Exhibit 99.2(j)(i)
CUSTODIAN SERVICES AGREEMENT
THIS AGREEMENT is made as of ____________, 2003 by and between
PFPC TRUST COMPANY, a limited purpose trust company incorporated under the laws
of Delaware ("PFPC Trust"), and ASA Market Neutral Equity Fund LLC, an Illinois
limited liability company (the "Fund").
W I T N E S S E T H:
WHEREAS, the Fund is registered as a closed-end, non-diversified
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Fund wishes to retain PFPC Trust to provide custodian
services, and PFPC Trust wishes to furnish custodian services, either directly
or through an affiliate or affiliates, as more fully described herein.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. Definitions. As Used in This Agreement:
(a) "1933 Act" means the Securities Act of 1933, as amended.
(b) "1934 Act" means the Securities Exchange Act of 1934, as amended.
(c) "Authorized Person" means any officer of the Fund and any other
person authorized by the Fund to give Oral or 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.
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(d) "Book-Entry System" means the 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 registered with the SEC under
the 1934 Act.
(e) "CEA" means the Commodities Exchange Act, as amended.
(f) "Change of Control" means a change in ownership or control (not
including transactions between wholly-owned direct or indirect
subsidiaries of a common parent) of 25% or more of the
beneficial ownership of the shares of common stock or shares of
beneficial interest of an entity or its parent(s).
(g) "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. PFPC Trust
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.
(h) "PFPC Trust" means PFPC Trust Company or a subsidiary or
affiliate of PFPC Trust Company.
(i) "SEC" means the Securities and Exchange Commission.
(j) "Securities Laws" mean the 1933 Act, the 1934 Act, the 1940 Act
and the CEA.
(k) "Shares" mean the shares of beneficial interest of any series or
class of the Fund.
(l) "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;
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(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.
(m) "Written Instructions" mean (i) written instructions signed by
two Authorized Persons (or persons reasonably believed by PFPC
Trust to be Authorized Persons) 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 or facsimile sending device.
2. Appointment. The Fund hereby appoints PFPC Trust to provide custodian
services to the Fund as set forth herein, on behalf of each of its
investment portfolios (each, a "Portfolio"), and PFPC Trust accepts
such appointment and agrees to furnish such services.
3. Compliance with Laws.
PFPC Trust undertakes to comply with material applicable requirements
of the Securities Laws and material laws, rules and regulations of
governmental authorities having jurisdiction with respect to the
duties to be performed by PFPC Trust hereunder. Except as
specifically set forth herein, PFPC Trust assumes no responsibility
for such compliance by the Fund or any other entity.
4. Instructions.
(a) Unless otherwise provided in this Agreement, PFPC
Trust shall act only upon Oral Instructions or Written
Instructions.
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(b) PFPC Trust shall be entitled to rely upon any Oral
Instruction or Written Instruction it receives pursuant to
this Agreement. PFPC Trust may assume that any Oral
Instructions or Written Instructions received hereunder are
not in any way inconsistent with the provisions of
organizational documents of the Fund or of any vote,
resolution or proceeding of the Fund's directors or of the
Fund's members, unless and until PFPC Trust receives Written
Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Trust Written
Instructions confirming Oral Instructions (except where such
Oral Instructions are given by PFPC Trust or its affiliates)
so that PFPC Trust receives the Written Instructions by the
close of business on the same day that such Oral
Instructions are received. The fact that such confirming
Written Instructions are not received by PFPC Trust 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 Trust's ability
to rely upon such Oral Instructions.
5. 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 from 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).
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(c) Conflicting Advice. In the event of a conflict between
directions or advice or Oral Instructions or Written
Instructions PFPC Trust receives from the Fund, and the
advice it receives from counsel, PFPC Trust shall be
entitled to rely upon and follow the advice of counsel.
(d) Protection of PFPC Trust. PFPC Trust shall be indemnified
by the Fund and without liability for any action PFPC Trust
takes or does not take in reliance upon directions or advice
or Oral Instructions or Written Instructions PFPC Trust
receives from or on behalf of the Fund or from counsel and
which PFPC Trust believes, in good faith, to be consistent
with those directions or 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 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 unless, under the terms of the 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, gross negligence, or reckless
disregard of its duties, obligations, or responsibilities
set forth in this Agreement.
