Document:

Exhibit 10.9

CUSTOMER AGREEMENT

CITIGROUP EMERGING CTA PORTFOLIO L.P.

This Customer Agreement made and entered into as of the 17th day of October 2003, by and among CITIGROUP EMERGING CTA PORTFOLIO L.P., a New York limited partnership (the “Partnership”), CITIGROUP MANAGED FUTURES LLC, a Delaware limited liability company (“CMF” or the “General Partner”), and CITIGROUP GLOBAL MARKETS INC., a Delaware corporation (“CGM”).

WITNESSETH:

WHEREAS, the Partnership, formed on July 7, 2003, has been organized to engage in the speculative trading of commodity interests, including, but not limited to, futures contracts, options, spot, and forward contracts; and

WHEREAS, CMF is the general partner of the Partnership and is registered as a commodity pool operator with the Commodity Futures Trading Commission (“CFTC”) and is a member of the National Futures Association (“NFA”); and

WHEREAS, the Partnership and CGM wish to enter into this Customer Agreement setting forth the terms and conditions upon which CGM will perform brokerage and other services for the Partnership;

NOW, THEREFORE, in consideration of the promises and the mutual covenants contained herein, it is agreed as follows:

1. Appointment of Broker/Dealer and Opening of Account. The Partnership hereby appoints CGM as its commodity broker/dealer through whom the Partnership will execute trades in commodity interests including futures contracts, options, spot, and forward contracts. As soon as practicable following the conclusion of the Initial Offering Period (as defined in the Private Placement Offering Memorandum of the Partnership) of the units of limited partnership interest in the Partnership (the “Units”), provided at least 20,000 Units are sold, the Partnership shall deposit or cause to be deposited the partners’ capital contributions in a commodity brokerage account with CGM, and will maintain all of its assets, as they from time to time exist, in such account except for such amounts as may be
necessary or desirable to be maintained in a bank account or with a broker to facilitate trading in interbank forward foreign currency transactions and the payment of Partnership expenses, redemptions or distributions. The Partnership shall execute such other documents as shall be necessary or appropriate to permit CGM to perform its services hereunder.

2. Services of CGM. CGM agrees to use its best efforts to effect transactions for the Partnership’s account. CGM agrees to assist the Partnership in performing various functions. These include, but are not limited to: (a) calculating the Partnership’s Net Assets and Net Asset Value (as such terms are defined in the Partnership’s Limited Partnership Agreement) at such times as may be required, (b) calculating any fees due the Partnership’s trading advisors (the “Advisors”), (c) preparing and confirming financial information for annual or interim audits and reports and (d) establishing procedures for effecting redemptions, cash distributions and the liquidation of the Partnership upon termination. CGM further agrees to furnish clerical and bookkeeping support for the
administration of the Partnership.

 

 

3. Brokerage and Other Fees. (a)  The Partnership shall pay to CGM, in lieu of brokerage commissions on a per trade basis, a monthly flat rate brokerage fee equal to 3.5% per year of the Partnership’s month-end Net Assets (computed monthly by multiplying the Partnership’s Net Assets as of the last business day of each month by 3.5% and multiplying the result thereof by the ratio which the total number of calendar days in that month bears to 365 days). The Partnership shall also pay all floor brokerage, National Futures Association, exchange, clearing, user and give-up fees, or shall reimburse CGM for all such fees previously paid by CGM on behalf of the Partnership. CGM’s fee may be increased or decreased at any time at CGM’s discretion upon notice to the Partnership.

(b) Reimbursement of Offering Expenses. The Partnership shall reimburse CGM for the total amount of the offering and organizational expenses of the Initial Offering Period, plus interest at the prime rate quoted by JPMorgan Chase Bank over the first 24 months after trading commences.

