PRIVATE INVESTMENT COMPANY CUSTODIAN AGREEMENT
CUSTODIAN
AGREEMENT
THIS
AGREEMENT is made and entered into as of this ____ day of April 2010, by and
between SCS HEDGED
OPPORTUNITIES MASTER FUND, LLC, a Delaware limited liability company (the
“Fund”) and U.S. BANK NATIONAL
ASSOCIATION, a national banking association organized and existing under
the laws of the United States of America with its principal place of business at
Minneapolis, Minnesota (the “Custodian”).
WHEREAS,
the Fund is a private investment company;
WHEREAS,
the Custodian is in the business of, among other things, providing custodial
services to private investment companies;
WHEREAS,
the Fund desires to retain the Custodian to act as custodian of its cash and
securities; and
NOW,
THEREFORE, in consideration of the promises and mutual covenants herein
contained, and other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto, intending to be legally bound, do
hereby agree as follows:
ARTICLE
1
CERTAIN
DEFINITIONS
Whenever
used in this Agreement, the following words and phrases shall have the meanings
set forth below unless the context otherwise requires:
|
(a)
|
“Authorized
Person” means any person authorized by the Fund, on the list
attached hereto as Exhibit A (as
amended from time to time), to give Written Instructions on behalf of the
Fund. An Authorized Person’s scope of authority may be limited
by setting forth such limitation in a written document signed by both
parties hereto.
|
|
(b)
|
“Securities”
means any “security” as that term is defined in Section 2(a)(36) of the
Investment Company Act of 1940, as
amended.
|
|
(c)
|
“Written
Instructions” mean (i) written instructions signed by two
Authorized Persons and received by the Custodian, 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. Written Instructions may be delivered
electronically or by hand, electronic mail or facsimile sending
device.
|
ARTICLE
2
APPOINTMENT
OF CUSTODIAN
The Fund
hereby appoints the Custodian as custodian of all Securities and cash owned by
or in the possession of the Fund at any time during the period of this
Agreement, on the terms and conditions set forth in this Agreement, and the
Custodian hereby accepts such appointment and agrees to perform the services and
duties set forth in this Agreement. The services and duties of the
Custodian shall be confined to those matters expressly set forth herein, and no
implied duties are assumed by or may be asserted against the Custodian
hereunder.
ARTICLE
3
INSTRUCTIONS
|
(a)
|
Unless
otherwise provided in this Agreement, the Custodian shall act only upon
Written Instructions.
|
|
(b)
|
The
Custodian shall be entitled to rely upon any Written Instruction it
receives from an Authorized Person pursuant to this
Agreement. The Custodian may assume that any 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 or the Fund’s members, unless and
until the Custodian receives Written Instructions to the
contrary.
|
|
(c)
|
Where
Written Instructions reasonably appear to have been received from an
Authorized Person, the Custodian shall incur no liability to the Fund in
acting upon such Written Instruction provided that the Custodian’s actions
comply with the other provisions of this
Agreement.
|
ARTICLE
4
NAMES,
TITLES, AND SIGNATURES OF AUTHORIZED PERSONS
The Fund
shall certify to the Custodian the names, titles, and signatures of Authorized
Persons who are authorized to give Written Instructions to the Custodian on
behalf of the Fund. The Fund agrees that, whenever any change in such
authorization occurs, it will file with the Custodian a new certified list of
names, titles, and signatures which shall be signed by at least one officer
previously certified to the Custodian if such officer still holds an office with
the Fund. The Custodian is authorized to rely and act upon the names,
titles, and signatures of the individuals as they appear in the most recent
certified list which has been delivered to the Custodian.