6. Records; Visits. The books and records pertaining to the Fund and any
Portfolio, 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
Authorized Persons shall have access to such books and records at all
times during PFPC Trust's
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normal business hours. Upon the reasonable request of the Fund, copies
of any such books and records shall be provided by PFPC Trust to the
Fund or to an authorized representative of the Fund, at the Fund's
expense. To the extent required by, and in the manner prescribed by
and in accordance 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, employees, or agents of the Fund or
auditors employed by the Fund and will be preserved by PFPC Trust. If
PFPC Trust is served with Legal Process seeking information relating
to the Fund, the Fund shall bear the cost and expense relating to
response to the Legal Process, including reasonable attorneys' fees.
7. Confidentiality. Each party shall keep confidential any 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,
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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: (a) it is already known to the
receiving party at the time it is obtained; (b) it is or becomes
publicly known or available through no wrongful act of the receiving
party; (c) it 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) it is released by the protected party to a third
party without restriction; (e) it 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) release of
such information by PFPC Trust is necessary or desirable in
connection with the provision of services under this Agreement; (g)
it is relevant to the defense of any claim or cause of action
asserted against the receiving party; or (h) it 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
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the disclosure request or requirement is, in the written opinion of
such party's counsel addressed to such other party (the reasonable
costs of which shall be paid by 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
disclosed Confidential Information pursuant to the foregoing sentence
shall not be liable for the disclosure of such Confidential
Information to the other party unless such disclosures was caused by
such party's or such party's Qualified Person's action or inaction
that (i) constitutes willful misfeasance, bad faith, gross
negligence, or reckless disregard of their duties hereunder subject
to the disclosure request or requirement or (ii) is not otherwise
permitted by this Agreement.
8. Cooperation with Accountants. PFPC Trust shall cooperate with the
Fund's independent public accountants and shall take all reasonable
action to make any requested information available to such
accountants as reasonably requested by the Fund.
9. PFPC System. PFPC Trust 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 Trust in connection with the services
provided by PFPC Trust to the Fund.
10. Disaster Recovery. PFPC Trust shall enter into and shall maintain in
effect with appropriate parties one or more agreements making
reasonable provisions for emergency use of electronic data processing
equipment to the extent appropriate equipment is
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available. 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, gross 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, on behalf of each
of the Portfolios, 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.
The Fund acknowledges that PFPC Trust may receive float benefits in
connection with maintaining certain accounts required to provide
services under this Agreement.
12. Indemnification. The Fund, on behalf of each Portfolio, agrees to
indemnify, defend and hold harmless PFPC Trust and its affiliates,
including their respective officers, directors, agents and employees,
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 in connection with the provision of services to the Fund.
Neither PFPC Trust, nor any of its affiliates, shall be indemnified
against any liability (or any expenses incident to such liability)
caused by PFPC Trust's or its affiliates' own willful misfeasance,
bad faith, gross negligence or reckless disregard in the performance
of PFPC Trust's activities under this Agreement. The provisions of
this Section 12 shall survive termination of this Agreement.
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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 hereunder
on behalf of the Fund or any Portfolio except as specifically
set forth herein or as may be specifically agreed to by PFPC
Trust and the Fund in a written amendment hereto. PFPC Trust
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
Trust shall be liable only for any damages arising out of PFPC
Trust's failure to perform its duties under this Agreement and
only to the extent such damages arise out of PFPC Trust's
willful misfeasance, bad faith, gross negligence or reckless
disregard of its duties under this Agreement.
(b) Notwithstanding anything in this Agreement to the contrary, (i)
PFPC Trust shall not be liable for losses, delays, failure,
errors, interruption or loss of data occurring directly or
indirectly by reason of circumstances beyond its reasonable
control, including without limitation acts of God; action or
inaction of civil or military authority; public enemy; 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; or
non-performance by a third party; and (ii) PFPC Trust shall not
be under any duty or obligation to inquire into and shall not
be liable for the validity or
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invalidity, authority or lack thereof, or truthfulness or
accuracy or lack thereof, of any instruction, direction, notice,
instrument or other information which PFPC Trust reasonably
believes to be genuine.
(c) Notwithstanding anything in this Agreement to the contrary, (i)
neither PFPC Trust 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 Trust or its affiliates and (ii) PFPC Trust's cumulative
liability to the Fund for all losses, claims, suits,
controversies, breaches or damages for any cause 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 the lesser of $100,000 or the
fees received by PFPC Trust for services provided hereunder
during the 12 months immediately prior to the date of such loss
or damage.