4. Payment of Interest. All of the assets of the Partnership which are deposited in the Partnership’s accounts at CGM will be deposited and maintained in cash and/or in U.S. government securities. During the term of this Agreement, CGM will, within ten (10) days following the end of each calendar month, credit the Partnership’s brokerage accounts with a sum representing interest on one hundred percent (100%) of the average daily equity maintained in cash in U.S. dollars, and interest on one hundred percent (100%) of the average daily equity maintained in cash in non-U.S. dollars, in such accounts during each month (i.e., the sum of the daily cash balances in such accounts divided by the total number of calendar days in that month)  at a 30-day Treasury bill rate determined weekly by CGM
based on the average non-competitive yield on 3-month U.S. Treasury bills maturing in 30 days (or on the closest maturity date thereto) from the date on which such weekly rate is determined. The equity maintained in cash in the account on Saturdays, Sundays and holidays shall be the equity maintained in cash in the account as of the close of business on the immediately preceding business day. Citigroup Global Markets may place up to 100% of the Partnership’s assets into 90-day U.S. Treasury bills, in which case the Partnership will receive one hundred percent (100%) of the interest (original issue discount) earned on the Treasury bills.

5. Trading Authorization. The General Partner has entered into Management Agreements with Altis Partners Limited, Conquest Capital LLC, Fall River Capital LLC, Potomac Portfolios LLC, Premia Capital Management LLC, Sequent Capital LLC and Waypoint Capital Management LLC as the Partnership’s Advisors. Pursuant to the Management Agreements, the Partnership’s Advisors shall have discretion to order purchases and sales of commodity interests including futures contracts, options, spot, and forward contracts. CMF as the Partnership’s General Partner may allocate or reallocate all or a portion of the Partnership’s assets among trading programs operated by the Partnership’s Advisors or select or appoint additional or replacement trading advisors. CGM is hereby authorized to execute
all orders placed by the Partnership’s Advisors for the account of the Partnership until notified by CMF to the contrary, and shall have no obligation to inquire into the reason for or method of determining such orders, nor any obligation to monitor such orders in relation to the Partnership’s trading policies. The provisions of this Paragraph 5 shall apply with equal force and effect to any other commodity trading advisors designated in the future by CMF.

 

 

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6. Terms of the Account. The following terms and conditions shall be applicable to the Partnership’s account:

(a) The word “property” is used herein to mean securities of all kinds, monies, options, commodities and contracts for the future delivery of, or otherwise relating to, commodities or securities and all property usually and customarily dealt in by brokerage firms.

(b) All transactions for the Partnership’s account shall be subject to the regulations of all applicable federal, state and self-regulatory agencies including, but not limited to, the various commodity exchanges and the constitutions, rules and customs, as the same may be constituted from time to time, of the exchange or market (and its clearing house, if any) where executed. Actual deliveries are intended on all transactions. The Partnership also agrees not to exceed the speculative position limits for its own account, acting alone or in concert with others, and promptly to advise CGM if it is required to file reports of its commodity positions with the Commodity Futures Trading Commission.

(c) Any and all property belonging to the Partnership, or in which it may have an interest, held by CGM or carried in the Partnership’s account (either individually or jointly with others) shall be subject to a general lien for the discharge of the Partnership’s obligations to CGM, wherever or however arising and without regard to whether or not CGM has made advances with respect to such property, and CGM is hereby authorized to sell and/or purchase any and all property in the Partnership’s account without notice to satisfy such general lien.

(d) The Partnership agrees to maintain such collateral and/or margin as CGM may, in its discretion, require from time to time and will pay on demand any amount owing with respect to its account. Against a “short” position in any commodity contract, prior to the maturity thereof, the Partnership will give CGM instructions to cover, or furnish CGM with all necessary delivery documents, and in default thereof, CGM may, without demand or notice, cover the contracts, or if an order to buy in such contracts cannot be executed under prevailing conditions, CGM may procure the actual commodity and make delivery thereof upon any terms and by any method which may be feasible. It is further agreed that if the Partnership fails to receive sufficient funds to pay for any commodities and commodity futures contracts and/or to satisfy any demands for original and/or
variation margin, CGM may, without prior demand and notice, sell any property held by it in the Partnership’s account and any loss resulting therefrom will be charged to the Partnership’s account.

