CUSTODIAN SERVICES AGREEMENT
THIS AGREEMENT is made as of [ ], 2001 by and between PFPC TRUST
COMPANY, a limited purpose trust company incorporated under the laws of
Delaware ("PFPC Trust"), and ADVANTAGE ADVISERS MULTI-SECTOR FUND I, a
Delaware business trust (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,
and the rules and regulations of the SEC promulgated
thereunder.
(b) "1934 Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC
promulgated thereunder.
(c) "1940 Act" has the meaning set forth in the recitals
hereof and includes the rules and regulations of the SEC
promulgated thereunder.
(d) "Authorized Person" means any officer of the Fund and any
other person duly authorized by the Fund's Board of
Trustees 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.
(e) "Board of Trustees" and "Shareholders" shall have the
same meanings as set forth in the Fund's Amended and
Restated Agreement and Declaration of Trust.
(f) "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.
(g) "Declaration" means the Fund's Amended and Restated
Agreement and Declaration of Trust, as amended from time
to time.
(h) "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.
(i) "PFPC Trust" means PFPC Trust Company, or a subsidiary or
affiliate of PFPC Trust Company.
(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.
(k) "SEC" means the Securities and Exchange Commission.
(l) "Securities" means Securities (including without
limitation equities, debt obligations, options, and other
"securities" as that term is defined in Section 2(a)(36)
of the 0000 Xxx) and any contracts for forward or future
delivery of any security debt obligation, all manner of
derivative instruments and any contracts based on any
index or group of Securities or debt obligations, and any
options thereon, as well as investments in registered
investment companies and private investment funds.
(m) "Securities Laws" mean the 1933 Act, the 1934 Act and the
1940 Act.
(n) ["Separate Investment Account" shall have the meaning set
forth in the Fund's registration statement.]
(o) "Shares" means the Fund's shares of beneficial interest,
$0.001 par value per share.
(p) "Written Instructions" means (i) written instructions
signed by two Authorized Persons, unless specified
otherwise herein, and received by PFPC Trust or (ii)
trade instructions transmitted by means of an electronic
transaction reporting system which requires the use of a
password or other authorized identifier in order to gain
access. The instructions may be delivered electronically
or 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 Board of Trustees approving the appointment of
PFPC Trust to provide the custodial services set forth
herein and approving this Agreement;
(b) a copy of the Fund's current registration statement on
Form N-2;
(c) a copy of the Declaration;
(d) a copy of the Funds investment advisory agreement
pursuant to which Advantage Advisers, L.L.C., provides
investment advisory services to the Fund;
(e) a copy of the distribution agreement and selling and
servicing agreement with respect to the Shares;
(f) a copy of any administration agreements; provided that,
so long as an affiliate of PFPC Trust serves as
administrator for the Fund, this paragraph (f) will be
deemed satisfied without any further action by the Fund;
or
(g) certified or authenticated copies of any and all
amendments or supplements to the foregoing.
4. Compliance with Laws. PFPC Trust represents and warrants that it
is a trust company that meets the standard set of forth in
Sections 2(a)(5)(C) and Section 26(a)(1) of the 1940 Act. PFPC
Trust agrees to comply with all applicable requirements of the
Securities Laws, and any other laws, rules and regulations of
governmental authorities having jurisdiction with respect to the
duties to be performed by PFPC Trust hereunder.
5. Instructions.
(a) Unless otherwise provided in this Agreement, PFPC Trust
shall act only upon Oral Instructions or Written
Instructions.
(b) PFPC Trust shall be entitled to rely upon any Oral
Instruction or Written Instruction it receives from an
Authorized Person pursuant to this Agreement. PFPC Trust
may assume that any Oral 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 Board of
Trustees or the Shareholders, 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 given on behalf
of the Fund (except where such Oral Instructions are
given by PFPC Trust or its affiliates) and shall endeavor
to ensure 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 or differ in an immaterial fashion from the
Oral Instructions shall in no way invalidate the
transactions or enforceability of the transactions
authorized by the Oral Instructions. Where Oral
Instructions or Written Instructions reasonably appear to
have been received from a person listed on the Authorized
Person Appendix, 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
promptly inform the Fund of such conflict and PFPC Trust
shall refrain from acting in the event of a conflict
unless counsel advises PFPC Trust that a failure to take
action is likely to result in additional loss, liability
or expense. In the event PFPC Trust 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 (to the extent
permitted under clause (c) above) 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 and maintained as required by the 1940 Act and other
applicable securities laws, rules and regulations. The Fund and
its duly authorized officers, employees and agents and the staff
of the SEC 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 Person, at the Fund's expense. No records will be
destroyed without the Fund's written consent.