(d) No party may assert a cause of action against PFPC Trust or any
of its affiliates that allegedly occurred more than 12 months
immediately prior to the filing of the suit (or, if applicable,
commencement of arbitration proceedings) alleging such cause of
action.
(e) Each party shall have a duty to mitigate damages for which the
other party may become responsible.
(f) Notwithstanding anything in this Agreement to the contrary
(other than as specifically provided in Section 14(h)(ii)(B)(4)
and Section 14 (h)(iii)(A) of this Agreement), the Fund shall
be responsible for all filings, tax returns and reports on any
transactions undertaken pursuant to this Agreement, or in
respect of the
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Property or any collections undertaken pursuant to this
Agreement, which may be requested by any relevant authority. In
addition, the Fund shall be responsible for the payment of all
taxes and similar items (including without limitation penalties
and interest related thereto).
(g) The provisions of this Section 13 shall survive termination of
this Agreement.
(h) Notwithstanding anything in this Agreement to the contrary,
PFPC Trust shall have no liability either for any error or
omission of any of its predecessors as servicer on behalf of
the Fund or for any failure to discover any such error or
omission.
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
Portfolios, including cash received as a result of the
distribution of Shares, during the term of this Agreement. PFPC
Trust will not be responsible for any assets until actual
receipt.
(b) Receipt and Disbursement of Money. PFPC Trust, acting upon
Written Instructions, shall open and maintain a separate
account for each separate Portfolio of the Fund (each an
"Account") and shall maintain in the Account of a particular
Portfolio all cash and other assets received from or for the
Fund specifically designated to such Account.
PFPC Trust shall make cash payments from or for the Account of a
Portfolio only for:
(i) purchases of securities in the name of a Portfolio,
PFPC Trust, 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;
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(ii) purchase or redemption of Shares of the Fund delivered
to PFPC Trust;
(iii) payment of, subject to Written Instructions, interest,
taxes (provided that tax which PFPC Trust considers is
required to be deducted or with held "at source" will
be governed by Section 14(h)(iii)(B) of this
Agreement), administration, accounting, distribution,
advisory and management fees which are to be borne by a
Portfolio;
(iv) payment to, subject to receipt of Written Instructions,
the Fund's transfer agent, as agent for the members, of
an amount equal to the amount of dividends and
distributions stated in the Written Instructions to be
distributed in cash by the transfer agent to members,
or, in lieu of paying the Fund's transfer agent, PFPC
Trust may arrange for the direct payment of cash
dividends and distributions to members in accordance
with procedures mutually agreed upon from time to time
by and among the Fund, PFPC Trust and the Fund's
transfer agent;
(v) payments, upon receipt of Written Instructions, in
connection with the conversion, exchange or surrender
of securities owned or subscribed to by the Fund and
held by or delivered to PFPC Trust;
(vi) payments of the amounts of dividends received with
respect to securities sold short;
(vii) payments to PFPC Trust for its services hereunder;
(viii) payments made to a sub-custodian pursuant to provisions
in sub-section (c) of this Section; and
(ix) 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 Accounts.
(c) Receipt of Securities; Subcustodians.
(i) PFPC Trust shall hold all securities received by it for
the Accounts in a separate account that physically
segregates such securities from those of any other
persons, firms or corporations, except for securities
held in a Book-Entry System or through a sub-custodian
or depository. All such securities shall be held or
disposed of only upon Written Instructions or otherwise
pursuant to the terms of this Agreement. PFPC Trust
shall have no power or authority to assign,
hypothecate, pledge or otherwise dispose
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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 directors, or any officer,
employee or agent of the Fund withdraw any securities.
At PFPC Trust's own expense and for its own convenience,
PFPC Trust may enter into sub-custodian agreements with
other banks or trust companies to perform duties
described in this sub-section (c) with respect to
domestic assets. Such bank or trust company shall have
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 applicable rules and
regulations. Any such arrangement will not be entered
into without prior written notice to the Fund (or as
otherwise provided in the 1940 Act).
In addition, PFPC Trust may enter into arrangements with
sub-custodians with respect to services regarding
foreign assets. Any such arrangement will not be
entered into without prior written notice to the Fund
(or as otherwise provided in the 1940 Act).
PFPC Trust shall remain responsible for the acts and
omissions of any sub-custodian chosen by PFPC Trust
under the terms of this sub-section (c) to the same
extent that PFPC Trust is responsible for its own acts
and omissions under this Agreement.
