Exhibit (h)(6)
EXECUTION COPY (12/18/12)
PBI Agreement
This agreement (including all terms, schedules, supplements and exhibits attached hereto, this “PBI Agreement”) is
entered into between ALPS Series, Trust, on behalf of its series, Cognios Market Neutral Large Cap Fund (“Customer”) and BNP PARIBAS PRIME BROKERAGE INTERNATIONAL, LTD. (“PBI”), and BNP Paribas, acting through its
New York branch (“BNPP NY”, and together with PBI, the “Arranged Financing Entities”). The Agreement sets forth the terms and conditions on which PBI will open and maintain Accounts for prime brokerage and other
products and otherwise transact business with Customer. Customer and BNP Paribas Prime Brokerage, Inc. (“BNPP PB”), on behalf of itself and as agent for the BNPP Entities, have also entered into a U.S. Prime Brokerage Agreement (the
“U.S. PB Agreement”) for the provision of certain securities related services.
All terms, provisions and
agreements set forth in the agreements listed below are hereby incorporated herein by reference with the same force and effect as though fully set forth herein, all of which taken together shall constitute a single, integrated agreement.
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Account Agreement attached as Exhibit A to the U.S. PB Agreement, substituting “BNP PARIBAS PRIME BROKERAGE, INC.” or
“BNPP PB” as used in the Account Agreement with “BNP PARIBAS PRIME BROKERAGE INTERNATIONAL, LTD.” or “PBI”, as the case may be; |
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Custody Terms, attached as Exhibit A hereto; |
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Arranged Financing Terms, attached as Exhibit B hereto; for long-side arranged financing; |
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Master Securities Loan Agreement (2000 Version), as published at
xxxx://xxx.xxxxx.xxx/xxxxxx/xxxxxx_xxxxxxxxxx_xxxx_xxxxxxxxx_0000_xxxxxxx.xxx for short-side arranged financing between the Customer and PBI; and |
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Master Securities Loan Agreement (2000 Version), as published at
xxxx://xxx.xxxxx.xxx/xxxxxx/xxxxxx_xxxxxxxxxx_xxxx_xxxxxxxxx_0000_xxxxxxx.xxx for short-side arranged financing between the Customer and BNPP NY. |
IN WITNESS WHEREOF, the parties have caused this PBI Agreement to be duly executed and delivered as of December 20, 2012.
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| BNP PARIBAS PRIME BROKERAGE INTERNATIONAL, LTD. |
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Name: |
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Title: |
EXECUTION COPY (12/18/12)
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| BNP PARIBAS, acting through its New York Branch |
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Name: |
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| BNP PARIBAS, acting through its New York Branch |
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| By: |
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Name: |
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Title: |
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| ALPS Series, Trust, on behalf of its series, Cognios Market Neutral Large Cap
Fund |
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Name: |
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EXECUTION COPY (12/18/12)
Exhibit A to PBI Agreement – Custody Terms
The Custody Terms (the
“Custody Terms”) are entered into between Customer and BNP PARIBAS, acting through its NEW YORK BRANCH (“BNPP NY”). Customer and BNP Paribas Prime Brokerage, Inc. (“BNP PB”), on behalf of itself and
as agent for the BNPP Entities, have also entered into a U.S. Prime Brokerage Agreement (the “U.S. PB Agreement”) for the provision of certain securities related services. The following provisions apply where BNPP NY is
acting as custodian of Collateral (but do not apply to any assets in respect of which a BNPP Entity has exercised the rights to hypothecate and use the assets in accordance with Section 4 of the Account Agreement as incorporated by reference
into the U.S. PB Agreement). All capitalized terms used but not defined herein shall have the meanings set forth in the U.S. PB Agreement.
| 1. |
Customer hereby appoints BNPP NY as its custodian to hold certain stocks, shares, options, bonds, debentures, notes, other similar instruments and
securities, and other financial assets (the “Securities”), cash and other investment property and assets of the Customer, and shall, open and maintain one or more custody accounts (the “Securities Account”) in such
name or names as Customer may, from time to time, direct; and will accept for safekeeping and for credit to the Securities Account, in accordance with the terms hereof. The parties agree that the Securities Account is a “securities
account” within the meaning of Article 8 of the UCC. |
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BNPP NY may hold Collateral through a custodian which is a BNPP Entity, and accepts the same level of responsibility to Customer for any default of
such BNPP Entity or nominee controlled by it as BNPP NY itself owes to Customer for the safe custody of the Collateral. Notwithstanding anything in this PBI Agreement to the contrary, BNPP NY may execute any of its duties and rights hereunder by or
through agents (which may include affiliates). BNPP NY shall not be liable for the acts or omissions of any agent selected by it with reasonable care. |
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BNPP NY is authorized to make payments to itself or others for fees and expenses of handling the Securities Account and Collateral credited into the
Securities Account, provided that all such payments shall be accounted for Customer. Each relevant BNPP Entity shall pay BNPP NY for services rendered by BNPP NY as may be separately agreed by the parties. |
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As set forth in the U.S. PB Agreement, in order to secure the due and punctual payment in full of (i) all present and future obligations of the
Customer to the BNPP Entities that (i) arise under this PBI Agreement or the U.S. PB Agreement, (ii) related to the purchase, sale, borrowing or loan of securities or other property involving Customer and any BNPP Entity, or
(iii) arise under or in connection with any and all other agreements, instruments, or other documents to which Customer and any BNPP Entity are parties, the Customer hereby pledges, transfers and assigns to the BNPP Entities, and grants to the
BNPP Entities a continuing first priority security interest in, a general lien upon and a right of set-off with power of sale against, all of Customer’s right, title and interest in and to all assets of the Securities Account.
