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Great
American
Insurance
Group
Administrative Offices
Administrative Offices
580
Walnut Street
Cincinnati,
Ohio 45202
Tel:
1-513-369-5000
TSB
5062b
(Ed. 10
87)
FINANCIAL INSTITUTION
BOND
Standard
Form No. 14, Revised to October, 1987
Bond No. FS
379-29-05-03
GREAT
AMERICAN INSURANCE COMPANY
(Herein
called Underwriter)
Declarations
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Item 1.
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Name
of Insured (herein called Insured):
|
Special
Value Opportunities Fund, LLC
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|
Principal
Address:
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2951
28th
Street, Suite 1000
Santa
Monica, CA 90405
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Item 2.
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Bond
Period: from 12:01 a.m. on 08/31/2009 (month, day, year) to 12:01 a.m.
on 08/31/2010 (month, day, year) standard time.
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Item 3.
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The
aggregate liability of the Underwriter during the Bond Period shall be
$5,000,000
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Item 4.
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Subject
to Sections 4. and 11. hereof,
The
Single Loss Limit of Liability
is $5,500,000
and
the Single Loss Deductible
is
$50,000
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|
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Provided,
however, that if any amounts are inserted below opposite specified
Insuring Agreements or Coverage, those amounts shall be controlling. Any
amount set forth below shall be part of and not in addition to amounts set
forth above. (If an Insuring Agreement or Coverage is to be deleted,
insert “Not Covered.”)
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|
Amount
applicable to:
|
||||||||
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Single Loss
Limit of Liability
|
Single Loss
Deductible
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|||||||
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|||||||
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Insuring
Agreement (D) - Forgery Or
Alteration
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$
|
5,500,000
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$
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50,000
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||||
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Insuring
Agreement (E) - Securities
|
$
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5,500,000
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$
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50,000
|
||||
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Coverage
on Partners
|
Not
Covered
|
N/A
|
||||||
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Optional
Insuring Agreements and Coverages:
|
$
|
$
|
||||||
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SEE
RIDER NO. 1
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||||
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If
“Not Covered” is inserted above opposite any specified Insuring Agreement
or Coverage, such Insuring Agreement or Coverage and any other reference
thereto in this bond shall be deemed to be deleted
therefrom.
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|
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Item 5.
|
The
liability of the Underwriter is subject to the terms of the riders
attached hereto and listed on RIDER NO.
1
|
|
Item 6.
|
The
Insured by the acceptance of this bond gives notice to the Underwriter
terminating or canceling prior bond(s) or policy(ies) No.(s) FS
379-29-05-02 such termination or cancellation to be effective as of
the time this bond becomes
effective.
|
|
Date:
10-9-07
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 |
(Page 1
of 16)
The
Underwriter, in consideration of an agreed premium, and in reliance upon all
statements made and information furnished to the Underwriter by the insured in
applying for this bond, and subject to the Declarations, Insuring Agreements,
General Agreements, Conditions and Limitations and other terms hereof, agrees to
indemnify the Insured for:
INSURING
AGREEMENTS
Fidelity
(A)
Loss
resulting directly from dishonest or fraudulent acts committed by an Employee
acting alone or in collusion with others.
Such
dishonest or fraudulent acts must be committed by the Employee with the manifest
intent:
(a)
to cause
the Insured to sustain such loss; and
(b)
to obtain
financial benefit for the Employee and which, in fact, result in obtaining such
benefit.
As used
in this Insuring Agreement, financial benefit does not include any employee
benefits earned in the normal course of employment, including salaries,
commissions, fees, bonuses, promotions, awards, profit sharing or
pensions.
On Premises
(B)
(1)
Loss of
Property resulting directly from
(a)
robbery,
burglary, misplacement, mysterious unexplainable disappearance and damage
thereto or destruction thereof, or
(b)
theft,
false pretenses, common-law or statutory larceny, committed by a person present
in an office or on the premises of the Insured.
(2)
Loss of
or damage to
(a)
furnishings,
fixtures, supplies or equipment within an office of the Insured covered under
this bond resulting directly from larceny or theft in, or by burglary or robbery
of, such office, or attempt thereat, or by vandalism or malicious mischief,
or
(b)
such
office resulting from larceny or theft in, or by burglary or robbery of such
office or attempt thereat, or to the interior of such office or attempt thereat,
or to the interior of such office by vandalism or malicious
mischief,
provided
that
(i)
the
Insured is the owner of such furnishings, fixtures, supplies, equipment, or
office or is liable for such loss of damage, and
(ii)
the loss
is not caused by fire.
(Page 2
of 16)
In Transit
(C)
Loss of
Property resulting directly from robbery, common-law or statutory larceny,
theft, misplacement, mysterious unexplainable disappearance, being lost or made
away with, and damage thereto or destruction thereof, while the Property is in
transit anywhere in the custody of
(a)
a natural
person acting as a messenger of the Insured (or another natural person acting as
messenger or custodian during an emergency arising from the incapacity of the
original messenger), or
(b)
a
Transportation Company and being transported in an armored motor vehicle,
or
(c)
a
Transportation Company and being transported in a conveyance other than an
armored motor vehicle provided that covered Property transported in such manner
is limited to the following:
(i)
records,
whether recorded in writing or electronically, and
(ii)
Certificated
Securities issued in registered form and not endorsed, or with restrictive
endorsements, and
(iii)
Negotiable
instruments not payable to bearer, or not endorsed, or with restrictive
endorsements.
Coverage
under this Insuring Agreement begins immediately upon the receipt of such
Property by the natural person or Transportation Company and ends immediately
upon delivery to the designated recipient or its agent.
Forgery Or
Alteration
(D)
Loss
resulting directly from
(1)
Forgery
or alteration of, on or in any Negotiable Instrument (except an Evidence of
Debt), Acceptance, Withdrawal Order, receipt for the withdrawal of Property,
Certificate of Deposit or Letter of Credit,
(2)
transferring,
paying or delivering any funds or Property or establishing any credit or giving
any value on the faith of any written instructions or advices directed to the
Insured and authorizing or acknowledging the transfer, payment, delivery or
receipt of funds or Property, which instructions or advices purport to have been
signed or endorsed by any customer of the Insured or by any financial
institution but which instructions or advices either bear a signature which is a
Forgery or have been altered without the knowledge and consent of such customer
or financial institution.
A
mechanically reproduced facsimile signature is treated the same as a handwritten
signature.
Securities
(E)
Loss
resulting directly from the Insured having, in good faith, for its own account
or for the account of others,
(1)
acquired,
sold or delivered, or given value, extended credit or assumed liability, on the
faith of, any original
(a)
Certificated
Security,
(b)
deed,
mortgage or other instrument conveying title to, or creating or discharging a
lien upon, real property,
(c)
Evidence
of Debt,
(Page 3
of 16)
(d)
Instruction
to a Federal Reserve Bank of the United States, or
(e)
Statement
of Uncertificated Security of any Federal Reserve Bank of the United
States
which
(i)
bears a
signature of any maker, drawer, issuer, endorser, assignor, lessee, transfer
agent, registrar, acceptor, surety, guarantor, or of any person signing in any
other capacity which is a Forgery, or
(ii)
is
altered, or
(iii)
is lost
or stolen;
(2)
guaranteed
in writing or witnessed any signature upon any transfer, assignment, bill of
sale, power of attorney, Guarantee, or any items listed in (a) through (c)
above;
(3)
acquired,
sold or delivered, or given value, extended credit or assumed liability, on the
faith of any item listed in (a) and (b) above which is a
Counterfeit.
A
mechanically reproduced facsimile signature is treated the same as a handwritten
signature.
Counterfeit
Currency
(F)
Loss
resulting directly from the receipt by the Insured, in good faith, of any
Counterfeit Money of the United States of America, Canada or of any other
country in which the Insured maintains a branch office.
GENERAL
AGREEMENTS
Nominees
A.
Loss
sustained by any nominee organized by the Insured for the purpose of handling
certain of its business transactions and composed exclusively of its Employees
shall, for all the purposes of this bond and whether or not any partner of such
nominee is implicated in such loss, be deemed to be loss sustained by the
Insured.
