EXHIBIT 99.23(E)
TRANSFER AGENCY SERVICES AGREEMENT
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THIS AGREEMENT is made as of November 1, 2006 by and between PFPC INC.,
a Massachusetts corporation ("PFPC"), and BHR INSTITUTIONAL TRUSTS, a Delaware
statutory trust (the "Trust").
W I T N E S S E T H:
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Trust wishes to retain PFPC to serve as transfer agent,
registrar, dividend disbursing agent and shareholder servicing agent to its
investment series and PFPC wishes to furnish such services.
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 officer of the Trust, and any other
person, duly authorized by the Trust's Board of Trustees to give Oral
Instructions or Written Instructions on behalf of the Trust. An
Authorized Person's scope of authority may be limited by setting forth
such limitation in a written document signed by both parties hereto.
(d) "ORAL INSTRUCTIONS" mean oral instructions received by PFPC from an
Authorized Person
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or from a person reasonably believed by PFPC to be an Authorized
Person. PFPC may, in its sole discretion in each separate instance,
consider and rely upon instructions it receives from an Authorized
Person via electronic mail as Oral Instructions.
(e) "SEC" means the Securities and Exchange Commission.
(f) "SECURITIES LAWS" means the 1933 Act, the 1934 Act and the 0000 Xxx.
(g) "SHARES" means the shares of beneficial interest of any series or class
of the Trust.
(h) "WRITTEN INSTRUCTIONS" mean (i) written instructions signed by an
Authorized Person (or a a person reasonably believed by PFPC to be an
Authorized Person) and received by PFPC or (ii) trade instructions
transmitted (and received by PFPC) by means of an electronic
transaction reporting system access to which requires use of a password
or other authorized identifier. The instructions may be delivered
electronically (with respect to sub-item (ii) above) or by hand, mail
or facsimile sending device.
2. APPOINTMENT. The Trust hereby appoints PFPC to serve as transfer
agent, registrar, dividend disbursing agent and shareholder servicing agent to
the Trust in accordance with the terms set forth in this Agreement. PFPC accepts
such appointment and agrees to furnish such services.
3. COMPLIANCE WITH RULES AND REGULATIONS. PFPC undertakes 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 hereunder. Except as specifically set forth
herein, PFPC assumes no responsibility for such compliance by the Trust or other
entity.
4. INSTRUCTIONS.
(a) Unless otherwise provided in this Agreement, PFPC shall act only upon
Oral Instructions
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or Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral Instruction or Written
Instruction it receives from an Authorized Person (or from a person
reasonably believed by PFPC to be an Authorized Person) pursuant to
this Agreement. PFPC may assume that any Oral Instruction or Written
Instruction received hereunder is not in any way inconsistent with the
provisions of organizational documents or this Agreement or of any
vote, resolution or proceeding of the Trust's Board of Trustees or of
the Trust's shareholders, unless and until PFPC receives Written
Instructions to the contrary.
(c) The Trust agrees to forward to PFPC Written Instructions confirming
Oral Instructions so that PFPC 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 or differ from the Oral Instructions shall in no way
invalidate the transactions or enforceability of the transactions
authorized by the Oral Instructions or PFPC's ability to rely upon such
Oral Instructions.
5. RIGHT TO RECEIVE ADVICE.
(a) ADVICE OF THE TRUST. If PFPC is in doubt as to any action it
should or should not take, PFPC may request directions or
advice, including Oral Instructions or Written Instructions,
from the Trust.
(b) ADVICE OF COUNSEL. If PFPC shall be in doubt as to any
question of law pertaining to any action it should or should
not take, PFPC may request advice from counsel of its own
choosing (who may be counsel for the Trust, the Trust's
investment adviser or PFPC, at the option of PFPC).
(c) CONFLICTING ADVICE. In the event of a conflict between
directions or advice or Oral
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Instructions or Written Instructions PFPC receives from the
Trust, and the advice PFPC receives from counsel, PFPC may
rely upon and follow the advice of counsel. PFPC shall notify
the Trust of any such conflict if such conflict is material.
(d) PROTECTION OF PFPC. PFPC shall be indemnified by the Trust and without
liability for any action PFPC takes or does not take in reliance upon
directions or advice or Oral Instructions or Written Instructions PFPC
receives from or on behalf of the Trust or from counsel and which PFPC
believes, in good faith, to be consistent with those directions or
advice and Oral Instructions or Written Instructions. Nothing in this
section shall be construed so as to impose an obligation upon PFPC (i)
to seek such directions or advice or Oral Instructions or Written
Instructions, or (ii) to act in accordance with such directions or
advice or Oral Instructions or Written Instructions.
