UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21201
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UBS Technology Partners Fund L.L.C.
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(Exact name of registrant as specified in charter)
1285 Avenue of the Americas, 37th Floor
New York, NY 10019
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(Address of principal executive offices) (Zip code)
Michael Mascis
c/o UBS Financial Services, Inc.
1285 Avenue of the Americas
New York, NY 10019
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(Name and address of agent for service)
registrant's telephone number, including area code: 212-713-2217
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Date of fiscal year end: December 31, 2004
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Date of reporting period: December 31, 2004
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
The Report to Shareholders is attached herewith.
UBS TECHNOLOGY PARTNERS, L.L.C.
FINANCIAL STATEMENTS
WITH REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
YEAR ENDED
DECEMBER 31, 2004
UBS TECHNOLOGY PARTNERS, L.L.C.
FINANCIAL STATEMENTS
WITH REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
YEAR ENDED
DECEMBER 31, 2004
CONTENTS
Report of Independent Registered Public Accounting Firm ................... 1
Statement of Assets, Liabilities and Members' Capital ..................... 2
Statement of Operations ................................................... 3
Statements of Changes in Members' Capital ................................. 4
Statement of Cash Flows ................................................... 5
Notes to Financial Statements ............................................. 6
Schedule of Portfolio Investments ......................................... 12
[LETTERHEAD OF ERNST & YOUNG LLP]
Report of Independent Registered Public Accounting Firm
To the Members and Board of Directors of
UBS Technology Partners, L.L.C.
We have audited the accompanying statement of assets, liabilities and members'
capital of UBS Technology Partners, L.L.C. (the "Fund"), including the schedule
of portfolio investments, as of December 31, 2004, and the related statements of
operations and cash flows for the year then ended and the statements of changes
in members' capital for each of the two years in the period then ended. These
financial statements are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Fund's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. Our procedures included confirmation of
investments owned as of December 31, 2004, by correspondence with management of
the investment funds. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of UBS Technology Partners, L.L.C.
at December 31, 2004, the results of its operations and its cash flows for the
year then ended and the changes in its members' capital for each of the two
years in the period then ended, in conformity with U.S. generally accepted
accounting principles.
/s/ Ernst & Young LLP
February 25, 2005
1
UBS TECHNOLOGY PARTNERS, L.L.C.
STATEMENT OF ASSETS, LIABILITIES AND MEMBERS' CAPITAL
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DECEMBER 31, 2004
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ASSETS
Investments in Investment Funds, at value (cost $314,514,335) $ 382,535,327
Cash and cash equivalents 39,207,222
Interest receivable 23,270
Other assets 2,464
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TOTAL ASSETS 421,768,283
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LIABILITIES
Payables:
Withdrawals payable 111,509,194
Management fee 344,579
Professional fees 243,029
Administration fee 68,438
Other 28,081
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TOTAL LIABILITIES 112,193,321
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NET ASSETS $ 309,574,962
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MEMBERS' CAPITAL
Represented by:
Net capital contributions $ 241,553,970
Accumulated net unrealized appreciation on investments 68,020,992
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MEMBERS' CAPITAL $ 309,574,962
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The accompanying notes are an integral part of these financial statements.
2
UBS TECHNOLOGY PARTNERS, L.L.C.
STATEMENT OF OPERATIONS
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YEAR ENDED DECEMBER 31, 2004
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INVESTMENT INCOME
Interest $ 189,574
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TOTAL INVESTMENT INCOME 189,574
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EXPENSES
Management fee 4,573,623
Administration fee 444,130
Professional fees 337,516
Miscellaneous 305,552
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TOTAL EXPENSES 5,660,821
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NET INVESTMENT LOSS (5,471,247)
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REALIZED AND UNREALIZED GAIN/(LOSS) FROM INVESTMENTS
Net realized gain from investments 64,417,958
Change in net unrealized appreciation/depreciation from investments (51,493,717)
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NET REALIZED AND UNREALIZED GAIN FROM INVESTMENTS 12,924,241
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NET INCREASE IN MEMBERS' CAPITAL
DERIVED FROM OPERATIONS $ 7,452,994
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The accompanying notes are an integral part of these financial statements.
3
UBS TECHNOLOGY PARTNERS, L.L.C.