8. Confidentiality. Each party shall keep confidential all records
and information relating to the other party's business
("Confidential Information"). Confidential Information shall
include (a) any data or information that is competitively
sensitive material, and not generally known to the public,
including, but not limited to, information about product plans,
marketing strategies, finances, operations, customer
relationships, customer profiles, customer lists, sales estimates,
business plans, and internal performance results relating to the
past, present or future business activities of the Fund or PFPC
Trust, their respective subsidiaries and affiliated companies and
the customers, clients and suppliers of any of them; (b) any
scientific or technical information, design, process, procedure,
formula, or improvement that is commercially valuable and secret
in the sense that its confidentiality affords the Fund or PFPC
Trust a competitive advantage over its competitors; (c) all
confidential or proprietary concepts, documentation, reports,
data, specifications, computer software, source code, object code,
flow charts, databases, inventions, know-how, and trade secrets,
whether or not patentable or copyrightable; and (d) anything
designated as confidential. Notwithstanding the foregoing,
information shall not be subject to such confidentiality
obligations if it: (a) is already known to the receiving party at
the time it is obtained; (b) is or becomes publicly known or
available through no wrongful act of the receiving party; (c) is
rightfully received from a third party who, to the best of the
receiving party's knowledge, is not under a duty of
confidentiality; (d) is released by the protected party to a third
party without restriction; (e) is required to be disclosed by the
receiving party pursuant to a requirement of a court order,
subpoena, governmental or regulatory agency or law (provided the
receiving party will provide the other party written notice of
such requirement, to the extent such notice is permitted); (f) is
relevant to the defense of any claim or cause of action asserted
against the receiving party; or (g) has been or is independently
developed or obtained by the receiving party. If any party to this
agreement or any of such party's affiliates or their respective
employees, officers, agents, or representatives (hereinafter,
"Qualified Persons") is requested or required (by oral question,
interrogatories, requests for information or documents, subpoena,
civil investigative demand or similar process) to disclose any
Confidential Information, such Party, on its own behalf or on
behalf of such party's Qualified Person, will promptly notify such
other Party of such request or requirement so that such other
Party may seek an appropriate protective order or waive compliance
with provisions of this Agreement. If, in the absence of a
protective order or the receipt of a waiver hereunder, such Party
or such Party's Qualified Person subject to the disclosure request
or requirement is, in the written opinion of such Party's counsel
addressed to such other Party, compelled to disclose the
Confidential Information or else stand liable for contempt or
suffer other censure or significant penalty, such Party or such
Party's Qualified Person subject to the disclosure request or
requirement may disclose only such of the Confidential Information
to the party compelling disclosure as is required by law. Any
Party that discloses Confidential Information pursuant to the
foregoing sentence shall not be liable for the disclosure of such
Confidential Information to the other Party unless such disclosure
was caused by such Party's or such Party's Qualified Person's
action or inaction that (i) constitutes willful misfeasance, bad
faith, negligence or reckless disregard of their duties hereunder
subject to the disclosure request or requirement or (ii) is not
otherwise permitted by this Agreement.
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 assure that the necessary information is made
available to such independent public accountants in order that
such independent public accountants may provide their opinion to
the Fund or as may otherwise be required by the Securities Laws or
requested 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. In the event of equipment failures, PFPC
Trust shall, at no additional expense to the Fund, 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 attorneys' fees and disbursements and
liabilities arising under the Securities Laws and any
state and foreign securities and blue sky laws) 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;
provided, however, 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 and obligations under this Agreement.
