Document:

exv4w6

 

EXHIBIT 4.6

SECURITY AGREEMENT

     SECURITY AGREEMENT (this “Agreement”), dated as of April 17, 2003, made by
QuadraMed Corporation, a Delaware corporation (the “Grantor”), in favor of The
Bank of New York (the “Collateral Agent”), as collateral agent for the Secured
Parties (as defined below),

W I T N E S S E T H:

     WHEREAS, the Grantor is (or will be with respect to after-acquired
property) the legal and beneficial owner and the holder of the Collateral (as
defined in Section 2 hereof);

     WHEREAS, pursuant to an Indenture (as the same may be amended or
supplemented from time to time, the “Indenture”), dated as of the date hereof,
between the Grantor and The Bank of New York, the Grantor has issued certain
Senior Secured Notes due 2008 (the “Notes”); and

     WHEREAS, the obligations of the Grantor under the Indenture are secured by
the Collateral;

     NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, the parties hereto agree as follows:

     SECTION 1. Definitions.

          (a)     All terms used in this Agreement that are defined in the Indenture or
in Article 9 of the Uniform Commercial Code (the “Code”) as in effect from time
to time in the State of New York and that are not otherwise defined herein
shall have the same meanings herein as set forth therein.

          (b)     As used in this Agreement, the following terms shall have the
respective meanings indicated below, such meanings to be applicable equally to
both the singular and plural forms of such terms:

     “Copyright Licenses” means all written licenses, contracts or other
agreements naming the Grantor as licensee or licensor and providing for the
grant of any and all copyright rights in any Works covered by any copyright
(including, without limitation, all Copyright Licenses set forth on Schedule IV
hereto).

     “Copyrights” means all domestic and foreign copyrights in all Works,
whether registered or not, including, without limitation, all copyright rights
(whether now or hereafter arising) in any and all media (whether now known or
hereafter developed), acquired or used by the Grantor (including, without
limitation, all Copyrights described on Schedule IV hereto), all applications
and registrations thereof (including, without limitation, applications and
registrations in the United States Copyright Office or in any similar office or
agency of the United States or any other country), and all extensions or
renewals thereof.

 

 

     “Event of Default” shall have the meaning given such term in the
Indenture.

     “Grantor” means QuadraMed Corporation, together with its successors and
assigns.

     “Holder” means the person in whose name a Senior Secured Note due 2008
issued pursuant to the Indenture is registered in the Security Register (as
defined in the Indenture) kept by the Company for that purpose in accordance
with the terms of the Indenture.

     “Licenses” means the Copyright Licenses, the Trademark Licenses and the
Patent Licenses.

     “Patent Licenses” means all licenses, contracts or other agreements,
whether written or oral, naming the Grantor as licensee or licensor and
providing for the grant of any right to manufacture, use or sell any invention
covered by any Patent (including, without limitation, all Patent Licenses set
forth on Schedule III hereto).

     “Patents” means all domestic and foreign letters patent, now existing or
hereafter acquired (including, without limitation, all domestic and foreign
letters patent described on Schedule III hereto), all applications and
registrations thereof (including, without limitation, applications and
registrations in the United States Patent and Trademark Office, or in any
similar office or agency of the United States or any other country), and all
reissues, divisions, continuations, continuations in part and extensions or
renewals thereof.

     “Secured Parties” means, collectively, the Trustee and the Holders.

     “Security Documents” means, collectively, the Indenture, the Notes, this
Agreement and any related document or agreement that secures the Notes.

     “Trademark Licenses” means all licenses, contracts or other agreements,
whether written or oral, naming the Grantor as licensor or licensee and
providing for the grant of any right concerning any Trademark (including,
without limitation, all Trademark Licenses described on Schedule II hereto),
together with any goodwill of the business connected therewith.

     “Trademarks” means all domestic and foreign trademarks, service marks,
collective marks, certification marks, trade names, business names, d/b/a’s,
trade styles, designs, logos and other source or business identifiers now or
hereafter owned, adopted, acquired or used by the Grantor (including, without
limitation, all domestic and foreign trademarks, service marks, collective
marks, certification marks, trade names, business names, d/b/a’s, trade styles,
designs, logos and other source or business identifiers described on Schedule
II hereto), all applications and registrations thereof (including, without
limitation, applications and registrations in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
state thereof or any other country), and all reissues, extensions or renewals
thereof, together with all goodwill of the business connected therewith.

     “Works” means any work that is subject to copyright protection pursuant to
Title 17 of the United States Code or under the legislation of any other
country.

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     SECTION 2. Grant of Security Interest.

     As collateral security for all of the Obligations (as defined in Section 3
hereof), the Grantor hereby pledges and assigns to the Collateral Agent, and
grants to the Collateral Agent for the benefit of the Secured Parties a
continuing security interest in, any and all right, title and interest of the
Grantor in and to the following, whether now or hereafter existing and whether
now owned or hereafter acquired (collectively, the “Collateral”):

          (a)     all Copyrights;

          (b)     all Patents;

          (c)     all Trademarks; and

          (d)     all Licenses;

in each case howsoever the Grantor’s interest therein may arise or appear
(whether by ownership, security interest, claim or otherwise).

     The Grantor and the Collateral Agent hereby acknowledge and agree that the
security interest created hereby in the Collateral (i) constitutes continuing
collateral security for all of the Obligations, whether now existing or
hereafter arising, and (ii) is not to be construed as an assignment or sale of
any intellectual property or a right to use any intellectual property unless
and until an Event of Default shall have occurred and be continuing.

     SECTION 3. Security for Obligations.

     The security interest created hereby in the Collateral constitutes
continuing collateral security for all of the following obligations, whether
now existing or hereafter incurred (the “Obligations”):

with respect to the Grantor (a) the full and punctual payment of the principal
of, and premium, if any, and interest on the Notes when due, whether at
maturity, by acceleration, by redemption or otherwise, and all other monetary
obligations of the Grantor under the Indenture, the Notes and the Security
Documents and (b) the full and punctual performance within applicable grace
periods of all other obligations of the Grantor under the Indenture, the Notes
and the Security Documents.

     SECTION 4. Representations and Warranties.

     The Grantor represents and warrants as follows:

          (a)     Schedule I hereto sets forth (i) the exact legal name of the Grantor
and (ii) the organizational identification number of the Grantor.

          (b)     The Grantor (i) is duly organized, validly existing and in good
standing under the laws of the state or jurisdiction of its organization as set
forth on Schedule I hereto and

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(ii)  has all requisite entity power and authority to execute, deliver and
perform this Agreement and each other Security Document to which the Grantor is
a party.