STATEMENTS OF CHANGES IN MEMBERS' CAPITAL
YEARS ENDED DECEMBER 31, 2004 AND 2003
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UBS FUND
ADVISOR, L.L.C. MEMBERS TOTAL
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MEMBERS' CAPITAL AT JANUARY 1, 2003 $ 1,846,518 $ 651,193,691 $ 653,040,209
INCREASE (DECREASE) FROM OPERATIONS
Pro rata allocation:
Net investment loss (359) (7,158,276) (7,158,635)
Net realized gain from investments 75,194 29,222,432 29,297,626
Change in net unrealized
appreciation/depreciation from investments (72,568) (3,966,873) (4,039,441)
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NET INCREASE IN MEMBERS' CAPITAL
DERIVED FROM OPERATIONS 2,267 18,097,283 18,099,550
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MEMBERS' CAPITAL TRANSACTIONS
Proceeds from Members' subscriptions -- 9,043,385 9,043,385
Members' withdrawals (1,833,664) (174,938,470) (176,772,134)
Offering costs (1) (30,909) (30,910)
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NET DECREASE IN MEMBERS' CAPITAL
FROM CAPITAL TRANSACTIONS (1,833,665) (165,925,994) (167,759,659)
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MEMBERS' CAPITAL AT DECEMBER 31, 2003 $ 15,120 $ 503,364,980 $ 503,380,100
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INCREASE (DECREASE) FROM OPERATIONS
Pro rata allocation:
Net investment loss (84) (5,471,163) (5,471,247)
Net realized gain from investments 2,328 64,415,630 64,417,958
Change in net unrealized
appreciation/depreciation from investments (1,868) (51,491,849) (51,493,717)
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NET INCREASE IN MEMBERS' CAPITAL
DERIVED FROM OPERATIONS 376 7,452,618 7,452,994
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MEMBERS' CAPITAL TRANSACTIONS
Proceeds from Members' subscriptions -- 5,629,497 5,629,497
Members' withdrawals -- (206,791,505) (206,791,505)
Offering costs (3) (96,121) (96,124)
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NET DECREASE IN MEMBERS' CAPITAL DERIVED
FROM CAPITAL TRANSACTIONS (3) (201,258,129) (201,258,132)
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MEMBERS' CAPITAL AT DECEMBER 31, 2004 $ 15,493 $ 309,559,469 $ 309,574,962
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The accompanying notes are an integral part of these financial statements.
4
UBS TECHNOLOGY PARTNERS, L.L.C.
STATEMENT OF CASH FLOWS
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YEAR ENDED DECEMBER 31, 2004
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CASH FLOWS FROM OPERATING ACTIVITIES
Net Increase in Members' capital derived from operations $ 7,452,994
Adjustments to reconcile net decrease in Members' capital derived from operations
to net cash provided by operating activities:
Purchases of investments (48,750,000)
Proceeds from disposition of investments 204,510,162
Net realized gain from investments (64,417,958)
Change in net unrealized appreciation/depreciation from investments 51,493,717
Changes in assets and liabilities:
(Increase) decrease in assets:
(Increase) decrease in assets:
Receivable from Investment Funds 4,361,778
Interest receivable (15,034)
Other assets 467
Increase (decrease) in payables:
Management fee (166,569)
Professional fees (20,926)
Administration fee (31,573)
Other 9,896
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NET CASH PROVIDED BY OPERATING ACTIVITIES 154,426,954
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Members' subscriptions 5,629,497
Members' withdrawals (204,215,838)
Offering costs (96,124)
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NET CASH USED IN FINANCING ACTIVITIES (198,682,465)
Net decrease in cash and cash equivalents (44,255,511)
Cash and cash equivalents--beginning of year 83,462,733
CASH AND CASH EQUIVALENTS--END OF YEAR $ 39,207,222
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The accompanying notes are an integral part of these financial statements.
5
UBS TECHNOLOGY PARTNERS, L.L.C.
NOTES TO FINANCIAL STATEMENTS
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DECEMBER 31, 2004
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1. ORGANIZATION
UBS Technology Partners, L.L.C. (the "Fund") was initially organized as a
limited partnership under the laws of Delaware on December 28, 1998 and
was subsequently reorganized as a limited liability company effective
October 15, 2002. The Fund is registered under the Investment Company Act
of 1940, as amended (the "1940 Act"), as a closed-end, non-diversified,
management investment company. The Fund's investment objective is to
maximize capital appreciation over the long-term. The Fund pursues its
investment objective by deploying its assets primarily among a select
group of portfolio managers who invest primarily in, or who have
particular knowledge within, the technology sector. Generally, such
portfolio managers conduct their investment programs through unregistered
investment funds (collectively, the "Investment Funds") in which the Fund
invests as a limited partner or member along with other investors. The
Fund commenced operations on April 1, 1999.
The Fund's Board of Directors (the "Directors") has overall responsibility
to manage and control the business affairs of the Fund, including the
exclusive authority to oversee and to establish policies regarding the
management, conduct and operation of the Fund's business. The Directors
have engaged UBS Fund Advisor, L.L.C. (the "UBSFA" or "Manager"), a
Delaware limited liability company and the Manager of the Fund, to provide
investment advice regarding the selection of Investment Funds and to be
responsible for the day-to-day management of the Fund.
