EXHIBIT (j)
CUSTODIAN SERVICES AGREEMENT
THIS AGREEMENT is made as of August 31, 2000 by and between PFPC TRUST
COMPANY, a limited purpose trust company organized under the laws of Delaware
("PFPC Trust"), and X.X. XXXXXX HEDGE FUND SERIES/CORE LLC, a Delaware limited
liability company (the "Fund").
W I T N E S S E T H:
WHEREAS, the Fund is registered as a closed-end, non-diversified
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Fund wishes to retain PFPC Trust to provide custodian
services, and PFPC Trust wishes to furnish custodian services, either directly
or through an affiliate or affiliates, as more fully described herein.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. DEFINITIONS. AS USED IN THIS AGREEMENT:
(a) "1933 ACT" means the Securities Act of 1933, as amended.
(b) "1934 ACT" means the Securities Exchange Act of 1934, as amended.
(c) "AUTHORIZED PERSON" means any person duly authorized by the Fund's
directors to give Oral Instructions and Written Instructions on behalf
of the Fund and listed on the Authorized Persons Appendix attached
hereto and made a part hereof, or any amendment thereto as may be
received by PFPC Trust. An Authorized Person's scope of authority may
be limited by the Fund by setting forth such limitation in the
Authorized Persons Appendix.
(d) "BOOK-ENTRY SYSTEM" means Federal Reserve Treasury book-entry system
for United States and federal agency securities, its successor or
successors, and its nominee or nominees and any book-entry system
maintained by an exchange registered with the SEC under the 1934 Act.
(e) "CEA" means the Commodities Exchange Act, as amended.
(f) "CODE" means the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder.
(g) "INTERESTS" mean the ownership interests of the Fund.
(h) "MEMBER" shall have the same meaning given such term in the Fund's
limited liability company agreement ("LLC Agreement").
(i) "ORAL INSTRUCTIONS" mean oral instructions received by PFPC Trust from
an Authorized Person or from a person reasonably believed by PFPC
Trust to be an Authorized Person.
(j) "PROPERTY" means:
(i) any and all securities and other investment items which the
Fund may from time to time deposit, or cause to be
deposited, with PFPC Trust or which PFPC Trust may from time
to time hold for the Fund;
(ii) all income in respect of any of such securities or other
investment items;
(iii) all proceeds of the sale of any of such securities or
investment items; and
(iv) all proceeds of the sale of securities issued by the Fund,
which are received by PFPC Trust from time to time, from or
on behalf of the Fund.
(i) "SEC" means the Securities and Exchange Commission.
(j) "SECURITIES LAWS" mean the 1933 Act, the 1934 Act, the 1940 Act and
the CEA.
(k) "WRITTEN INSTRUCTIONS" mean written instructions signed by two
Authorized Persons and received by PFPC Trust. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or facsimile
sending device.
2. APPOINTMENT. The Fund hereby appoints PFPC Trust to provide custodian
services to the Fund and PFPC Trust accepts such appointment and agrees to
furnish such services.
3. DELIVERY OF DOCUMENTS. The Fund has provided or, where applicable, will
provide PFPC Trust with the following:
(a) certified or authenticated copies of the resolutions of the Fund's
directors, approving the appointment of PFPC Trust or its affiliates
to provide services;
(b) a copy of the Fund's most recent effective registration statement;
(c) a copy of the Fund's advisory agreements;
(d) a copy of the LLC Agreement and placement agency agreement with
respect to the Fund;
(e) a copy of the Fund's administration agreement if PFPC Trust is not
providing the Fund with such services;
(f) copies of any investor servicing agreements made in respect of the
Fund; and
(g) certified or authenticated copies of any and all amendments or
supplements to the foregoing.
4. COMPLIANCE WITH LAWS. PFPC Trust undertakes to comply with all applicable
requirements of the Securities Laws and any laws, rules and regulations of
governmental authorities having jurisdiction with respect to the duties to
be performed by PFPC Trust hereunder. Except as specifically set forth
herein, PFPC Trust assumes no responsibility for such compliance by the
Fund.
5. INSTRUCTIONS.
(a) Unless otherwise provided in this Agreement, PFPC Trust shall act only
upon Oral Instructions and Written Instructions.