Additional Offices Or Employees -
Consolidation,
Merger Or Purchase Of Assets -
Notice
B.
If the
Insured shall, while this bond is in force, establish any additional offices,
other than by consolidation or merger with, or purchase or acquisition of assets
or liabilities of, another institution, such offices shall be automatically
covered hereunder from the date of such establishment without the requirement of
notice to the Underwriter or the payment of additional premium for the remainder
of the premium period.
If the
Insured shall, while this bond is in force, consolidate or merge with, or
purchase or acquire assets or liabilities of, another institution, the Insured
shall not have such coverage as is afforded under this bond for loss
which
(a)
has
occurred or will occur in offices or premises, or
(b)
has been
caused or will be caused by an employee or employees of such institution,
or
(c)
has
arisen or will arise out of the assets or liabilities acquired by the Insured as
a result of such consolidation, merger or purchase or acquisition of assets or
liabilities unless the Insured shall
(i)
give the
Underwriter written notice of the proposed consolidation, merger or purchase or
acquisition of assets or liabilities prior to the proposed effective date of
such action and
(Page 4
of 16)
(ii)
obtain
the written consent of the Underwriter to extend the coverage provided by this
bond to such additional offices or premises, Employees and other exposures,
and
(iii)
upon
obtaining such consent, pay to the Underwriter an additional
premium.
Change Of Control -
Notice
C.
When the
Insured learns of a change in control, it shall give written notice to the
Underwriter.
As used
in this General Agreement, control means the power to determine the management
or policy of a controlling holding company or the Insured by virtue of
voting-stock ownership. A change in ownership of voting-stock which results in
direct or indirect ownership by a stockholder or an affiliated group of
stockholders of ten percent (10%) or more of such stock shall be presumed to
result in a change of control for the purpose of the required
notice.
Failure
to give the required notice shall result in termination of coverage for any loss
involving a transferee, to be effective upon the date of the stock
transfer.
Representation Of
Insured
D.
The
Insured represents that the information furnished in the application for this
bond is complete, true and correct. Such application constitutes part of this
bond.
Any
misrepresentation omission, concealment or incorrect statement of a material
fact, in the application or otherwise, shall be grounds for the recession
of this bond.
Joint Insured
E.
If two or
more Insureds are covered under this bond, the first Named Insured shall act for
all Insureds. Payment by the Underwriter to the first Named Insured of loss
sustained by any Insured shall fully release the Underwriter on account of such
loss. If the first Named Insured ceases to be covered under this bond, the
Insured next named shall thereafter be considered as the first Named Insured.
Knowledge possessed or discovery made by any Insured shall constitute knowledge
or discovery by all Insureds for all purposes of this bond. The liability of the
Underwriter for loss or losses sustained by all Insureds shall not exceed the
amount for which the Underwriter would have been liable had all such loss or
losses been sustained by one Insured.
Notice Of Legal Proceedings
Against Insured - Election To
Defend
F.
The
Insured shall notify the Underwriter at the earliest practicable moment, not to
exceed 30 days after notice thereof, of any legal proceeding brought to
determine the Insured’s liability for any loss, claim or damage, which, if
established, would constitute a collectible loss under this bond. Concurrently,
the Insured shall furnish copies of all pleadings and pertinent papers to the
Underwriter.
The
Underwriter, at its sole option, may elect to conduct the defense of such legal
proceeding, in whole or in part. The defense of the Underwriter shall be in the
Insured’s name through attorneys selected by the Underwriter. The Insured shall
provide all reasonable information and assistance required by the Underwriter
for such defense.
If the
Underwriter elects to defend the Insured, in whole or in part, any judgment
against the Insured on those counts or causes of action which the Underwriter
defended on behalf of the Insured or any settlement in which the Underwriter
participates and all attorneys’ fees, costs and expenses incurred by the
Underwriter in the defense of the litigation shall be a loss covered by this
bond.
If the
Insured does not give the notices required in Subsection (a) of Section 5. of
this bond and in the first paragraph of this General Agreement, or if the
Underwriter elects not to defend any causes of action, neither a judgment
against the Insured, nor a settlement of any legal proceeding by the Insured,
shall determine the existence, extent or amount of coverage under this bond for
loss sustained by the Insured, and the Underwriter shall not be liable for any
attorneys’ fees, costs and expenses incurred by the Insured.
(Page 5
of 16)
With
respect to this General Agreement, Subsections (b) and (d) of Section 5. of this
bond apply upon the entry of such judgment or the occurrence of such settlement
instead of upon discovery of loss. In addition, the Insured must notify the
Underwriter within 30 days after such judgment is entered against it or after
the Insured settles such legal proceeding, and subject to Subsection (e) of
Section 5., the Insured may not bring legal proceedings for the recovery of such
loss after the expiration of 24 months from the date of such final judgment or
settlement.
CONDITIONS AND
LIMITATIONS
Definitions
Section
1. As used in this bond:
(a)
Acceptance
means a draft which the drawee has, by signature written thereon, engaged to
honor as presented.
(b)
Certificate
of Deposit means an acknowledgment in writing by a financial institution of
receipt of Money with an engagement to repay it.
(c)
Certificated
Security means a share, participation or other interest in property of or an
enterprise of the issuer or an obligation of the issuer, which is:
(1)
represented
by an instrument issued in bearer or registered form;
(2)
of a type
commonly dealt in on securities exchanges or markets or commonly recognized in
any area in which it is issued or dealt in as a medium for investment;
and
(3)
either
one of a class or series or by its terms divisible into a class or series of
shares, participations, interests or obligations.
(d)
Counterfeit
means an imitation of an actual valid original which is intended to deceive and
to be taken as the original.
(e)
Employee
means:
(1)
a natural
person in the service of the Insured at any of the Insured’s offices or premises
covered hereunder whom the Insured compensates directly by salary or commissions
and whom the Insured has the right to direct and control while performing
services for the Insured;
(2)
an
attorney retained by the Insured and an employee of such attorney while either
is performing legal services for the Insured;
(3)
a person
provided by an employment contractor to perform employee duties for the Insured
under the Insured’s supervision at any of the Insured’s offices or premises
covered hereunder; and a guest student pursuing studies or duties in any of said
offices or premises;
(4)
an
employee of an institution merged or consolidated with the Insured prior to the
effective date of this bond;
(5)
each
natural person, partnership or corporation authorized by the Insured to perform
services as data processor of checks or other accounting records of the Insured
(not including preparation or modification of computer software or programs),
herein called Processor. (Each such Processor, and the partners, officers and
employees of such Processor shall, collectively, be deemed to be one Employee
for all the purposes of this bond, excepting, however, the second paragraph of
Section 12. A Federal Reserve Bank or clearing house shall not be construed to
be a processor.) and
(Page 6
of 16)
(6)
a Partner
of the Insured, unless not covered as stated in Item 4. of the
Declarations.
(f)
Evidence
of Debt means an instrument, including a Negotiable Instrument, executed by a
customer of the Insured and held by the Insured which in the regular course of
business is treated as evidencing the customer’s debt to the
Insured.