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BNPP NY is entitled to receive and collect all income, dividends, distributions, cash equivalent payments and principal with respect to the
Collateral credited to the Securities Account and to credit the same to the Securities Account. |
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Collateral in the form of registrable securities will be registered as BNPP NY may direct in the name of a nominee company controlled by BNP Paribas
or by another BNPP Entity or by an approved depositary. |
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BNPP NY need not notify Customer of any corporate actions, including any events concerning takeovers, other offers or capital reorganisations or
voting, conversion and subscription rights relating to Collateral. If instructions are received by BNPP NY within sufficient time, it will use reasonable endeavours to ensure that Customer has the benefit of all corporate actions attached to the
Collateral, although the benefit of such actions cannot be guaranteed. |
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All voting rights in respect of the securities will be exercisable only at the direction of Customer. BNPP NY may take any nondiscretionary action
on mandatory corporate actions. |
BNPP NY will not be liable to Customer for any losses
suffered as a result of the benefit of corporate actions not being obtained or voting rights not being exercised provided that BNPP NY has used all reasonable endeavours to forward Customer’s instructions to the appropriate recipient.
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Where Collateral has been pooled with assets of other customers, Customer shall be treated as the beneficial owner of such proportion of the
relevant securities, as the number of its securities bears to the total number of securities held. In this case Customer’s redelivery rights in respect of the securities are not in specie but rather in respect of securities of the same number,
class, denomination and issue as those originally deposited with BNPP NY. Entitlements to shares and any other benefits including cash proceeds arising from corporate actions will be distributed amongst the clients for whom BNPP NY holds the pooled
securities in the same proportions as the respective holdings of clients of BNPP NY who have given identical instructions in connection with the relevant corporate action in relation to their holdings of the pooled securities.
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Customer will receive periodic statements of account providing details of the Collateral (“Statements”) at intervals agreed with
Customer and at least annually. The basis on which assets shown on these Statements will be valued will be the market price of such assets on the date(s) shown on the Statement based on information received by BNPP NY from reputable pricing sources.
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EXECUTION COPY (12/18/12)
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Customer authorises BNPP NY to act on instructions from BNPP PB and other BNPP Entities in respect of the Collateral. |
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BNPP NY nor any BNPP Entity shall be liable for any expense, claim, loss or damage suffered by Customer or any other person arising out of or caused
by any delay in, or failure of, performance by BNPP NY, in whole or in part, arising out of or caused by any change in law, order or ruling by any governmental entity, or other regulation or the enactment or coming into force of any law or other
regulations, in each case applicable to BNPP NY and which has the effect of preventing, impairing or otherwise prejudicing BNPP NY from complying with all or any part of its obligations under this PBI Agreement and Customer hereby waives, releases
and agrees not to xxx upon any such claim for such damages. |
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At the end of any Business Day, BNPP NY shall have to right to, directly or indirectly, cause any cash balances in the Securities Account to be
invested in an interest-bearing deposit account (the “Interest Account”) with a BNPP Entity (including, without limitation, an off-shore affiliate). The interest rate paid
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on such deposit may vary daily and will be equal to the sum of a published based rate plus or minus an additional percentage. Any interest on such cash balances invested in the Interest Account
will be credited to the Securities Account. The deposits held in the Securities Account and Interest Account are unconditional obligations of BNP Paribas that are not insured and carry no FDIC insurance. Payment of deposits is not guaranteed by BNP
Paribas if the local affiliate where the Interest Account is held is precluded from making payment due to any restriction imposed by the local government or applicable regulatory agencies. For purposes of any transfers of cash balances to or from
the Interest Account, “Business Day” shall mean any day, except Saturday, Sunday and any day which is a day on which banking institutions are authorized or required by law, regulation, executive order or other government action to close in
New York or the jurisdiction in which the Interest Account is held, or the New York Stock Exchange is closed. |
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The provisions of the Custody Terms shall be governed by and construed in accordance with the laws of New York.