6. RECORDS; VISITS. The books and records pertaining to the Trust, which
are in the possession or under the control of PFPC, shall be the property of the
Trust. Such books and records shall be prepared and maintained as required by
the 1940 Act and other applicable securities laws, rules and regulations. The
Trust and Authorized Persons shall have access to such books and records at all
times during PFPC's normal business hours. Upon the reasonable request of the
Trust, copies of any such books and records shall be provided by PFPC to the
Trust or to an Authorized Person, at the Trust's expense.
7. CONFIDENTIALITY.
(a) Each party shall keep confidential any information relating to the
other party's business ("Confidential Information"). Confidential
Information shall include:
(i) any data or information that is competitively sensitive material,
and not generally
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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 Trust or PFPC, their
respective subsidiaries and affiliated companies;
(ii) 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 Trust or PFPC
a competitive advantage over its competitors;
(iii) 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 (iv) anything designated as
confidential.
(b) Notwithstanding the foregoing, information shall not be Confidential
Information and shall not be subject to such confidentiality
obligations if it:
(i) is already known to the receiving party at the time it is obtained;
(ii) is or becomes publicly known or available through no wrongful act
of the receiving party;
(iii) is rightfully received from a third party who, to the best of the
receiving party's knowledge, is not under a duty of confidentiality;
(iv) is released by the protected party to a third party without
restriction;
(v) is requested or required to be disclosed by the receiving party
pursuant to a court order, subpoena, governmental or regulatory agency
request or law (provided the receiving party will provide the other
party written notice of the same, to the extent such
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notice is permitted);
(vi) is relevant to the defense of any claim or cause of action
asserted against the receiving party;
(vii) is Trust information provided by PFPC in connection with an
independent third party compliance or other review;
(viii) is necessary for PFPC to release such information in connection
with the provision of services under this Agreement; or
(ix) has been or is independently developed or obtained by the
receiving party.
(c) The provisions of this Section 7 shall survive termination of this
Agreement for a period of three (3) years after such termination.
8. COOPERATION WITH ACCOUNTANTS. PFPC shall cooperate with the Trust's
independent public accountants and shall take all reasonable actions 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 Trust.
9. PFPC SYSTEM. PFPC shall retain title to and ownership of any and all
data bases, computer programs, screen formats, report formats, interactive
design techniques, derivative works, inventions, discoveries, patentable or
copyrightable matters, concepts, expertise, patents, copyrights, trade secrets,
and other related legal rights utilized by PFPC in connection with the services
provided by PFPC to the Trust. Notwithstanding the foregoing, the parties
acknowledge that the Trust shall retain all ownership rights in Trust data which
resides on the PFPC system.
10. DISASTER RECOVERY. PFPC 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
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equipment failures, PFPC shall, at no additional expense to the Trust, take
reasonable steps to minimize service interruptions. PFPC 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's own willful
misfeasance, bad faith, gross negligence or reckless disregard of its duties or
obligations under this Agreement.
11. COMPENSATION.
(a) As compensation for services rendered by PFPC under this Agreement, the
Trust will pay to PFPC a fee or fees as may be agreed to from time to
time in writing by the Trust and PFPC. In addition, the Trust agrees to
pay, and will be billed separately in arrears for, reasonable expenses
incurred by PFPC in the performance of its duties hereunder.
(b) PFPC shall establish certain cash management accounts ("Service
Accounts") required to provide services under this Agreement. The Trust
acknowledges (i) PFPC may receive investment earnings from sweeping the
funds in such Service Accounts into investment accounts including, but
not limited, investment accounts maintained at an affiliate or client
of PFPC; (ii) balance credits earned with respect to the amounts in
such Service Accounts ("Balance Credits") will be used to offset the
banking service fees imposed by the cash management service provider
(the "Banking Service Fees"); (iii) PFPC shall retain any excess
Balance Credits for its own use; (iv) Balance Credits will be
calculated and applied toward the Trust's Banking Service Fees
regardless of the Service Account balance sweep described in
Sub-Section (i); and (v) PFPC may use the services of third-party
vendors in connection with the issuance of redemption and distribution
checks and shall retain any benefits obtained from any arrangements
with such vendors, including any commission or return on float paid to
it by any such vendors.
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(c) The undersigned hereby represents and warrants to PFPC that (i) the
terms of this Agreement, (ii) the fees and expenses associated with
this Agreement, and (iii) any benefits accruing to PFPC or to the
adviser or sponsor of the Trust in connection with this Agreement have
been fully disclosed to the Board of Trustees of the Trust and that, if
required by applicable law, such Board of Trustees has approved or will
approve the terms of this Agreement, any such fees and expenses, and
any such benefits.