(e) CGM may, whenever in its discretion it considers it necessary for its protection, sell any or all property held in the Partnership’s account, cancel any open orders for the purchase or sale of any property with or without notice to the Partnership, and CGM may borrow or buy in any property required to make delivery against any 

 

 

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sales, including a short sale, effected for the Partnership. Such sale or purchase may be public or private and may be made without advertising or notice to the Partnership and in such manner as CGM may, in its discretion, determine, and no demands, calls, tenders or notices which CGM may make or give in any one or more instances shall invalidate the aforesaid waiver on the Partnership’s part. At any such sale CGM may purchase the property free of any right of redemption and the Partnership shall be liable for any deficiency in its account.

(f) CGM and the Partnership agree that the parties shall have the right to offset any unrealized gains and losses on the Partnership’s open positions and to net any open orders for the purchase or sale of any property of the Partnership.

(g) The Partnership agrees to pay service fees and/or interest charges upon its account monthly at the prevailing and/or allowable rates according to the laws of the State of New York, as determined by CGM at the time of the acceptance of this Agreement in its New York office and thereafter.

(h) If any provisions herein are or should become inconsistent with any present or future law, rule or regulation of any sovereign government or a regulatory body having jurisdiction over the subject matter of this Agreement, such provision shall be deemed to be rescinded or modified in accordance with any such law, rule or regulation. In all other respects, this Agreement shall continue and remain in full force and effect.

7. Indemnification. (a) In any action, suit, or proceeding to which CGM was or is a party or is threatened to be made a party by reason of the fact that it is or was the commodity broker for the Partnership (other than an action by or in the right of the Partnership), the Partnership shall indemnify and hold harmless CGM, subject to subparagraph (c), against any loss, liability, damage, cost, expense (including attorneys’ fees and accountants’ fees), judgments and amounts paid in settlement actually and reasonably incurred by it in connection with such action, suit or proceeding if CGM acted in good faith and in a manner it reasonably believed to be in the best interests of the Partnership, except that no indemnification shall be made in respect of any claim, issue or matter which as to CGM
constituted negligence, misconduct or breach of its fiduciary obligations to the Partnership, unless, and only to the extent that, the court 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, CGM is fairly and reasonably entitled to indemnification for such expenses which such court shall deem proper; and further provided that no indemnification shall be available from the Partnership if such indemnification is prohibited by Section 16 of the Partnership’s Limited Partnership Agreement. The termination of any action, suit or proceeding by judgment, order or settlement shall not, of itself, create a presumption that CGM did not act in good faith, and in a manner which it reasonably believed to be in or not opposed to the best interests of the Partnership.

(b) To the extent that CGM has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subparagraph (a) above, or in defense of any claim, issue or matter therein, the Partnership shall indemnify it against the expenses, including attorneys’ fees, actually and reasonably incurred by it in connection therewith.

 

 

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(c) Any indemnification under subparagraph (a) above, unless ordered by a court, shall be made by the Partnership only as authorized in the specific case and only upon a determination by independent legal counsel in a written opinion that indemnification is proper in the circumstances because CGM has met the applicable standard of conduct set forth in subparagraph (a) above.

(d) The term CGM as used in this Paragraph 7 shall include CGM, its officers, directors, stockholders, employees and affiliates.

8. Termination. This Agreement may be terminated at any time by either party hereto upon notice to the other, in which event the brokerage accounts shall be closed and all positions open at such time shall be liquidated or shall be transferred to another broker as directed by the Partnership.

9. Miscellaneous. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. This Agreement shall be governed by the laws of the State of New York.

IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto as of the day and year first above written.

 

	
                         
 	
                         
 	
                        CITIGROUP EMERGING CTA PORTFOLIO L.P.
 
	
                         
 	
                         
 	
                        By:     Citigroup Managed Futures LLC
 (General Partner)
 
	
                          
 	
                         
 	
                        By: 
 	
                        
 /s/ David J. Vogel
 
	
                         
 	
                         
 	
                         
 	
                        David J. Vogel
 President
 

 

	
                         
 	
                         
 	
                        CITIGROUP GLOBAL MARKETS INC.
 (Commodity Broker/Dealer)
 
	
                          
 	
                         
 	
                        By: 
 	
                        
 /s/ David J. Vogel
 
	
                         
 	
                         
 	
                         
 	
                        Name: David J. Vogel
 Title: Managing Director
 

 

 

-5-Exhibit 10.10

AMENDED AND RESTATED AGENCY AGREEMENT

CITIGROUP EMERGING CTA PORTFOLIO L.P.