(d) Transactions Requiring Instructions. Upon receipt of
Oral Instructions or Written Instructions and not otherwise,
PFPC Trust shall:
(i) deliver any securities held for a Portfolio against the
receipt of payment for the sale of such securities or
otherwise in accordance with standard market practice;
(ii) execute and deliver to such persons as may be
designated in such Oral Instructions or Written
Instructions, proxies, consents, authorizations, and
any other instruments whereby the authority of a
Portfolio 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 at the option of
the holder; provided that, in any such case, the cash
or other consideration is to be delivered to PFPC
Trust;
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(iv) deliver any securities held for a Portfolio 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 a Portfolio 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
Portfolios 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 a Portfolio to any bank
or trust company for the purpose of a pledge or
hypothecation to secure any loan incurred by the Fund
on behalf of that Portfolio; 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 a Portfolio in
connection with any repurchase agreement entered into
by the Fund on behalf of that Portfolio, but only on
receipt of payment therefor; and pay out monies 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 shares of the Fund
upon delivery thereof to PFPC Trust; and
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(xii) release and deliver or exchange securities owned by the
Fund for other purposes.
PFPC Trust must also receive a certified resolution
describing the nature of the corporate purpose and
the name and address of the person(s) to whom
delivery shall be made when such action is pursuant
to sub-paragraph d(xii).
(e) Use of Book-Entry System or Other Depository. PFPC Trust will
deposit in Book-Entry Systems and other depositories all
securities belonging to the Portfolios eligible for deposit
therein and will utilize Book-Entry Systems and other
depositories to the extent possible in connection with
settlements of purchases and sales of securities by the
Portfolios, 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. Notwithstanding
anything in this Agreement to the contrary, PFPC Trust's use of
a Book-entry System shall comply with the requirements of Rule
17f-4 under the 1940 Act.
PFPC Trust shall administer a Book-Entry System or other depository
as follows:
(i) With respect to securities of each Portfolio which are
maintained in a Book-Entry System or another
depository, the records of PFPC Trust shall identify by
book-entry or otherwise those securities as belonging
to each Portfolio.
(ii) Assets of each Portfolio deposited in a Book-Entry
System or another depository will (to the extent
consistent with applicable law and standard practice)
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
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control as the Fund may reasonably request from time to time.
(f) Registration of Securities. All securities held for a Portfolio
which are issued or issuable only in bearer form, except such
securities maintained in the Book-Entry System or in another
depository, shall be held by PFPC Trust in bearer form; all
other securities maintained for a Portfolio may be registered
in the name of the Fund on behalf of that Portfolio, PFPC
Trust, a Book-Entry System, another depository, a
sub-custodian, or any duly appointed nominee of the Fund, PFPC
Trust, Book-Entry System, depository 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 maintain 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 maintain for
the Accounts. With respect to uncertificated securities which
are registered in the name of the Fund or a Portfolio (or a
nominee thereof), PFPC Trust will reflect such securities on
its records based upon the holdings information provided to it
by the issuer of such securities, but notwithstanding anything
in this Agreement to the contrary PFPC Trust shall not be
obligated to safekeep such securities or to perform other
duties with respect to such securities other than to make
payment for the purchase of such securities upon receipt of
Oral or Written Instructions, accept in sale proceeds received
by PFPC Trust upon the sale of such securities of which PFPC
Trust is informed pursuant to Oral or Written Instructions, and
accept in other distributions received by PFPC Trust with
respect
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to such securities or reflect on its records any reinvested
distributions with respect to such securities of which it is
informed by the issuer of the securities.
(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 a Portfolio, except in
accordance with Written Instructions. PFPC Trust, directly or
through the use of another entity, shall execute in blank and
promptly deliver all notices, proxies and proxy soliciting
materials received by PFPC Trust as custodian of the Property
to the registered holder of such securities. If the registered
holder is not the Fund on behalf of a Portfolio, then Written
Instructions or Oral Instructions must designate the person who
owns such securities.
(h) Transactions Not Requiring Instructions. Notwithstanding
anything in this Agreement requiring instructions in order to
take a particular action, in the absence of a contrary Written
Instruction, PFPC Trust is authorized to take the following
actions without the need for instructions:
(i) Collection of Income and Other Payments.