12. INDEMNIFICATION.
(a) The Trust, on behalf of each of its investment series, agrees to
indemnify, defend and hold harmless PFPC and its affiliates, including
their respective officers, directors, agents and employees, from all
taxes, charges, expenses, assessments, claims and liabilities
(including, without limitation, reasonable attorneys' fees and
disbursements) arising directly or indirectly from any action or
omission to act which PFPC takes in connection with the provision of
services to the Trust. Neither PFPC, nor any of its affiliates, shall
be indemnified against any liability (or any expenses incident to such
liability) caused by PFPC's or its affiliates' own willful misfeasance,
bad faith, gross negligence or reckless disregard in the performance of
PFPC's duties under this Agreement, provided that in the absence of a
finding to the contrary the acceptance, processing and/or negotiation
of a fraudulent payment for the purchase of Shares shall be presumed
not to have been the result of PFPC's or its affiliates own willful
misfeasance, bad faith, gross negligence or reckless disregard of such
duties under this Agreement.
(b) PFPC agrees to indemnify, defend and hold harmless the Trust and its
officers, directors and employees only from those taxes, charges,
expenses, assessments, claims and liabilities (including without
limitation, reasonable attorney's fees and disbursements)
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caused by PFPC's failure to perform its duties under this Agreement and
only to extend such taxes, charges, expenses, assessments, claims and
liabilities are the result of PFPC's willful misfeasance, bad faith,
gross negligence or reckless disregard of its duties under this
Agreement. In the absence of a finding to the contrary the acceptance,
processing and/or negotiation of a fraudulent payment for the purchase
of Shares shall be presumed not to have been the result of PFPC's
willful misfeasance, bad faith, gross negligence or reckless disregard
of its duties under this Agreement. Any obligation of PFPC to
indemnify, defend or hold harmless the Trust is subject to the
provisions of this Agreement limiting PFPC's responsibility to the
Trust; any limitation on the Trust's ability to be indemnified,
defended or held harmless shall also apply to any ability of the
Trust's officers, directors and employees to be indemnified, defended
or held harmless.
(c) The provisions of this Section 12 shall survive termination of this
Agreement.
13. RESPONSIBILITY OF PFPC.
(a) PFPC shall be under no duty to take any action hereunder on behalf of
the Trust except as specifically set forth herein or as may be
specifically agreed to by PFPC and the Trust in a written amendment
hereto. PFPC shall be obligated to exercise care and diligence in the
performance of its duties hereunder and to act in good faith in
performing services provided for under this Agreement. PFPC shall be
liable only for any damages arising out of PFPC's failure to perform
its duties under this Agreement and only to the extent such damages
arise out of PFPC's willful misfeasance, bad faith, gross negligence or
reckless disregard of such duties.
(b) Notwithstanding anything in this Agreement to the contrary, (i) PFPC
shall not be liable for losses, delays, failure, errors, interruption
or loss of data occurring directly or
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indirectly by reason of circumstances beyond its reasonable control,
including without limitation acts of God; action or inaction of civil
or military authorities; public enemies; war; terrorism; riot; fire;
flood; sabotage; epidemics; labor disputes; civil commotion;
interruption, loss or malfunction of utilities, transportation,
computer or communications capabilities; insurrection; elements of
nature; non-performance by a third party; and (ii) PFPC shall not be
under any duty or obligation to inquire into and shall not be liable
for the validity or invalidity, authority or lack thereof, or
truthfulness or accuracy or lack thereof, of any instruction,
direction, notice, instrument or other information which conforms to
the applicable requirements of this Agreement, if any, and which PFPC
reasonably believes to be genuine.
(c) Notwithstanding anything in this Agreement to the contrary, (i) neither
PFPC nor its affiliates shall be liable for any consequential, special
or indirect losses or damages, whether or not the likelihood of such
losses or damages was known by PFPC or its affiliates; and (ii) PFPC's
cumulative liability to the Trust for all losses, claims, suits,
controversies, breaches and damages of any nature whatsoever (including
but not limited to those arising out of or related to this Agreement)
and regardless of the form of action or legal theory shall not exceed
an amount equal to the greatest amount of the fees received by PFPC for
services provided hereunder during a particular eighteen (18)
consecutive month period.
(d) Each party shall have a duty to mitigate damages for which the other
party may become responsible.
(e) The provisions of this Section 13 shall survive termination of this
Agreement.
14. DESCRIPTION OF SERVICES.
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(a) SERVICES PROVIDED ON AN ONGOING BASIS, IF APPLICABLE.