(A NEW YORK LIMITED PARTNERSHIP)

UNITS OF LIMITED PARTNERSHIP INTEREST

April 30, 2008

Citigroup Global Markets Inc.

Smith Barney Division 

485 Lexington Avenue, 12th Floor

New York, New York 10017

Re: Citigroup Emerging CTA Portfolio L.P.

Gentlemen:

Citigroup Managed Futures LLC, a Delaware limited liability company (the “General Partner”), has caused Citigroup Emerging CTA Portfolio L.P. (the “Partnership”) to be organized as a limited partnership under the New York Revised Uniform Limited Partnership Act, as amended and in effect on the date hereof (the “Partnership Act”) for the purpose of speculative trading in commodity interests including, but not limited to, futures contracts, options, spot, and forward contracts. The Partnership may also enter into swap transactions and other derivative transactions with the approval of the General Partner. This Agency Agreement (the “Agreement”) amends and restates the initial Agency Agreement, dated December 22, 2003. The General Partner desires to continue to raise capital for the Partnership by the sale of units of limited partnership interest (the
“Units”) to certain qualified investors pursuant to Rule 506 of Regulation D (“Reg. D”) under section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”) and Rule 4.7 under the Commodity Exchange Act (the “CEA”). The General Partner, the Partnership, the business of the Partnership and the Units are described in a Private Placement Offering Memorandum and Disclosure Document dated on or about March, 2006 prepared by the General Partner. As used in this Agreement, “Memorandum” refers to that Private Placement Offering Memorandum and Disclosure Document, including the appendices thereto, unless such memorandum or appendices have been supplemented or amended, in which case the term shall refer, from and after the time the supplement or amendment is delivered to you, to the memorandum and appendices as so amended and supplemented. The commodity trading advisors to the Partnership as of the date of this Agreement are Altis
Partners Limited, Fall River Capital LLC, Sequent Capital LLC, Waypoint Capital Management LLC, Xplor Capital Management, LLC, Avant Capital Management L.P., Cantab Partners LLP and Vantage Advisors L.P. (the “Advisors”).

The subscribers for Units will be required to execute the Subscription Agreement, a copy of which is attached as an appendix to the Memorandum, and to tender or cause to be tendered for each Unit subscribed cash in the amount of the Net Asset Value per Unit and partial Unit (rounded to four decimal places) on the date of purchase. Subscribers for Units whose 

 

 

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Subscription Agreements are accepted by the General Partner will become limited partners of the Partnership (the “Limited Partners”) upon the execution by the General Partner as attorney-in-fact for each such subscriber of a Limited Partnership Agreement, a copy of which is attached as an appendix to the Memorandum (the “Partnership Agreement”), and at the time such subscribers’ names are entered in the books and records of the Partnership.

Section 1. Appointment of Agent.

On the basis of the representations, warranties and covenants contained in this Agreement, but subject to the terms and conditions set forth in it, you are hereby appointed the non-exclusive agent of the Partnership during the offering period specified in this Section, for the purpose of finding subscribers for the Units for the account and risk of the Partnership through a private offering. The Partnership will continue to offer Units until the General Partner terminates such offering or until up to 200,000 Units have been subscribed (the “Continuous Offering”). Units or partial Units sold during the Continuous Offering will be sold at their Net Asset Value per Unit as of the last day of each month, provided that the General Partner may determine to offer no Units in a particular month. Subject to the performance by the General Partner of all of its obligations to be
performed under this Agreement and to the completeness and accuracy of all material representations and warranties of the General Partner contained in this Agreement, you hereby accept such agency and agree on the terms and conditions set forth in this Agreement to use commercially reasonable efforts during the Continuous Offering to find subscribers for the Units. Your agency under this Agreement, which is coupled with an interest and, therefore, is not terminable by the General Partner without your permission, will continue until the termination of the Continuous Offering.

Section 2. Representations and Warranties of the Partnership and the General Partner.