(g)
Financial
Interest in the Insured of the Insured’s general partner(s), or limited
partner(s), committing dishonest or fraudulent acts covered by this bond or
concerned or implicated therein means:
(1)
as
respects general partners the value of all right, title and interest of such
general partner(s), determined as of the close of business on the date of
discovery of loss covered by this bond, in the aggregate of:
(a)
the “net
worth” of the Insured, which for the purposes of this bond, shall be deemed to
be the excess of its total assets over its total liabilities, without adjustment
to give effect to loss covered by this bond, (except that credit balances and
equities in proprietary accounts of the Insured, which shall include capital
accounts of partners, investment and trading accounts of the
Insured, participations of the Insured in joint accounts, and accounts of
partners which are covered by agreements providing for the inclusion of equities
therein as partnership property, shall not be considered as liabilities) with
securities, spot commodities, commodity future contracts in such proprietary
accounts and all other assets marked to market or fair value and with adjustment
for profits and losses at the market of contractual commitments for such
proprietary accounts of the Insured; and
(b)
the value
of all other Money, securities and property belonging to such general
partner(s), or in which such general partner(s) have a pecuniary interest, held
by or in the custody of and legally available to the Insured as set off against
loss covered by this bond;
provided,
however, that if such “net worth” adjusted to give effect to loss covered by
this bond and such value of all other Money, securities and property as set
forth in (g)(1)(b) preceding, plus the amount of coverage afforded by this bond
on account of such loss, is not sufficient to enable the Insured to meet its
obligations, including its obligations to its partners other than to such
general partner(s), then the Financial Interest in the Insured, as above
defined, of such general partner(s) shall be reduced in an amount necessary, or
eliminated if need be, in order to enable the Insured upon payment of loss under
this bond to meet such obligations, to the extent that such payment will enable
the Insured to meet such obligations, without any benefit accruing to such
general partner(s) from such payment; and
(2)
as
respects limited partners the value of such limited partners(’) investment in
the Insured.
(h)
Forgery
means the signing of the name of another person or organization with intent to
deceive; it does not mean a signature which consists in whole or in part of
one’s own name signed with or without authority, in any capacity, for any
purpose.
(i)
Guarantee
means a written undertaking obligating the signer to pay the debt of another to
the Insured or its assignee or to a financial institution from which the Insured
has purchased participation in the debt, if the debt is not paid in accordance
with its terms.
(j)
Instruction
means a written order to the issuer of an Uncertificated Security requesting
that the transfer, pledge, or release from pledge, of the Uncertificated
Security specified be registered.
(Page 7
of 16)
(k)
Letter of
Credit means an engagement in writing by a bank or other person made at the
request of a customer that the bank or other person will honor drafts or other
demands for payment upon compliance with the conditions specified in the Letter
of Credit.
(l)
Money
means a medium of exchange in current use authorized or adopted by a domestic or
foreign government as a part of its currency.
(m)
Negotiable
Instrument means any writing
(1)
signed by
the maker or drawer; and
(2)
containing
any unconditional promise or order to pay a sum certain in Money and no other
promise, order, obligation or power given by the maker or drawer;
and
(3)
is
payable on demand or at a definite time; and
(4)
is
payable to order or bearer.
(n)
Partner
means a natural person who
(1)
is a
general partner of the Insured, or
(2)
is a
limited partner and an Employee (as defined in Section 1.(e)(1) of the bond) of
the Insured.
(o)
Property
means Money, Certificated Securities, Uncertificated Securities of any Federal
Reserve Bank of the United States, Negotiable Instruments, Certificates of
Deposit, documents of title, Acceptances, Evidences of Debt, security
agreements, Withdrawal Orders, certificates of origin or title, Letters of
Credit, insurance policies, abstracts of title, deeds and mortgages on real
estate, revenue and other stamps, tokens, unsold state lottery tickets, books of
account and other records whether recorded in writing or electronically, gems,
jewelry, precious metals of all kinds and in any form, and tangible items of
personal property which are not hereinbefore enumerated.
(p)
Statement
of Uncertificated Security means a written statement of the issuer of an
Uncertificated Security containing:
(1)
a
description of the Issue of which the Uncertificated Security is a
part;
(2)
the
number of shares or units;
(a)
transferred
to the registered owner;
(b)
pledged
by the registered owner to the registered pledgee;
(c)
released
from pledge by the registered pledgee;
(d)
registered
in the name of the registered owner on the date of the statement;
or
(e)
subject
to pledge on the date of the statement;
(3)
the name
and address of the registered owner and registered pledgee;
(4)
a
notation of any liens and restrictions of the issuer and any adverse claims to
which the Uncertificated Security is or may be subject or a statement that there
are none of those liens, restrictions or adverse claims; and
(Page 8
of 16)
(5)
the
date:
(a)
the
transfer of the shares or units to the new registered owner of the shares or
units was registered;
(b)
the
pledge of the registered pledgee was registered, or
(c)
of the
statement, if it is a periodic or annual statement.
(q)
Transportation
Company means any organization which provides its own or leased vehicles for
transportation or which provides freight forwarding or air express
services.
(r)
Uncertificated
Security means a share, participation or other interest in property of or an
enterprise of the issuer or an obligation of the issuer, which is:
(1)
not
represented by an instrument and the transfer of which is registered upon books
maintained for that purpose by or on behalf of the issuer;
(2)
of a type
commonly dealt in on securities exchanges or markets; and
(3)
either
one of a class or series or by its terms divisible into a class or series of
shares, participations, interests or obligations.
(s)
Withdrawal
Order means a non-negotiable instrument, other than an instruction, signed by a
customer of the Insured authorizing the Insured to debit the customer’s account
in the amount of funds stated therein.
Exclusions
Section
2. This bond does not cover:
(a)
loss
resulting directly or indirectly from forgery or alteration, except when covered
under Insuring Agreements (A), (D) or (E);
(b)
loss due
to riot or civil commotion outside the United States of America and Canada; or
loss due to military, naval or usurped power, war or insurrection unless such
loss occurs in transit in the circumstances recited in Insuring Agreement (C),
and unless, when such transit was initiated, there was no knowledge of such
riot, civil commotion, military, naval or usurped power, war or insurrection on
the part of any person acting for the Insured in initiating such
transit;
(c)
loss
resulting directly or indirectly from the effects of nuclear fission or fusion
or radioactivity; provided, however, that this paragraph shall not apply to loss
resulting from industrial uses of nuclear energy;
(d)
loss
resulting from any act or acts of any person who is a member of the Board of
Directors of the Insured or a member of any equivalent body by whatsoever name
known unless such person is also an Employee or an elected official of the
Insured in some other capacity, nor, in any event, loss resulting from the act
or acts of any person while acting in the capacity of a member of such Board or
equivalent body;
(e)
loss
resulting directly or indirectly from the complete or partial nonpayment of, or
default upon, any loan or transaction involving the Insured as a lender or
borrower, or extension of credit, including the purchase, discounting or other
acquisition of false or genuine accounts, invoices, notes, agreements or
Evidences of Debt, whether such loan, transaction or extension was procured in
good faith or through trick, artifice, fraud or false pretenses; except when
covered under Insuring Agreements (A), (D) or (E);
(Page 9
of 16)
(f)
loss
resulting from any violation by the Insured or by any Employee
(1)
of law
regulating (i) the issuance, purchase or sale of securities, (ii) securities
transactions upon security exchanges or over the counter market, (iii)
investment companies, or (iv) investment advisers, or
(2)
of any
rule or regulation made pursuant to any such law, unless it is established by
the Insured that the act or acts which caused the said loss involved fraudulent
or dishonest conduct which would have caused a loss to the Insured in a similar
amount in the absence of such laws, rules or regulations;
(g)
loss
resulting directly or indirectly from the failure of a financial or depository
institution, or its receiver or liquidator, to pay or deliver, on demand of the
Insured, funds or Property of the Insured held by it in any capacity, except
when covered under Insuring Agreements (A) or (B) (1) (a);
(h)
loss
caused by an Employee, except when covered under Insuring Agreement (A) or when
covered under Insuring Agreement (B) or (C) and resulting directly from
misplacement, mysterious unexplainable disappearance or destruction of or damage
to Property;
(i)
loss
resulting directly or indirectly from transactions in a customer’s account,
whether authorized or unauthorized, except the unlawful withdrawal and
conversion of Money, securities or precious metals, directly from a customer’s
account by an Employee provided such unlawful withdrawal and conversion is
covered under Insuring Agreement (A);
(j)
damages
resulting from any civil, criminal or other legal proceeding in which the
Insured is alleged to have engaged in racketeering activity except when the
Insured establishes that the act or acts giving rise to such damages were
committed by an Employee under circumstances which result directly in a loss to
the Insured covered by Insuring Agreement (A). For the purposes of this
exclusion, “racketeering activity” is defined in 18 United States Code 1961 et
seq., as amended.