(b) Notwithstanding anything in this Agreement to the
contrary, neither the Fund nor its affiliates shall be
liable for any consequential, special or indirect losses
or damages whether or not the likelihood of such damages
or loss was known by the Fund or its affiliates.
13. Responsibility of PFPC Trust.
(a) PFPC Trust shall be under no duty to take any action on
behalf of the Fund except as necessary to fulfill its
duties and obligations 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
and to act in good faith and to use its best efforts,
within reasonable limits, in performing services provided
for under this Agreement. PFPC Trust shall be liable for
any damages 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 liable for losses beyond its control,
provided, that PFPC Trust has acted in accordance with
the standard of care set forth above; and (ii) PFPC Trust
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, 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 the Property
owned by the Fund, including cash received as a result of
the distribution of Shares during the term of 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 (each an "Account") 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 specifically designated to the Fund.
PFPC Trust shall make cash payments from or for the
Accounts only for:
(i) purchases of Securities in the name of the Fund,
PFPC Trust or PFPC Trust's nominee or a
sub-custodian or nominee thereof as provided in
sub-section (j) and for which PFPC Trust has
received a copy of the broker's or dealer's
confirmation or payee's invoice, as appropriate;
(ii) the repurchase of Shares of the Fund;
(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 receipt of Written
Instructions, the Fund's administrator, as agent
for the Shareholders, of an amount equal to the
amount of dividends and distributions stated in
the Written Instructions to be distributed in
cash by the administrator to Shareholders, or,
in lieu of paying the Fund's administrator, PFPC
Trust may arrange for the direct payment of cash
dividends and distributions to Shareholders in
accordance with procedures mutually agreed upon
from time to time by and among the Fund, PFPC
Trust and the Fund's administrator.
(v) payments, upon receipt of Written Instructions
signed by one Authorized Person, in connection
with the conversion, exchange or surrender of
Securities owned or subscribed to by the Fund
and held pursuant to this Agreement or delivered
to PFPC Trust;
(vi) payments of, subject to receipt of Written
Instructions signed by one Authorized Person,
the amounts of dividends received 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) other payments, upon Written Instructions.
PFPC Trust is hereby authorized to endorse and collect
all checks, drafts or other orders for the payment of
money received as custodian for the Fund.
(c) Receipt of Securities; Subcustodians.
(i) PFPC Trust shall hold all Securities received by
it for the Fund [or any Separate Investment
Account] in separate account[s] that physically
segregates such Securities from those of any
[other Separate Investment Account], 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 or upon Written
Instructions authorizing the transaction. In no
case may any member of the Fund's Board of
Managers, 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, which are banks
as defined by the 1940 Act, to perform duties
described in this sub-section (c) with respect
to domestic assets. 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, including but not limited to, if
applicable, standards relating to the custody of
foreign Securities. Any such arrangement will
not be entered into without prior written notice
to the Fund.
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 and from 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 a 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 received by PFPC Trust
as custodian 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 to a broker in
connection with the broker's custody of margin
collateral relating to futures and options
transactions;
(xi) release and deliver Securities owned by the Fund
for the purpose of redeeming in kind Interests
of the Fund upon delivery thereof to PFPC Trust;
and
(xii) release and deliver or exchange Securities owned
by the Fund for other purposes.
(e) Use of Book-Entry System. PFPC Trust is authorized and
instructed on a continuous basis, to deposit in
Book-Entry Systems all Securities belonging to the Fund
eligible for deposit therein and to utilize Book-Entry
Systems 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.
(ii) Assets 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 will 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 a Portfolio may be registered in the
name of the Fund, PFPC Trust, a 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 Fund and which may
from time to time be registered 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 a Book-Entry System, shall
execute in blank and promptly deliver all notices,
proxies and proxy soliciting materials received by PFPC
Trust as custodian 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) elect 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, in addition, 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) PFPC Trust is authorized to 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,
for 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
Internal Revenue 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.
(i) Segregated Accounts.
PFPC Trust shall upon receipt of Written
Instructions or Oral Instructions 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 a Book-Entry System:
(A) for the purposes of compliance by the
Fund with the procedures required by a
securities, futures 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 purposes.