(i) Calculate 12b-1 payments;
(ii) Maintain shareholder registrations;
(iii) Review new applications and communicate with investors to
complete or correct information;
(iv) Direct payment processing of checks or wires;
(v) Prepare and certify stockholder lists in conjunction with
proxy solicitations;
(vi) Prepare and mail to shareholders confirmation of activity;
(vii) Provide toll-free lines for direct shareholder use, plus
customer liaison staff for on-line inquiry response;
(viii) Mail duplicate confirmations to broker-dealers of their
clients' activity, whether executed through the broker-dealer
or directly with PFPC;
(ix) Provide periodic shareholder lists and statistics to the
Trust;
(x) Provide detailed data for underwriter/broker confirmations;
(xi) Prepare periodic mailing of year-end tax and statement
information;
(xii) Notify on a timely basis the investment adviser, accounting
agent, and custodian of Share activity;
(xiii) Perform other participating broker-dealer shareholder services
as may be agreed upon from time to time;
(xiv) Accept and post daily Share purchases and redemptions;
(xv) Accept, post and perform shareholder transfers and exchanges;
(xvi) Perform certain administrative and ministerial duties relating
to opening, maintaining and processing transactions for
shareholders or financial intermediaries that trade shares
through the NSCC.
(b) PURCHASE OF SHARES. PFPC shall issue and credit an account of an
investor, in the manner described in the Trust's prospectus
("Prospectus"), once it receives:
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(i) A purchase order in completed proper form;
(ii) Proper information to establish a shareholder account; and
(iii) Confirmation of receipt or crediting of Trusts for such order
to the Trust's custodian.
(c) REDEMPTION OF SHARES. PFPC shall process requests to redeem Shares as
follows:
(i) All requests to transfer or redeem Shares and payment therefor
shall be made in accordance with the Trust's prospectus, when
the shareholder tenders Shares in proper form, accompanied by
such documents as PFPC reasonably may deem necessary.
(ii) PFPC reserves the right to refuse to transfer or redeem Shares
until it is satisfied that the endorsement on the instructions
is valid and genuine and that the requested transfer or
redemption is legally authorized, and it shall incur no
liability for the refusal, in good faith, to process transfers
or redemptions which PFPC, in its good judgment, deems
improper or unauthorized, or until it is reasonably satisfied
that there is no basis to any claims adverse to such transfer
or redemption.
(iii) When Shares are redeemed, PFPC shall deliver to the Trust's
custodian (the "Custodian") and the Trust or its designee a
notification setting forth the number of Shares redeemed. Such
redeemed Shares shall be reflected on appropriate accounts
maintained by PFPC reflecting outstanding Shares of the Trust
and Shares attributed to individual accounts.
(iv) PFPC shall, upon receipt of the monies provided to it by the
Custodian for the redemption of Shares, pay such monies as are
received from the Custodian, all in
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accordance with the procedures established from time to time
between PFPC and the Trust.
(v) When a broker-dealer notifies PFPC of a redemption desired by
a customer, and the Custodian provides PFPC with funds, PFPC
shall prepare and send the redemption check to the
broker-dealer and made payable to the broker-dealer on behalf
of its customer, unless otherwise instructed in writing by the
broker-dealer.
(vi) PFPC shall not process or effect any redemption requests with
respect to Shares of the Trust after receipt by PFPC or its
agent of notification of the suspension of the determination
of the net asset value of the Trust.
(d) DIVIDENDS AND DISTRIBUTIONS. Upon a resolution of the Trust's Board of
Trustee authorizing the declaration and payment of dividends and
distributions and Written Instructions to PFPC received no later than
the business day prior to the record date of such dividend or
distribution, PFPC shall issue dividends and distributions declared by
the Trust in Shares, or, upon shareholder election, pay such dividends
and distributions in cash, if provided for in the Trust's prospectus.
In all cases the ex-date and the payable date of any dividends and
distributions will be the next business day following the record date.
Such issuance or payment, as well as payments upon redemption as
described in sub-section (c) above, shall be made after deduction and
payment of the required amount of fund to be withheld in accordance
with any applicable tax laws or other laws, rules or regulations. PFPC
shall mail to the Trust's shareholders such tax forms and other
information, or permissible substitute notice, relating to dividends
and distributions paid by the Trust as are required to be filed and
mailed by applicable law, rule or regulation. PFPC shall prepare,
maintain and file with the IRS and other appropriate taxing
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authorities reports relating to all dividends above a stipulated amount
paid by the Trust to its shareholders as required by tax or other law,
rule or regulation.
(e) SHAREHOLDER ACCOUNT SERVICES.
(i) PFPC may arrange, in accordance with the prospectus, for
issuance of Shares obtained through:
- Any pre-authorized check plan; and
- Direct purchases through broker wire orders, checks
and applications.