(k)
loss
resulting directly or indirectly from the use or purported use of credit, debit,
charge, access, convenience, identification, cash management or other
cards
(1)
in
obtaining credit or funds, or
(2)
in
gaining access to automated mechanical devices which, on behalf of the Insured,
disburse Money, accept deposits, cash checks, drafts or similar written
instruments or make credit card loans, or
(3)
in
gaining access to point of sale terminals, customer bank communication
terminals, or similar electronic terminals of electronic funds transfer
systems.
whether
such cards were issued, or purport to have been issued, by the Insured or by
anyone other than the Insured, except when covered under Insuring Agreement
(A);
(I)
loss
involving automated mechanical devices which, on behalf of the Insured, disburse
Money, accept deposits, cash checks, drafts or similar written instruments or
make credit card loans, except when covered under Insuring Agreement
(A);
(m)
loss
through the surrender of Property away from an office of the Insured as a result
of a threat
(1)
to do
bodily harm to any person, except loss of Property in transit in the custody of
any person acting as messenger provided that when such transit was initiated
there was no knowledge by the Insured of any such threat, or
(2)
to do
damage to the premises of property of the Insured, except when covered under
Insuring Agreement (A);
(Page 10
of 16)
(n)
loss
resulting directly or indirectly from payments made or withdrawals from a
depositor’s or customer’s account involving erroneous credits to such account,
unless such payments or withdrawals are physically received by such depositor or
customer or representative of such depositor or customer who is within the
office of the Insured at the time of such payment or withdrawal, or except when
covered under Insuring Agreement (A);
(o)
loss
involving items of deposit which are not finally paid for any reason, including
but not limited to Forgery or any other fraud, except when covered under
Insuring Agreement (A);
(p)
loss
resulting directly or indirectly from counterfeiting, except when covered under
Insuring Agreements (A), (E) or (F);
(q)
loss of
any tangible item of personal property which is not specifically enumerated in
the paragraph defining Property if such property is specifically insured by
other insurance of any kind and in any amount obtained by the Insured, and in
any event, loss of such property occurring more than 60 days after the Insured
takes possession of such property, except when covered under Insuring Agreements
(A) or (B)(2);
(r)
loss of
Property while
(1)
in the
mail, or
(2)
in the
custody of any Transportation Company, unless covered under Insuring Agreement
(C),
except
when covered under Insuring Agreement (A);
(s)
potential
income, including but not limited to interest and dividends, not realized by the
Insured or by any customer of the Insured;
(t)
damages
of any type for which the Insured is legally liable, except compensatory
damages, but not multiples thereof, arising directly from a loss covered under
this bond;
(u)
all fees,
costs and expenses incurred by the Insured
(1)
in
establishing the existence of or amount of loss covered under this bond,
or
(2)
as a
party to any legal proceeding whether or not such legal proceeding exposes the
Insured to loss covered by this bond;
(v)
indirect
or consequential loss of any nature;
(w)
loss
involving any Uncertificated Security except an Uncertificated Security of any
Federal Reserve Bank of the United States or when covered under Insuring
Agreement (A);
(x)
loss
resulting directly or indirectly from any dishonest or fraudulent act or acts
committed by any non-Employee who is a securities, commodities, money, mortgage,
real estate, loan, insurance, property management, investment banking broker,
agent or other representative of the same general character;
(y)
loss
caused directly or indirectly by a Partner of the Insured unless the amount of
such loss exceeds the Financial Interest in the Insured of such Partner and the
Deductible Amount applicable to this bond, and then for the excess
only;
(z)
loss
resulting directly or indirectly from any actual or alleged representation,
advice, warranty or guarantee as to the performance of any
investments;
(Page 11
of 16)
(aa)
loss due
to liability imposed upon the Insured as a result of the unlawful disclosure of
non-public material information by the Insured or any Employee, or as a result
of any Employee acting upon such information, whether authorized or
unauthorized.
Discovery
Section
3. This bond applies to loss discovered by the Insured during the Bond Period.
Discovery occurs when the Insured first becomes aware of facts which would cause
a reasonable person to assume that a loss of a type covered by this bond has
been or will be incurred, regardless of when the act or acts causing or
contributing to such loss occurred, even though the exact amount or details of
loss may not then be known.
Discovery
also occurs when the Insured receives notice of an actual or potential claim in
which it is alleged that the Insured is liable to a third party under
circumstances which, if true, would constitute a loss under this
bond.
LIMIT OF
LIABILITY
Section
4.
Aggregate Limit Of
Liability
The
Underwriter’s total liability for all losses discovered during the Bond Period
shown in Item 2. of the Declarations shall not exceed the Aggregate Limit of
Liability shown in item 3 of the Declarations. The Aggregate Limit of Liability
shall be reduced by the amount of any payment made under the terms of this
bond.
Upon
exhaustion of the Aggregate Limit of Liability by such payments:
(a)
The
Underwriter shall have no further liability for loss or losses regardless of
when discovered and whether or not previously reported to the Underwriter,
and
(b)
The
Underwriter shall have no obligation under General Agreement F to continue the
defense of the Insured, and upon notice by the Underwriter to the Insured that
the Aggregate Limit of Liability has been exhausted, the Insured shall assume
all responsibility for its defense at its own cost.
The
Aggregate Limit of Liability shall not be increased or reinstated by any
recovery made and applied in accordance with subsections (a), (b) and (c) of
Section 7. In the event that a loss of Property is settled by the Underwriter
through the use of a lost instrument bond, such loss shall not reduce the
Aggregate Limit of Liability.
Single Loss Limit of
Liability
Subject
to the Aggregate Limit of Liability, the Underwriter’s liability for each Single
Loss shall not exceed the applicable Single Loss Limit of Liability shown in
Item 4 of the Declarations. If a Single Loss is covered under more than one
Insuring Agreement or Coverage, the maximum payable shall not exceed the largest
applicable Single Loss Limit of Liability.
Single Loss
Defined
Single
Loss means all covered loss, including court costs and attorneys’ fees incurred
by the Underwriter under General Agreement F., resulting from
(a)
any one
act or series or related acts of burglary, robbery or attempt thereat, in which
no Employee is implicated, or
(Page 12
of 16)
(b)
any one
act or series of related unintentional or negligent acts or omissions on the
part of any person (whether an Employee or not) resulting in damage to or
destruction or misplacement of Property, or
(c)
all acts
or omissions other than those specified in (a) and (b) preceding, caused by any
person (whether an Employee or not) or in which such person is implicated,
or
(d)
any one
casualty or event not specified in (a), (b) or (c) preceding.
NOTICE/PROOF - LEGAL PROCEEDINGS
AGAINST UNDERWRITER
Section
5.
(a)
At the
earliest practicable moment, not to exceed 30 days, after discovery of loss, the
Insured shall give the Underwriter notice thereof.
(b)
Within 6
months after such discovery, the Insured shall furnish to the Underwriter proof
of loss, duly sworn to, with full particulars.
(c)
Loss
Certificated Securities listed in a proof of loss shall be identified by
certificate or bond numbers if such securities were issued
therewith.
(d)
Legal
proceedings for the recovery of any loss hereunder shall not be brought prior to
the expiration of 60 days after the original proof of loss is filed with the
Underwriter or after the expiration of 24 months from the discovery of such
loss.
(e)
If any
limitation embodied in this bond is prohibited by any law controlling the
construction hereof, such limitation shall be deemed to be amended so as to
equal the minimum period of limitation provided by such law.
(f)
This bond
affords coverage only in favor of the Insured. No suit, action or legal
proceedings shall be brought hereunder by any one other than the named
Insured.
VALUATION
Section
6. Any loss of Money, or loss payable in Money, shall be paid, at the option of
the Insured, in the Money of the country in which the loss was sustained or in
the United States of America dollar equivalent thereof determined at the rate of
exchange at the time of payment of such loss.