ARTICLE
5
RECEIPT
AND DISBURSEMENT OF MONEY
Section
5.1 The Fund
shall, from time to time, cause cash owned by the Fund to be delivered or paid
to the Custodian, but the Custodian shall not be under any obligation or duty to
determine whether all cash of the Fund is being so deposited or to take any
action or to give any notice with respect to cash not so
deposited. The Custodian agrees to hold such cash, together with any
other sum collected or received by it, for or on behalf of the Fund (the “Fund
Account”). The Custodian shall make payments of cash from the Fund
Account only:
2
|
(a)
|
for
bills, statements and other obligations of the Fund (including but not
limited to obligations in connection with the conversion, exchange or
surrender of securities owned by the Fund, interest charges, dividend
disbursements, taxes, management fees, custodian fees, legal fees,
auditors’ fees, transfer agents’ fees, brokerage commissions, compensation
to personnel, and other operating expenses of the Fund) pursuant to
Written Instructions from the Fund setting forth the name of the person to
whom payment is to be made, the amount of the payment, and the purpose of
the payment;
|
|
(b)
|
as
provided in Article 6 hereof; and
|
|
(c)
|
upon
the termination of this Agreement.
|
Section
5.2 The
Custodian is hereby appointed the attorney-in-fact of the Fund to enforce and
collect all checks, drafts, or other orders for the payment of money received by
the Custodian for the Fund Account and drawn to or to the order of the Fund and
to deposit them in said account.
ARTICLE
6
RECEIPT
OF SECURITIES
The Fund
agrees to place all of its Securities in the custody of the Custodian, but the
Custodian shall not be under any obligation or duty to determine whether all
Securities of the Fund are being so deposited or to take any action or give any
notice with respect to the Securities not so deposited. The Custodian
agrees to hold such Securities for the account of the Fund, in the name of the
Fund or a bearer or nominee of the Custodian, and in conformity with the terms
of this Agreement. The Custodian also agrees, upon Written
Instructions from the Fund, to receive from persons other than the Fund and to
hold for the account of the Fund Securities specified in said Written
Instructions, and, if the same are in proper form, to cause payment to be made
therefor to the persons from whom such Securities were received, from the funds
of the Fund held by it in the Fund Account in the amounts provided and in the
manner directed by the Written Instructions from the Fund.
The
Custodian agrees that all Securities of the Fund placed in its custody shall be
kept physically segregated at all times from those of any other person, firm, or
corporation, and shall be held by the Custodian with all reasonable precautions
for the safekeeping thereof, with safeguards substantially equivalent to those
maintained by the Custodian for its own Securities.
Subject
to such rules, regulations, and orders as the Securities and Exchange Commission
(the “SEC”) may adopt, the Fund may direct the Custodian to deposit all or any
part of the Securities owned by the Fund in a system for the central handling of
Securities established by a national securities exchange or a national
securities association registered with the SEC under the Securities Exchange Act
of 1934, as amended, or such other person as may be permitted by the SEC,
pursuant to which system all Securities of any particular class of any issuer
deposited within the system are treated as fungible and may be transferred or
pledged by bookkeeping entry without physical delivery of such Securities,
provided that all such deposits shall be subject to withdrawal only at the
direction of the Fund.
3
ARTICLE
7
TRANSFER,
EXCHANGE, AND DELIVERY OF SECURITIES
The
Custodian agrees to transfer, exchange, and deliver Securities as provided in
Article 8, or on receipt by it of, and in accordance with, Written Instructions
from the Fund in which the Fund shall state specifically which of the following
cases is covered thereby, provided that it shall not be the responsibility of
the Custodian to determine the propriety or legality of any such
order:
|
(a)
|
In
the case of deliveries of Securities sold by the Fund, against receipt by
the Custodian of the proceeds of sale and after receipt of a confirmation
from a broker or dealer with respect to the
transaction;
|
|
(b)
|
In
the case of deliveries of Securities which may mature or be called,
redeemed, retired, or otherwise become payable, against receipt by the
Custodian of the sums payable thereon or against interim receipts or other
proper delivery receipts;
|
|
(c)
|
In
the case of deliveries of Securities which are to be transferred to and
registered in the name of the Fund or of a nominee of the Custodian and
delivered to the Custodian for the account of the Fund, against receipt by
the Custodian of interim receipts or other proper delivery
receipts;
|
|
(d)
|
In
the case of deliveries of Securities to the issuer thereof, its transfer
agent or other proper agent, or to any committee or other organization for
exchange for other Securities to be delivered to the Custodian in
connection with a reorganization or recapitalization of the issuer or any
split-up or similar transaction involving such Securities, against receipt
by the Custodian of such other Securities or against interim receipts or
other proper delivery receipts;
|
|
(e)
|
In
the case of deliveries of temporary certificates in exchange for permanent
certificates, against receipt by the Custodian of such permanent
certificates or against interim receipts or other proper delivery
receipts;
|
|
(f)
|
In
the case of deliveries of Securities upon conversion thereof into other
Securities, against receipt by the Custodian of such other Securities or
against interim receipts or other proper delivery
receipts;
|
|
(g)
|
In
the case of deliveries of Securities in exchange for other Securities
(whether or not such transactions also involve the receipt or payment of
cash), against receipt by the Custodian of such other Securities or
against interim receipts or other proper delivery
receipts;
|
|
(h)
|
In
a case not covered by the preceding paragraphs of this Article, upon
receipt of a resolution adopted by the Fund specifying the Securities and
assets to be transferred, exchanged, or delivered, the purposes for which
such delivery is being made, declaring such purposes to be proper
corporate purposes, and naming a person or persons to whom such transfer,
exchange, or delivery is to be made;
and
|
4
|
(i)
|
In
the case of deliveries pursuant to paragraphs (a), (b), (c), (d), (e),
(f), and (g) above, the Written Instructions from the Fund shall direct
that the proceeds of any Securities delivered, or Securities or other
assets exchanged for or in lieu of Securities so delivered, are to be
delivered to the Custodian.