          (c)     The execution, delivery and performance by the Grantor of this
Agreement and each other Security Document to which the Grantor is a party (i)
have been duly authorized by all necessary organizational action of the
Grantor, (ii) do not and will not contravene its charter or by-laws, any law or
any contractual restriction binding on or affecting the Grantor or any of its
properties, and (iii) do not and will not result in or require the creation of
any Lien, security interest or other charge or encumbrance upon or with respect
to any of its properties.

          (d)     This Agreement is, and each other Security Document to which the
Grantor is or will be a party when executed and delivered pursuant hereto, will
be, a legal, valid and binding obligation of the Grantor, enforceable against
the Grantor in accordance with its terms.

          (e)     To the Grantor’s knowledge, there is no pending or threatened action,
suit, proceeding or claim before any court or other governmental authority or
any arbitrator, or any order, judgment or award by any court or other
governmental authority or arbitrator, that may adversely affect the grant by
the Grantor or the perfection of the security interest purported to be created
hereby in the Collateral, or the exercise by the Collateral Agent of any of its
rights or remedies hereunder.

          (f)     All taxes, assessments and other governmental charges imposed upon the
Grantor or any property of the Grantor (including, without limitation, all
federal income and social security taxes on employees’ wages) and that have
become due and payable on or prior to the date hereof have been paid, except to
the extent contested in good faith by proper proceedings that stay the
imposition of any penalty or fine resulting from the non-payment thereof and
with respect to which adequate reserves in accordance with GAAP have been
established for the payment thereof.

          (g)     Schedule II hereto sets forth a true and complete list of all
Trademarks and Trademark Licenses owned or used by the Grantor as of the date
hereof. Schedule III hereto sets forth a true and complete list of all Patents
and Patent Licenses owned or used by the Grantor as of the date hereof.
Schedule IV hereto sets forth a true and complete list of all Copyrights and
Copyright Licenses owned or used by the Grantor as of the date hereof. All of
such Trademarks, Patents and Copyrights are subsisting and in full force and
effect, have not been adjudged invalid or unenforceable, are valid and
enforceable and have not been abandoned in whole or in part. Except as set
forth on Schedules II, III or IV hereto, none of such Trademarks, Patents or
Copyrights is the subject of any licensing or franchising agreement. The
Grantor has no knowledge of any conflict with the rights of others to any
Trademark, Patent or Copyright and, to the knowledge of the Grantor, the
Grantor is not now infringing or in conflict with any such rights of others in
any material respect, and to the knowledge of the Grantor, no other Person is
now infringing or in conflict in any material respect with any such properties,
assets and rights owned or used by the Grantor. The Grantor has not received
any notice that it is violating or has violated the trademarks, patents,
copyrights or other intellectual property rights of any third party.

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          (h)     The Grantor is and will be at all times the sole and exclusive owner
of, or otherwise have and will have adequate rights in, the Collateral free and
clear of any Lien, security interest or other charge or encumbrance except for
(i) the security interest created by this Agreement and (ii) the Liens
permitted pursuant to the Indenture. No effective financing statement or other
instrument similar in effect covering all or any part of the Collateral is on
file in any recording or filing office except (A) such as may have been filed
in favor of the Collateral Agent relating to this Agreement and (B) such as may
have been filed to perfect or protect any Liens permitted pursuant to the
Indenture.

          (i)     The exercise by the Collateral Agent of any of its rights and remedies
hereunder will not contravene any law or any contractual restriction binding on
or otherwise affecting the Grantor or any of its properties and will not result
in or require the creation of any Lien, security interest or other charge or
encumbrance upon or with respect to any of its properties.

          (j)     This Agreement creates valid security interests in favor of the
Collateral Agent in the Collateral, as security for the Obligations. The
security interests created herein are, or in the case of Collateral in which
the Grantor obtains rights after the date hereof will be, first priority
security interests, subject only to the security interests and other Liens
permitted pursuant to the Indenture.

     SECTION 5. Covenants as to the Collateral.

     So long as any of the Obligations shall remain outstanding and the
Indenture and the other Security Documents shall not have expired or
terminated, unless the Collateral Agent shall otherwise consent in writing:

          (a)     Further Assurances. The Grantor shall, at any time and from time to
time, promptly execute and deliver all further instruments and documents and
take all commercially reasonable further action that may be necessary or
desirable or that the Collateral Agent may reasonably request in order (i) to
protect the security interest purported to be created hereby; (ii) to enable
the Collateral Agent to exercise and enforce its rights and remedies hereunder
in respect of the Collateral; or (iii) otherwise to effect the purposes of this
Agreement, including, without limitation: (A) executing and filing (to the
extent, if any, that the Grantor’s signature is required thereon) or
authenticating the filing of, such financing or continuation statements, or
amendments thereto, as may be necessary or that the Collateral Agent may
reasonably request in order to perfect and preserve the security interest
purported to be created hereby, (B) furnishing to the Collateral Agent from
time to time statements and schedules further identifying and describing the
Collateral as the Collateral Agent may reasonably request, (C) if any
Collateral shall be in the possession of a third party, notifying such Person
of the Collateral Agent’s security interest created hereby, (D) taking all
actions reasonably required by any earlier versions of the Uniform Commercial
Code or by other law, as applicable, in any relevant Uniform Commercial Code
jurisdiction, or by other law as applicable in any foreign jurisdiction.

          (b)     Provisions Concerning the Licenses. Unless contrary to the Grantor’s
sound business judgment:

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               (i)     upon the occurrence and during the continuance of any material breach
or default under any License referred to on Schedules II, III or IV hereto by
any party thereto other than the Grantor, (A) the Grantor shall, promptly after
obtaining knowledge thereof, give the Collateral Agent written notice of the
nature and duration thereof, (B) the Grantor shall not, without the prior
written consent of the Collateral Agent, which consent shall not be
unreasonably withheld, declare or waive any such breach or default or
affirmatively consent to the cure thereof or exercise any of its remedies in
respect thereof, and (C) the Grantor shall, upon written instructions from the
Collateral Agent, take such action as the Collateral Agent may reasonably deem
necessary or advisable in respect thereof.

               (ii)     the Grantor shall exercise promptly and diligently each and every
right that it may have under each License (other than any right of termination)
and shall duly perform and observe in all respects all of its obligations under
each License and shall take all reasonable action necessary to maintain the
Licenses in full force and effect. The Grantor shall not, without the prior
written consent of the Collateral Agent, which consent shall not be
unreasonably withheld, cancel, terminate, amend or otherwise modify in any
respect, or waive any provision of, any License referred to on Schedules II,
III or IV hereto.

          (c)     Transfers and Other Liens.

               (i)     Except to the extent permitted by the Indenture or the exercise of the
Grantor’s sound business judgment, the Grantor shall not sell, assign (by
operation of law or otherwise), lease, license, exchange or otherwise transfer
or dispose of any of the Collateral.