Securities
The
Underwriter shall settle in kind its liability under this bond on account of a
loss of any securities or, at the option of the Insured, shall pay to the
Insured the cost of replacing such securities, determined by the market value
thereof at the time of such settlement. However, if prior to such settlement the
Insured shall be compelled by the demands of a third party or by market rules to
purchase equivalent securities, and gives written notification of this to the
Underwriter, the cost incurred by the Insured shall be taken as the value of
those securities. In case of a loss of subscription, conversion or redemption
privileges through the misplacement or loss of securities, the amount of such
loss shall be the value of such privileges immediately preceding the expiration
thereof. If such securities cannot be replaced or have no quoted market value,
or if such privileges have no quoted market value, their value shall be
determined by agreement or arbitration.
If the
applicable coverage of this bond is subject to a Deductible Amount and/or is not
sufficient in amount to indemnify the Insured in full for the loss of securities
for which claim is made hereunder, the liability of the Underwriter under this
bond is limited to the payment for, or the duplication of, so much of such
securities as has a value equal to the amount of such applicable
coverage.
(Page 13
of 16)
Books of Account and Other
Records
In case
of loss of, or damage to, any books of account or other records used by the
Insured in its business, the Underwriter shall be liable under this bond only if
such books or records are actually reproduced and then for not more than the
cost of the blank books, blank pages or other materials plus the cost of labor
for the actual transcription or copying of data which shall have been furnished
by the Insured in order to reproduce such books and other records.
Property Other Than Money, Securities
or Records
In case
of loss of, or damage to, any Property other than Money, securities, books of
account or other records, or damage covered under Insuring Agreement (B)(2), the
Underwriter shall not be liable for more than the actual cash value of such
Property, or of items covered under Insuring Agreement (B)(2). The Underwriter
may, at its election, pay the actual cash value of, replace or repair such
property. Disagreement between the Underwriter and the Insured as to the cash
value or as to the adequacy of repair or replacement shall be resolved by
arbitration.
Set-Off
Any loss
covered under this bond shall be reduced by a set-off consisting of any amount
owed to the Employee causing the loss if such loss is covered under Insuring
Agreement (A).
ASSIGNMENT - SUBROGATION - RECOVERY -
COOPERATION
Section
7.
(a)
In the
event of payment, under this bond, the Insured shall deliver, if so requested by
the Underwriter, an assignment of such of the Insured’s rights, title and
interest and causes of action as it has against any person or entity to the
extent of the loss payment.
(b)
In the
event of payment under this bond, the Underwriter shall be subrogated to all of
the Insured’s rights of recovery therefor against any person or entity to the
extent of such payment.
(c)
Recoveries,
whether effected by the Underwriter or by the Insured, shall be applied net of
the expense of such recovery first to the satisfaction of the Insured’s loss
which would otherwise have been paid but for the fact that it is in excess of
either the Single or Aggregate Limit of Liability, secondly, to the Underwriter
as reimbursement of amounts paid in settlement of the Insured’s claim, and
thirdly, to the Insured in satisfaction of any Deductible Amount. Recovery on
account of loss of securities as set forth in the second paragraph of Section 6
or recovery from reinsurance and/or indemnity of the Underwriter shall not be
deemed a recovery as used herein.
(d)
Upon the
Underwriter’s request and at reasonable times and places designated by the
Underwriter the Insured shall
(1)
submit to
examination by the Underwriter and subscribe to the same under oath;
and
(2)
produce
for the Underwriter’s examination all pertinent records; and
(3)
cooperate
with the Underwriter in all matters pertaining to the loss.
(e)
The
Insured shall execute all papers and render assistance to secure to the
Underwriter the rights and causes of action provided for herein. The Insured
shall do nothing after discovery of loss to prejudice such rights or causes of
action.
(Page 14
of 16)
LIMIT OF LIABILITY UNDER THIS BOND
AND PRIOR INSURANCE
Section
8. With respect to any loss set forth in Sub-section (c) of Section 4 of this
bond which is recoverable or recovered in whole or in part under any other bonds
or policies issued by the Underwriter to the Insured or to any predecessor in
interest of the Insured and terminated or canceled or allowed to expire and in
which the period for discovery has not expired at the time any such loss
thereunder is discovered, the total liability of the Underwriter under this bond
and under such other bonds or policies shall not exceed, in the aggregate, the
amount carried hereunder on such loss or the amount available to the Insured
under such other bonds or policies, as limited by the terms and conditions
thereof, for any such loss if the latter amount be the larger.
If the
coverage of this bond supersedes in whole or in part the coverage of any other
bond or policy of insurance issued by an Insurer other than the Underwriter and
terminated, canceled or allowed to expire, the Underwriter, with respect to any
loss sustained prior to such termination, cancelation or expiration and
discovered within the period permitted under such other bond or policy for the
discovery of loss thereunder, shall be liable under this bond only for that part
of such loss covered by this bond as is in excess of the amount recoverable or
recovered on account of such loss under such other bond or policy, anything to
the contrary in such other bond or policy notwithstanding.
OTHER INSURANCE OR
INDEMNITY
Section
9. Coverage afforded hereunder shall apply only as excess over any valid and
collectible insurance or indemnity obtained by the Insured, or by one other than
the Insured on Property subject to Exclusion (q) or by a Transportation Company,
or by another entity on whose premises the loss occurred or which employed the
person causing the loss or the messenger conveying the Property
involved.
OWNERSHIP
Section
10. This bond shall apply to loss of Property (1) owned by the Insured, (2) held
by the Insured in any capacity, or (3) for which the Insured is legally liable.
This bond shall be for the sole use and benefit of the Insured named in the
Declarations.
DEDUCTIBLE AMOUNT
Section
11. The Underwriter shall be liable hereunder only for the amount by which any
single loss, as defined in Section 4, exceeds the Single Loss Deductible amount
for the Insuring Agreement or Coverage applicable to such loss, subject to the
Aggregate Limit of Liability and the applicable Single Loss Limit of
Liability.
The
Insured shall, in the time and in the manner prescribed in this bond, give the
Underwriter notice of any loss of the kind covered by the terms of this bond,
whether or not the Underwriter is liable therefor, and upon the request of the
Underwriter shall file with it a brief statement giving the particulars
concerning such loss.
TERMINATION OR
CANCELATION
Section
12. This bond terminates as an entirety upon occurrence of any of the following:
- (a) 60 days after the receipt by the Insured of a written notice from the
Underwriter of its desire to cancel this bond, or (b) immediately upon the
receipt by the Underwriter of a written notice from the Insured of its desire to
cancel this bond, or (c) immediately upon the taking over of the Insured by a
receiver or other liquidator or by State or Federal officials, or (d)
immediately upon the taking over of the Insured by another institution, or (e)
immediately upon exhaustion of the Aggregate Limit of Liability, or (f)
immediately upon expiration of the Bond Period as set forth in Item 2 of the
Declarations.
(Page 15
of 16)
This bond
terminates as to any Employee or any partner, officer or employee of any
Processor - (a) as soon as any Insured, or any director or officer not in
collusion with such person, learns of any dishonest or fraudulent act committed
by such person at any time, whether in the employment of the Insured or
otherwise, whether or not of the type covered under Insuring Agreement (A),
against the Insured or any other person or entity, without prejudice to the loss
of any Property then in transit in the custody of such person, or (b) 15 days
after the receipt by the Insured of a written notice from the Underwriter of its
desire to cancel this bond as to such person.
Termination
of the bond as to any Insured terminates liability for any loss sustained by
such Insured which is discovered after the effective date of such
termination.
IN WITNESS WHEREOF, the
Underwriter has caused this bond to be executed on the Declarations
page.