|
ARTICLE
8
CUSTODIAN’S
ACTS WITHOUT INSTRUCTIONS
Unless
and until the Custodian receives contrary Written Instructions from the Fund,
the Custodian shall, without order from the Fund:
|
(a)
|
Present
for payment all bills, notes, checks, drafts, and similar items, and all
coupons or other income items (except stock dividends), held or received
for the account of the Fund, and which require presentation in the
ordinary course of business, and credit such items to the Fund Account
pursuant to the Custodian’s then current funds availability schedule, but
the Custodian shall have no duty to take action to effect collection of
any amount if the assets upon which such payment is due are in default or
if payment is refused after due demand and
presentation;
|
|
(b)
|
Present
for payment all Securities which may mature or be called, redeemed,
retired, or otherwise become payable and credit such items to the Fund
Account pursuant to the Custodian’s then current funds availability
schedule, but the Custodian shall have no duty to take action to effect
collection of any amount if the assets upon which such payment is due are
in default or if payment is refused after due demand and
presentation;
|
|
(c)
|
Hold
for and credit to the Fund Account all shares of stock and other
Securities received as stock dividends or as the result of a stock split
or otherwise from or on account of Securities of the Fund, and notify the
Fund promptly of the receipt of such
items;
|
|
(d)
|
Deposit
any cash received by it from, for or on behalf of the Fund to the credit
of the Fund in the Fund Account (in its own deposit department without
liability for interest);
|
|
(e)
|
Charge
against the Fund Account for Fund disbursements authorized to be made by
the Custodian hereunder and actually made by it, and notify the Fund of
such charges at least once a month;
|
|
(f)
|
Deliver
Securities which are to be transferred to and reissued in the name of the
Fund, or of a nominee of the Custodian for the account of the Fund, and
temporary certificates which are to be exchanged for permanent
certificates, to a proper transfer agent for such purpose against interim
receipts or other proper delivery receipts;
and
|
5
|
(g)
|
Hold
for disposition in accordance with Written Instructions from the Fund
hereunder all options, rights, and similar Securities which may be
received by the Custodian and which are issued with respect to any
Securities held by it hereunder, and notify the Fund promptly of the
receipt of such items.
|
ARTICLE
9
DELIVERY
OF PROXIES
The
Custodian shall deliver promptly to the Fund all proxies, written notices, and
communications with respect to Securities held by it for the account of the Fund
which it may receive from securities issuers or obligors and/or via the industry
standard information services to which Custodian subscribes.
ARTICLE
10
TRANSFER
OF SECURITIES
The Fund
shall furnish to the Custodian appropriate instruments to enable the Custodian
to hold or deliver in proper form for transfer any Securities which it may hold
for the Fund. For the purpose of facilitating the handling of
Securities, unless the Fund shall otherwise direct by Written Instructions, the
Custodian is authorized to hold Securities deposited with it under this
Agreement in the name of its registered nominee or nominees (as defined in the
Internal Revenue Code and any Regulations of the United States Treasury
Department issued thereunder or in any provision of any subsequent federal tax
law exempting such transaction from liability for stock transfer taxes) and
shall execute and deliver such certificates in connection therewith as may be
required by such laws or regulations or under the laws of any
state. The Custodian shall advise the Fund of the certificate number
of each certificate so presented for transfer and that of the certificate
received in exchange therefor, and shall use its best efforts to the end that
the specific Securities held by it hereunder shall be at all times
identifiable.