(b) PFPC Trust shall be entitled to rely upon any Oral Instructions and
Written Instructions it receives from an Authorized Person (or from a
person reasonably believed by PFPC Trust to be an Authorized Person)
pursuant to this Agreement. PFPC Trust may assume that any Oral
Instructions or Written Instructions received hereunder are not in any
way inconsistent with the provisions of organizational documents of
the Fund or of any vote, resolution or proceeding of the Fund's
directors or Members unless and until PFPC Trust receives Written
Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Trust Written Instructions
confirming Oral Instructions (except where such Oral Instructions are
given by PFPC Trust or its affiliates) so that PFPC Trust receives the
Written Instructions by the close of business on the same day that
such Oral Instructions are received. The fact that such confirming
Written Instructions are not received by PFPC Trust in no way shall
invalidate the transactions or enforceability of the transactions
authorized by the Oral Instructions. PFPC agrees to notify the Fund
promptly if confirming Written Instructions are not timely received or
if they differ from such Oral Instructions. Where Oral Instructions or
Written Instructions reasonably appear to have been received from an
Authorized Person, PFPC Trust shall incur no liability to the Fund in
acting upon such Oral Instructions or Written Instructions provided
that PFPC Trust's actions comply with the other provisions of this
Agreement.
6. RIGHT TO RECEIVE ADVICE.
(a) ADVICE OF THE FUND. If PFPC Trust is in doubt as to any action it
should or should not take, PFPC Trust may request directions or
advice, including Oral Instructions or Written Instructions, from the
Fund.
(b) ADVICE OF COUNSEL. If PFPC Trust shall be in doubt as to any question
of law pertaining to any action it should or should not take, PFPC
Trust may request advice at its own cost from such counsel of its own
choosing (who may be counsel for the Fund, the Fund's investment
adviser or PFPC Trust, at the option of PFPC Trust).
(c) CONFLICTING ADVICE. In the event of a conflict between directions,
advice or Oral Instructions or Written Instructions PFPC Trust
receives from the Fund, and the advice it receives from counsel, PFPC
Trust shall be entitled to rely upon and follow the advice of counsel
provided that such counsel is selected with reasonable care. In the
event PFPC Trust so relies on the advice of counsel, PFPC Trust
remains liable for any action or omission on the part of PFPC Trust
which constitutes willful misfeasance, bad faith, negligence or
reckless disregard by PFPC Trust of any duties, obligations or
responsibilities set forth in this Agreement.
(d) PROTECTION OF PFPC TRUST. PFPC Trust shall be protected in any action
it takes or does not take in reliance upon directions, advice or Oral
Instructions or Written Instructions it receives from the Fund or from
counsel and which PFPC Trust believes, in good faith, to be consistent
with those directions, advice or Oral Instructions or Written
Instructions. Nothing in this section shall be construed so as to
impose an obligation upon PFPC Trust (i) to seek such directions,
advice or Oral Instructions or Written Instructions, or (ii) to act in
accordance with such directions, advice or Oral Instructions or
Written Instructions unless, under the terms of other provisions of
this Agreement, the same is a condition of PFPC Trust's properly
taking or not taking such action. Nothing in this subsection shall
excuse PFPC Trust when an action or omission on the part of PFPC Trust
constitutes willful misfeasance, bad faith, negligence or reckless
disregard by PFPC Trust of any duties, obligations or responsibilities
set forth in this Agreement.
7. RECORDS; VISITS. The books and records pertaining to the Fund, which are in
the possession or under the control of PFPC Trust, shall be the property of
the Fund. Such books and records shall be prepared, preserved and
maintained as required by the 1940 Act and other applicable securities
laws, rules and regulations. The Fund and Authorized Persons shall have
access to such books and records at all times during PFPC Trust's normal
business hours. Upon the reasonable request of the Fund, copies of any such
books and records shall be provided by PFPC Trust to the Fund or to an
authorized representative of the Fund, at the Fund's expense.
8. CONFIDENTIALITY. PFPC Trust agrees to keep confidential all records of the
Fund and information relating to the Fund, the Fund's directors and the
Members, unless the release of such records or information is otherwise
consented to, in writing, by the Fund. The Fund agrees that such consent
shall not be unreasonably withheld and may not be withheld where PFPC Trust
may be exposed to civil or criminal contempt proceedings or when required
to divulge such information or records to duly constituted authorities.
9. COOPERATION WITH ACCOUNTANTS. PFPC Trust shall cooperate with the Fund's
independent public accountants and shall take all reasonable action in the
performance of its obligations under this Agreement to ensure that the
necessary information is made available to such accountants for the
expression of their opinion, as required by the Fund.