               (ii)     Except to the extent permitted by the Indenture or the exercise of
the Grantor’s sound business judgment, the Grantor shall not create, suffer to
exist or grant any Lien, security interest or other charge or encumbrance upon
or with respect to any Collateral.

          (d)     Trademarks, Patents and Copyrights.

               (i)     If applicable, the Grantor has duly executed and delivered the
Assignment for Security (Trademarks) in the form attached hereto as Exhibit A,
the Assignment for Security (Patents) in the form attached hereto as Exhibit B
and the Assignment for Security (Copyrights) in the form attached hereto as
Exhibit C. Subject to Grantor’s sound business judgment, the Grantor (either
itself or through licensees) shall, and shall cause each licensee thereof to,
take all commercially reasonable action(s) necessary to maintain all of the
Trademarks, Patents and Copyrights in full force and effect, including, without
limitation, using the proper statutory notices and markings and using the
Trademarks on each applicable trademark class of goods in order to so maintain
the Trademarks in full force free from any claim of abandonment for non-use,
and the Grantor shall (nor permit any licensee thereof to) do any act or
knowingly omit to do any act whereby any Trademark, Patent or Copyright may
become invalidated; provided, however, that so long as no Event of Default has
occurred and is continuing, the Grantor shall have no obligation to use or to
maintain any Trademark, Patent or Copyright that relates solely to any product
or work that has been, or is in the process of being, discontinued, abandoned
or terminated. Subject to the Grantor’s sound business judgment, the Grantor
shall cause to be taken all commercially reasonable and necessary steps in any
proceeding before the United States Patent and Trademark Office and the United
States

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Copyright Office to maintain each registration of the Trademarks, the
Patents and the Copyrights (other than those Trademarks, Patents or Copyrights
described in the proviso to the immediately preceding sentence), including,
without limitation, filing of renewals, affidavits of use, affidavits of
incontestability and opposition, interference and cancellation proceedings and
payment of maintenance fees, filing fees, taxes or other governmental fees. If
any Trademark, Patent or Copyright is infringed, misappropriated, diluted or
otherwise violated in any material respect by a third party, the Grantor shall
(x) upon learning of such infringement, misappropriation, dilution or other
violation, promptly notify the Collateral Agent and (y) to the extent the
Grantor shall deem appropriate, in its sole discretion, promptly sue for
infringement, misappropriation, dilution or other violation, seek injunctive
relief where appropriate and recover any and all damages for such infringement,
misappropriation, dilution or other violation, or take such other actions as
the Grantor shall deem appropriate to protect such Trademark, Patent or
Copyright. The Grantor shall furnish to the Collateral Agent from time to time
(but, unless an Event of Default has occurred and is continuing, no more
frequently than quarterly) statements and schedules further identifying and
describing the Trademarks, Patents or Copyrights and such other reports in
connection with the Trademarks, Patents or Copyrights as the Collateral Agent
may reasonably request, shall modify this Agreement by amending Schedules II,
III or IV hereto, as the case may be, to include any Trademark, Patent or
Copyright, as the case may be, that becomes part of the Collateral under this
Agreement, and shall execute and authenticate such documents prepared by the
Secured Parties as shall be commercially reasonable and necessary to subject
such Trademarks, Patents or Copyrights to the Lien and security interest
created by this Agreement.

               (ii)     In the event the Grantor, either itself or through any agent,
employee, licensee or designee, files an application for the registration of
any Trademark or Copyright or the issuance of any Patent with the United States
Patent and Trademark Office or the United States Copyright Office, as
applicable, or in any similar office or agency of the United States or any
country, it shall give the Collateral Agent written notice thereof. The
Grantor shall execute, authenticate and deliver any and all assignments,
agreements, instruments, documents and papers as are necessary to evidence the
Collateral Agent’s security interest hereunder in such Trademark, Patent or
Copyright of the Grantor relating thereto or represented thereby, and the
Grantor hereby appoints the Collateral Agent its attorney-in-fact to execute
and/or authenticate and file all such writings as provided to it for the
foregoing purposes, all acts of such attorney being hereby ratified and
confirmed, and such power (being coupled with an interest) shall be irrevocable
until the termination of all Commitments, the repayment of all of the
Obligations in full and the termination of each of the Security Documents.

     SECTION 6. Additional Provisions Concerning the Collateral.

          (a)     The Grantor hereby (i) authorizes the Collateral Agent to file one or
more financing or continuation statements, and amendments thereto as provided
to it relating to the Collateral and (ii) ratifies such authorization to the
extent that the Collateral Agent has filed any such financing or continuation
statements, or amendments thereto prior to the date hereof. A photocopy or
other reproduction of this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.

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          (b)     The Grantor hereby irrevocably appoints the Collateral Agent as its
attorney-in-fact and proxy, with full authority in the place and stead of the
Grantor and in the name of the Grantor or otherwise, from time to time in the
Collateral Agent’s reasonable discretion, to take any action and to execute any
instrument that the Collateral Agent may deem necessary or advisable to
accomplish the purposes of this Agreement (subject to the rights of the Grantor
under Section 5 hereof), including, without limitation, (i) to ask, demand,
collect, sue for, recover, compound, receive and give acquittance and receipts
for moneys due and to become due under or in respect of any Collateral, (ii) to
receive, endorse, and collect any drafts or other instruments, documents and
chattel paper in connection with clause (i) above, and (iii) to file any claims
or take any action or institute any proceedings that the Collateral Agent may
deem necessary or desirable for the collection of any Collateral or otherwise
to enforce the rights of the Collateral Agent and the Secured Parties with
respect to any Collateral. This power is coupled with an interest and is
irrevocable until all of the Obligations are paid in full after the termination
of the Indenture and the other Security Documents.

          (c)     The powers conferred on the Collateral Agent hereunder are solely to
protect its interest in the Collateral and shall not impose any duty upon it to
exercise any such powers. Except for the safe custody of any Collateral in its
possession and the accounting for moneys actually received by it hereunder, the
Collateral Agent shall have no duty as to any Collateral including the filing
of any UCC financing statements or as to the taking of any necessary steps to
preserve rights against prior parties or any other rights pertaining to any
Collateral.

          (d)     Anything herein to the contrary notwithstanding (i) the Grantor shall
remain liable under the Licenses and otherwise with respect to any of the
Collateral to the extent set forth therein to perform all of its obligations
thereunder to the same extent as if this Agreement had not been executed, (ii)
the exercise by the Collateral Agent of any of its rights hereunder shall not
release the Grantor from any of its obligations under the Licenses or otherwise
in respect of the Collateral, and (iii) the Collateral Agent shall not have any
obligation or liability by reason of this Agreement under the Licenses or with
respect to any of the other Collateral, nor shall the Collateral Agent be
obligated to perform any of the obligations or duties of the Grantor thereunder
or to take any action to collect or enforce any claim for payment assigned
hereunder.