[(ii) PFPC Trust shall arrange for the
establishment of XXX custodian accounts
for such members holding Shares through
XXX accounts, in accordance with the
Fund's prospectuses, the Internal
Revenue Code of 1986, as amended
(including regulations promulgated
thereunder), and with such other
procedures as are mutually agreed upon
from time to time by and among the Fund,
PFPC Trust and the Fund's transfer
agent.]
(j) Purchases of Securities. PFPC Trust shall settle
purchased Securities upon receipt of Oral Instructions or
Written Instructions that specify:
(i) the name of the issuer and the title of the
Securities, including CUSIP number if
applicable;
(ii) the number of Interests 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
shall upon receipt of Securities purchased by or
for the Fund 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 that specify:
(i) the name of the issuer and the title of the
security, including CUSIP number if applicable;
(ii) the number of Interests 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. Notwithstanding the other provisions
hereof, PFPC Trust may accept payment in such form which
is consistent with industry practice 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
security 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 of 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, other corporate action 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 hereunder in the amount
necessary to secure the return and payment to PFPC Trust
of any advance or credit made by PFPC Trust (including
reasonable charges related thereto).
(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 and 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 shall also
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.
(o) Maintenance of Records and Accounting Services. PFPC
Trust will maintain records with respect to transactions
for which PFPC Trust is responsible pursuant to the terms
and conditions of this Agreement, and in compliance with
the 1940 Act. The books and records of PFPC Trust
pertaining to its actions under this Agreement and
reports by PFPC Trust or its independent accountants
concerning its accounting system, procedures for
safeguarding securities and internal accounting controls
will be open to inspection and audit at reasonable times
by officers or auditors employed by the Fund and will be
preserved by PFPC Trust in the prescribed by, and in
accordance with, the 1940 Act. PFPC Trust shall perform
fund accounting and shall keep the books of account and
render statements or copies from time to time as
reasonably requested by the Treasurer or any officer of
the Fund. PFPC Trust shall assist generally in the
preparation of reports to shareholders and others, audits
of accounts and other ministerial matter of like nature.
15. Duration and Termination. This Agreement shall continue until
terminated by either party upon [ninety (90)] days' prior written
notice to the other party by certified mail with confirmed
receipt. In the event this Agreement is terminated (pending
appointment of a successor to PFPC Trust or vote of the
Shareholders 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
[Portfolios] 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) and
which meets the requirements of Rule 17(f)(1) under the 1940 Act,
as a custodian for the Fund to be held under terms similar to
those of this Agreement. -
16. Notices. All notices and other communications, including Written
Instructions, shall be in writing or by confirming telegram,
cable, telex or facsimile sending device. Notices shall be
addressed (a) if to PFPC Trust at 0000 Xxxxxxx Xxxxxxxxx, 0xx
Xxxxx, Xxxxx 000, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000, Attention: Xxx
Xxxxxxxx; (b) if to the Fund, at c/o CIBC World Markets Corp., 000
Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, XX 00000, Attn: Xxxxxx X.
Xxxxxx 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. This Agreement and the rights and duties
of the parties herein may not be assigned; provided, however, that
PFPC Trust may assign its rights and delegate its duties hereunder
at no additional cost to the Fund to any affiliate of or any
majority-owned direct or indirect subsidiary of PFPC Inc. or of
PNC Bank Corp., provided that (i) PFPC Trust gives the Fund sixty
(60) days' prior written notice of such assignment or delegation;
(ii) the assignee or delegate agrees to comply with the relevant
provisions of the Securities Laws; and (iii) PFPC Trust and such
assignee or delegate promptly provide such information as the Fund
may request, and respond to such questions as the Fund may ask,
relative to the assignment or delegation, (including, without
limitation) the capabilities of the assignee or delegate. Except
as stated above, this Agreement may not be assigned or delegated
by any party without the written consent of each party.
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:
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Title:
-------------------------------
ADVANTAGE ADVISERS MULTI-SECTOR FUND I
By:
-----------------------------------
Title:
--------------------------------
AUTHORIZED PERSONS APPENDIX
NAME (Type) SIGNATURE
Xxxxxx Xxxxxx
Xxxxx XxXxxxxx