ARTICLE
11
TRANSFER
TAXES AND OTHER DISBURSEMENTS
The Fund
shall pay or reimburse the Custodian for any transfer taxes payable upon
transfers of Securities made hereunder, including transfers incident to the
termination of this Agreement, and for all other necessary and proper
disbursements and expenses made or incurred by the Custodian in the performance
or incident to the termination of this Agreement, and the Custodian shall have a
lien upon any cash or Securities held by it for the account of the Fund for all
such items, enforceable, after 30 days’ written notice by registered mail to the
Fund, by the sale of sufficient Securities to satisfy such lien. The
Custodian may reimburse itself by deducting from the proceeds of any sale of
Securities an amount sufficient to pay any transfer taxes payable upon the
transfer of Securities sold. The Custodian shall execute such
certificates in connection with Securities delivered to it under this Agreement
as may be required, under the provisions of any federal revenue act and any
Regulations of the Treasury Department issued thereunder or any state laws, to
exempt from taxation any transfers and/or deliveries of any such Securities as
may qualify for such exemption.
6
ARTICLE
12
CUSTODIAN’S
REPORT
The
Custodian shall furnish the Fund, as of the close of business on the last
business day of each month, a statement showing all cash transactions and
entries for the Fund Account and a list of the Securities held by it in custody
for the account of the Fund.
ARTICLE
13
COMPENSATION
OF CUSTODIAN
The
Custodian shall be compensated for providing the services set forth in this
Agreement in accordance with the fee schedule set forth on Exhibit B hereto (as
amended from time to time). The Custodian shall also be compensated
for such out-of-pocket expenses (e.g., telecommunication charges, postage and
delivery charges, and reproduction charges) as are reasonably incurred by the
Custodian in performing its duties hereunder. The Fund shall pay all
such fees and reimbursable expenses within 30 calendar days following the
receipt of the billing notice, except for any fee or expense subject to a good
faith dispute. The Fund shall use reasonable efforts to notify the
Custodian in writing within 30 calendar days following receipt of each invoice
if the Fund is disputing any amounts in good faith. The Fund shall
pay such disputed amounts within 10 calendar days of the day on which the
parties agree to the amount to be paid. With the exception of any fee
or expense the Fund is disputing in good faith as set forth above, unpaid
invoices shall accrue a finance charge of 1½% per month after the due
date.
ARTICLE
14
REPRESENTATIONS
AND WARRANTIES
Section
14.1 Representations and
Warranties of the Fund. The Fund hereby represents and
warrants to the Custodian, which representations and warranties shall be deemed
to be continuing throughout the term of this Agreement, that:
|
(a)
|
It
is duly organized and existing under the laws of the jurisdiction of its
organization, with full power to carry on its business as now conducted,
to enter into this Agreement and to perform its obligations
hereunder;
|
|
(b)
|
This
Agreement has been duly authorized, executed and delivered by the Fund in
accordance with all requisite action and constitutes a valid and legally
binding obligation of the Fund, enforceable in accordance with its terms,
subject to bankruptcy, insolvency, reorganization, moratorium and other
laws of general application affecting the rights and remedies of creditors
and secured parties; and
|
|
(c)
|
It
is conducting its business in compliance in all material respects with all
applicable laws and regulations, both state and federal, and has obtained
all regulatory approvals necessary to carry on its business as now
conducted; there is no statute, rule, regulation, order or judgment
binding on it and no provision of its charter, bylaws or any contract
binding it or affecting its property which would prohibit its execution or
performance of this Agreement.