10. DISASTER RECOVERY. PFPC Trust shall enter into and shall maintain in effect
with appropriate parties one or more agreements making reasonable
provisions for emergency use of electronic data processing equipment to the
extent appropriate equipment is available. In the event of equipment
failures, PFPC Trust at no additional expense to the Fund, shall take
reasonable steps to minimize service interruptions. PFPC Trust shall have
no liability with respect to the loss of data or service interruptions
caused by equipment failure provided such loss or interruption is not
caused by PFPC Trust's own willful misfeasance, bad faith, negligence or
reckless disregard of its duties or obligations under this Agreement.
11. COMPENSATION. As compensation for custody services rendered by PFPC Trust
during the term of this Agreement, the Fund will pay to PFPC Trust a fee or
fees as may be agreed to in writing from time to time by the Fund and PFPC
Trust.
12. INDEMNIFICATION. (a) The Fund agrees to indemnify and hold harmless PFPC
Trust and its affiliates from all taxes, charges, expenses, assessments,
claims and liabilities (including, without limitation, liabilities arising
under the Securities Laws and any state and foreign securities and blue sky
laws, and amendments thereto) and expenses, including (without limitation)
reasonable attorneys' fees and disbursements, (collectively, "Losses")
arising directly or indirectly from any action or omission to act which
PFPC Trust takes (i) at the request or on the direction of or in reliance
on the advice of the Fund or (ii) upon Oral Instructions or Written
Instructions. Neither PFPC Trust, nor any of its affiliates, shall be
indemnified against any liability (or any expenses incident to such
liability) arising out of PFPC Trust's or its affiliates' own willful
misfeasance, bad faith, negligence or reckless disregard of its duties
under this Agreement. (b) Notwithstanding anything in this Agreement to the
contrary, the Fund shall not be liable to PFPC Trust or its affiliates for
any consequential, special or indirect losses or damages which PFPC Trust
or its affiliates may incur or suffer, whether or not the likelihood of
such losses or damages was known by the Fund.
13. RESPONSIBILITY OF PFPC TRUST.
(a) PFPC Trust shall be under no duty to take any action on behalf of the
Fund except as specifically set forth herein or as may be specifically
agreed to by PFPC Trust in writing. PFPC Trust shall be obligated to
exercise care and diligence in the performance of its duties
hereunder, to act in good faith and to use its best efforts, within
reasonable limits, in performing services provided for under this
Agreement. PFPC Trust agrees to indemnify and hold harmless the Fund
from Losses arising out of PFPC Trust's failure to perform its duties
under this Agreement to the extent such damages arise out of PFPC
Trust's willful misfeasance, bad faith, negligence or reckless
disregard of its duties under this Agreement.
(b) Without limiting the generality of the foregoing or of any other
provision of this Agreement, (i) PFPC Trust shall not be under any
duty or obligation to inquire into and shall not be liable for (A) the
validity or invalidity or authority or lack thereof of any Oral
Instruction or Written Instruction, notice or other instrument which
conforms to the applicable requirements of this Agreement, and which
PFPC Trust reasonably believes to be genuine; or (B) subject to
Section 10 of this Agreement, delays or errors or loss of data
occurring by reason of circumstances beyond PFPC Trust's control,
including acts of civil or military authority, national emergencies,
fire, flood, catastrophe, acts of God, insurrection, war, riots or
failure of the mails, transportation, communication or power supply.
(c) Notwithstanding anything in this Agreement to the contrary, neither
PFPC Trust nor its affiliates shall be liable to the Fund for any
consequential, special or indirect losses or damages which the Fund
may incur or suffer by or as a consequence of PFPC Trust's or its
affiliates' performance of the services provided hereunder, whether or
not the likelihood of such losses or damages was known by PFPC Trust
or its affiliates.
14. DESCRIPTION OF SERVICES.
(a) DELIVERY OF THE PROPERTY. The Fund will deliver or arrange for
delivery to PFPC Trust, all of the Property owned by the Fund,
including cash received as a result of the distribution of Interests,
during the period that is set forth in this Agreement. PFPC Trust will
not be responsible for such Property until actual receipt.