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EXECUTION COPY (12/18/12)
Exhibit B to PBI Agreement – Arranged Financing Terms
The Arranged Financing Terms (the “Arranged Financing Terms”) are entered into between Customer and BNP Paribas Prime
Brokerage International, Ltd. (“PBI”), BNP Paribas, acting through its New York branch (“BNPP NY”, and together with PBI, the “Arranged Financing Entities”). The Arranged Financing Terms set forth
the terms and conditions on which the Arranged Financing Entities will open and maintain margin accounts (the “Accounts”) for and otherwise transact business with Customer. Customer and BNP Paribas Prime Brokerage, Inc.
(“BNPP PB”), on behalf of itself and as agent for the BNPP Entities, have also entered into a U.S. Prime Brokerage Agreement (the “U.S. PB Agreement”) for the provision of certain securities related services.
All capitalized terms used but not defined herein shall have the meanings set forth in the U.S. PB Agreement.
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The U.S. PB Agreement - |
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(a) |
All capitalized terms used but not defined herein shall have the meanings set forth in the U.S. PB Agreement. For the avoidance of doubt, the
Arranged Financing Terms is a “Contract” as defined in the U.S. PB Agreement and all obligations of Customer to PBI arising hereunder or in connection with any Loan (as defined below) are “Obligations” as defined in the U.S. PB
Agreement. |
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(b) |
Customer specifically agrees that PBI is entitled to the rights and remedies accorded to the BNPP Entities under the U.S. PB Agreement. Customer
specifically acknowledges that the Arranged Financing Entities are pledgees under that U.S. PB Agreement. To the extent that BNPP PB performs any obligations under the Arranged Financing Terms, Customer agrees that BNPP PB is acting solely as agent
for the Arranged Financing Entities. Customer acknowledges and agrees that BNPP PB is not assuming any principal obligations to it. |
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Customer and BNPP NY hereby agree that BNPP NY is authorized, but in no event obligated, to extend credit in the form of cash to Customer hereunder
in connection with Customer’s purchase of securities. The term “Loan” means the outstanding amount of each cash loan from BNPP NY to Customer at any time and from time to time outstanding under the Arranged Financing Terms.
BNPP NY shall have no commitment to make, or Customer to accept, any Loan hereunder. Customer hereby agrees to repay any such Loan in accordance with the provisions of the Arranged Financing Terms. |
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(b) |
Interest on Loans is computed from the first to the last calendar day of each month and shall compound on a daily basis. Interest shall accrue on
any Loan at an annual rate determined on the basis of the sum of a published base rate in the U.S., plus an additional percentage and based on a notional year appropriate to the interest rate basis (the “Interest Rate”).
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Customer hereby acknowledges that the Interest Rate may change without prior notice to Customer. |
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Interest shall be due and payable in arrears on the first Business Day of the month following the month in which the interest accrued.
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(d) |
Immediately upon BNPP NY’s demand at any time and for any reason whatsoever, Customer shall repay to BNPP NY the aggregate principal amount of
any Loans outstanding, together with accrued interest. Interest shall accrue on any amounts (including unpaid interest) not paid immediately upon demand at the Interest Rate plus 2% per annum. |
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(e) |
If the relevant Arranged Financing Entity is required by any court or otherwise to return to Customer (or any representative thereof) any amount
relating to the Loans or any other obligations of Customer hereunder (the “Secured Lending Obligations”), then Customer’s obligations hereunder in respect of the pertinent Secured Lending Obligations, to the extent theretofore
discharged, shall be reinstated. |
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(f) |
Customer will transfer in respect of the Loans, pursuant to the Arranged Financing Terms, securities, cash and other investment property and assets
of such types, in such amounts and at such times as the Arranged Financing Entities shall from time to time request. |
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(g) |
Notwithstanding the foregoing, the parties agree that any of the BNPP Entities may act as agent in accordance with any Loan entered into hereunder;
provided that no such arrangement shall discharge BNPP NY of its obligations hereunder. The BNPP Entities and any subagent that they may appoint shall have no responsibility or liability to Customer or PBI or BNPP NY with respect to the performance
of either such party under the Arranged Financing Terms, and the BNPP Entities and any subagent that they may appoint shall not be deemed to endorse or guarantee any transaction effected hereunder.
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EXECUTION COPY (12/18/12)
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Representations and Warranties of Customer – Qualified Investor – Customer (and, if a person or entity is signing this
Agreement on behalf of Customer, such person or entity) hereby represents and warrants as of the date hereof, which representations and warranties will be deemed repeated on each date on which this
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Agreement is in effect, that Customer is a “qualified investor” as defined in Section 3(a)(54) of the Securities Exchange Act of 1934, as amended.
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