|
7
Section
14.2 Representations and
Warranties of the Custodian. The Custodian hereby represents
and warrants to the Fund, which representations and warranties shall be deemed
to be continuing throughout the term of this Agreement, that:
|
(a)
|
It
is duly organized and existing under the laws of the jurisdiction of its
organization, with full power to carry on its business as now conducted,
to enter into this Agreement and to perform its obligations
hereunder;
|
|
(b)
|
This
Agreement has been duly authorized, executed and delivered by the
Custodian in accordance with all requisite action and constitutes a valid
and legally binding obligation of the Custodian, enforceable in accordance
with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the rights and
remedies of creditors and secured parties;
and
|
|
(c)
|
It
is conducting its business in compliance in all material respects with all
applicable laws and regulations, both state and federal, and has obtained
all regulatory approvals necessary to carry on its business as now
conducted; there is no statute, rule, regulation, order or judgment
binding on it and no provision of its charter, bylaws or any contract
binding it or affecting its property which would prohibit its execution or
performance of this Agreement.
|
ARTICLE
15
STANDARD
OF CARE; INDEMNIFICATION; LIMITATION OF LIABILITY
Section
15.1 Standard of
Care. The Custodian shall exercise reasonable care in the
performance of its duties under this Agreement. The Custodian shall
not be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with its duties under this Agreement,
including losses resulting from mechanical breakdowns or the failure of
communication or power supplies beyond the Custodian’s control, except a loss
arising out of or relating to the Custodian’s refusal or failure to comply with
the terms of this Agreement or from its bad faith, negligence or willful
misconduct in the performance of its duties under this Agreement. The
Custodian shall be entitled to rely on and may act upon advice of qualified
outside legal counsel on all matters, and shall be without liability for any
action reasonably taken or omitted pursuant to such advice. The
Custodian shall promptly notify the Fund of any action taken or omitted by the
Custodian pursuant to advice of counsel.
Section
15.2 Actual Collection
Required. The Custodian shall not be liable for, or considered
to be the custodian of, any cash belonging to the Fund or any money represented
by a check, draft or other instrument for the payment of money, until the
Custodian or its agents actually receive such cash or collect on such
instrument.
Section
15.3 No Responsibility for Title,
etc. So long as and to the extent that it is in the exercise
of reasonable care, the Custodian shall not be responsible for the title,
validity or genuineness of any property or evidence of title thereto received or
delivered by it pursuant to this Agreement.
8
Section
15.4 Limitation on Duty to
Collect. Custodian shall not be required to enforce
collection, by legal means or otherwise, of any money or property due and
payable with respect to Securities held for the Fund if such Securities are in
default or payment is not made after due demand or presentation.
Section
15.5 Reliance Upon Documents and
Instructions. The Custodian shall be entitled to rely upon any
certificate, notice or other instrument in writing received by it and reasonably
believed by it to be genuine. The Custodian shall be entitled to rely
upon any Written Instructions actually received by it pursuant to this
Agreement.
Section
15.6 Indemnification by
Fund. The Fund shall indemnify and hold harmless the Custodian
from and against any and all claims, demands, losses, expenses and liabilities
of any and every nature (including reasonable attorneys’ fees) that the
Custodian may sustain or incur or that may be asserted against the Custodian by
any person arising directly or indirectly (a) from any action taken or omitted
to be taken by the Custodian (i) at the request or direction of or in reliance
on the advice of the Fund, or (ii) upon Written Instructions, or (b) from the
performance of its obligations under this Agreement, provided that the Custodian
shall not be indemnified and held harmless from and against any such claim,
demand, loss, expense or liability arising out of or relating to its refusal or
failure to comply with the terms of this Agreement, or from its bad faith,
negligence or willful misconduct in the performance of its duties under this
Agreement. This indemnity shall be a continuing obligation of the
Fund, its successors and assigns, notwithstanding the termination of this
Agreement. As used in this paragraph, the term “Custodian” shall
include the Custodian’s directors, officers and employees.
Section
15.7 Indemnification by
Custodian. The Custodian shall indemnify and hold harmless the
Fund from and against any and all claims, demands, losses, expenses, and
liabilities of any and every nature (including reasonable attorneys’ fees) that
the Fund may sustain or incur or that may be asserted against the Fund by any
person arising out of any action taken or omitted to be taken by the Custodian
as a result of the Custodian’s refusal or failure to comply with the terms of
this Agreement, or from its bad faith, negligence or willful misconduct in the
performance of its duties under this Agreement. This indemnity shall
be a continuing obligation of the Custodian, its successors and assigns,
notwithstanding the termination of this Agreement. As used in this
paragraph, the term “Fund” shall include the Fund’s directors, officers and
employees.