(b) RECEIPT AND DISBURSEMENT OF MONEY. PFPC Trust, acting upon Written
Instructions, shall open and maintain separate accounts in the Fund's
name using all cash received from or for the account of the Fund,
subject to the terms of this Agreement. In addition, upon Written
Instructions, PFPC Trust shall open separate custodial accounts for
the Fund (collectively, the "Accounts") and shall hold in the Accounts
all cash received from or for the Accounts of the Fund. PFPC Trust
shall make cash payments from or for the Accounts of the Fund only
for:
(i) purchases of securities in the name of PFPC Trust or PFPC
Trust's nominee as provided in sub-section (j) of this
Section and for which PFPC Trust has received a copy of the
broker's or dealer's confirmation or payee's invoice, as
appropriate;
(ii) purchase or redemption of Interests delivered to PFPC Trust;
(iii) payment of, subject to Written Instructions, interest,
taxes, administration, accounting, distribution, advisory,
management fees or similar expenses which are to be borne by
the Fund;
(iv) payment to, subject to Written Instructions, the Members of
an amount equal to the amount of dividends and distributions
stated in the Written Instructions to be distributed in
cash.
(v) payments, upon Written Instructions, in connection with the
conversion, exchange or surrender of securities owned or
subscribed to by the Fund and held by or delivered to PFPC
Trust;
(vi) payments of the amounts of dividends with respect to
securities sold short;
(vii) payments made to a sub-custodian pursuant to provisions in
sub-section (c) of this Section; and
(viii) payments, upon Written Instructions, made for other proper
Fund purposes.
PFPC Trust hereby is authorized to endorse and collect all checks,
drafts or other orders for the payment of money received as custodian for
the Accounts.
(c) RECEIPT OF SECURITIES; SUBCUSTODIANS.
(i) PFPC Trust shall hold all securities received by it for the
Accounts in a separate account that physically segregates
such securities from those of any other persons, firms or
corporations, except for securities held in a Book-Entry
System. All such securities shall be held or disposed of
only upon Written Instructions of the Fund pursuant to the
terms of this Agreement. PFPC Trust shall have no power or
authority to assign, hypothecate, pledge or otherwise
dispose of any such securities or investment, except upon
the express terms of this Agreement and upon Written
Instructions, accompanied by a certified resolution of the
Fund's directors, authorizing the transaction. In no case
may any of the Fund's directors, or any officer, employee or
agent of the Fund withdraw any securities.
At PFPC Trust's own expense and for its own
convenience, PFPC Trust may enter into sub-custodian
agreements with other United States banks or trust companies
to perform duties described in this sub-section (c). Such
bank or trust company shall have an aggregate capital,
surplus and undivided profits, according to its last
published report, of at least one million dollars
($1,000,000), if it is a subsidiary or affiliate of PFPC
Trust, or at least twenty million dollars ($20,000,000) if
such bank or trust company is not a subsidiary or affiliate
of PFPC Trust. In addition, such bank or trust company must
be qualified to act as custodian and agree to comply with
the relevant provisions of the 1940 Act and other applicable
rules and regulations. Any such arrangement will not be
entered into without prior written notice to the Fund.
In addition, PFPC Trust may enter into
arrangements with sub-custodians with respect to services
regarding foreign assets. Any such arrangement will be
entered into with prior written notice to the Fund (or as
otherwise provided in the 1940 Act).
PFPC Trust shall remain responsible for the performance of
all of its duties as described in this Agreement and shall hold the
Fund harmless from its own acts or omissions, under the standards of
care provided for herein, or the acts and omissions of any
sub-custodian chosen by PFPC Trust under the terms of this sub-section
(c).