(Page 16
of 16)
RIDER NO. 1
To be
attached to and form part of Financial Institution Bond, Standard Form
14,
Bond
No. FS
379-29-05-02
In favor
of Special
Value Opportunities Fund, LLC
| 1. |
Item
4, OPTIONAL INSURING AGREEMENTS AND COVERAGES, of the Declarations page is
continued:
|
|
OPTIONAL
INSURING
AGREEMENT/COV.
|
SINGLE LIMIT
OF
LIABILITY
|
SINGLE LOSS
DEDUCTIBLE
|
RIDER
NO.
|
|||
|
Computer
Systems
|
$5,500,000
|
$50,000
|
SR
6196
|
|||
|
Audit
Expense
|
$50,000
|
$10,000
|
4
|
|||
|
Stop Payment
Order
|
$50,000
|
$10,000
|
5
|
|||
|
Unauthorized
Signatures
|
$50,000
|
$10,000
|
6
|
|||
|
Telefacsimile Transfer
Fraud
|
$5,500,000
|
$50,000
|
7
|
|||
|
Voice Initiated Transfer
Fraud
|
$5,500,000
|
$50,000
|
8
|
|||
| 2. |
The
following Coverage
Modification Riders are added to this
Bond:
|
|
RIDER
NAME
|
RIDER
NO.
|
|
|
Named Insured
List
|
2
|
|
|
S.E.C. Cancellation
Rider
|
3
|
|
|
California Premium
Rider
|
9
|
| 3. |
This
rider shall become effective 12:01 a.m. on 08/31/2008 standard
time.
|
RIDER NO. 2
To be
attached to and form part of Bond No. FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
| 1. |
At
the request of the Insured, the Underwriter adds to the list of
Insured under the attached bond the
following:
|
Special
Value Opportunities Fund, LLC
Special Value Opportunities Feeder Fund
Special
Value Expansion Fund, LLC
Special
Value Continuation Partners, LP
Special
Value Continuation Fund, LLC
Tennenbaum
Opportunities Partners V, LP
Tennenbaum
Opportunities Fund V, LLC
| 2. |
This
rider shall become effective as of 12:01 a.m. on 08/31/2009 standard
time.
|
RIDER NO. 3
To be
attached to and form part of Bond No. FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
| 1. |
The
attached bond shall not be cancelled or modified except after written
notice shall have been given by the acting party to the affected party,
and by the Underwriter to all registered management investment companies
named as Insureds and to the Securities and Exchange Commission,
Washington, D.C., not less than ninety days prior to the effective date of
such cancellation or modification.
|
| 2. |
The
Underwriter shall furnish each registered management investment company
named as an Insured with (a) a copy of the bond and any amendment thereto,
promptly after the execution thereof, (b) a copy of each formal filing of
a claim under the bond by any other named Insured promptly after receipt
thereof, and (c) notification of the terms of the settlement of each such
claim prior to the execution of the
settlement.
|
| 3. |
This
rider shall become effective as of 12:01 a.m. on 08/31/2009 standard
time.
|
RIDER NO. 4
AUDIT EXPENSE
RIDER
To be
attached to and form part of Financial Institution Bond, Standard Form No.
14,
Bond No.
FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
| 1. |
An
additional paragraph, as follows, is inserted as the fourth paragraph of
the Fidelity Insuring Agreement.
|
Audit Expense Coverage $50,000 (for
coverage, an amount must be inserted)
Expense
incurred by the Insured for that part of the cost of audits or examinations
required by State or Federal supervisory authorities to be conducted either by
such authorities or by independent accountants by reason of the discovery of
loss sustained by the Insured through dishonest or fraudulent acts of any of the
Employees. The total liability of the Underwriter for such expense by reason of
such acts of any Employee or in which such Employee is concerned or implicated
or with respect to any one audit or examination is limited to the amount stated
opposite “Audit Expense Coverage”; it being understood, however, that such
expense shall be deemed to be loss sustained by the Insured through dishonest or
fraudulent acts of one or more of the Employees and the liability of the
Underwriter under this paragraph of Insuring Agreement (A) shall be part of and
not in addition to the Single Loss Limit of Liability stated in Item 4 of the
Declarations.
| 2. |
The
following paragraph is substituted for Section
2(d):
|
|
(d)
|
loss
resulting directly or indirectly from any acts of any director or trustee
of the Insured other than one employed as a salaried, pensioned or elected
official or an Employee of the Insured, except when performing acts coming
within the scope of the usual duties of any Employee, or while acting as a
member of any committee duly elected or appointed by resolution of the
board of directors or trustees of the Insured to perform specific, as
distinguished from general, directorial acts on behalf of the
Insured;
|
| 3. |
The
following paragraph is substituted for Section
2(u):
|
(u)
all fees,
costs and expenses incurred by the Insured
| (1) |
in
establishing the existence of or amount of loss covered under this bond,
except to the extent covered under the portion of Insuring Agreement (A)
entitled Audit Expense, or
|
| (2) |
as
a party to any legal proceeding whether or not such legal proceeding
exposes the Insured to loss covered by this
bond.
|
| 4. |
Nothing
herein contained shall be held to vary, alter, waive or extend any of the
terms, conditions, provisions, agreements or limitations of the bond,
other than as stated herein.
|
| 5. |
This
rider shall become effective as of 12:01 a.m. on 08/31/2009 standard
time.
|
RIDER NO. 5
STOP PAYMENT
ORDER
To be
attached to and form part of Financial Institution Bond, Standard Form No.
14,
Bond No.
FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
| 1. |
In
any consideration of an additional premium included herein, this Bond is
extended to indemnify the Insured against any and all sums which the
Insured shall become obligated to pay by reason of the Liability imposed
upon the Insured by law for damages:
|
| a. |
For
having either complied with or failed to comply with any written notice of
any depositor of the Insured or any Authorized Representative of such
depositor to stop payment of any check or draft made or drawn by such
deposit or any Authorized Representative of such depositor,
or
|
| b. |
For
having refunded to pay any check or draft made or drawn by any depositor
of the Insured or any Authorized Representative of such
depositor.
|
Provided
always that:
| i. |
The
Underwriter’s Liability under this rider shall be limited to $50,000 for
any one Loss and in all during each Bond term, subject to a deductible of
$10,000
|
| ii. |
The
term “Bond term” as used in this Rider shall mean each period of twelve
calendar months commencing the effective date of the attached
bond.
|
| 2. |
Nothing
herein contained shall be held to vary, alter, waive or extend any of the
terms, conditions, provisions, agreements or limitations of the above
mentioned Bond, other than as stated
herein.
|
| 3. |
This
rider shall become effective as of 12:01 a.m. on 08/31/2009 standard
time.
|
RIDER NO. 6
UNAUTHORIZED
SIGNATURES
To be
attached to and form part of Financial Institution Bond, Standard Form No.
14,
Bond No.
FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
| 1. |
The
attached bond is amended by adding as an additional paragraph to insuring
Clause (D), Forgery or Alteration, the
following:
|
Loss resulting directly from the Insured having accepted, paid or cashed any check or withdrawal order made or drawn on a customer’s account which bears the signature or endorsement of one other than the person whose name and signature is on file with the Insured as a signatory on such account, shall be deemed to be a Forgery under this Insuring Clause. It shall be a condition precedent to the Insured’s right of recovery under this Coverage that the Insured shall have on the file the signatures of all persons who are signatories on such account.
| 2. |
The
limit of the underwriter’s liability for such coverage (Unauthorized
Signatures coverage) shall be stated herein, subject to all the terms of
this rider having reference
thereto:
|
|
Limit
of Liability
|
$50,000
|
|
Deductible
|
$10,000
|
| 3. |
Nothing
herein contained shall be held to vary, alter, waive or extend any of the
terms, conditions, provisions, agreements or limitations of the above
mentioned bond, other than as stated
herein.
|
| 4. |
This
rider shall become effective as of 12:01 a.m. on 08/31/2009 standard
time.
|
RIDER NO. 7
TELEFACSIMILE TRANSFER
FRAUD
To be
attached to and form part of Financial Institution Bond, Standard Form No.
14,
Bond No.
FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
| 1. |
The
attached bond is amended by adding an Insuring Agreement as
follows:
|
Loss
resulting directly from the Insured having, in good faith, transferred or
delivered Funds, Certificated Securities or Uncertificated Securities through a
Computer System covered under the terms of the Computer System Fraud Insuring
Agreement in reliance upon a fraudulent instruction received through a
Telefacsimile Device, and which instruction
| (1) |
purports
and reasonably appears to have originated
from
|
| (a) |
a
Customer of the Insured
|
| (b) |
another
financial institution, or
|
| (c) |
another
office of the Insured
|
but in fact, was not originated by the Customer or entity whose identification it bears and
| (2) |
contains
a valid test code which proves to have been used by a person who was not
authorized to make use of it and
|
| (3) |
contains
the name of a person authorized to initiate such transfer;
and
|
provided
that, if the transfer was in excess of $50,000 the instruction was verified by a
call-back according to a prearranged procedure.