(a) The Partnership and the General Partner jointly and severally represent and warrant to you, for your benefit, and for the benefit of the purchasers of the Units that:

(i) They shall deliver to you such number of copies of the Memorandum as you may reasonably request. They shall not make any amendment or supplement to the Memorandum until they have given you a copy thereof and reasonable notice of the same, and no such amendment or supplement shall be made if you reasonably object thereto.

(ii) The information to be made available or furnished to each purchaser of a Unit pursuant to Section 5(f) hereof or otherwise shall be sufficient to comply with Rule 502(b)(2)(v) of Reg. D.

(iii) The Memorandum shall not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

 

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(iv)  All action required under the Partnership Agreement or otherwise to be taken by the General Partner before the subscription for and sale of the Units to subscribers therefor has been taken or before the Monthly Closing dates, as defined in Section 4 hereof, will have been taken, and upon (i) payment of the consideration therefor specified in the Subscription Agreement, (ii) acceptance by the General Partner of each subscriber acceptable to the General Partner, and (iii) the payment of any required filing fee, the subscribers will become Limited Partners of the Partnership entitled to all the rights of Limited Partners under the Partnership Agreement and the Partnership Act. The Units, when sold and paid for as contemplated by the Memorandum, will represent validly authorized and duly issued limited partnership interests in the Partnership and will conform to all
statements relating thereto contained in the Memorandum, including the Partnership Agreement. The General Partner shall maintain records required of a registered commodity pool operator pursuant to the rules of each of the Commodity Futures Trading Commission (the “CFTC”) and the National Futures Association. 

(v) The Partnership is a limited partnership duly and validly organized pursuant to the Partnership Agreement and the laws of New York, and is validly existing under, and subject to, the laws of New York with full power and authority to conduct the business in which it proposes to engage as described in the Memorandum. A Limited Partner will have no liability in excess of his capital contribution and his share of Partnership assets and undistributed profits except as set forth in Section 7(f)(2) of the Partnership Agreement and in the Partnership Act.

(vi) There is no action, suit, litigation or proceeding before or by any court or governmental agency, federal, state or local, pending or threatened against or affecting or involving the property or business of the General Partner, or the business of the Partnership, that would materially and adversely affect the condition (financial or otherwise), business or prospects of the General Partner or the Partnership.

(vii) Other than as disclosed to you, neither the Partnership, the General Partner, nor any person directly or indirectly affiliated with either of them has, either directly or through an agent, sold or offered for sale or solicited offers to subscribe for or buy, or approached potential investors for or otherwise negotiated in respect of, the Units except for the activities of the General Partner in approaching potential investors undertaken in cooperation with you after advance consultation with you; and neither the Partnership, the General Partner nor any person directly or indirectly affiliated with any of them has, either directly or through an agent, participated in the organization or management of any partnership or other entity, or has engaged in any other activity, in a manner or under circumstances that would jeopardize the status of the offering of the Units as an
exempted transaction under the Securities Act or under the laws of any state in which it is represented by the General Partner that the offering may be made.

(viii) This Agreement and the Partnership Agreement have been duly and validly authorized, executed and delivered by and on behalf of the General Partner and constitute valid and binding agreements of the General Partner enforceable in accordance with their terms. This Agreement and the Subscription Agreements have been or will be duly and validly authorized, executed and delivered by and on behalf of the Partnership and constitute or will constitute valid and binding agreements of the Partnership enforceable in accordance with their terms.

 

 

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(ix) The execution and delivery of this Agreement, the Subscription Agreements and the Partnership Agreement, and the consummation of the transactions contemplated in this Agreement and in the Memorandum, do not conflict with and will not constitute a breach of, or default under, the certificate of formation or limited liability company agreement of the General Partner or any agreement or instrument by which the General Partner is bound by any order, rule or regulation applicable to it of any court or any governmental body or administrative agency having jurisdiction over it.