(A) collect and receive for the account of each
Portfolio, 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 each
Portfolio of such receipt and credit such income
to each Portfolio'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 each Portfolio
all securities received as a distribution on the
Portfolio'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 a Portfolio and held by PFPC Trust
hereunder;
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(D) present for payment and collect the amount payable
upon all securities which may mature or be called,
redeemed, retired, or otherwise become payable (on
a mandatory basis) 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 a Portfolio 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 on behalf of a Portfolio 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) 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 each Portfolio;
(2) collect interest and cash dividends
received, with notice to the Fund, to the
account of each Portfolio;
(3) hold for the account of each Portfolio all
stock dividends, rights and similar
securities issued with respect to any
19
securities held by PFPC Trust; and
(4) subject to receipt of such documentation and
information as PFPC Trust may request,
execute as agent on behalf of the Fund all
necessary ownership certificates required by
a national governmental taxing authority or
under the laws of any U.S. state now or
hereafter in effect, inserting the Fund's
name, on behalf of a Portfolio, on such
certificate as the owner of the securities
covered thereby, to the extent it may
lawfully do so.
(iii) Other Matters.
(A) subject to receipt of such documentation and
information as PFPC Trust may request, PFPC Trust
will, in such jurisdictions as PFPC Trust may
agree from time to time, seek to reclaim or obtain
a reduction with respect to any withholdings or
other taxes relating to assets maintained
hereunder (provided that PFPC Trust will not be
liable for failure to obtain any particular relief
in a particular jurisdiction); and
(B) PFPC Trust is authorized to deduct or withhold any
sum in respect of tax which PFPC Trust considers
is required to be deducted or withheld "at source"
by any relevant law or practice.
(i) Segregated Accounts.
(i) PFPC Trust shall upon receipt of Written Instructions
or Oral Instructions establish and maintain segregated
accounts on its records for and on behalf of each
Portfolio. Such accounts may be used to transfer cash
and securities, including securities in a Book-Entry
System or other depository:
(A) for the purposes of compliance by the Fund with
the procedures required by a securities or option
exchange, providing such procedures comply with
the 1940 Act and any releases of the SEC relating
to the maintenance of segregated accounts by
registered investment companies; and
(B) upon receipt of Written Instructions, for other
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.
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(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 shares or the principal amount purchased
and accrued interest, if any;
(iii) the date of purchase and settlement;
(iv) the purchase price per unit;
(v) the total amount payable upon such purchase;
(vi) the Portfolio involved; and
(vii) 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 a Portfolio (or
otherwise in accordance with standard market practice)
pay out of the monies held for the account of the
Portfolio 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 shares or principal amount sold, and
accrued interest, if any;
(iii) the date of trade and settlement;
(iv) the sale price per unit;
(v) the total amount payable to the Fund upon such sale;
(vi) the name of the broker through whom or the person to whom
the sale was made;
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(vii) the location to which the security must be delivered and
delivery deadline, if any; and
(viii) the Portfolio involved.
PFPC Trust shall deliver the securities upon receipt of the total
amount payable to the Portfolio upon such sale, provided that the
total amount payable is the same as was set forth in the Oral
Instructions or Written Instructions. Notwithstanding anything to the
contrary in this Agreement, PFPC Trust may accept payment in such
form as is consistent with standard 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 each Portfolio,
listing each portfolio security belonging to each
Portfolio (with the corresponding security
identification number) held at the end of such
month and stating the cash balance of each
Portfolio at the end of such month;
(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
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. For
22
clarification, upon termination of this Agreement PFPC
Trust shall have no responsibility to transmit such
material or to inform the Fund or any other person of such
actions or events.
(m) Crediting of Accounts. PFPC Trust may in its sole discretion
credit an Account with respect to income, dividends,
distributions, coupons, option premiums, other payments or
similar items prior to PFPC Trust's actual receipt thereof, and
in addition PFPC Trust may in its sole discretion credit or
debit the assets in an Account on a contractual settlement date
with respect to any sale, exchange or purchase applicable to
the Account; provided that nothing herein or otherwise shall
require PFPC Trust to make any advances or to credit any
amounts until PFPC Trust's actual receipt thereof. If PFPC
Trust 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
23
otherwise pursue recovery of any such amounts so credited from
the Fund. The Fund hereby grants a first priority contractual
possessory security interest in and a right of setoff against
the assets maintained in an Account hereunder in the amount
necessary to secure the return and payment to PFPC Trust of any
advance or credit made by PFPC Trust (including charges related
thereto) to such Account.