In this
Insuring Agreement, Customer means an entity or an individual which has a
written agreement with the Insured authorizing the Insured to rely on
Telefacsimile Device Instructions to initiate transfers and has provided the
Insured with the names of persons authorized to initiate such transfers, and
with which the Insured has established an instruction verification mechanism,
and Funds means Money on deposit in an account.
| 2. |
In
addition to the Conditions and Limitations in the bond and Computer
Systems Fraud Insuring Agreement rider, the following provisions are
applicable to the Telefacsimile Transfer Fund Insuring
Agreement:
|
Telefacsimile
Device means a machine capable of sending or receiving a duplicate image of a
document by means of electronic impulses transmitted through a telephone line
and which reproduces the duplicate image on paper.
This
Insuring agreement does not cover loss resulting directly or indirectly from the
assumption of liability by the Insured by contract unless the liability arises
from a loss covered by the Telefacsimile Transfer Fraud Insuring Agreement and
would be imposed on the Insured regardless of the existence of the
contract.
Proof of
loss for claim under the Telefacsimile Transfer Fraud Insuring Agreement must
include a copy of the document reproduced by the Telefacsimile
Device.
| 3. |
The
exclusion below, as found in the attached bond, does not apply to the
Telefacsimile Transfer Fraud Insuring
Agreement.
|
“loss
involving any Uncertificated Security except an Uncertificated Security of any
Federal Reserve Bank of the United States or when covered under Insuring
Agreement (A);”
| 4. |
Nothing
herein contained shall be held to vary, alter, waive or extend any of the
terms, conditions, provisions, agreements or limitations of the above
mentioned Bond, other than as stated
herein.
|
| 5. |
This
rider shall become effective as of 12:01 a.m. on 08/31/2009 standard
time.
|
RIDER NO. 8
To be
attached to and form part of Financial Institution Bond, Standard Form No.
14,
Bond No.
FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
| 1. |
The
attached bond is amended by adding an Insuring Agreement as
follows:
|
VOICE INITIATED TRANSFER
FRAUD
Loss
resulting directly from the Insured having, in good faith, transferred funds
from a Customer’s account through a Computer System covered under the terms of
the Computer System Fraud Insuring Agreement in reliance upon a fraudulent voice
instruction transmitted by telephone which was purported to be
from:
| (1) |
an
officer, director, partner or employee of a Customer of the Insured who
was authorized by the Customer to instruct the Insured to make such
transfer,
|
| (2) |
an
individual person who is a Customer of the Insured,
or
|
| (3) |
an
Employee of the Insured in another office of the Insured who was
authorized by the Insured to instruct other Employees of the Insured to
transfer Funds, and was received by an Employee of the Insured
specifically designated to receive and act upon such
instructions,
|
but the
voice instruction was not from a person described in (1), (2) or (3) above,
provided that
| (i) |
such
voice instruction was electronically recorded by the Insured and required
password(s) or code word(s) given;
and
|
| (ii) |
if
the transfer was in excess of $50,000 voice instruction was verified the
by a call-back according to a prearranged
procedure.
|
In this
Insuring Agreement:
| (A) |
Customer
means an entity or individual which has a written agreement with the
Insured authorizing the Insured to rely on voice instructions to make
transfers and which has provided the Insured with the Names of persons
authorized to initiate such transfers and with which the Insured has
established an instruction verification
mechanism.
|
| (B) |
Funds
means Money on deposit in an
account.
|
| 2. |
In
addition to the Conditions and Limitations in the bond and Computer
Systems Fraud Insuring Agreement rider, the following provisions are
applicable to the Voice Initiated Transfer Fraud Insuring
Agreement:
|
This
Insuring Agreement does not cover loss resulting directly or indirectly from the
assumption of liability by the Insured by contract unless the liability arises
from a loss covered by this Insuring Agreement and would be imposed on the
Insured regardless of the existence of the contract.
Proof of
loss for claim under the Voice Initiated Transfer Insuring agreement must
include electronic recordings of such voice instructions and the verification
call-back, if such call was required.
| 3. |
Nothing
herein contained shall be held to vary, alter, waive or extend any of the
terms, conditions, provisions, agreements or limitations of the bond,
other than as stated herein.
|
| 4. |
This
rider shall become effective as of 12:01 a.m. on 08/31/2009 standard
time.
|
RIDER NO. 9
CALIFORNIA PREMIUM
RIDER
To be
attached to and form part of Bond No. FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
| 1. |
In
compliance with the ruling of the Commissioner of Insurance of the State
of California and the Opinion of the Attorney-General of that State
requiring that the premium for all bonds or policies be endorsed thereon,
the basic premium charged for the attached bond for the
period
|
|
From:
|
08/31/2009
|
|
To:
|
08/31/2010
|
Is:
Thirty Thousand four hundred Twenty Nine and 00/100 Dollars
($30,429)
| 2. |
This
rider shall become effective as of 12:01 a.m. on 08/31/2009 standard
time.
|
RIDER
To be
attached to and form part of Financial Institution Bond, Standard Form No.
14,
Bond No.
FS 379-29-05-03
in favor
of Special
Value Opportunities Fund, LLC
It is
agreed that:
|
1.
|
The
attached bond is amended by adding an Insuring Agreement as
follows:
|
COMPUTER SYSTEMS
FRAUD
Loss
resulting directly from a fraudulent
|
(1)
|
entry
of Electronic Data or Computer Program into,
or
|
|
(2)
|
change
of Electronic Data or Computer Program
within
|
any
Computer System operated by the Insured, whether owned or leased; or any
Computer System identified in the application for this bond; or a Computer
System first used by the Insured during the Bond Period, as provided by the
General Agreement B of this bond;
provided
that the entry or change causes
|
(i)
|
Property
to be transferred, paid or
delivered,
|
|
(ii)
|
an
account of the Insured, or if its customer, to be added, deleted, debited
or credited, or
|
|
(iii)
|
an
unauthorized account or a fictitious account to be debited or
credited
|
In this
Insuring Agreement, fraudulent entry or change shall include such entry or
change made by an Employee of the Insured acting in good faith on an instruction
from a software contractor who has a written agreement with the Insured to
design, implement or service programs for a Computer System covered by this
Insuring Agreement.
|
2.
|
In
addition to the Conditions and Limitations in the bond, the following,
applicable to the Computer Systems Fraud Insuring Agreement, are
added:
|
DEFINITIONS
|
(A)
|
Computer
Program means a set of related electronic instructions which direct the
operations and functions of a computer or devices connected to it which
enable the computer or devices to receive, process, store or send
Electronic Data;
|
|
(B)
|
Computer
System means
|
|
(1)
|
computers
with related peripheral components, including storage components wherever
located,
|
|
(2)
|
systems
and applications software,
|
|
(3)
|
terminal
devices, and
|
|
(4)
|
related
communication networks
|
by which
Electronic Data are electronically collected, transmitted, processed, stored and
retrieved;
|
(C)
|
Electronic
data means facts or information converted to a form usable in a Computer
System by Computer Programs, and which is stored on magnetic tapes or
disks, or optical storage disks or other bulk
media.
|
EXCLUSIONS
|
(A)
|
loss
resulting directly or indirectly from the assumption of liability by the
Insured by contract unless the liability arises from a loss covered by the
Computer Systems Fraud Insuring Agreement and would be imposed on the
Insured regardless of the existence of the
contract;
|
|
(B)
|
loss
resulting directly or indirectly from negotiable instruments, securities,
documents or other written instruments which bear a forged signature, or
are counterfeit, altered, or otherwise fraudulent and which are used as
source documentation in the preparation of Electronic Data or manually
keyed into a data terminal;
|
|
(C)
|
loss
resulting directly or indirectly
from
|
|
(1)
|
mechanical
failure, faulty construction, error in design, latent defect, fire, wear
or tear, gradual deterioration, electrical disturbance or electrical surge
which affects a Computer System, or
|
|
(2)
|
failure
or breakdown or electronic data processing media,
or
|
|
(3)
|
error
or omission in programming or
processing;
|
|
(D)
|
loss
resulting directly or indirectly from the Input of Electronic Data into a
Computer System terminal device either on the premises of a customer of
the Insured or under the control of such a customer by a person who has
authorized access to the customer’s authentication
mechanism;
|
|
(E)
|
loss
resulting directly or indirectly from the theft of confidential
information.