(ii) PFPC may arrange, in accordance with the Prospectus, for a
shareholder's:
- Exchange of Shares for shares of another Trust with
which the Trust has exchange privileges;
- Automatic redemption from an account where that
shareholder participates in a automatic redemption
plan; and/or
- Redemption of Shares from an account with a
checkwriting privilege.
(f) COMMUNICATIONS TO SHAREHOLDERS. Upon timely Written Instructions, PFPC
shall mail all communications by the Trust to its shareholders,
including:
(i) Reports to shareholders;
(ii) Confirmations of purchase and sales of Trust shares;
(iii) Monthly or quarterly statements as well as an annual
statement;
(iv) Dividend and distribution notices; and
(v) Tax form information.
(g) RECORDS. PFPC shall maintain records of the accounts for each
shareholder showing the following information:
(i) Name, address and United States Tax Identification or Social
Security number;
(ii) Number and class of Shares held and number and class of Shares
for which certificates, if any, have been issued, including
certificate numbers and denominations;
(iii) Historical information regarding the account of each
shareholder, including
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dividends and distributions paid and the date and price for
all transactions on a shareholder's account;
(iv) Any stop or restraining order placed against a shareholder's
account;
(v) Any correspondence relating to the current maintenance of a
shareholder's account;
(vi) Information with respect to withholdings; and
(vii) Any information required in order for PFPC to perform any
calculations required by this Agreement.
(h) SHAREHOLDER INSPECTION OF STOCK RECORDS. Upon a request from any Trust
shareholder to inspect stock records, PFPC will notify the Trust and
the Trust will issue instructions granting or denying each such
request. Unless PFPC has acted contrary to the Trust's instructions,
the Trust agrees to and does hereby release PFPC from any liability for
refusal of permission for a particular shareholder to inspect the
Trust's stock records.
(i) LOST SHAREHOLDERS. PFPC shall perform such services as are required in
order to comply with rule 17Ad-17 of the 1934 Act (the "Lost
Shareholder Rule"), including, but not limited to, those set forth
below. PFPC may, in its sole discretion, use the services of a third
party to perform some of or all such services.
(i) documentation of search policies and procedures;
(ii) execution of required searches;
(iii) tracking results and maintaining data sufficient to comply
with the Lost Shareholder Rules; and
(iv) preparation and submission of data required under the Lost
Shareholder Rules.
Except as set forth above, PFPC shall have no responsibility for any
escheatment services.
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(j) RETIREMENT PLANS.
(i) In connection with the individual retirement accounts,
simplified employee pension plans, rollover individual
retirement plans, educational IRA's and XXXX individual
retirement accounts ("XXX Plans"), 403(b) Plans and money
purchase and profit sharing plans ("Qualified Plans")
(collectively, the "Retirement Plans") within the meaning of
Section 408 of the Internal Revenue Code of 1986, as amended
(the "Code") sponsored by the Trust for which contributions of
the Trust's shareholders (the "Participants") are invested
solely in Shares of the Trust, PFPC shall provide the
following administrative services:
(A) Establish a record of types and reasons for
distributions (i.e., attainment of age 59-1/2,
disability, death, return of excess contributions,
etc.);
(B) Record method of distribution requested and/or made;
(C) Receive and process designation of beneficiary forms
requests;
(D) Examine and process requests for direct transfers
between custodians/trustees, transfer and pay over to
the successor assets in the account and records
pertaining thereto as requested;
(E) Prepare any annual reports or returns required to be
prepared and/or filed by a custodian of a Retirement
Plan, including, but not limited to, an annual fair
market value report, Forms 1099R and 5498; and file
same with the IRS and provide same to
Participant/Beneficiary, as applicable; and
(F) Perform applicable federal withholding and send
Participants/Beneficiaries an annual TEFRA notice
regarding required federal tax withholding.
(ii) PFPC shall arrange for PFPC Trust Company to serve as
custodian for the Retirement Plans sponsored by the Trust.
(iii) With respect to the Retirement Plans, PFPC shall provide the
Trust with the associated Retirement Plan documents for use by
the Trust and PFPC shall be responsible for the maintenance of
such documents in compliance with all applicable provisions of
the Code and the regulations promulgated thereunder.
(k) PRINT MAIL. The Trust hereby engages PFPC as its exclusive print/mail
service provider with respect to those items and for such fees as may
be agreed to from time to time in writing by the Trust and PFPC.
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(l) PROXY ADVANTAGE. The Trust hereby engages PFPC as its exclusive proxy
solicitation service provider with respect to those items and for such
fees as may be agreed to from time to time in writing by the Trust and
PFPC.