(x) A separate escrow account has been opened at JPMorgan Chase Bank, New York, New York (the “Escrow Agent”) and will be maintained for all funds received from subscribers for Units. All payments received from persons desiring to purchase Units will be deposited in such account and held in accordance with the terms of the Escrow Agreement entered into with the Escrow Agent. During the Continuous Offering, the General Partner may elect to hold subscription proceeds at its affiliate, Citibank, N.A. If the General Partner elects to hold subscription proceeds at Citibank, N.A., it shall notify you promptly and provide you with details of the new account. 

(xi) The General Partner has filed five (5) copies of a notice on Form D with the Securities and Exchange Commission (the “SEC”) no later than fifteen (15) days after the first sale of a Unit pursuant to Rule 503 under Reg. D.

Section 3. Your Representations and Warranties.

You represent and warrant to and for the benefit of the Partnership and the General Partner that:

(a) You shall not offer or sell the Units by any form of general solicitation or general advertising within the meaning of Rule 502(c) of Reg. D.

(b) Where required by applicable state law or regulation, you shall initiate contact with a prospective offeree only after determining that the suitability and sophistication standards described in the Memorandum are likely to be satisfied with respect to such prospective offeree and, where applicable, only after having obtained an executed Purchaser Representative Questionnaire.

(c) You shall not offer the Units for sale to, or solicit any offers to subscribe for the Units from, any offeree who resides in a state whose securities or “blue sky” laws require offerees to meet specified qualifications unless such offeree meets such qualifications or which laws require offerees to receive disclosure documents until you have delivered (or directed the General Partner to deliver) the Memorandum, the Partnership Agreement, and any other agreement or document that may be attached as an exhibit or appendix referred to in and distributed with the Memorandum or any other information provided by the General Partner which is required to be delivered to purchasers pursuant to Rule 502(b)(2) of Reg. D to such offeree, and within a reasonable time prior to the Monthly Closing you shall deliver (or cause the General Partner to deliver) all such documents to
all persons who are to purchase the Units, to the extent they have not theretofore received such documents. In connection with the offering, 

 

 

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you shall not represent to any person acquiring Units any material facts relating to the offering unless such facts are contained in the Memorandum or have been provided to you in writing by the General Partner.

(d)  You shall not sell Units to any person unless, immediately before making such sales, you reasonably believe such person (i) would be able to represent that such person is acquiring the Units for such person’s own account as principal for investment and not with a view to resale or distribution, (ii) qualifies as an accredited investor under Rule 501 of Reg. D, (iii) qualifies as a qualified eligible person under Rule 4.7 under the CEA
and (iv) meets such other suitability standards as are specified in the Memorandum under the caption “Who May Invest” and the other conditions contained in the Subscription Agreement.

(e) You shall maintain a record of all information obtained by you indicating that subscribers for Units meet the suitability standards referred to in Section 3(d) hereof. The General Partner shall approve or reject the subscriptions and notify you of the same.

(f) You are a member in good standing of the Financial Industry Regulatory Authority (formerly, NASD, Inc.).

(g) You are in compliance with applicable anti-money laundering laws (including the USA Patriot Act) and related regulations and shall be responsible for compliance with such laws and regulations with respect to purchasers of Units.

(h) You acknowledge that, in its sole discretion, the General Partner may in the future engage additional selling agents for the Partnership. Compensation of any additional selling agents shall be determined by the General Partner in its sole discretion. 

Section 4. Monthly Closings.

During the Continuous Offering, closings shall be held as of the last business day of each month (“Monthly Closings”).

Section 5. Covenants of the Partnership and the General Partner.

The Partnership and the General Partner covenant with you that:

(a) If any event occurs before a Monthly Closing and relates to or affects the business or condition (financial or other) of the General Partner or the Partnership which makes it necessary to amend or supplement the Memorandum in order that the Memorandum will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time 

 

 

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it is delivered to a subscriber, the General Partner forthwith shall prepare and furnish to you a reasonable number of copies of the amendment or amendments of, or supplement or supplements to, the Memorandum (in form and substance satisfactory to you and your counsel) that will so amend or supplement the Memorandum.