     SECTION 7. Remedies Upon Default.

          (a)     If any Event of Default shall have occurred and be continuing beyond
the notice, cure, or continuance period provided in the Indenture, if any, the
Collateral Agent may exercise in respect of the Collateral, in addition to the
other rights and remedies provided for herein or otherwise available to it, all
of the rights and remedies of a secured party upon default under the Code
(whether or not the Code applies to the affected Collateral), and also may (i)
take absolute control of the Collateral, including, without limitation,
transfer into the Collateral Agent’s name or into the name of its nominee or
nominees (to the extent the Collateral Agent has not theretofore done so) and
thereafter receive, for the benefit of the Collateral Agent, all payments made
thereon, give all consents, waivers and ratifications in respect thereof and
otherwise act with respect thereto as though it were the outright owner
thereof, (ii) require the Grantor to, and the Grantor hereby agrees that it
shall at its expense and upon request of the

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Collateral Agent forthwith, assemble all or part of the Collateral as
directed by the Collateral Agent and make it available to the Collateral Agent
at a place or places to be designated by the Collateral Agent that is
reasonably convenient to both parties, and (iii) without notice except as
specified below and without any obligation to prepare or process the Collateral
for sale, (A) sell the Collateral or any part thereof in one or more parcels at
public or private sale, at any of the Collateral Agent’s offices or elsewhere,
for cash, on credit or for future delivery, and at such price or prices and
upon such other terms as the Collateral Agent may deem commercially reasonable
and/or (B) lease, license or dispose of the Collateral or any part thereof upon
such terms as the Collateral Agent may deem commercially reasonable. The
Grantor agrees that, to the extent notice of sale or any other disposition of
the Collateral shall be required by law, at least ten (10) days’ notice to the
Grantor of the time and place of any public sale or the time after which any
private sale or other disposition of the Collateral is to be made shall
constitute reasonable notification. The Collateral Agent shall not be
obligated to make any sale or other disposition of Collateral regardless of
notice of sale having been given. The Collateral Agent may adjourn any public
or private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned. The Grantor hereby waives any claims
against the Collateral Agent and the Secured Parties arising by reason of the
fact that the price at which the Collateral may have been sold at a private
sale was less than the price that might have been obtained at a public sale or
was less than the aggregate amount of the Obligations, even if the Collateral
Agent accepts the first offer received and does not offer the Collateral to
more than one offeree, and waives all rights that the Grantor may have to
require that all or any part of the Collateral be marshalled upon any sale
(public or private) thereof. The Grantor hereby acknowledges that (i) any such
sale of the Collateral by the Collateral Agent shall be made without warranty,
(ii) the Collateral Agent may specifically disclaim any warranties of title,
possession, quiet enjoyment or the like, and (iii) such actions set forth in
clauses (i) and (ii) above shall not adversely affect the commercial
reasonableness of any such sale of the Collateral. In addition to the
foregoing, (i) the Collateral Agent may, at any time and from time to time,
upon ten (10) days’ prior notice to the Grantor, license, whether general,
special or otherwise, and whether on an exclusive or non-exclusive basis, any
of the Trademarks, Patents or Copyrights, throughout the universe for such term
or terms, on such conditions, and in such manner, as the Collateral Agent shall
in its sole discretion determine; and (ii) the Collateral Agent may, at any
time, pursuant to the authority granted in Section 6 hereof (such authority
being effective upon the occurrence and during the continuance of an Event of
Default) execute and deliver on behalf of the Grantor, one or more instruments
of assignment of the Trademarks, Patents or Copyrights (or any application or
registration thereof), in form suitable for filing, recording or registration
in any country.

          (b)     All Cash Proceeds received by the Collateral Agent in respect of any
sale of or collection from, or other realization upon, all or any part of the
Collateral shall be applied (after payment of any amounts payable to the
Collateral Agent pursuant to Section 8 hereof) by the Collateral Agent against
all or any part of the Obligations in accordance with Section 5.6 of the
Indenture. Any surplus of such cash or Cash Proceeds held by the Collateral
Agent and remaining after payment in full of all of the Obligations after
termination of the Indenture and the other Security Documents shall be paid
over to whomsoever shall be lawfully entitled to receive the same or as a court
of competent jurisdiction shall direct.

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          (c)     In the event that the proceeds of any such sale, collection or
realization are insufficient to pay all amounts to which the Collateral Agent
and the Secured Parties are legally entitled, the Grantor shall be liable for
the deficiency, together with interest thereon at such rate as shall be fixed
by applicable law.

          (d)     The Grantor hereby acknowledges that if the Collateral Agent complies
with any applicable state or federal law requirements in connection with a
disposition of the Collateral, such compliance will not adversely affect the
commercial reasonableness of any sale or other disposition of the Collateral.

          (e)     The Collateral Agent shall not be required to marshal any present or
future collateral security (including, but not limited to, this Agreement and
the Collateral) for, or other assurances of payment of, the Obligations or any
of them or to resort to such collateral security or other assurances of payment
in any particular order, and all of the Collateral Agent’s rights hereunder and
in respect of such collateral security and other assurances of payment shall be
cumulative and in addition to all other rights, however existing or arising.
To the extent that the Grantor lawfully may, the Grantor hereby agrees that it
shall not invoke any law relating to the marshalling of collateral that might
cause delay in or impede the enforcement of the Collateral Agent’s rights under
this Agreement or under any other instrument creating or evidencing any of the
Obligations or under which any of the Obligations is outstanding or by which
any of the Obligations is secured or payment thereof is otherwise assured, and,
to the extent that it lawfully may, the Grantor hereby irrevocably waives the
benefits of all such laws.

     SECTION 8. Indemnity and Expenses.

     The Grantor agrees to indemnify and hold the Collateral Agent harmless
from and against any and all claims, damages, losses, liabilities, obligations,
penalties, costs and expenses to the extent that they arise out of or otherwise
result from any third-party claims related to this Agreement (including,
without limitation, enforcement of this Agreement), except claims, losses or
liabilities resulting solely and directly from the Collateral Agent’s own
negligence or willful misconduct, as determined by a final judgment of a court
of competent jurisdiction. Additionally, in connection with its appointment
and performance of its duties hereunder, the Collateral Agent is entitled to
all rights, privileges, protections and benefits accorded to it as Trustee
under the Indenture.