Section
15.8 Security. If
the Custodian advances cash or Securities to the Fund for any purpose, or in the
event that the Custodian incurs, in connection with its performance under this
Agreement, any claim, demand, loss, expense or liability (including reasonable
attorneys' fees) (except such as may arise from its bad faith, negligence or
willful misconduct), then, in any such event, any property at any time held for
the account of the Fund shall be security therefor, and should the Fund fail
promptly to repay or indemnify the Custodian, the Custodian shall be entitled to
utilize available cash of such Fund and to dispose of other assets of such Fund
to the extent necessary to obtain reimbursement or indemnification.
9
Section
15.9 Miscellaneous.
|
(a)
|
Neither
party to this Agreement shall be liable to the other party for
consequential, special or punitive damages under any provision of this
Agreement.
|
|
(b)
|
In
the event of a mechanical breakdown or failure of communication or power
supplies beyond its control, the Custodian shall take all reasonable steps
to minimize service interruptions for any period that such interruption
continues. The Custodian will make every reasonable effort to restore any
lost or damaged data and correct any errors resulting from such a
breakdown at the expense of the Custodian. The Custodian agrees
that it shall, at all times, have reasonable contingency plans with
appropriate parties, making reasonable provision for emergency use of
electrical data processing equipment to the extent appropriate equipment
is available. Representatives of the Fund shall be entitled to
inspect the Custodian’s premises and operating capabilities at any time
during regular business hours of the Custodian, upon reasonable notice to
the Custodian. Moreover, the Custodian shall provide the Fund,
at such times as the Fund may reasonably require, copies of reports
rendered by independent accountants on the internal controls and
procedures of the Custodian relating to the services provided by the
Custodian under this Agreement. Notwithstanding the above, the
Custodian reserves the right to reprocess and correct administrative
errors at its own expense.
|
|
(c)
|
In
order that the indemnification provisions contained in this Article shall
apply, it is understood that if in any case the indemnitor may be asked to
indemnify or hold the indemnitee harmless, the indemnitor shall be fully
and promptly advised of all pertinent facts concerning the situation in
question, and it is further understood that the indemnitee will use all
reasonable care to notify the indemnitor promptly concerning any situation
that presents or appears likely to present the probability of a claim for
indemnification. The indemnitor shall have the option to defend the
indemnitee against any claim that may be the subject of this
indemnification. In the event that the indemnitor so elects, it
will so notify the indemnitee and thereupon the indemnitor shall take over
complete defense of the claim, and the indemnitee shall in such situation
initiate no further legal or other expenses for which it shall seek
indemnification under this section. The indemnitee shall in no
case confess any claim or make any compromise in any case in which the
indemnitor will be asked to indemnify the indemnitee except with the
indemnitor’s prior written consent.
|
|
(d)
|
The
indemnity and defense provisions of this Article shall indefinitely
survive the termination and/or assignment of this
Agreement.
|
10
ARTICLE
16
CUSTODIAN’S
LIABILITY FOR PROCEEDS OF SECURITIES SOLD
If the
mode of payment for Securities to be delivered by the Custodian is not specified
in the Written Instructions from the Fund directing such delivery, the Custodian
shall make delivery of such Securities against receipt by it of cash, a postal
money order or a check drawn by a bank, trust company, or other banking
institution, or by a broker named in such Written Instructions from the Fund,
for the amount the Custodian is directed to receive. The Custodian
shall be liable for the proceeds of any delivery of Securities made pursuant to
this Article, but provided that it has complied with the provisions of this
Article, only to the extent that such proceeds are actually
received.