The Manager is an indirect wholly-owned subsidiary of UBS Americas, Inc.,
which is a wholly-owned subsidiary of UBS AG, and is registered as an
investment adviser under the Investment Advisers Act of 1940, as amended.
Initial and additional applications for interests by eligible investors
may be accepted at such times as the Manager may determine and are
generally accepted monthly. The Fund reserves the right to reject any
application for interests in the Fund.
The Fund from time to time may offer to repurchase interests pursuant to
written tenders to Members. These repurchases will be made at such times
and on such terms as may be determined by the Directors, in their complete
and exclusive discretion. The Manager expects that generally, it will
recommend to the Directors that the Fund offer to repurchase interests
from Members twice in each year, near mid-year and year-end. Members can
only transfer or assign their membership interests, or a portion thereof,
(i) by operation of law pursuant to the death, bankruptcy, insolvency or
dissolution of a Member, or (ii) with the written approval of the
Directors, which may be withheld in their sole and absolute discretion.
Such transfers may be made even if the balance of the capital account to
such transferee is equal to or less than the transferor's initial capital
contribution.
2. SIGNIFICANT ACCOUNTING POLICIES
A. PORTFOLIO VALUATION
Net asset value of the Fund is determined by or at the direction of the
Manager as of the close of business at the end of any fiscal period in
accordance with the valuation principles set forth below or as may be
determined from time to time pursuant to policies established by the
Directors.
6
UBS TECHNOLOGY PARTNERS, L.L.C.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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DECEMBER 31, 2004
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2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
A. PORTFOLIO VALUATION (CONTINUED)
The Fund's investments in Investment Funds are subject to the terms and
conditions of the respective operating agreements and offering memoranda,
as appropriate. The Fund's investments in Investment Funds are carried at
fair value as determined by the Fund's pro-rata interest in the net assets
of each Investment Fund. All valuations utilize financial information
supplied by each Investment Fund and are net of management and performance
incentive fees or allocations payable to the Investment Funds' managers or
pursuant to the Investment Funds' agreements. The Fund's valuation
procedures require the Manager to consider all relevant information
available at the time the Fund values its portfolio. The Manager and/or
the Board will consider such information and consider whether it is
appropriate, in light of all relevant circumstances, to value such a
position at its net asset value as reported or whether to adjust such
value. The underlying investments of each Investment Fund are accounted
for at fair value as described in each Investment Fund's financial
statements. (See Schedule of Portfolio Investments)
Distributions received or withdrawals from Investment Funds, whether in
the form of cash or securities, are first applied as a reduction of the
investment's cost.
B. INCOME RECOGNITION
Interest income is recorded on the accrual basis. Realized gains and
losses from Investment Fund transactions are calculated on the identified
cost basis.
C. FUND COSTS
The Fund bears all expenses incurred in its business, including, but not
limited to, the following: all costs and expenses related to portfolio
transactions and positions for the Fund's account; legal fees; accounting
and auditing fees; custodial fees; costs of computing the Fund's net asset
value; costs of insurance; registration expenses; certain organization
costs; due diligence, including travel and related expenses; expenses of
meetings of Directors and Members; all costs with respect to
communications to Members; and other types of expenses approved by the
Directors. Offering costs are charged to capital as incurred.
D. INCOME TAXES
No provision for the payment of Federal, state or local income taxes has
been provided, since the Fund is not subject to income tax. Each Member is
individually required to report on its own tax return its distributive
share of the Fund's taxable income or loss.
The Fund has reclassified $5,471,247 and $64,417,958 from accumulated net
investment loss and accumulated net realized gain from investments,
respectively, to net capital contributions during the year ended December
31, 2004. The reclassification was to reflect, as an adjustment to net
capital contributions, the amount of taxable income or loss that have been
allocated to the Fund's Members and had no effect on net assets.
7
UBS TECHNOLOGY PARTNERS, L.L.C.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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DECEMBER 31, 2004
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2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
E. CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of monies invested in a PNC Bank, NA
account which pays money market rates and are accounted for at cost plus
accrued interest which is included in interest receivable on the Statement
of Assets, Liabilities and Members' Capital.
F. REPURCHASE AGREEMENTS
From time to time the Fund may enter into repurchase agreements. In
connection with such transactions it is the Fund's policy that its
custodian take possession of the underlying collateral securities, the
fair value of which exceeds the principal amount of the repurchase
transaction, including accrued interest, at all times. If the seller
defaults, and the fair value of the collateral declines, realization of
the collateral by the Fund may be delayed or limited. As of December 31,
2004 there were no open repurchase agreements.