     SECTION 9. Notices, Etc. All notices and other communications provided
for hereunder shall be in writing and shall be mailed (by certified mail,
postage prepaid and return receipt requested), telecopied or delivered to the
Grantor or to the Collateral Agent

          if to the Grantor:

	 	 	 
	 	 	
QuadraMed Corporation
	 	 	
12110 Sunset Hills Road
	 	 	
Reston, Virginia 20190
	 	 	
Attention: General Counsel
	 	 	 
	 	 	
with a copy to:

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Akin Gump Strauss Hauer & Feld LLP
	 	 	
1333 New Hampshire Avenue, NW
	 	 	
Washington, DC 20036
	 	 	
Attention: Bruce S. Mendelsohn, Esq.

          if to the Collateral Agent:

	 	 	 
	 	 	
The Bank of New York
	 	 	
101 Barclay Street
	 	 	
Floor 8 West
	 	 	
New York, New York 10286
	 	 	
Attn: Corporate Trust Administration

or as to either such Person, at such other address as shall be designated by
such Person in a written notice to such other Person complying as to delivery
with the terms of this Section 9. All such notices and other communications
shall be effective (i) if sent by certified mail, return receipt requested,
when received or three (3) Business Days after mailing, whichever first occurs,
(ii) if telecopied, when transmitted and confirmation is received, provided
same is on a Business Day and, if not, on the next Business Day or (iii) if
delivered, upon delivery, provided same is on a Business Day and, if not, on
the next Business Day.

     SECTION 10. Miscellaneous.

          (a)     No amendment of any provision of this Agreement shall be effective
unless it is in writing and signed by the Grantor and the Collateral Agent, and
no waiver of any provision of this Agreement, and no consent to any departure
by the Grantor therefrom, shall be effective unless it is in writing and signed
by the Collateral Agent, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.

          (b)     No failure on the part of the Collateral Agent to exercise, and no
delay in exercising, any right hereunder or under any other Security Document
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or the exercise
of any other right. The rights and remedies of the Collateral Agent provided
herein and in the other Security Documents are cumulative and are in addition
to, and not exclusive of, any rights or remedies provided by law. The rights
of the Collateral Agent against any party thereto are not conditional or
contingent on any attempt by the Collateral Agent to exercise any of its rights
under any other Security Document against such party or against any other
Person, including but not limited to, the Grantor.

          (c)     Any provision of this Agreement that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
portions hereof or thereof or affecting the validity or enforceability of such
provision in any other jurisdiction.

11

 

          (d)     This Agreement shall create a continuing security interest in the
Collateral and shall (i) remain in full force and effect until the later of (A)
the payment in full of the Obligations and (B) the termination of the Indenture
and the other Security Documents, and (ii) be binding on the Grantor and all
other Persons who become bound as debtor to this Agreement in accordance with
Section 9-203(d) of the Code and shall inure, together with all rights and
remedies of the Collateral Agent and the Secured Parties hereunder, to the
benefit of the Collateral Agent and the Secured Parties and their respective
permitted successors, transferees and assigns. Without limiting the generality
of clause (ii) of the immediately preceding sentence, without notice to the
Grantor, the Collateral Agent and the Secured Parties may assign or otherwise
transfer their rights and obligations under this Agreement or any other
Security Document to any other Person and such other Person shall thereupon
become vested with all of the benefits in respect thereof granted to the
Collateral Agent and the Secured Parties herein or otherwise. Upon any such
assignment or transfer, all references in this Agreement to the Collateral
Agent shall mean the assignee of the Collateral Agent.

          (e)     Upon the satisfaction in full of the Obligations and the termination
of the Indenture and the other Security Documents, (i) this Agreement and the
security interests created hereby shall terminate and all rights to the
Collateral shall revert to the Grantor and (ii) the Collateral Agent shall,
upon the Grantor’s request and at the Grantor’s expense, (A) return to the
Grantor such of the Collateral as shall not have been sold or otherwise
disposed of or applied pursuant to the terms hereof and (B) execute and deliver
to the Grantor such documents as the Grantor shall reasonably request to
evidence such termination, all without any representation, warranty or recourse
whatsoever.

          (f)     This Agreement shall be governed by and construed and interpreted in
accordance with the laws of the State of New York, except as required by
mandatory provisions of law and except to the extent that the validity and
perfection or the perfection and the effect of perfection or non-perfection of
the security interest created hereby, or remedies hereunder, in respect of any
particular Collateral are governed by the law of a jurisdiction other than the
State of New York.

          (g)     Any legal action, suit or proceeding with respect to this Agreement or
any document related thereto may be brought in the courts of the State of New
York or the United States of America for the Southern District of New York, and
appellate courts thereof, and, by execution and delivery of this Agreement, the
Grantor hereby accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The Grantor hereby
irrevocably waives any objection, including, without limitation, any objection
to the laying of venue or based on the grounds of forum non conveniens, that it
may now or hereafter have to the bringing of any such action, suit or
proceeding in such respective jurisdictions.

          (h)     The Grantor irrevocably consents to the service of process of any of
the aforesaid courts in any such action, suit or proceeding by the mailing of
copies thereof by registered or certified mail (or any substantially similar
form of mail), postage prepaid, to the Grantor at its address provided herein,
such service to become effective when received or thirty (30) days after such
mailing, whichever first occurs.

12

 

           (i)     Nothing contained herein shall affect the right of the Collateral
Agent to serve process in any other manner permitted by law or commence legal
proceedings or otherwise proceed against the Grantor or any property of the
Grantor in any other jurisdiction.

          (j)     EACH OF THE GRANTOR AND (BY ITS ACCEPTANCE OF THE BENEFITS OF THIS
AGREEMENT) THE COLLATERAL AGENT WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT OR ANY OTHER SECURITY DOCUMENT, OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR OTHER ACTION OF THE PARTIES
HERETO.

          (k)     Section headings herein are included for convenience of reference only
and shall not constitute a part of this Agreement for any other purpose.

          (l)     This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which shall be
deemed to be an original, but all of which taken together constitute one in the
same Agreement.

[Signature Page Follows]

13

 

     IN WITNESS WHEREOF, Grantor has caused this Agreement to be executed and
delivered by its officer thereunto duly authorized as of the date first above
written.

