND THE PARTNERSHIP.

(a)     The Advisor agrees as follows:

(i)     In connection with its activities on behalf of the Partnership, the
Advisor will comply with all applicable laws, including rules and regulations of
the CFTC, NFA, swap execution facility and/or the commodity exchange on which
any particular transaction is executed.

(ii)     The Advisor will promptly notify CMF of the commencement of any
investigation, suit, action or proceeding involving the Advisor or any of its
affiliates, officers, directors, employees and shareholder(s), agents or
representatives, regardless of whether such investigation, suit, action or
proceeding also involves CMF. The Advisor will provide CMF with copies of any
correspondence (including, but not limited to, any notice or correspondence
regarding the violation, or potential violation, of position limits) from or to
the CFTC, NFA or any commodity exchange in connection with an investigation or
audit of the Advisor’s business activities.

(iii)     In the placement of orders for the Partnership’s account and for the
accounts of any other client, the Advisor will utilize a pre-determined,
systematic, fair and reasonable order entry system, which shall, on an overall
basis, be no less favorable to the Partnership than to any other commodity
interest trading account managed by the Advisor. The Advisor acknowledges its
obligation to review and reconcile the Partnership’s positions, prices and
equity in the account managed by the Advisor daily and within two business days
to notify, in writing, the broker and CMF and the Partnership’s brokers of
(A) any error committed by the Advisor or its principals or employees; (B) any
trade which the Advisor believes was not executed in accordance with its
instructions; and (C) any discrepancy with a value of $10,000 or more (due to
differences in the positions, prices or equity in the account) between its
records and the information reported on the account’s daily and monthly broker
statements.

(iv)     The Advisor will maintain a net worth of not less than USD 100,000
during the term of this Agreement.

(v)     The Advisor will use its best efforts to close out all futures positions
prior to any applicable delivery period, and will use its best efforts to avoid
causing the Partnership to take delivery of any commodity.

(vi)     For so long as the Advisor or any of its principals or affiliates acts
as advisor to the Partnership, the Master Fund, or any affiliate of the Master
Fund, any fees to be charged to such accounts shall be the lowest such fee
charged to any account managed or advised by the Advisor other than proprietary
accounts of the Advisor, its principals and affiliates.

 

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(b)     CMF agrees for itself and the Partnership that:

(i)     CMF and the Partnership will comply with all applicable laws, including
rules and regulations of the CFTC, NFA, swap execution facility and/or the
commodity exchange on which any particular transaction is executed.

(ii)     CMF will promptly notify the Advisor of the commencement of any
material suit, action or proceeding involving it or the Partnership, whether or
not such suit, action or proceeding also involves the Advisor.

(iii)     CMF or the selling agents for the Partnership have policies,
procedures, and internal controls in place that are reasonably designed to
comply with applicable anti-money laundering laws, rules and regulations,
including applicable provisions of the USA PATRIOT Act. CMF or the selling
agents for the Partnership have Customer Identification Programs (“CIP”), which
require the performance of CIP due diligence in accordance with applicable USA
PATRIOT Act requirements and regulatory guidance. CMF or the selling agents for
the Partnership also have policies, procedures, and internal controls in place
that are reasonably designed to comply with regulations and economic sanctions
programs administered by the U.S. Department of the Treasury’s Office of Foreign
Assets Control. CMF or the selling agents for the Partnership has policies and
procedures in place reasonably designed to comply with Section 312 of the USA
PATRIOT Act, including processes reasonably designed to identify clients that
may be senior foreign political figures1, in accordance with applicable
requirements and regulatory guidance, and to conduct enhanced scrutiny on such
clients where required under applicable law. In addition, CMF or the selling
agents for the Partnership has policies and procedures in place reasonably
designed to prohibit accounts for foreign shell banks2 in compliance with
Sections 313 & 319 of the USA PATRIOT Act.

9.       COMPLETE AGREEMENT. This Agreement constitutes the entire agreement
between the parties pertaining to the subject matter hereof.

10.     ASSIGNMENT. This Agreement may not be assigned by any party without the
express written consent of the other parties.

11.     AMENDMENT. This Agreement may not be amended except by the written
consent of the parties.

 

1  A “senior foreign political figure” is defined as a current or former senior
official in the executive, legislative, administrative, military or judicial
branches of a non-U.S. government (whether elected or not), a current or former
senior official of a major non-U.S. political party, or a current or former
senior executive of a non-U.S. government-owned commercial enterprise. In
addition, a “senior foreign political figure” includes any corporation, business
or other entity that has been formed by, or for the benefit of, a senior foreign
political figure. For purposes of this definition, a “senior official” or
“senior executive” means an individual with substantial authority over policy,
operations, or the use of government-owned resources. An “immediate family
member” of a senior foreign political figure means spouses, parents, siblings,
children and a spouse’s parents and siblings. A “close associate” of a senior
foreign political figure means a person who is widely and publicly known (or is
actually known) to be a close associate of a senior foreign political figure.

2  The term shell bank means a bank that does not maintain a physical presence
in any country and is not subject to inspection by a banking authority. In
addition, a shell bank generally does not employ individuals or maintain
operating records.