G. USE OF ESTIMATES
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires the Manager to make estimates and
assumptions that affect the amounts reported in the financial statements
and accompanying notes. The Manager believes that the estimates utilized
in preparing the Fund's financial statements are reasonable and prudent;
however, actual results could differ from these estimates.
3. RELATED PARTY TRANSACTIONS
UBSFA provides certain management and administrative services to the Fund,
including, among other things, providing office space and other support
services. In consideration for such services, the Fund pays UBSFA a
monthly management fee (the "Fee") at an annual rate of 1% of the Fund's
net assets, excluding assets attributable to the Manager's capital
account. The Fee is paid to UBSFA out of the Fund's assets and debited
against the Members' capital accounts, excluding the Manager's capital
account. A portion of the fee is paid by UBSFA to its affiliates.
UBS Financial Services Inc. ("UBS FSI"), a wholly-owned subsidiary of UBS
Americas, Inc., acts as a placement agent for the Fund, without special
compensation from the Fund, and bears its own costs associated with its
activities as placement agent. Placement fees, if any, charged on
contributions are debited against the contribution amounts, to arrive at a
net subscription amount. The placement fee does not constitute assets of
the Fund.
The net increase (or decrease) in members' capital derived from operations
(net income or loss) is initially allocated to the capital accounts of all
Members on a pro-rata basis, other than the Fee which is similarly
allocated to all Members other than the Manager as described above. In
accordance with the Limited Liability Company Agreement, the Manager is
then allocated an amount based on the
8
UBS TECHNOLOGY PARTNERS, L.L.C.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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DECEMBER 31, 2004
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3. RELATED PARTY TRANSACTIONS (CONTINUED)
performance of the Fund (the "Performance Bonus") for the Measurement
Period, as defined in the Confidential Memorandum (i.e., the period
commencing on the admission of a Member to the Fund, and thereafter each
period commencing on the day following the last Measurement Period and
ending generally on the first to occur of (1) a fiscal year-end or (2) a
whole or partial redemption). The Performance Bonus is calculated
separately with respect to each Member.
The Performance Bonus is equal to 1% of the balance of the Member's
capital account at the end of the Measurement Period, provided that
appreciation in the Member's capital account (net of any Performance
Bonus) exceeds the Member's threshold return. The threshold return is the
amount that a Member would have earned for a fiscal year if it had
received an annualized rate of return of 20% on its opening capital
account balance, as adjusted. No Performance Bonus was earned for the year
ended December 31, 2004.
Each Director who is not an "interested person" of the Fund, as defined by
the 1940 Act, receives an annual retainer of $5,000 plus a fee for each
meeting attended. Any Director who is an "interested person" does not
receive any annual or other fee from the Fund. All Directors are
reimbursed by the Fund for all reasonable out of pocket expenses. Total
amounts expensed by the Fund related to Directors for the year ended
December 31, 2004 were $23,374.
4. ADMINISTRATION AND CUSTODIAN FEES
PFPC Trust Company (an affiliate of PNC Bank, NA) serves as custodian (the
"Custodian") of the Fund's assets and provides custodial services for the
Fund.
PFPC Inc. (also an affiliate of PNC Bank, NA) serves as Administrator and
Accounting Agent to the Fund and in that capacity provides certain
administrative, accounting, record keeping, tax and investor related
services. PFPC Inc. receives a monthly fee primarily based upon (i) the
average net assets of the Fund, subject to a minimum monthly fee, and (ii)
the aggregate net assets of the Fund and certain other investment funds
sponsored or advised by UBS Americas, Inc. or it affiliates. Additionally,
the Fund reimburses certain out of pocket expenses incurred by PFPC Inc.
5. CREDIT FACILITY
Effective July 2, 2004, the Fund, along with other UBS sponsored funds,
entered into a $75,000,000 committed, unsecured revolving line of credit
with Harris Trust and Savings Bank. Under the most restrictive
arrangement, the Fund may borrow an amount that combined with the other
borrowings of the Fund would not exceed 20% of its net assets. The Fund's
borrowing capacity is also limited to the portion of the unused line of
credit at any point in time. The Fund is only liable under the line of
credit to the extent of its own borrowing thereunder. The interest rate on
the borrowing is based on the Federal Funds rate plus 150 basis points per
annum. The expiration date of such credit agreements is July 1, 2005. The
committed facility also requires a fee to be paid by the Fund, on a
prorata basis, based on the amount of the aggregate commitment which has
not been utilized of 25 basis points per annum. The fund has no borrowings
outstanding at December 31, 2004.