	 	 	 	 	 	 	 
	 	 	 	 	GRANTOR:
	 	 	 	 	 	 	 
	 	 	
 
	 	QUADRAMED CORPORATION
	 	 	 	 	 	 	 
	 	 	 	 	By:
	 	 
	 	 	 	 	 	

	 	 	 	 	Name:	 
	 	 	 	 	Title:	 

14

 

SCHEDULE I

LEGAL NAME; ORGANIZATIONAL IDENTIFICATION NUMBER; STATE OR

JURISDICTION OF ORGANIZATION

	 	 
	 	QuadraMed Corporation
	 	 
	 	IRS Employee Identification Number: 52-1992861
	 	 
	 	Delaware Corporation

Sched. I-1

 

SCHEDULE II 

TRADEMARKS

AND

TRADEMARK LICENSES

 

SCHEDULE III

PATENTS AND PATENT LICENSES

 

SCHEDULE IV

COPYRIGHTS AND COPYRIGHT LICENSES

 

EXHIBIT A

COLLATERAL ASSIGNMENT FOR
SECURITY

(TRADEMARKS)

          WHEREAS,
_____________(the “Assignor”) has adopted, used and is
using, and holds all right, title and interest in and to, the trademarks and
service marks listed on the annexed Schedule 1A, which trademarks and service
marks are registered or applied for in the United States Patent and Trademark
Office (the “Trademarks”);

          WHEREAS, the Assignor, has entered into a Security Agreement, dated as of
_____________, 2003 (the “Security Agreement”), in
favor of _______________,
as collateral agent (the “Assignee”); and

          WHEREAS, pursuant to the Security Agreement, the Assignor has assigned to
the Assignee and granted to the Assignee for the benefit of the Secured Parties
(as defined in the Security Agreement) a continuing security interest in all
right, title and interest of the Assignor in, to and under the Trademarks,
together with, among other things, the good-will of the business symbolized by
the Trademarks and the applications and registrations thereof (the
“Collateral”), to secure the payment, performance and observance of the
Obligations (as defined in the Security Agreement);

          NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Assignor does hereby pledge,
convey, sell, assign, transfer and set over unto the Assignee and grants to the
Assignee for the benefit of the lenders a continuing security interest in the
Collateral to secure the prompt payment, performance and observance of the
Obligations.

          The Assignor does hereby further acknowledge and affirm that the rights
and remedies of the Assignee with respect to the Collateral are more fully set
forth in the Security Agreement, the terms and provisions of which are hereby
incorporated herein by reference as if fully set forth herein.

          IN WITNESS WHEREOF, the Assignor has caused this Assignment to be duly
executed by its officer thereunto duly authorized as of ___________,
20__.

	 	 	 	 
	 	 	QUADRAMED CORPORATION
	 	 	 	 	 
	 	 	
By:	 
	 	 	 	

	 	 	 	Name

Title:

Exh. A-1

 

 

	 	 	 
	STATE OF _______________________	 	 
	 	
ss.:
	COUNTY OF  _____________________	 	 

          On
this __ day of ___________, 20__, before me personally came
________________, to me known to be the person who executed the foregoing
instrument, and who, being duly sworn by me, did depose and say that he or she
is the _________________ of _________________, a
___________________, and that he or she executed the foregoing instrument in
the firm name of __________________, and that he or she had
authority to sign the same, and he or she acknowledged to me that he or she
executed the same as the act and deed of said firm for the uses and purposes
therein mentioned.

 

 

 

 

Exh. A-2

 

 

SCHEDULE 1A TO COLLATERAL
ASSIGNMENT FOR SECURITY

(REGISTERED TRADEMARKS AND
TRADEMARK APPLICATIONS)

Trademarks and Trademark Applications Owned

by QuadraMed Corporation:

Exh. A-3

 

 

EXHIBIT B

COLLATERAL ASSIGNMENT FOR
SECURITY

(PATENTS)

          WHEREAS,
 ___________________ (the “Assignor”) holds all right,
title and interest in the letters patent listed on the annexed
Schedule 1A,
which patents are issued or applied for in the United States Patent and
Trademark Office (the “Patents”);

          WHEREAS, the Assignor, has entered into an Security Agreement, dated as of
___________, 2003 (the “Security
Agreement”), in favor of
____________________, as collateral agent (the
“Assignee”); and

          WHEREAS, pursuant to the Security Agreement, the Assignor has assigned to
the Assignee and granted to the Assignee for the benefit of the Secured Parties
(as defined in the Security Agreement) a continuing security interest in all
right, title and interest of the Assignor in, to and under the Patents and the
applications and registrations thereof (the “Collateral”), to secure the
payment, performance and observance of the Obligations (as defined in the
Security Agreement);

          NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Assignor does hereby pledge,
convey, sell, assign, transfer and set over unto the Assignee and grants to the
Assignee for the benefit of the lenders a continuing security interest in the
Collateral to secure the prompt payment, performance and observance of the
Obligations.

          The Assignor does hereby further acknowledge and affirm that the rights
and remedies of the Assignee with respect to the Collateral are more fully set
forth in the Security Agreement, the terms and provisions of which are hereby
incorporated herein by reference as if fully set forth herein.

          IN WITNESS WHEREOF, the Assignor has caused this Assignment to be duly
executed by its officer thereunto duly authorized as of
______________, 200__.

	 	 	 	 	 
	 	 	QUADRAMED CORPORATION
	 	 	 	 	 
	 	 	
By:	 	 
	 	 	 	 	

	 	 	 	 	Name:

Title:

 

Exh. B-1

 

	 	 	 
	STATE OF
                              	 	 
	 	
ss.:
	COUNTY OF                    	 	 

          On
this        day of
        , 200        , before me personally came
        , to me known to be the person who executed the foregoing
instrument, and who, being duly sworn by me, did depose and say that he or she
is the         of         , a
        , and that he or she executed the foregoing instrument in
the firm name of      , and that he or she had
authority to sign the same, and he or she acknowledged to me that he or she
executed the same as the act and deed of said firm for the uses and purposes
therein mentioned.

Exh. B-2

 

 

SCHEDULE 1A TO COLLATERAL ASSIGNMENT FOR SECURITY

(PATENTS AND PATENT APPLICATIONS)

Patents and Patent Applications Owned

by QuadraMed
Corporation:

Exh. B-3

 

 

EXHIBIT C

COLLATERAL ASSIGNMENT FOR
SECURITY

(COPYRIGHTS)

          WHEREAS,
          (the
“Assignor”) holds all right, title
and interest in the copyrights listed on the annexed Schedule 1A, which
copyrights are registered in the United States Copyright Office (the
“Copyrights”);

          WHEREAS, the Assignor, has entered into a Security Agreement, dated as of
        , 2003 (the
“Security Agreement”), in favor of
         ,
as collateral agent (the “Assignee”); and

          WHEREAS, pursuant to the Security Agreement, the Assignor has assigned to
the Assignee and granted to the Assignee for the benefit of the Secured Parties
(as defined in the Security Agreement) a continuing security interest in all
right, title and interest of the Assignor in, to and under the Copyrights and
the applications and registrations thereof (the “Collateral”), to secure the
payment, performance and observance of the Obligations (as defined in the
Security Agreement);

          NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Assignor does hereby pledge,
convey, sell assign, transfer and set over unto the Assignee and grants to the
Assignee for the benefit of the lenders a continuing security interest in the
Collateral to secure the prompt payment, performance and observance of the
Obligations.