(d) TRANSACTIONS REQUIRING INSTRUCTIONS. Upon receipt of Oral Instructions
or Written Instructions and not otherwise, PFPC Trust, directly or
through the use of the Book-Entry System, shall:
(i) deliver any securities held for the Fund against the receipt
of payment for the sale of such securities;
(ii) execute and deliver to such persons as may be designated in
such Oral Instructions or Written Instructions, proxies,
consents, authorizations, and any other instruments whereby
the authority of the Fund as owner of any securities may be
exercised;
(iii) deliver any securities to the issuer thereof, or its agent,
when such securities are called, redeemed, retired or
otherwise become payable; provided that, in any such case,
the cash or other consideration is to be delivered to PFPC
Trust;
(iv) deliver any securities held for the Fund against receipt of
other securities or cash issued or paid in connection with
the liquidation, reorganization, refinancing, tender offer,
merger, consolidation or recapitalization of any
corporation, or the exercise of any conversion privilege;
(v) deliver any securities held for the Fund to any protective
committee, reorganization committee or other person in
connection with the reorganization, refinancing, merger,
consolidation, recapitalization or sale of assets of any
corporation, and receive and hold under the terms of this
Agreement such certificates of deposit, interim receipts or
other instruments or documents as may be issued to it to
evidence such delivery; (vi) make such transfer or exchanges
of the assets of the Fund and take such other steps as shall
be stated in said Oral Instructions or Written Instructions
to be for the purpose of effectuating a duly authorized plan
of liquidation, reorganization, merger, consolidation or
recapitalization of the Fund;
(vii) release securities belonging to the Fund to any bank or
trust company for the purpose of a pledge or hypothecation
to secure any loan incurred by the Fund; provided, however,
that securities shall be released only upon payment to PFPC
Trust of the monies borrowed, except that in cases where
additional collateral is required to secure a borrowing
already made subject to proper prior authorization, further
securities may be released for that purpose; and repay such
loan upon redelivery to it of the securities pledged or
hypothecated therefor and upon surrender of the note or
notes evidencing the loan;
(viii) release and deliver securities owned by the Fund in
connection with any repurchase agreement entered into on
behalf of the Fund, but only on receipt of payment therefor;
and pay out moneys of the Fund in connection with such
repurchase agreements, but only upon the delivery of the
securities;
(ix) release and deliver or exchange securities owned by the Fund
in connection with any conversion of such securities,
pursuant to their terms, into other securities;
(x) release and deliver securities owned by the Fund for the
purpose of redeeming in kind shares of the Fund upon
delivery thereof to PFPC Trust; and
(xi) release and deliver or exchange securities owned by the Fund
for other corporate purposes.
PFPC Trust must also receive a certified resolution
describing the nature of the corporate purpose and the name and
address of the person(s) to whom delivery shall be made when such
action is pursuant to this sub-section d.
(e) USE OF BOOK-ENTRY SYSTEM. The Fund shall deliver to PFPC Trust
certified resolutions of the Fund's directors approving, authorizing
and instructing PFPC Trust on a continuous basis, to deposit in the
Book-Entry System all securities belonging to the Fund eligible for
deposit therein and to utilize the Book-Entry System to the extent
possible in connection with settlements of purchases and sales of
securities by the Fund, and deliveries and returns of securities
loaned, subject to repurchase agreements or used as collateral in
connection with borrowings. PFPC Trust shall continue to perform such
duties until it receives Written Instructions or Oral Instructions
authorizing contrary actions.
PFPC Trust shall administer the Book-Entry System as follows:
(i) With respect to securities of the Fund which are maintained
in the Book-Entry System, the records of PFPC Trust shall
identify by book-entry or otherwise those securities
belonging to the Fund. PFPC Trust shall furnish to the Fund
a detailed statement of the Property held for the Fund under
this Agreement at least monthly and from time to time and
upon written request.
(ii) Securities and any cash of the Fund deposited in the
Book-Entry System will at all times be segregated from any
assets and cash controlled by PFPC Trust in other than a
fiduciary or custodian capacity but may be commingled with
other assets held in such capacities. PFPC Trust and its
sub-custodian, if any, will pay out money only upon receipt
of securities and will deliver securities only upon the
receipt of money.
(iii) All books and records maintained by PFPC Trust which relate
to the Fund's participation in the Book-Entry System will be
open to the inspection of Authorized Persons at all times
during PFPC Trust's regular business hours, and PFPC Trust
will furnish to the Fund all information in respect of the
services rendered as it may require.
PFPC Trust will also provide the Fund with such reports on its
own system of internal control as the Fund may reasonably request from
time to time.
(f) REGISTRATION OF SECURITIES. All Securities held for the Fund which are
issued or issuable only in bearer form, except such securities held in
the Book-Entry System, shall be held by PFPC Trust in bearer form; all
other securities held for the Fund may be registered in the name of
the Fund, PFPC Trust, the Book-Entry System, a sub-custodian, or any
duly appointed nominees of the Fund, PFPC Trust, Book-Entry System or
sub-custodian. The Fund reserves the right to instruct PFPC Trust as
to the method of registration and safekeeping of the securities of the
Fund. The Fund agrees to furnish to PFPC Trust appropriate instruments
to enable PFPC Trust to hold or deliver in proper form for transfer,
or to register in the name of its nominee or in the name of the
Book-Entry System or in the name of another appropriate entity any
securities which it may hold for the Accounts and which may be
registered from time to time in the name of the Fund.