9
UBS TECHNOLOGY PARTNERS, L.L.C.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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DECEMBER 31, 2004
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6. SECURITIES TRANSACTIONS
Aggregate purchases and sales of Investment Funds for the year ended
December 31, 2004, amounted to $48,750,000 and $204,510,162, respectively.
The cost of investments for Federal income tax purposes is adjusted for
items of taxable income allocated to the Fund from the Investment Funds.
The allocated taxable income is reported to the Fund by the Investment
Funds on Schedules K-1. The Fund has not yet received all such Schedules
K-1 for the year ended December 31, 2004.
7. INVESTMENTS
As of December 31, 2004, the Fund had investments in Investment Funds,
none of which were related parties. The Fund's investments are summarized
below based on the investment objectives of the specific Investment Funds
at December 31, 2004.
INVESTMENT OBJECTIVE COST FAIR VALUE
-------------------- ---- ----------
Long/Short Equity $314,514,335 $382,535,327
The agreements related to investments in Investment Funds provide for
compensation to the general partners/managers in the form of management
fees of 1% to 2% (per annum) of net assets and performance incentive fees
or allocations of 20% of net profits earned. The Investment Funds provide
for periodic redemptions, with lock up provisions ranging up to three
years from initial investment. Detailed information about the Investment
Funds' portfolios is not available.
8. FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK
In the normal course of business, the Investment Funds in which the Fund
invests trade various financial instruments and enter into various
investment activities with off-balance sheet risk. These include, but are
not limited to, short selling activities, writing option contracts,
contracts for differences, and equity swaps. The Fund's risk of loss in
these Investment Funds is limited to the value of these investments as
reported by the Fund.
9. INDEMNIFICATION
In the ordinary course of business, the Fund may enter into contracts or
agreements that contain indemnifications or warranties. Future events
could occur that lead to the execution of these provisions against the
Fund. Based on its history and experience, management feels the likelihood
of such an event is remote.
10
UBS TECHNOLOGY PARTNERS, L.L.C.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
DECEMBER 31, 2004
- --------------------------------------------------------------------------------
10. FINANCIAL HIGHLIGHTS
The following represents the ratios to average net assets and other
supplemental information for the periods indicated:
YEARS ENDED DECEMBER 31,
2004 2003 2002 2001 2000
---- ---- ---- ---- ----
Ratio of net investment loss to
average net assets**** (1.19)% (1.14)% (1.11)% (1.06)% (1.11)%
Ratio of total expenses to average
net assets(a), **** 1.23% 1.22% 1.16% 1.15% 1.20%
Portfolio turnover rate 10.84% 27.53% 26.80% 9.74% 0.00%
Total return pre incentive allocation** 1.82% 3.02% (1.90)% (4.80)% 14.24%
Total return post incentive allocation*** 1.82% 3.02% (1.90)% (4.80)% 14.24%
Average debt ratio**** .04% -- -- -- --
Net asset value at end of year $309,564,962 $503,380,100 $653,040,209 $832,173,503 $753,481,256
(a) Ratio of total expenses to average net assets does not include the
impact of expenses for incentivE allocations or incentive fees
related to the underlying Investment Funds.
* Annualized.
** Total return assumes a purchase of an interest in the Fund at the
beginning of the period and a sale of the Fund interest on the last
day of the period noted and does not reflect the deduction of
placement fees, if any, incurred when subscribing to the Fund. Total
returns for a period of less than a full year are not annualized. An
individual member's ratios and return may vary from the above based
on incentive allocation, if applicable and the timing of capital
transactions.
*** Total return assumes a purchase of an interest in the Fund at the
beginning of the period and a sale of the Fund interest on the last
day of the period noted, after Performance Bonus to the Manager, and
does not reflect the deduction of placement fees, if any, incurred
when subscribing to the Fund. Total returns for a period of less
than a full year are not annualized.
**** The average net assets used in the above ratios are calculated by
adding any withdrawals payable effective at the end of a period to
the net assets for such period.
11. SUBSEQUENT EVENTS
Effective January 1, 2005, the Fund has redeemed approximately
$104,000,000 in interest from Investment Funds. Effective January 12,
2005, the unsecured revolving line of credit with Harris Trust and Savings
Bank was increased to a commitment of $150,000,000.
11
UBS TECHNOLOGY PARTNERS, L.L.C.