ARTICLE
17
PROPRIETARY
AND CONFIDENTIAL INFORMATION
The
Custodian agrees on behalf of itself and its directors, officers and employees
to treat confidentially and as proprietary information of the Fund, all records
and other information relative to the Fund and prior, present, or potential
investors thereof (and clients of said investors) and not to use such records
and information for any purpose other than the performance of its
responsibilities and duties hereunder, except (i) after prior notification to
and approval in writing by the Fund, which approval shall not be unreasonably
withheld and may not be withheld where the Custodian may be exposed to civil or
criminal contempt proceedings for failure to comply, (ii) when requested to
divulge such information by duly constituted authorities, or (iii) when so
requested by the Fund. Records and other information which have
become known to the public through no wrongful act of the Custodian or any of
its employees, agents or representatives, and information that was already in
the possession of the Custodian prior to the receipt thereof from the Fund or
its agent, shall not be subject to this paragraph. Further, the
Custodian will adhere to any privacy policies adopted by the
Fund. The Custodian maintains appropriate security measures regarding
the treatment of the records and other information (including any personal
information) of the Fund and prior, present or potential investors, that are
consistent and compliant with all applicable state and federal laws, rules and
regulations.
ARTICLE
18
RECORDS
The books
and records pertaining to the Fund, which are in the possession or under the
control of the Custodian, shall be the property of the Fund. The
Custodian shall keep such books and records in the form and manner, and for such
period, as it may deem advisable, as is consistent with industry practice and as
is agreeable to the Fund. The Fund and Authorized Persons shall have
reasonable access to such books and records at all times during the Custodian’s
normal business hours. Upon the reasonable request of the Fund,
copies of any such books and records shall be provided by the Custodian to the
Fund or to an Authorized Person, at the Fund’s expense.
11
ARTICLE
19
TERM
OF AGREEMENT; AMENDMENT
This
Agreement shall become effective as of the date first written above and will
continue in effect for an initial term of three years (the “Initial Term”)
unless otherwise terminated as provided below. Thereafter, unless
otherwise terminated earlier as provided below, this Agreement automatically
renews for additional one year terms (each a “Renewal Term”) unless the Fund
notifies Custodian, in writing, of its intention to terminate at least sixty
(60) days prior to the end of the Initial Term or the then current Renewal
Term. Notwithstanding the foregoing, Custodian may terminate this
Agreement at any time upon giving ninety (90) days prior written notice to the
Fund. Furthermore, either party may terminate this Agreement upon the
breach of the other party of any material term of this Agreement if such breach
is not cured within thirty (30) days of notice of such breach to the breaching
party. This Agreement may not be amended or modified in any manner
except by written agreement executed by the Custodian and the Fund.
ARTICLE
20
DUTIES
IN THE EVENT OF TERMINATION
Upon
termination of this Agreement, the assets of the Fund held by the Custodian
shall be delivered by the Custodian to a successor custodian upon receipt of
Written Instructions designating the successor custodian and if no successor
custodian is designated, the Custodian shall, upon such termination, deliver all
such assets to the Fund. In addition, the Custodian shall transfer to
such successor custodian or to the Fund, as the case may be, at the expense of
the Fund, all relevant books, records, correspondence, and other data
established or maintained by the Custodian under this Agreement in a form
reasonably acceptable to the Fund (if such form differs from the form in which
the Custodian has maintained the same, the Fund shall pay any expenses
associated with transferring the data to such form), and will cooperate in the
transfer of such duties and responsibilities, including provision for assistance
from the Custodian’s personnel in the establishment of books, records, and other
data by such successor or the Fund, as the case may be.
ARTICLE
21
MISCELLANEOUS
|
(a)
|
Compliance with
Laws. In the performance of its duties hereunder, the
Custodian undertakes to comply with the laws, rules and regulations of
governmental authorities having jurisdiction with respect to the duties to
be performed by the Custodian hereunder. Except as specifically
set forth herein, the Custodian assumes no responsibility for such
compliance by the Fund.
|
|
(b)
|
Assignment. This
Agreement shall extend to and be binding upon the parties hereto and their
respective successors and assigns; provided, however, that this Agreement
shall not be assignable by either party hereto without the written consent
of the other party.
|
12
|
(c)
|
Governing
Law. This Agreement shall be construed in accordance
with the laws of the State of Delaware, without regard to conflicts of law
principles.
|
|
(d)
|
No Agency
Relationship. Nothing herein contained shall be deemed
to authorize or empower either party to act as agent for the other party
to this Agreement, or to conduct business in the name, or for the account,
of the other party to this
Agreement.