(g) VOTING AND OTHER ACTION. Neither PFPC Trust nor its nominee shall vote
any of the securities held pursuant to this Agreement by or for the
account of the Fund, except in accordance with Written Instructions.
PFPC Trust, directly or through the use of the Book-Entry System,
shall execute in blank and promptly deliver all notices, proxies and
proxy soliciting materials received by PFPC Trust as custodian of the
Property to the registered holder of such securities. If the
registered holder is not the Fund, then Written Instructions or Oral
Instructions must designate the person who owns such securities.
(h) TRANSACTIONS NOT REQUIRING INSTRUCTIONS. In the absence of contrary
Written Instructions, PFPC Trust is authorized to take the following
actions:
(i) COLLECTION OF INCOME AND OTHER PAYMENTS.
(A) collect and receive for the account of the Fund, all income,
dividends, distributions, coupons, option premiums, other
payments and similar items, included or to be included in
the Property, and promptly advise the Fund of such receipt
and credit such income, as collected, to the Fund's
custodian account;
(B) endorse and deposit for collection, in the name of the Fund,
checks, drafts, or other orders for the payment of money;
(C) receive and hold for the account of the Fund all securities
received as a distribution on the Fund's securities as a
result of a stock dividend, share split-up or
reorganization, recapitalization, readjustment or other
rearrangement or distribution of rights or similar
securities issued with respect to any securities belonging
to the Fund and held by PFPC Trust hereunder;
(D) present for payment and collect the amount payable upon all
securities which may mature or be called, redeemed, or
retired, or otherwise become payable on the date such
securities become payable; and
(E) take any action which may be necessary and proper in
connection with the collection and receipt of such income
and other payments and the endorsement for collection of
checks, drafts, and other negotiable instruments.
(ii) MISCELLANEOUS TRANSACTIONS.
(A) deliver or cause to be delivered Property against payment or
other consideration or written receipt therefor in the
following cases:
(1) for examination by a broker or dealer selling for the
account of the Fund in accordance with street delivery
custom;
(2) for the exchange of interim receipts or temporary
securities for definitive securities; and
(3) for transfer of securities into the name of the Fund or
PFPC Trust or a sub-custodian or a nominee of one of
the foregoing, or for exchange of securities for a
different number of bonds, certificates, or other
evidence, representing the same aggregate face amount
or number of units bearing the same interest rate,
maturity date and call provisions, if any; provided
that, in any such case, the new securities are to be
delivered to PFPC Trust.
(B) Unless and until PFPC Trust receives Oral Instructions or
Written Instructions to the contrary, PFPC Trust shall:
(1) pay all income items held by it which call for payment
upon presentation and hold the cash received by it upon
such payment for the account of the Fund;
(2) collect interest and cash dividends received, with
notice to the Fund, to the account of the Fund;
(3) hold for the account of the Fund all stock dividends,
rights and similar securities issued with respect to
any securities held by PFPC Trust; and
(4) execute as agent on behalf of the Fund all necessary
ownership certificates required by the Code or the
Income Tax Regulations of the United States Treasury
Department or under the laws of any state now or
hereafter in effect, inserting the Fund's name on such
certificate as the owner of the securities covered
thereby, to the extent it may lawfully do so.
(h) SEGREGATED ACCOUNTS.
(i) PFPC Trust upon receipt of Written Instructions or Oral
Instructions, shall establish and maintain segregated accounts on
its records for and on behalf of the Fund. Such accounts may be
used to transfer cash and securities, including securities in the
Book-Entry System:
(A) for the purposes of compliance by the Fund with the
procedures required by a securities or option exchange,
providing such procedures comply with the 1940 Act and any
releases of the SEC relating to the maintenance of
segregated accounts by registered investment companies; and
(B) Upon receipt of Written Instructions, for other proper
corporate purposes.
(ii) PFPC Trust shall arrange for the establishment of XXX
custodian accounts for such Members holding Interests
through XXX accounts, in accordance with the Fund's
confidential memorandum, the Code and such other procedures
as are mutually agreed upon from time to time by and between
the Fund and PFPC Trust.