SCHEDULE OF PORTFOLIO INVESTMENTS
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DECEMBER 31, 2004
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REALIZED AND
UNREALIZED
GAIN/(LOSS)
% OF MEMBERS' FROM
INVESTMENT FUND: COST FAIR VALUE CAPITAL INVESTMENTS LIQUIDITY
- ---------------- ------------ ------------ ------------ ------------- ---------
Andor Technology Perennial Fund, L.P.* $ -- $ 12,559,678 4.06% $ (2,293,714) Quarterly
Andor Technology Small Cap Fund, L.P.** 11,500,000 12,973,361 4.19 (820,199) Quarterly
Artis Technology Qualified Partners, L.P. 25,250,000 31,453,536 10.16 2,693,561 Quarterly
Artis Technology Qualified 2X, L.P. 5,750,000 6,472,357 2.09 722,357 Quarterly
Bowman Capital Founders Private 2,152,335 114,325 0.04 (58,403) ***
Cavalry Technology, L.P. 30,000,000 33,652,662 10.87 (2,082,551) Quarterly
Chilton New Area Partners, L.P. 45,000,000 47,086,863 15.21 (1,523,660) Annually
Coatue Qualified Partners, LP 26,500,000 28,300,568 9.14 1,632,208 Quarterly
Intrepid Capital Fund (QP), L.P. 23,312,000 41,654,504 13.46 2,764,583 Quarterly
Kaintuck Opportunity Fund B, L.L.C 18,000,000 19,334,451 6.25 884,335 Annually
Loch Fund, L.P. 25,550,000 27,918,335 9.02 2,010,595 Quarterly
Minot Capital II, L.P. 32,500,000 33,727,143 10.89 (1,289,587) Quarterly
Mosaic Technology Fund, L.P. 3,000,000 3,249,238 1.05 (186,538) Quarterly
Mosaic Technology Fund II, L.P. 6,000,000 6,513,335 2.10 (342,356) Quarterly
TCS Capital II, L.P. 25,000,000 33,437,622 10.80 7,750,103 Quarterly
Tiger Technology Fund, L.P. 10,000,000 18,604,723 6.01 3,284,371 Annually
Sidus Investments, Ltd. Series A2 10,000,000 9,917,843 3.20 (82,157) Quarterly
Sidus Investments, Ltd. Series A3 5,000,000 4,988,964 1.61 (11,036) Quarterly
Sidus Investments, Ltd. Series A10 10,000,000 10,575,819 3.42 575,819 Quarterly
Redeemed Investment Funds: -- -- -- (703,490)
------------ ------------ ------ ------------
TOTAL $314,514,335 $382,535,327 123.57% $ 12,924,241
============ ============ ====== ============
* Formerly, Pequot Technology Perennial Fund, L.P.
** Initial lock-up is three years from initial investment;
approximately six months remaining.
*** The liquidity of the Fund's investments is driven by the Investment
Fund's ability to liquidate its Private Investments.
The preceding notes are an integral part of these financial statements.
12
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DIRECTORS AND OFFICERS (Unaudited)
Information pertaining to the Directors and officers of the Fund is set forth
below. The statement of additional information (SAI) includes additional
information about the Directors and is available without charge, upon request,
by calling UBS Financial Service Inc.'s, Alternative Investment Group at
800-580-2359.
- -------------------------------------------------------------------------------------------------------------------------
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX OTHER TRUSTEESHIPS/
TERM OF OFFICE OVERSEEN DIRECTORSHIPS
NAME, AGE, ADDRESS AND AND LENGTH OF PRINCIPAL OCCUPATION(S) BY HELD BY DIRECTOR
POSITION(S) WITH FUND TIME SERVED(1) DURING PAST 5 YEARS DIRECTOR(2) OUTSIDE FUND COMPANY
- --------------------- -------------- ------------------- ----------- --------------------
- -------------------------------------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
- -------------------------------------------------------------------------------------------------------------------------
Meyer Feldberg, (62) Term - Dean and Professor of Mgmt of 48 Director of:
UBS Financial Services Inc. Indefinite Graduate School of Business, Primedia, Inc.,
1285 Avenue of the Americas Length-since Columbia University Federated Department
New York, NY 10019 Inception Stores, Inc.,
Director Revlon, Inc., Select
Medical, Inc. and
SAPPI, Ltd.
- -------------------------------------------------------------------------------------------------------------------------
George W. Gowen, (75) Term - Law partner for Dunnington, 14 None
UBS Financial Services Inc. Indefinite Bartholow & Miller
1285 Avenue of the Americas Length-since
New York, NY 10019 Inception
Director
- -------------------------------------------------------------------------------------------------------------------------
Stephen H. Penman, (58) Term - Professor of Financial 14 None
UBS Financial Services Inc. Indefinite Accounting of Graduate School
1285 Avenue of the Americas Length-since of Business, Columbia University
New York, NY 10019 July 2004
Director
- -------------------------------------------------------------------------------------------------------------------------
OFFICER(S) WHO ARE NOT DIRECTORS
- -------------------------------------------------------------------------------------------------------------------------
Michael Mascis, (37) Term-Indefinite Senior Vice President / CFO of N/A N/A
UBS Financial Services Inc. Length- since UBS Financial Services Inc.