          The Assignor does hereby further acknowledge and affirm that the rights
and remedies of the Assignee with respect to the Collateral are more fully set
forth in the Security Agreement, the terms and provisions of which are hereby
incorporated herein by reference as if fully set forth herein.

          IN WITNESS WHEREOF, the Assignor has caused this Assignment to be duly
executed by its officer thereunto duly authorized as of
          ,
200     .

	 	 	 
	 	
QUADRAMED CORPORATION
	 
	 	By:	 
	 	

	 	
Name:

Title:

Sched. C-1

 

 

	 	 	 
	STATE OF NEW YORK	 	
 
	 	
ss.:
	COUNTY OF NEW YORK	 	 

          On
this
          day
of          ,
200     , before me personally came
        , to me known to be the person who executed the foregoing
instrument, and who, being duly sworn by me, did depose and say that he or she
is the         of
        , a
        
corporation, and that he or she executed the foregoing instrument in the firm
name of      , and that he or she had authority to sign the
same, and he or she acknowledged to me that he or she executed the same as the
act and deed of said firm for the uses and purposes therein mentioned.

Sched. C-2

 

 

SCHEDULE 1A TO COLLATERAL
ASSIGNMENT FOR SECURITY

(COPYRIGHTS AND COPYRIGHT
APPLICATIONS)

Copyrights and Copyright Applications owned

by QuadraMed
Corporation:

Sched. C-3exv10w01

 

EXHIBIT 10.01

Campbell Fund Trust

ADVISORY AGREEMENT

     This Agreement made as of the 1st day of January, 1997 among Campbell Fund
Trust, a Delaware business trust (the “Trust”), and Campbell & Company, Inc.
(the “Managing Operator”).

W I T N E S S E T H:

     THAT, WHEREAS, the Managing Operator has caused the Trust to be formed as
a Delaware business trust for the purposes of speculative buying, selling,
trading, and generally dealing in futures contracts, forward contracts, and
related options (collectively referred to as “commodity interests”); and

     WHEREAS, the Trust and the Managing Operator are fully cognizant of the
high risks involved in trading commodity interests; and

     WHEREAS, the Trust and the Managing Operator are, pursuant to the
Declaration of Trust and Trust Agreement establishing the Trust (the “Trust
Agreement”), authorized to utilize the services of one or more professional
commodity trading advisors in connection with the commodity trading activities
of the Trust; and

     WHEREAS, the Trust and the Managing Operator have determined to utilize
the Managing Operator to render commodity trading services to the Trust and
wish to enter into this Agreement in order to set forth the terms and
conditions upon which the Managing Operator will render and implement commodity
management services in connection with the conduct by the Trust of its
commodity trading activities during the term of this Agreement;

     NOW, THEREFORE, the parties agree as follows:

     1.     ADVISORY DUTIES. As of January 1, 1997 and until termination of this
Agreement, the Managing Operator shall have sole authority and responsibility
for directing the investment and reinvestment in commodity interests of the
Trust’s assets. The Managing Operator will determine the trades in commodity
interests on behalf of the Trust in accordance with the Trust’s Offering
Memorandum. All purchases and sales of commodity interests shall be for the
account and at the risk of the Trust. All brokerage and floor commissions and
fees, option premiums, and other transaction costs and expenses incurred in
connection with transactions by and for the Trust shall be charged to the
Trust. The Managing Operator shall receive a Commodity Trading Authorization
appointing it the Trust’s agent and attorney-in-fact for such purpose. The
Chicago Corporation is currently the Trust’s clearing broker (the “Commodity
Broker”), although the Managing Operator may select an additional or
replacement Commodity Broker if it deems such action to be in the best interest
of the Trust.

     2.     INDEPENDENCE OF THE MANAGING OPERATOR. When acting as the Trust’s
trading advisor, the Managing Operator is an independent contractor and, unless
otherwise expressly provided herein or authorized in writing, shall have no
authority to act for or represent the Trust in any way, and shall not otherwise
be deemed an agent of the Trust.

     3.     COMPENSATION. The Trust will pay the Managing Operator a monthly
management fee and a quarterly incentive fee as follows:

     (a)     Management Fee. The Managing Operator will receive a monthly
management fee to 1/12 of 4% of the Trust’s month-end Net Assets (approximately
4% per year).

 

     (b)     Performance Fee. The Managing Operator will receive a performance fee
equal to 20% of the aggregate quarterly cumulative appreciation in the Net
Asset Value of the Units. The performance fee will be paid only on profits
from commodity trading attributable to Units outstanding, and no fee will be
paid with respect to interest income. Units which are redeemed other than at
the end of the quarter will pay a performance fee, if any would otherwise be
due, as of the end of the month in which the redemption occurs. If any payment
is made by the Trust in respect of a performance fee, and the Trust thereafter
incurs a net loss, the Managing Operator will retain the amount previously
paid.

     If Unit value during a quarter declines, no performance fees shall be
payable until the Unit value rises at least to the Unit level when the
preceding performance fee was paid. To the extent any Units are redeemed at a
loss, any loss attributed to the redeemed Units shall not be carried forward to
reduce future appreciation in Unit value.

     If this Agreement shall be terminated other than at the end of a period
when a fee is otherwise payable, performance fees shall be calculated as if
such termination date were the end of the quarter and the management fee shall
be prorated based on the number of trading days for which services were
rendered divided by the total number of trading days in such month. Fees shall
be paid within 10 days after the date on which they are earned.

     Neither the Managing Operator nor its principals or employees shall
receive any per-transaction compensation, remuneration or payments whatsoever
from any broker with whom the Trust carries an account for any transactions
executed in the Trust’s account.

     4.     RIGHT TO ADVISE OTHERS. The advisory services provided hereunder are
not to be deemed exclusive. The Trust acknowledges that the Managing Operator
will render advisory, consulting and management services to other clients,
which may be charged different fees from those charged the Trust. The Managing
Operator shall be free to advise others and manage other commodity accounts as
well as trade for proprietary accounts during the term of this Agreement and to
use the same or different information and trading methods and strategies which
the Managing Operator obtains, produces or utilizes in the performance of
services for the Trust, and the Managing Operator shall be free to compete for
the same commodity interests as the Trust or to take positions in commodity
interests which are the same as or opposite to the Trust’s positions on behalf
of the Managing Operator and/or any other account advised, managed, or traded
by the Managing Operator.