(b) They shall qualify or register the Units for offering and sale under, or establish the exemption of the offering and sale of the Units from qualification or registration under, the applicable securities or “blue sky” laws of the jurisdictions listed in Appendix I hereto and use reasonable efforts to qualify in such other jurisdictions as you may reasonably request in writing; provided, however, that none of them will be obligated to qualify as a dealer in securities in any jurisdiction in which it is not so qualified. The General Partner shall promptly notify you in writing of such qualification, registration or exemption in each such jurisdiction and of any modification, rescission or withdrawal of any such
qualification, registration or exemption. The General Partner shall not consummate a sale of a Unit in any jurisdiction in which such sale may not be lawfully made and shall not consummate any sale otherwise than in accordance with the restrictions and limitations, if any, set forth or referred to in such survey.

(c) The Partnership shall apply the proceeds from the sale of the Units for the purposes set forth under “Use of Proceeds” in the Memorandum in substantially the amounts and at the times indicated thereunder.

(d) Neither they nor any person directly or indirectly affiliated with any of them is or will be engaged, as a general partner, sponsor or otherwise (i) in the organization or management of any partnership, fund or other entity, in a manner or under circumstances which, in the opinion of their counsel, will jeopardize the status of the offering of the Units as an exempted transaction under the Securities Act, the CEA or under the laws of any state in which it is represented by them that the offering may be made, or (ii) in any offering of securities which, when integrated with the offering of the Units in the manner prescribed by Rule 501(a) of Reg. D and SEC Release No. 33-4552 (Nov. 6, 1962) will jeopardize the status of the offering of the Units as an exempted transaction under Reg. D.

(e) At all times during the Continuous Offering and before each Monthly Closing, they shall (i) make available to each potential purchaser and to the purchaser’s representative, if any, such information (in addition to that contained in the Memorandum) concerning themselves, the offering and any other relevant matters, as they possess or can acquire without unreasonable effort or expense, and (ii) provide to each potential purchaser and to any purchaser representatives the opportunity to ask questions of, and receive answers from, them concerning the terms and conditions of the offering and the business of the Partnership and to obtain any other additional information, to the extent they possess the same or can acquire it without unreasonable effort or expense, necessary to verify the accuracy of the information furnished to the potential purchaser or any purchaser representatives.

(f) Within 15 days of receiving from you copies of information indicating that subscribers meet the suitability standards, the General Partner shall approve or reject the subscriptions and notify you of the same.

 

 

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(g) The General Partner shall comply with any filing requirement imposed by the SEC and by the laws of any state or jurisdiction in which sales are made. The General Partner shall furnish you and your counsel with copies of all filings made on Form D pursuant hereto.

(i) The General Partner shall notify you within a reasonable period of time if it engages in an additional selling agent for the Partnership. 

Section 6. Acknowledgment of Payment of Compensation to Citigroup Global Markets Inc. and its Smith Barney Financial Advisors.

Pursuant to the Customer Agreement between Citigroup Global Markets Inc. and the Partnership, the Partnership shall pay to Citigroup Global Markets, in lieu of brokerage commissions on a per trade basis, a monthly flat rate brokerage fee equal to 3.5% per year of the Partnership’s month-end net assets (computed monthly by multiplying the adjusted month-end net assets of the Partnership as of the last business day of each month by 3.5% and dividing the result thereof by 12). The brokerage fee shall be credited to the Citigroup Global Markets branch that supports the General Partner and the funds it operates. The Partnership and the General Partner acknowledge that during the term of the Partnership a portion of such brokerage fees shall be paid to Smith Barney financial advisors (or an additional selling agent) who place Units and who are registered with the CFTC as associated persons. 

Section 7. Conditions of Your Obligations.

Your obligations under this Agreement are subject to the accuracy of and compliance with the representations and warranties of the Partnership and the General Partner made in Section 2 hereof and to the performance by the Partnership and the General Partner of their obligations under this Agreement.

If any of the conditions specified in this Section 7 have not been fulfilled when and as required by the Agreement to be fulfilled, you may cancel this Agreement and all your obligations under it by notifying the General Partner of such cancellation in writing or by telegram at any time at or before any Monthly Closing and any such cancellation shall be without liability or obligation of any party to any other party except as otherwise provided in Section 5, Section 6 and Section 9 hereof. 