1285 Avenue of the Americas July 2002 Alternative Investment Group,
New York, NY 10019 since July 2002. Prior to July
Principal Accounting Officer 2002, Partner Arthur Andersen
and Secretary LLP
- -------------------------------------------------------------------------------------------------------------------------
(1) For Directors, their terms are for the duration of the term of the Fund,
unless his status as a Director shall be sooner terminated by death, adjudicated
incompetent, voluntarily withdraw, physically unable to perform duties, removed
either by vote or written consent of at least two-thirds of the Directors or
vote or written consent of Members holding not less than two-thirds of the total
number of votes eligible to be cast by all Members.
(2) Of the 48 funds/portfolios in the complex, 34 are advised by an affiliate of
UBS Financial Services, Inc., and 14 comprise UBS Financial Services Inc.'s,
Alternative Investment Group of Funds.
The Fund files its complete schedule of portfolio holdings with the Securities
and Exchange Commission ("SEC") for the first and third quarters of each fiscal
year on Form N-Q. The Fund's Forms N-Q are available on the SEC's website at
HTTP://WWW.SEC.GOV and may be reviewed or copied at the SEC's Public Reference
Room in Washington, D.C. Information on the operation of the Public Reference
Room may be obtained by calling 1-800-SEC-0330.
Proxy Voting
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to portfolio securities is available with out charge
upon request by calling the Alternative Investment Group at 800-580-2329.
ITEM 2. CODE OF ETHICS.
(a) The registrant, as of the end of the period covered by this report, has
adopted a code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the registrant
or a third party. The code of ethics may be obtained without charge by
calling 800-486-2608.
(c) There have been no amendments, during the period covered by this
report, to a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are employed
by the registrant or a third party, and that relates to any element of
the code of ethics.
(d) The registrant has not granted any waivers, including an implicit
waiver, from a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are employed
by the registrant or a third party, that relates to one or more of the
items set forth in paragraph (b) of this item's instructions.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
As of the end of the period covered by the report, the registrant's Board had
determined that Professor Stephen Penman, a member of the audit committee of the
Board, is the audit committee financial expert and that he is "independent," as
defined by Item 3 of Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Audit Fees
- ----------
(a) The aggregate fees billed for each of the last two fiscal years for
professional services rendered by the principal accountant for the
audit of the registrant's annual financial statements or services that
are normally provided by the accountant in connection with statutory
and regulatory filings or engagements for those fiscal years are
$77,000 for 2003 and $77,000 for 2004. Such audit fees include fees
associated with the annual audits and fees for providing a report in
connection with the registrant's report on Form N-SAR.
Audit-Related Fees
- ------------------
(b) The aggregate fees billed in each of the last two fiscal years for
assurance and related services by the principal accountant that are
reasonably related to the performance of the audit of the registrant's
financial statements and are not reported under paragraph (a) of this
Item are $4,500 for 2003 and $4,500 for 2004. Audit-related fees
principally include fees associated with reviewing and providing
comments on semi-annual reports.
Tax Fees
- --------
(c) The aggregate fees billed in each of the last two fiscal years for
professional services rendered by the principal accountant for tax
compliance, tax advice, and tax planning are $146,500 for 2003 and
$156,000 for 2004. Tax fees include fees for tax compliance services
and assisting management in the preparation of tax estimates.
All Other Fees
- --------------
(d) The aggregate fees billed in each of the last two fiscal years for
products and services provided by the principal accountant, other than
the services reported in paragraphs (a) through (c) of this Item, are
$8,000 for 2003 and $8,000 for 2004. Fees for all other services
include fees for administrative services associated with preparing the
K-1's for mailing. There were no frees billed in the last two fiscal
years for services rendered by the principal accountant to the
registrant's investment adviser (not including any sub-adviser whose
role is primarily portfolio management and is subcontracted with or
overseen by another investment adviser), and any entity controlling,
controlled by, or under common control with the investment adviser that
provides ongoing services to the registrant ("Service Affiliate") which
were required to be pre-approved by the audit committee.
(e)(1) The registrant's audit committee pre-approves the principal
accountant's engagements for audit and non-audit services to the
registrant, and certain non-audit services to service Affiliates
that are required to be pre-approved, on a case-by-case basis.
Pre-approval considerations include whether the proposed services
are compatible with maintaining the principal accountant's
independence.
(e)(2) There were no services described in each of paragraphs (b) through
(d) of this Item that were approved by the audit committee
pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X,
because such services were pre-approved.