15. PRIVACY. Each party hereto acknowledges and agrees that, subject to the
reuse and re-disclosure provisions of Xxxxxxxxxx X-X, 00 XXX Part 248.11, it
shall not disclose the non-public personal information of investors in the Trust
obtained under this Agreement, except as necessary to carry out the services set
forth in this Agreement or as otherwise permitted by law or regulation.
16. ANTI-MONEY LAUNDERING.
16.1 To the extent the other provisions of this Agreement require PFPC to
establish, maintain and monitor accounts of investors in the Trust consistent
with securities laws, PFPC shall perform reasonable actions necessary to help
the Trust be in compliance with Section 352 of the USA PATRIOT Act, as follows:
PFPC shall: (a) establish and implement written internal policies, procedures
and controls reasonably designed to help prevent the Trust from being used to
launder money or finance terrorist activities; (b) provide for independent
testing, by an employee who is not responsible for the operation of PFPC's AML
program or by an outside party, for compliance with PFPC's established AML
policies and procedures; (c) designate a person or persons responsible for
implementing and monitoring the operation and internal controls of PFPC's AML
program; and (d) provide ongoing training of PFPC personnel relating to the
prevention of money-laundering activities. Upon the reasonable request of the
Trust, PFPC shall provide to the Trust: (x) a copy of PFPC's written AML
policies and procedures (it being understood such information is to be
considered confidential and treated as such and afforded all protections
provided to confidential information under this Agreement); (y) at the
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option of PFPC, a copy of a written assessment or report prepared by the party
performing the independent testing for compliance, or a summary thereof, or a
certification that the findings of the independent party are satisfactory; and
(z) a summary of the AML training provided for appropriate personnel. PFPC
agrees to permit inspections relating to its AML program by U.S. Federal
departments or regulatory agencies with appropriate jurisdiction and to make
available to examiners from such departments or regulatory agencies such
information and records relating to its AML program as such examiners shall
reasonably request. Without limiting or expanding the foregoing, the parties
agree the provisions of this subsection 16.1 do not apply to Section 326 of the
USA PATRIOT Act (or other sections other than Section 352) or regulations
promulgated thereunder.
16.2 To help the Trust comply with its requirements to establish and implement a
due diligence program for "foreign financial institution" accounts (which the
Trust is required to have under regulations issued under Section 312 of the USA
PATRIOT Act), PFPC will do the following:
(i) Implement and operate a due diligence program that includes
appropriate, specific, risk-based policies, procedures and
controls that are reasonably designed to enable the Trust to
detect and report, on an ongoing basis, any known or suspected
money laundering activity conducted through or involving any
correspondent account established, maintained, administered or
managed by the Trust for a "foreign financial institution" (as
defined in 31 CFR 103.175(h)) ("Foreign Financial
Institution");
(ii) Conduct due diligence to identify and detect any Foreign
Financial Institution accounts in connection with new accounts
and account maintenance;
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(iii) Assess the money laundering risk presented by each such
Foreign Financial Institution account, based on a
consideration of all appropriate relevant factors (as
generally outlined in 31 CFR 103.176) and assign a risk
category to each such Foreign Financial Institution account;
(iv) Apply risked-based procedures and controls to each such
Foreign Financial Institution account reasonably designed to
detect and report known or suspected money laundering
activity, including a periodic review of the Foreign Financial
Institution account activity sufficient to determine
consistency with information obtained about the type, purpose
and anticipated activity of the account;
(v) Include procedures to be followed in circumstances in which
the appropriate due diligence cannot be performed with respect
to a Foreign Financial Institution account;
(vi) Adopted and operate enhanced due diligence policies, where
necessary, as may be required by future regulations pending
for Foreign Financial Institution accounts;
(vii) Record due diligence program and maintain due diligence
records relating to Foreign Financial Institution accounts;
(viii) Report to the Trust about measures taken under (i)-(vii)
above; and
(ix) Set forth on a separate fee schedule compensation amounts due
for these Foreign Financial Institution services.
Notwithstanding anything to the contrary, and without expanding the
scope of the express language in this sub-section 16.2, PFPC need not
complete any due diligence beyond the requirements of the relevant
Foreign Financial Institution due diligence program regulations and
PFPC need not perform any task that need not be performed for the Trust
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to be in compliance with relevant Foreign Financial Institution due
diligence program regulations.
Without limiting or expanding the foregoing, the parties agree the
provisions of this subsection 16.2 do not apply to Section 326 of the
USA PATRIOT Act (or other sections other than Section 312) or
regulations promulgated thereunder. The provisions of this subsection
16.2 specifically exclude private bank account provisions of Section
312 of the USA PATRIOT Act.