 

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12.     NOTICES. All notices, demands or requests required to be made or
delivered under this Agreement shall be effective upon actual receipt and shall
be made either by electronic (email) copy or in writing and delivered personally
or by registered or certified mail or expedited courier, return receipt
requested, postage prepaid, to the addresses below or to such other addresses as
may be designated by the party entitled to receive the same by notice similarly
given:

If to CMF or to the Partnership:

Ceres Managed Futures LLC

522 Fifth Avenue,

New York, New York 10036

Attention: Patrick Egan

Email: Patrick.Egan@morganstanley.com

If to the Advisor:

AE Capital Pty Limited

Suite 1/2A River St, South Yarra 3141

Melbourne Australia

Attention: Darran Goodger

Email: darran@aecapital.com.au or operations@aecapital.com.au

13.     GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.

14.     ARBITRATION. The parties agree that any dispute or controversy arising
out of or relating to this Agreement or the interpretation thereof, shall be
settled by arbitration in accordance with the rules, then in effect, of NFA or,
if NFA shall refuse jurisdiction, then in accordance with the rules, then in
effect, of the American Arbitration Association; provided, however, that the
power of the arbitrator shall be limited to interpreting this Agreement as
written and the arbitrator shall state in writing his reasons for his award, and
further provided, that any such arbitration shall occur within the Borough of
Manhattan in New York City. Judgment upon any award made by the arbitrator may
be entered in any court of competent jurisdiction.

15.     NO THIRD PARTY BENEFICIARIES. There are no third party beneficiaries to
this Agreement, except that certain persons not parties to this Agreement may
have rights under Section 6 hereof.

16.     COUNTERPARTS. This Agreement may be executed in any number of
counterparts, including via facsimile or email, each of which is an original and
all of which when taken together evidence the same agreement.

 

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PURSUANT TO AN EXEMPTION FROM THE COMMODITY FUTURES TRADING COMMISSION IN
CONNECTION WITH ACCOUNTS OF QUALIFIED ELIGIBLE PERSONS, THIS BROCHURE OR ACCOUNT
DOCUMENT IS NOT REQUIRED TO BE, AND HAS NOT BEEN, FILED WITH THE COMMISSION. THE
COMMODITY FUTURES TRADING COMMISSION DOES NOT PASS UPON THE MERITS OF
PARTICIPATING IN A TRADING PROGRAM OR UPON THE ADEQUACY OR ACCURACY OF COMMODITY
TRADING ADVISOR DISCLOSURE. CONSEQUENTLY, THE COMMODITY FUTURES TRADING
COMMISSION HAS NOT REVIEWED OR APPROVED THIS TRADING PROGRAM OR THIS BROCHURE OR
ACCOUNT DOCUMENT.

YOU SHOULD ALSO BE AWARE THAT THIS COMMODITY TRADING ADVISOR MAY ENGAGE IN
TRADING FOREIGN FUTURES OR OPTIONS CONTRACTS. TRANSACTIONS ON MARKETS LOCATED
OUTSIDE THE UNITED STATES, INCLUDING MARKETS FORMALLY LINKED TO A UNITED STATES
MARKET MAY BE SUBJECT TO REGULATIONS WHICH OFFER DIFFERENT OR DIMINISHED
PROTECTION. FURTHER, UNITED STATES REGULATORY AUTHORITIES MAY BE UNABLE TO
COMPEL THE ENFORCEMENT OF THE RULES OF REGULATORY AUTHORITIES OR MARKETS IN
NON-UNITED STATES JURISDICTIONS WHERE YOUR TRANSACTIONS MAY BE EFFECTED.

 

 

 

THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK

 

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IN WITNESS WHEREOF, this Agreement has been executed for and on behalf of the
undersigned as of the day and year first above written.

 

CERES MANAGED FUTURES LLC By  

/s/ Patrick T. Egan

  Patrick T. Egan   President and Director CERES TACTICAL CURRENCY L.P. By:  
Ceres Managed Futures LLC   (General Partner) By  

/s/ Patrick T. Egan

  Patrick T. Egan   President and Director AE CAPITAL PTY LIMITED By  

/s/ Lyle Pakula

  Name: Lyle Pakula   Title:   Director

 

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Appendix A

Pursuant to Section 1(a) of the Agreement, set forth below is the description of
the Advisor’s AE Systematic FX Fund Program.

The Advisor’s philosophy is that markets are driven by fundamental themes and
that those fundamental themes inherently change over time. The Advisor has
developed a proprietary systematic strategy that dynamically adapts to the
fundamental themes quantified to be driving markets. New themes are identified
by the Advisor primarily through fundamental research. Once a new theme is
scientifically tested and deemed eligible it is incorporated into the theme
adapting system framework. Capital is only allocated to a theme if the theme
adapting system determines that the theme carries statistically significant
information and improves the overall portfolio. Risk is minimized through a
proprietary portfolio construction technique that diversifies the portfolio in
terms of the underlying currency exposures, trade time horizons and fundamental
views.

Futures interests to be traded—Limited to spot transactions in the following
currencies unless written approval is otherwise requested by the Advisor and
granted by CMF, pursuant to Section 1(c) of the Agreement:

USD, EUR, GBP, JPY, CAD, NZD, AUD

 

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