(f) Not applicable.
(g) The aggregate non-audit fees billed by the registrant's accountant for
services rendered to the registrant, and rendered to Service Affiliates
for each of the last two fiscal years of the registrant was $1.2
million for 2003 and $1.5 million for 2004.
(h) The registrant's audit committee of the board of directors HAS
considered whether the provision of non-audit services that were
rendered to Service Affiliates that were not pre-approved pursuant to
paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with
maintaining the principal accountant's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Schedule of Investments in securities of unaffiliated issuers as of the close of
the reporting period is included as part of the report to shareholders filed
under Item 1 of this form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
The registrant is a fund of funds that invests primarily in unregistered
investment vehicles that have investors other than the registrant, and in other
registered investment companies ("Investment Funds"). The Fund may invest a
majority of its assets in non-voting securities of Investment Funds.
The registrant has delegated voting of proxies in respect of portfolio holdings
to UBS Fund Advisor, L.L.C. (the "Adviser"), to vote the Fund's proxies in
accordance with the Adviser's proxy voting guidelines and procedures. However,
Investment Funds typically do not submit matters to investors for vote. If an
Investment Fund submits a matter to the registrant for vote (and the registrant
holds voting interests in the Investment Fund), the Adviser will vote on the
matter in a way that it believes is in the best interest of the registrant and
in accordance with the following proxy voting guidelines (the "Voting
Guidelines"):
o In voting proxies, the Adviser is guided by general fiduciary
principles. The Adviser's goal is to act prudently, solely in the
best interest of the registrant.
o The Adviser attempts to consider all factors of its vote that could
affect the value of the investment and will vote proxies in the
manner that it believes will be consistent with efforts to maximize
shareholder values.
o The Adviser, absent a particular reason to the contrary, generally
will vote with management's recommendations on routine matters.
Other matters will be voted on a case-by-case basis.
The Adviser applies its Voting Guidelines in a manner designed to identify and
address material conflicts that may arise between the Adviser's interests and
those of its clients before voting proxies on behalf of such clients. The
Adviser relies on the following to seek to identify conflicts of interest with
respect to proxy voting and assess their materiality:
o The Adviser's employees are under an obligation (i) to be aware of
the potential for conflicts of interest on the part of the Adviser
with respect to voting proxies on behalf of client accounts both as
a result of an employee's personal relationships and due to special
circumstances that may arise during the conduct of the Adviser's
business, and (ii) to bring conflicts of interest of which they
become aware to the attention of certain designated persons.
o Such designated persons work with appropriate personnel of the
Adviser to determine whether an identified conflict of interest is
material. A conflict of interest will be considered material to the
extent that it is determined that such conflict has the potential
to influence the Adviser's decision-making in voting the proxy. All
materiality determinations will be based
on an assessment of the particular facts and circumstances. The
Adviser shall maintain a written record of all materiality
determinations.
o If it is determined that a conflict of interest is not material,
the Adviser may vote proxies notwithstanding the existence of the
conflict.
o If it is determined that a conflict of interest is material, the
Adviser's legal department works with appropriate personnel of the
Adviser to agree upon a method to resolve such conflict of interest
before voting proxies affected by the conflict of interest. Such
methods may include:
o disclosing the conflict to the registrant's Board and obtaining
the consent from registrant's Board before voting;
o engaging another party on behalf of the client to vote the proxy
on its behalf;
o engaging a third party to recommend a vote with respect to the
proxy based on application of the policies set forth herein; or
o such other method as is deemed appropriate under the
circumstances given the nature of the conflict.
o The Adviser shall maintain a written record of the method used to
resolve a material conflict of interest.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not yet applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's Board, where those changes were
implemented after the registrant last provided disclosure in response to the
requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR 240.14a-101), or
this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of the report that includes the disclosure
required by this paragraph, based on their evaluation of these
controls and procedures required by Rule 30a-3(b) under the 1940 Act
(17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the
Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or
240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17
CFR 270.30a-3(d)) that occurred during the registrant's second fiscal
quarter of the period covered by this report that have materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
(a)(3) Not applicable.
(b) Not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) UBS Technology Partners Fund L.L.C.
-----------------------------------------------------------
By (Signature and Title)* /s/ Richard Sipes
-----------------------------------------------
Richard Sipes, Principal Executive Officer
Date February 28, 2005
--------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Richard Sipes
-----------------------------------------------
Richard Sipes, Principal Executive Officer
Date February 28, 2005
--------------------------------------------------------------------
By (Signature and Title)* /s/ Michael Mascis
-----------------------------------------------
Michael Mascis, Chief Financial Officer
(principal financial officer)
Date February 28, 2005
--------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.