(n) Collections. All collections of monies or other property in
respect, or which are to become part, of the Property (but not
the safekeeping thereof upon receipt by PFPC Trust) shall be at
the sole risk of the Fund. If payment is not received by PFPC
Trust within a reasonable time after proper demands have been
made, PFPC Trust shall notify the Fund in writing, including
copies of all demand letters, any written responses 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) Foreign Exchange. PFPC Trust and/or sub-custodians may enter
into or arrange foreign exchange transactions (at such rates as
they may consider appropriate) in order to facilitate
transactions under this Agreement, and such entities and/or
their affiliates may receive compensation in connection with
such foreign exchange transactions.
15. Duration and Termination. This Agreement shall continue until
terminated by the Fund or PFPC Trust on sixty (60) days' prior
written notice to the other party. In the
24
event this Agreement is terminated (pending appointment of a successor
to PFPC Trust or vote of the members of the Fund to dissolve or to
function without a custodian of its cash, securities or other
property), PFPC Trust shall not deliver cash, securities or other
property of the Portfolios to the Fund. It may deliver them to a bank
or trust company of PFPC Trust's choice, having 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. PFPC Trust shall not be required to make any delivery
or payment of assets upon termination until full payment shall have
been made to PFPC Trust of all of its fees, compensation, costs and
expenses (including without limitation fees and expenses associated
with deconversion or conversion to another service provider and other
trailing expenses incurred by PFPC Trust). PFPC Trust shall have a
first priority contractual possessory security interest in and shall
have a right of setoff against the Property as security for the
payment of such fees, compensation, costs and expenses.
16. Change of Control. Notwithstanding any other provision of this
Agreement, in the event of an agreement to enter into a transaction
that would result in a Change of Control of the Fund's adviser or
sponsor, the Fund's ability to terminate the Agreement pursuant to
Section 15 will be suspended from the time of such agreement until
two years after the Change of Control.
17. Notices. 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 000 Xxxx
Xxxxxxxxx Xxxxxx, X.X., Xxxxx 0000, Xxxxxxx, Xxxxxxx 00000-0000,
25
Attention: Xxxxxx Xxxxxxxx; 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 electronic delivery, hand 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.
18. 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.
19. Delegation; Assignment. PFPC Trust may assign its rights and delegate
its duties hereunder to any affiliate of PFPC Trust or of The PNC
Financial Services Group, Inc., provided that PFPC Trust gives the
Fund 30 days' prior written notice of such assignment or delegation.
20. 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.
21. Further Actions. Each party agrees to perform such further
acts and execute such further documents as are necessary to
effectuate the purposes hereof.
22. 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
26
embody in one or more separate documents their agreement, if
any, with respect to delegated duties.
(b) No Representations or Warranties. Except as expressly provided
in this Agreement, PFPC Trust hereby disclaims all
representations and warranties, express or implied, made to the
Fund or any other person, including, without limitation, any
warranties regarding quality, suitability, merchantability,
fitness for a particular purpose or otherwise (irrespective of
any course of dealing, custom or usage of trade), of any
services or any goods provided incidental to services provided
under this Agreement. PFPC Trust disclaims any warranty of
title or non-infringement except as otherwise set forth in this
Agreement.
(c) No Changes that Materially Affect Obligations. Notwithstanding
anything in this Agreement to the contrary, the Fund agrees not
to make any modifications to its registration statement or
adopt any policies which would affect materially the
obligations or responsibilities of PFPC Trust hereunder without
the prior written approval of PFPC Trust, 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 Fund will provide such information and
documentation as PFPC Trust may reasonably request in
connection with services provided by PFPC Trust to the Fund.
(f) Governing Law. This Agreement shall be deemed to be
a contract made in
27
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) Facsimile Signatures. The facsimile signature of any party to
this Agreement shall constitute the valid and binding execution
hereof by such party.
(j) Customer Identification Program Notice. To help the U.S.
government fight the funding 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.
Consistent with this requirement, PFPC Trust may request (or
may have already requested) the Fund'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 Trust may also ask (and may
have already asked) for additional identifying information, and
PFPC Trust may take steps (and may have already taken steps) to
verify the authenticity and accuracy of these data elements.
28
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:______________________
Title:___________________
ASA MARKET NEUTRAL EQUITY FUND LLC
By:______________________
Title:___________________
29