(j) PURCHASES OF SECURITIES. PFPC Trust shall settle purchased securities
upon receipt of Oral Instructions or Written Instructions from the
Fund or its investment advisers that specify:
(i) the name of the issuer and the title of the securities,
including CUSIP number if applicable;
(ii) the number of shares or the principal amount purchased and
accrued interest, if any;
(iii) the date of purchase and settlement;
(iv) the purchase price per unit;
(v) the total amount payable upon such purchase; and
(vi) the name of the person from whom or the broker through whom
the purchase was made. PFPC Trust, upon receipt of
securities purchased by or for the Fund, shall pay out of
the moneys held for the account of the Fund the total amount
payable to the person from whom or the broker through whom
the purchase was made, provided that the same conforms to
the total amount payable as set forth in such Oral
Instructions or Written Instructions.
(k) SALES OF SECURITIES. PFPC Trust shall settle sold securities upon
receipt of Oral Instructions or Written Instructions from the Fund
that specify:
(i) the name of the issuer and the title of the security,
including CUSIP number if applicable;
(ii) the number of shares or principal amount sold, and accrued
interest, if any;
(iii) the date of trade and settlement;
(iv) the sale price per unit;
(v) the total amount payable to the Fund upon such sale;
(vi) the name of the broker through whom or the person to whom
the sale was made; and
(vii) the location to which the security must be delivered and
delivery deadline, if any.
PFPC Trust shall deliver the securities upon receipt of the
total amount payable to the Fund upon such sale, provided that the
total amount payable is the same as was set forth in the Oral
Instructions or Written Instructions. Subject to the foregoing, PFPC
Trust may accept payment in such form as shall be satisfactory to it,
and may deliver securities and arrange for payment in accordance with
the customs prevailing among dealers in securities.
(l) REPORTS; PROXY MATERIALS.
(i) PFPC Trust shall furnish to the Fund the following reports:
(A) such periodic and special reports as the Fund may reasonably
request;
(B) a monthly statement summarizing all transactions and entries
for the account of the Fund, listing each portfolio
securities belonging to the Fund with the adjusted average
cost of each issue and the market value at the end of such
month and stating the cash account of the Fund including
disbursements;
(C) the reports required to be furnished to the Fund pursuant to
Rule 17f-4 under the 1940 Act; and
(D) such other information as may be agreed upon from time to
time between the Fund and PFPC Trust.
(ii) PFPC Trust shall transmit promptly to the Fund any proxy
statement, proxy material, notice of a call or conversion or
similar communication received by it as custodian of the
Property. PFPC Trust shall be under no other obligation to
inform the Fund as to such actions or events.
(m) CREDITING OF ACCOUNTS. If PFPC Trust in its sole discretion credits an
Account with respect to (a) income, dividends, distributions, coupons,
option premiums, other payments or similar items on a contractual
payment date or otherwise in advance of PFPC Trust's actual receipt of
the amount due, (b) the proceeds of any sale or other disposition of
assets on the contractual settlement date or otherwise in advance of
PFPC Trust's actual receipt of the amount due or (c) provisional
crediting of any amounts due, and (i) PFPC Trust is subsequently
unable to collect full and final payment for the amounts so credited
within a reasonable time period using reasonable efforts or (ii)
pursuant to standard industry practice, law or regulation PFPC Trust
is required to repay to a third party such amounts so credited, or if
any Property has been incorrectly credited, PFPC Trust shall have the
absolute right in its sole discretion without demand to reverse any
such credit or payment, to debit or deduct the amount of such credit
or payment from the Account, and to otherwise pursue recovery of any
such amounts so credited from the Fund. Nothing herein or otherwise
shall require PFPC Trust to make any advances or to credit any amounts
until PFPC Trust's actual receipt thereof. The Fund hereby grants a
first priority contractual possessory security interest in and a right
of setoff against the assets maintained in an Account hereunder in the
amount necessary to secure the return and payment to PFPC Trust of any
advance or credit made by PFPC Trust (including charges related
thereto) to such Account.
(n) COLLECTIONS. All collections of monies or other property in respect,
or which are to become part, of the Property (but not the safekeeping
thereof upon receipt by PFPC Trust) shall be at the sole risk of the
Fund. If payment is not received by PFPC Trust within a reasonable
time after proper demands have been made, PFPC Trust shall notify the
Fund in writing, including copies of all demand letters, any written
responses, memoranda of all oral responses and shall await
instructions from the Fund. PFPC Trust shall not be obliged to take
legal action for collection unless and until reasonably indemnified to
its satisfaction. PFPC Trust also shall notify the Fund as soon as
reasonably practicable whenever income due on securities is not
collected in due course and shall provide the Fund with periodic
status reports of such income collected after a reasonable time.