     However, the Managing Operator warrants that the rendering of such
consulting, advisory and management services to other commodity futures trading
accounts and entities will not materially impair the discharge of the Managing
Operator’s responsibilities under this Agreement and that the Managing Operator
will not knowingly and deliberately favor other client accounts over the Trust.
The Trust agrees that the Managing Operator shall not be deemed to be favoring
another account over the Trust’s account for purposes of this Agreement where
the Managing Operator acts as described in the preceding paragraph and in the
Prospectus. If the Managing Operator’s trading recommendations for the Trust
are altered because of the application of speculative limits to the Trust’s
positions as a result of the trading activities of the Managing Operator, it
will not modify the trading instructions to the Trust in such manner as to
materially affect the Trust disproportionately compared with other client
accounts.

     5.     TERM. This Agreement shall continue in effect for twelve-month terms
beginning as of the date hereof, or until its earlier termination as provided
herein or upon (i) withdrawal of the Managing Operator either as trading
advisor or Managing Operator of the Trust or (ii) the termination of the Trust
as provided in the Trust Agreement. The Trust may terminate this Agreement as
of the end of each twelve-month term on 60 days’ prior written notice or upon
written notice if (i) the Managing Operator’s registration as a commodity
trading advisor or membership in NFA is terminated or suspended; or (ii) the
Managing Operator materially breaches this Agreement.

-2-

 

     6.     STANDARD OF LIABILITY AND INDEMNITIES.

          (a)     In acting as trading advisor, the Managing Operator shall not be
liable to the Trust, or any of its or their successors or assigns,
except that
the Managing Operator shall be liable in such capacity to the Trust for losses,
damages, costs, and expenses sustained by the Trust, or any of its successors
or assigns as a result of (i) acts or omissions of the Managing Operator with
respect to the Trust which constitute negligence or misconduct; (ii) a material
breach by the Managing Operator of this Agreement; and (iii) a misleading or
untrue statement of a material fact or omission to state a material fact
relating to or concerning the Managing Operator in its capacity as trading
advisor contained in the Offering Memorandum.

          (b)     The Managing Operator shall indemnify, defend, and hold harmless the
Trust from and against any and all losses, claims, damages, liabilities, costs,
and expenses sustained by the Trust (including in connection with the defense
or settlement of claims and in connection with any administrative proceedings),
to the extent and only to the extent that the Managing Operator is liable to
the Trust pursuant to the standard in Section 6(a) above. The Managing
Operator shall also reimburse any legal and other expenses reasonably incurred
by the Trust in connection with investigating or defending any loss, claim,
damage, liability, cost, or expense covered by this indemnity.

     7.     REPRESENTATIONS AND WARRANTIES. The Managing Operator represents and
warrants that:

     (a)     it has full capacity and authority to enter into this Agreement, and
to provide the services required hereunder;

     (b)     it will not, by acting as trading advisor to the Trust, breach any
undertaking, agreement, contract, statute, rule or regulation to which it is a
party or by which it is bound which would limit or materially affect the
performance of its duties under this Agreement;

     (c)     it is duly registered as a commodity trading advisor and commodity
pool operator under the Commodity Exchange Act (the “CEA”) and is a member of
the National Futures Association (the “NFA”) in such capacities and it will
maintain and renew such registration and membership during the term of this
Agreement;

     (d)     all of the information in the Offering Memorandum concerning the
Managing Operator, including but not limited to the Managing Operator’s
composite performance records and notes thereto, is complete, true and accurate
in all material respects and complies in all material respects with the CEA and
the rules thereunder and the rules of the NFA provided the statement or
omission was in conformity with information furnished by the Managing Operator
for use therein;

     (e)     it will promptly provide to the Trust the most current version of its
Commodity Trading Advisor Disclosure Document and any amendments thereto upon
request; and

     (f)     the within representations and warranties shall be continuing during
the term of this Agreement and, if, at any time, any event has occurred which
would make any of the foregoing not materially true, the Managing Operator will
promptly notify the Trust.

     8.     NO GUARANTEE OF PERFORMANCE. The Managing Operator makes no promises,
representations, warranties or guarantees that any of its trading services to
be rendered to the Trust will result in a profit or will not result in a loss
to the Trust.

     9.     COMPLETE AGREEMENT. This Agreement constitutes the entire agreement
between the parties, and no other agreement as to the matters referred to
herein, verbal or otherwise, shall be binding upon the parties hereto.

-3-

 

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

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

     12.     SUCCESSORS. This Agreement shall be binding upon and inure to the
benefit of the parties hereto, their permitted successors and assigns.

     13.     SURVIVAL OF CERTAIN TERMS. The Trust’s obligation to pay fees to the
Managing Operator for services rendered prior to any termination of this
Agreement pursuant to Section 3 and the indemnities set forth in Section 6
shall survive any termination of this Agreement.

     14.     NOTICES. All notices required or desired to be delivered under this
Agreement shall be delivered personally, by telex, telecopier or other means of
electronic communication, or by registered or certified mail, postage prepaid,
return receipt requested, as follows:

	If to the Trust:	Campbell Fund Trust

c/o Campbell & Company, Inc.

Court Towers Building

210 West Pennsylvania Avenue

Baltimore, Maryland 21204

	 
	If to the Managing Operator:	Campbell & Company, Inc.

Court Towers Building

210 West Pennsylvania Avenue

Baltimore, Maryland 21204

	Copies to:	Michael J. Schmidtberger

Sidley & Austin

875 Third Avenue

New York, NY 10022

All notices required or desired to be delivered under this Agreement shall be
deemed delivered and received by the party to whom a notice is addressed upon
such party’s actual receipt of such notice.

     15.     GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.

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

	 	CAMPBELL FUND TRUST

	 	By: Campbell & Company, Inc.

          the Managing Operator

	 	By:
     /s/  Bruce L. Cleland                                                            

	 	CAMPBELL & COMPANY, INC.

	 	By:
     /s/  Bruce L. Cleland                                                            

-4-

 

January 1, 1997

Campbell & Company, Inc.

Court Towers Building

210 West Pennsylvania Avenue

Baltimore, Maryland 21204

     Re:
Commodity Trading Authorization

Gentlemen:

     Campbell Fund Trust, a Delaware business trust, does hereby make,
constitute and appoint you as its Attorney-in-Fact to purchase and sell
commodity interests, including commodity futures contracts, through The Chicago
Corporation, as commodity broker, or such other commodity broker as you shall
select from time to time, in accordance with the Advisory Agreement between us
dated as of the above date.

	 	Very truly yours,

	 	CAMPBELL FUND TRUST

	 	By: Campbell & Company, Inc.

          the Managing Operator

	 	By:
     /s/ Bruce L. Cleland                                                       

-5-

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