Section 8. Conditions of the Obligations of the Partnership and the General Partner.

The obligations of the Partnership and the General Partner under this Agreement are subject to the performance by you of your obligations under the same and to the further condition that the Partnership and the General Partner will have received your certificate stating that you have offered the Units for sale, or solicited offers to subscribe for or buy Units, or otherwise negotiated with any person with respect to the Units, only in such manner and under such circumstances as are in compliance with the securities or “blue sky” laws of the jurisdictions designated by you in accordance with 5(b) hereof.

Section 9. Indemnification and Contribution.

You shall indemnify and hold harmless the Partnership and the General Partner and their officers, directors and employees, against any and all loss, liability, claim, damage, 

 

 

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expense, judgment or amount paid in settlement (including reasonable attorneys’ fees) with respect to statements or omissions in the Memorandum made with respect to you or your obligations under this Agreement made in reliance upon and in conformity with information furnished to the General Partner by you expressly for use in the Memorandum.

Section 10. Representations, Warranties and Agreements to Survive Delivery.

All representations, warranties and agreements contained in this Agreement or contained in certificates or opinions delivered pursuant to this Agreement shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of you or by or on behalf of the General Partner and shall survive the Monthly Closings.

Section 11. Notices and Authority to Act.

All communications herein shall be in writing 

and, if sent to you, shall be mailed, delivered or telegraphed and confirmed to you at:

Citigroup Global Markets Inc.

Smith Barney Division

485 Lexington Avenue, 12th Floor

New York, New York  10017

Attention:  Paul Weisenfeld

or if sent to the General Partner, shall be mailed, delivered or telegraphed and confirmed to the General Partner at:

Citigroup Managed Futures LLC

731 Lexington Avenue - 25th Floor

New York, New York  10022

Attention:  Jennifer Magro

or at such other address as may be provided in writing to the other party. 

Section 12. Parties.

This Agreement shall inure to the benefit of and be binding upon you, the Partnership and the General Partner and your and their respective successors, heirs and representatives. This Agreement and its conditions and provisions are intended to be and are for the sole and exclusive benefit of the parties to it and their respective successors, heirs and representatives, and not for the benefit of any other person, firm or corporation unless expressly stated otherwise.

Section 13. Governing Law.

This Agreement shall be governed by and construed under the laws of the State of New York.

 

 

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Section 14. Waiver.

Any party to this Agreement may waive compliance by the other with any of the terms, provisions and conditions set forth in this Agreement.

Section 15. Entire Agreement.

This Agreement contains the entire agreement between the parties to it, and is intended to supersede any and all prior agreements between those parties, relating to the same subject matter.

Section 16. The effective date of this Agreement is ______________.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

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If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to us a counterpart hereof, whereupon this instrument, along with all counterparts, shall become a binding agreement among you, the Partnership and the General Partner, in accordance with its terms.

 

	
                         
 	
                         
 	
                        Sincerely,

            CITIGROUP EMERGING CTA PORTFOLIO L.P.

            By: Citigroup Managed Futures LLC
 (General Partner)
 
	
                          
 	
                         
 	
                        

                        By: 
 	
                        /s/ Jennifer Magro  
 
	
                         
 	
                         
 	
                         
 	
                        Name:  Jennifer Magro

            Title:  Chief Financial Officer and Director
 

 

	
                         
 	
                         
 	
                        CITIGROUP MANAGED FUTURES LLC
 
	
                          
 	
                         
 	
                        

                        By: 
 	
                        /s/ Jennifer Magro  
 
	
                         
 	
                         
 	
                         
 	
                        Name:  Jennifer Magro

            Title:  Chief Financial Officer and Director
 

 

	
                        Confirmed, accepted and agreed to as of the date first above written.

            CITIGROUP GLOBAL MARKETS INC.
 	
                         
 	
                         
 
	
                        

                        By: 
 	
                        /s/ Paul Weisenfeld  
 	
                         
 	
                         
 	
                          
 
	
                        Name:  Paul Weisenfeld

            Title:  Director
 	
                         
 	
                         
 	
                         
 
					

            

 

 

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APPENDIX I

Blue Sky Survey

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