15. DURATION AND TERMINATION. This Agreement shall continue until terminated by
the Fund or by PFPC Trust on sixty (60) days' prior written notice to the
other party. In the event this Agreement is terminated (pending appointment
of a successor to PFPC Trust or vote of the Members of the Fund to dissolve
or to function without a custodian of its cash, securities or other
property), PFPC Trust shall not deliver cash, securities or other property
of the Fund to the Fund. It may deliver them to a bank or trust company of
PFPC Trust's choice, having an aggregate capital, surplus and undivided
profits, as shown by its last published report, of not less than twenty
million dollars ($20,000,000), as a custodian for the Fund to be held under
terms similar to those of this Agreement. PFPC Trust shall not be required
to make any such delivery or payment until full payment shall have been
made to PFPC Trust of all of its fees, compensation, costs and expenses
(such expenses include, without limitation, expenses associated with
movement (or duplication) of records and materials and conversion thereof
to a successor service provider, or to a bank or trust company pending
appointment of such successor, and all trailing expenses incurred by PFPC
Trust), attributable to the Fund. PFPC Trust shall have a security interest
in and shall have a right of setoff against the Property of the Fund as
security for the payment of such fees, compensation, costs and expenses.
16. NOTICES. All notices and other communications, including Written
Instructions, shall be in writing or by confirming telegram, cable, telex
or facsimile sending device. Notice shall be addressed (a) if to PFPC Trust
at 0000 Xxxxxxx Xxxxxxxxx, Xxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxxxx, XX 00000,
Attn: Xxx Xxxxxxxx, XX, (b) if to the Fund, c/o X.X. Xxxxxx Investment
Management Inc, 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, Attn:
Xxxxxxxx Xxxxx or (c) if to neither of the foregoing, at such other address
as shall have been given by like notice to the sender of any such notice or
other communication by the other party. If notice is sent by confirming
telegram, cable, telex or facsimile sending device, it shall be deemed to
have been given immediately. If notice is sent by first-class mail, it
shall be deemed to have been given five days after it has been mailed. If
notice is sent by messenger, it shall be deemed to have been given on the
day it is delivered.
17. AMENDMENTS. This Agreement, or any term hereof, may be changed or waived
only by a written amendment, signed by the party against whom enforcement
of such change or waiver is sought.
18. DELEGATION; ASSIGNMENT. PFPC Trust may assign its rights and delegate its
duties hereunder to any affiliate (as defined in the 0000 Xxx) of or any
majority-owned direct or indirect subsidiary of PFPC Trust or The PNC
Financial Services Group, Inc. provided that (i) PFPC Trust gives the Fund
sixty (60) days' prior written notice; (ii) the delegate (or assignee)
agrees with PFPC Trust and the Fund to comply with all relevant provisions
of the Securities Laws; and (iii) PFPC Trust and such delegate (or
assignee) promptly provide such information as the Fund may request, and
respond to such questions as the Fund may ask, relative to the delegation
(or assignment), including (without limitation) the capabilities of the
delegate (or assignee).
19. COUNTERPARTS. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
20. FURTHER ACTIONS. Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the purposes hereof.
21. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding between the parties and supersedes all prior agreements
and understandings relating to the subject matter hereof, provided
that the parties may embody in one or more separate documents their
agreement, if any, with respect to delegated duties and Oral
Instructions.
(b) CAPTIONS. The captions in this Agreement are included for convenience
of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
(c) GOVERNING LAW. This Agreement shall be deemed to be a contract made in
Delaware and governed by Delaware law, without regard to principles of
conflicts of law.
(d) PARTIAL INVALIDITY. If any provision of this Agreement shall be held
or made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
(f) FACSIMILE SIGNATURES. The facsimile signature of any party to this
Agreement shall constitute the valid and binding execution hereof by
such party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the day and year first above written.
PFPC TRUST COMPANY
By: /s/ Xxx Xxxxxxxx
------------------------
XXX XXXXXXXX
Title: Vice President
X.X. XXXXXX HEDGE FUND SERIES/CORE
LLC
By: /s/ Xxxxx X. Xxxxxxxx
------------------------
XXXXX X. XXXXXXXX
Title: Vice President
AUTHORIZED PERSONS APPENDIX
NAME (TYPE) SIGNATURE
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