|
|
(e)
|
Services Not
Exclusive. Nothing in this Agreement shall limit or
restrict the Custodian from providing services to other parties that are
similar or identical to some or all of the services provided
hereunder.
|
|
(f)
|
Invalidity. Any
provision of this Agreement which may be determined by competent authority
to be prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction. In such case, the parties shall in good faith
modify or substitute such provision consistent with the original intent of
the parties.
|
|
(g)
|
Notices. Any
notice required or permitted to be given by either party to the other
shall be in writing and shall be deemed to have been given on the date
delivered personally or by courier service, or three days after sent by
registered or certified mail, postage prepaid, return receipt requested,
or on the date sent and confirmed received by facsimile transmission to
the other party’s address set forth
below:
|
Notice to
the Custodian shall be sent to:
U.S. Bank National
Association
Attn: Mutual Fund Custody
Services
000 Xxxxxx Xxxxxx, X.X.
XX-XX-X0XX
Xxxxxxxxxx, XX 00000
Fax No.: (000) 000-0000
and
Notice to
the Fund shall be sent to:
c/o SCS
Capital Management, LLC
Xxx
XxXxxxx, Managing Director
Xxx
Xxxxxxxx Xxxxxx
Xxxxxx,
XX 00000
Fax:
(000) 000-0000
13
|
(h)
|
Multiple
Originals. This Agreement may be executed on two or more
counterparts, each of which when so executed shall be deemed to be an
original, but such counterparts shall together constitute but one and the
same instrument.
|
[SIGNATURE PAGE
FOLLOWS]
14
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by
a duly authorized officer on one or more counterparts as of the date first above
written.
|
|
By:
|
_____________________________
|
|
|
Name:
|
Xxx
XxXxxxx
|
|
|
Title:
|
Director
|
U.S.
BANK NATIONAL ASSOCIATION
|
|
By:
|
_____________________________
|
|
|
Name:
|
_____________________________
|
|
|
Title:
|
_____________________________
|
15
EXHIBIT
A
List
of Authorized Persons
|
Name
|
Title
|
|
|
Xxxxx
Xxxxxxx
|
President
and CEO (Fund)
|
|
|
Xxxxxx
XxXxxxx
|
VP
and CFO (Fund)
|
|
|
Xxx
Xxxxxxx
|
Portfolio
Manager (Fund)
|
|
|
Xxxxxxx
Xxxx
|
Director
of Operations (Adviser)
|
|
|
Xxxxxxx
Xxxxxxxxx
|
Manager,
Investment Operations (Adviser)
|
|
|
Mo
Omran
|
Manager,
Hedge Fund Operations/ Performance & Analytics
(Adviser)
|
A-1
EXHIBIT
B
Custodian
Compensation
Annual Fee Based Upon Market
Value*
[
] basis point on average daily market value of the Fund plus standard
transaction fees
Minimum
annual fee - $[ ]*
Plus
Out-Of-Pocket Expenses – Including but not limited to expenses incurred
in the safekeeping, delivery and receipt of securities, shipping, transfer fees,
extraordinary expenses based upon complexity, and all other out-of-pocket
expenses.
Fees are
billed monthly.
* Subject
to CPI increase, Milwaukee MSA (to be applied annually on the first and each
subsequent 12-month anniversary of launch date).
B-1
EXHIBIT
C
Shareholder
Communications Act Authorization
|
NAME OF FUND: SCS HEDGED
OPPORTUNITIES MASTER FUND, LLC
|
The
Shareholder Communications Act of 1985 requires banks and trust companies to
make an effort to permit direct communication between a company which issues
securities and the shareholder who votes those securities.
Unless
you specifically require us to NOT release your name and address to requesting
companies, we are required by law to disclose your name and
address.
Your
"yes" or "no" to disclosure will apply to all securities U.S. Bank holds for you
now and in the future, unless you change your mind and notify us in
writing.
|
_____ Yes
|
U.S.
Bank is authorized to provide my name, address and security position to
requesting companies whose stock is owned by
me.
|
|
__X__ No
|
U.S.
Bank is NOT authorized to provide my name, address and security position
to requesting companies whose stock is owned by
me.
|
Signature:
_________________________________________
Date:
____________________________________________
C-1