|
SINGLE LOSS LIMIT OF
LIABILITY
All loss
or series of losses involving the fraudulent acts of one individual, or
involving fraudulent acts in which one individual is implicated, whether or not
that individual is specifically identified, shall be treated as a Single Loss
and subject to the Single Loss Limit of Liability. A series of losses involving
unidentified individuals but arising from the same method of operation shall be
deemed to involve the same individual and in that event shall be treated as a
Single Loss and subject to the Single Loss Limit of Liability.
|
3.
|
The
exclusion below, as found in the attached bond, does not apply to the
Computer System Fraud Insuring
Agreement.
|
“loss
involving any Uncertificated Security except an Uncertificated Security of any
Federal Reserve Bank of the United States or when covered under Insuring
Agreement (A)”;
|
4.
|
This
rider shall become effective as of 12:01 a.m. on
08/31/2009.
|
Accepted:
__________________________________
Joint Fidelity
Bond
RESOLVED, that the Board of
Directors of the Fund has determined that the participation by the Fund and
the other registered funds managed by the Advisor in the joint fidelity bond
(the “Joint Bond”) which provides for equitable sharing of recoveries, including
payment of any premiums, in the form presented to the Board of Directors at this
meeting, is in the best interests of the Fund; and further
RESOLVED, that the Joint Bond
be, and it hereby is, adopted, ratified and approved substantially in the form
presented to the Board of Directors at this meeting, and all actions previously
taken by any officers of the Fund in connection with such Joint Bond or any such
amendments, supplements, extensions, or renewals related thereto be, and they
hereby are, ratified and approved in all respects.
RESOLVED, that the agreement
between the Fund and the other registered funds managed by the Advisor providing
for the equitable and proportionate share of any recovery under the joint
fidelity bond (the “Joint Insured Bond Agreement”), be, and it hereby is,
adopted and approved substantially in the form presented to the Board of
Directors at this meeting, together with such changes and modifications as the
officers of the Fund deem advisable; and further
RESOLVED, that the Board of
Directors, including a majority of the Directors who are not “interested
persons” (as defined in the Investment Company Act of 1940, as amended (the
“1940 Act”)) of the Fund or the Advisor, shall review the Joint Bond and the
Joint Insured Bond Agreement at least annually in order to ascertain whether or
not such policy and agreement continues to be in the best interests of the Fund,
and whether or not the premiums to be paid by the Fund under the Joint Bond are
fair and reasonable; and further
RESOLVED, that in accordance
with Rule 17g-1(h) under the 1940 Act, the Secretary of the Fund is hereby
designated as the officer of the Fund who is authorized and directed to make the
filings with the Securities and Exchange Commission and give the notices
required by Rule 17g-1(g); and further
RESOLVED, that the officers of
the Fund be, and they hereby are, authorized and directed at all times to take
all actions necessary to assure compliance with these resolutions and said Rule
17g-1; and further
RESOLVED, that the Fund be,
and hereby is, authorized to pay the portion of the premium of the Joint Bond as
noted in the premium allocation schedule presented to the Board of Directors at
this meeting.
|
Premium
and Fee Allocation
|
||||||||
|
Fund
|
Premium
|
Fees
|
||||||
|
SVOF
|
$ | 7,885 | $ | 591 | ||||
|
SVEF
|
$ | 3,449 | $ | 259 | ||||
|
SVCP
|
$ | 3,339 | $ | 250 | ||||
|
SVCF
|
$ | 1,667 | $ | 125 | ||||
|
TOPV
|
$ | 9,397 | $ | 705 | ||||
|
TOFV
|
$ | 4,691 | $ | 352 | ||||
| $ | 30,429 | $ | 2,282 | |||||
The
amount of the single insured bond which each investment company would have
provided and maintained had it not been named as an insured under a joint bond
is as follows:
|
Special
Value Opportunities Fund, LLC
|
$
|
1,500,000
|
||
|
Special
Value Expansion Fund, LLC
|
$
|
1,000,000
|
||
|
Special
Value Continuation Fund, LLC
|
$
|
1,250,000
|
||
|
Special
Value Continuation Partners, LP
|
$
|
1,250,000
|
||
|
Tennenbaum
Opportunities Fund V, LLC
|
$
|
1,700,000
|
||
|
Tennenbaum
Opportunities Partners V, LP
|
$
|
1,700,000
|
The
period for which premiums have been paid with respect to this bond is August 31,
2009 to August 31, 2010.
JOINT INSURED BOND
AGREEMENT
This
JOINT INSURED BOND AGREEMENT (the “Agreement”), effective as of September 29,
2006 (the “Effective Date”), is between
|
i.
|
Special
Value Opportunities Fund, LLC (“SVOF”), a Delaware limited
liability company, with its principal office at 2951 28th
Street, Suite 1000, Santa Monica, CA 90405,
|
|
ii.
|
Special
Value Expansion Fund, LLC (“SVEF”), a Delaware limited
liability company, with its principal office at 2951 28th
Street, Suite 1000, Santa Monica, CA 90405,
|
|
iii.
|
Special
Value Continuation Fund, LLC (“SVCF”), a Delaware limited
liability company, with its principal office at 2951 28th
Street, Suite 1000, Santa Monica, CA 90405,
|
|
iv.
|
Special
Value Continuation Partners, LP (“SVCP”), a Delaware limited
partnership, with its principal office at 2951 28th
Street, Suite 1000, Santa Monica, CA
90405,
|
|
v.
|
Tennenbaum
Opportunities Fund V, LLC (“TOF V”), a Delaware limited
liability company, with its principal office at 2951 28th
Street, Suite 1000, Santa Monica, CA 90405, and
|
|
vi.
|
Tennenbaum
Opportunities Partners V, LP (“TOP V” and together with SVOF, SVEF, SVCF,
SVCP, and TOF V the “Funds” and each a “Fund”), a Delaware limited
partnership, with its principal office at 2951 28th
Street, Suite 1000, Santa Monica, CA
90405.
|
WHEREAS,
the Funds have initiated joint coverage under an investment company fidelity
bond issued by
Great
American Insurance Company (as the same may be amended, supplemented, extended
or renewed from time to time, the “Bond”); and
WHEREAS,
the Funds desire to enter into this Agreement to determine the share received by
each party under a recovery received under the Bond as a result of a loss
sustained by the Funds;
NOW
THEREFORE, the parties agree as follows:
In the
event recovery is received under the Bond as a result of a loss sustained by the
Funds, each Fund shall receive an equitable and proportionate share of the
recovery, but at least equal to the amount which it would have received had it
provided and maintained a single insured bond with the minimum coverage required
by paragraph
(d)(1) of Rule
17g-1 under the Investment Company Act of 1940.
|
SPECIAL
VALUE OPPORTUNITIES FUND, LLC
By:
/s/ David A.
Hollander
David
A. Hollander
Authorized
Person
SPECIAL
VALUE EXPANSION FUND, LLC
By:
/s/ David A.
Hollander
David
A. Hollander
Authorized
Person
SPECIAL
VALUE CONTINUATION FUND, LLC
By:
/s/ David A.
Hollander
David
A. Hollander
Authorized
Person
SPECIAL
VALUE CONTINUATION PARTNERS, LP
By:
/s/ David A.
Hollander
David
A. Hollander
Authorized
Person
TENNENBAUM
OPPORTUNITIES FUND V, LLC
By:
/s/ David A.
Hollander
David
A. Hollander
Authorized
Person
TENNENBAUM
OPPORTUNITIES PARTNERS V, LP
By:
/s/ David A.
Hollander
David
A. Hollander
Authorized
Person
|