17. CUSTOMER IDENTIFICATION PROGRAM ("CIP") SERVICES.
(a) To help the Trust comply with its customer identification program
(which the Trust is required to have under regulations issued under
Section 326 of the USA PATRIOT Act) PFPC will do the following:
(i) Implement procedures under which new accounts in the Trust are
not established unless PFPC has obtained the name, date of
birth (for natural persons only), address and
government-issued identification number (collectively, the
"Data Elements") for each corresponding Customer (as defined
in 31 CFR 103.131).
(ii) Use collected Data Elements to attempt to reasonably verify
the identity of each new Customer promptly before or after
each corresponding new account is opened. Methods may consist
of non-documentary methods (for which PFPC may use
unaffiliated information vendors to assist with such
verifications) and documentary methods (as permitted by 31 CFR
103.131), and may include procedures under which PFPC
personnel perform enhanced due diligence to verify the
identities of Customers the identities of whom were not
successfully verified through the first-level (which will
typically be reliance on results obtained from an information
vendor) verification process(es).
(iii) Record the Data Elements and maintain records relating to
verification of new Customers consistent with 31 CFR
103.131(b)(3).
(iv) Determine whether any Customers' name appears on a list of
known or suspected terrorist or terrorist organizations
designed by the Department of Treasury, if any, consistent
with 31 C.F.R. 131 (b)(4).
(v) Regularly report to the Trust about measures taken under
(1)-(iv) above.
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(vi) If PFPC provides services by which prospective Customers may
subscribe for shares in the Trust via the Internet or
telephone, work with the Trust to notify prospective
Customers, consistent with 31 CFR 103.(b)(5), about the
Trust's CIP.
(vii) Set forth on a separate fee schedule compensation amounts due
for these CIP Services
(b) Notwithstanding anything to the contrary, and without expanding the
scope of the express language in this Section 17, PFPC need not collect
the Data Elements for (or verify) prospective customer (or accounts)
beyond the requirements of relevant customer identification program
regulations (for example, PFPC will not verify customers opening
accounts through NSCC) and PFPC need not perform any task that need not
be performed for the Trust to be in compliance with relevant customer
identification program regulations.
(c) Notwithstanding anything to the contrary, PFPC need not perform any of
the steps described above in this Section 17 with respect to persons
purchasing Shares via exchange privileges.
18. DURATION AND TERMINATION.
(a) This Agreement shall be effective on the date first written
above and unless terminated pursuant to its terms shall
continue for a period of three (3) years (the "Initial Term").
(b) Upon the expiration of the Initial Term, this Agreement shall
automatically renew for successive terms of one (1) year
("Renewal Term") each, unless the Trust or PFPC provides
written notice to the other of its intent not to renew. Such
notice
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must be received not less than ninety (90) days prior to the
expiration of the Initial Term or the then current Renewal
Term.
(c) In the event of termination, all expenses associated with
movement of records and materials and conversion thereof to a
successor administrator will be borne by the Trust and paid to
PFPC prior to any such conversion.
(d) If a party hereto is guilty of a material failure to perform
its duties and obligations hereunder (a "Defaulting Party")
the other party (the "Non-Defaulting Party") may give written
notice thereof to the Defaulting Party, and if such material
breach shall not have been remedied within thirty (30) days
after such written notice is given, then the Non-Defaulting
Party may terminate this Agreement by giving thirty (30) days
written notice of such termination to the Defaulting Party. In
all cases, termination by the Non-Defaulting Party shall not
constitute a waiver by the Non-Defaulting Party of any other
rights it might have under this Agreement or otherwise against
the Defaulting Party.
(e) Notwithstanding anything contained in this Agreement to the
contrary, should a merger, acquisition, change in control,
re-structuring, re-organization or any other decision
involving the Trust or any affiliate (as defined under the
0000 Xxx) of the Trust result in the Trust's desire to cease
to use PFPC as the provider of any of the services set forth
hereunder in favor of another service provider prior to the
expiration of the then current Initial or Renewal Term, PFPC
shall make a good faith effort to facilitate a conversion of
services to the Trust's successor service provider, provided,
however, there can be no guarantee that PFPC will be able to
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facilitate such a conversion of services on the conversion
date requested by the Trust. In connection with the foregoing
and prior to such conversion to the successor service
provider, the payment of all fees to PFPC as set forth herein
shall be accelerated to a date prior to the conversion or
termination of services and calculated as if the services had
remained with PFPC until the expiration of the then current
Initial or Renewal Term and calculated at the asset and/or
Shareholder account levels, as the case may be, on the date
notice of termination was given to PFPC.
19. NOTICES. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: President (or such other address
as PFPC may inform the Trust in writing); (b) if to the Trust, at BHR FUND
ADVISORS, LP 0000 XXXX XXXXXXXXXX XX., XXXXX 000, XXXXXX, XX 00000, Attention:
XXXX XXXXXXX (or such other address as the Trust may inform PFPC in writing); 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 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 three 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.
20. AMENDMENTS. This Agreement, or any term thereof, may be changed or
waived only by written amendment, signed by the party against whom enforcement
of such change or waiver is sought.
21. ASSIGNMENT. PFPC may assign this Agreement to any affiliate of PFPC or
of The PNC Financial Services Group, Inc., provided that PFPC gives the Trust
thirty (30) days' prior written
23
notice of such assignment, that the assignee agree with PFPC to comply with all
relevant provisions of the 1940 Act and that PFPC and such assignee shall
promptly provide such information as the Trust may ask, relative to the
assignment, including (without limitation) the capabilities of the assignee.
22. 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.
23. FURTHER ACTIONS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
24. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding 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.
(b) NON-SOLICITATION. During the term of this Agreement and for one year
thereafter, the Trust shall not (with the exceptions noted in the
immediately succeeding sentence) knowingly solicit or recruit for
employment or hire any of PFPC's employees involved in providing
services to the Trust, and the Trust shall cause the Trust's sponsor
and the Trust's affiliates to not (with the exceptions noted in the
immediately succeeding sentence) knowingly solicit or recruit for
employment or hire any of PFPC's employees involved in providing
services to the Trust. To "knowingly" solicit, recruit or hire within
the meaning of this provision does not include, and therefore does not
prohibit, solicitation, recruitment or hiring of a PFPC employee by the
Trust, the Trust's sponsor or an affiliate of the Trust if the PFPC
employee was identified by such entity solely as a
24
result of the PFPC employee's response to a general advertisement by
such entity in a publication of trade or industry interest or other
similar general solicitation by such entity.
(c) NO CHANGES THAT MATERIALLY AFFECT OBLIGATIONS. Notwithstanding anything
in this Agreement to the contrary, the Trust agrees not to make any
modifications to its registration statement or adopt any policies which
would affect materially the obligations or responsibilities of PFPC
hereunder without the prior written approval of PFPC, which approval
shall not be unreasonably withheld or delayed.
(d) 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.
(e) INFORMATION. The Trust will provide such information and documentation
as PFPC may reasonably request in connection with services provided by
PFPC to the Trust.
(f) 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.
(g) 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.
(h) 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.
(i) NO REPRESENTATIONS OR WARRANTIES. Except as expressly provided in this
Agreement, PFPC hereby disclaims all representations and warranties,
express or implied, made to the Trust or any other person, including
without limitation, any warranties regarding quality, suitability,
merchantability, fitness for a particular purpose or otherwise
(irrespective of
25
any course of dealing, custom or usage of trade), or any services or
any goods provided incidental to services provided under this
Agreement. PFPC disclaims any warranty of title or non-infringement
except as otherwise set forth in this Agreement.
(j) LIABILITY. The Trust and PFPC agree that the obligations of the Trust
under this Agreement shall not be binding upon any of the Trustees,
shareholders, nominees, officers, employees or agents, whether past,
present or future, of the Trust individually, but are binding only upon
the assets of the Trust or applicable investment series of the Trust.
The execution and delivery of this Agreement have been authorized by
the Trustees of the Trust, and signed by an authorized officer of the
Trust, acting as such, and neither such authorization by the Trustees
nor such execution by such officer shall be deemed to have been made by
them or any shareholder of the Trust individually or to impose any
liability on any of them or any shareholder of the Trust personally,
but shall bind only the assets and property of the Trust or applicable
investment series of the Trust.
(k) FACSIMILE SIGNATURES. The facsimile signature of any party to this
Agreement shall constitute the valid and binding execution hereof by
such party.
(l) CUSTOMER IDENTIFICATION PROGRAM NOTICE. To help the U.S. government
fight the Trusting of terrorism and money laundering activities, U.S.
Federal law requires each financial institution to obtain, verify, and
record certain information that identifies each person who initially
opens an account with that financial institution on or after October 1,
2003. Certain of PFPC's affiliates are financial institutions, and PFPC
may, as a matter of policy, request (or may have already requested) the
Trust's name, address and taxpayer identification number or other
government-issued identification number, and, if such party is a
natural person, that party's date of birth. PFPC may also ask (and may
have
26
already asked) for additional identifying information, and PFPC may
take steps (and may have already taken steps) to verify the
authenticity and accuracy of these data elements.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By: /S/ XXXX X. XXXXXX
------------------
Title: Vice President & Director
Transfer Agency DIVISION
BHR INSTITUTIONAL FUNDS
By: /s/ XXXX XXXXXXX
----------------
Title: Secretary
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