Exhibit 99.2(j)
CUSTODIAN SERVICES AGREEMENT
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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 Debt Arbitrage 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;
(ii) all income in respect of any of such securities or other
investment items;
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(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.
(b) PFPC Trust shall be entitled to rely upon any Oral Instruction or
Written
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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).
(c) Conflicting Advice. In the event of a conflict between directions
or advice or Oral
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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 normal business hours. Upon the reasonable
request of the Fund, copies of any such
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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, computer software, source code, object code, flow
charts, databases, inventions,
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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 the disclosure request
or requirement is, in the written opinion of such party's counsel
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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 available. In the event of equipment
failures, PFPC Trust shall, at no additional expense to
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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. Notwithstanding anything in this Agreement to the
contrary, neither the Fund nor its
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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 invalidity, authority or lack thereof, or truthfulness
or accuracy or lack thereof, of
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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 Property or any collections undertaken pursuant to this
Agreement, which may be
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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;
(ii) purchase or redemption of Shares of the Fund delivered to
PFPC Trust;
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(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 of any such
securities or investment, except upon the express terms of
this Agreement or upon Written Instructions authorizing the
transaction. In no
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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;
(iv) deliver any securities held for a Portfolio against receipt
of other securities
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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
(xii) release and deliver or exchange securities owned by the Fund
for other
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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 control as the Fund may reasonably
request from time to time.
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(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.
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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 TRUST COMPANY
By:
-------------------------------------
Title:
-----------------------------------
ASA DEBT ARBITRAGE FUND LLC
By:
-------------------------------------
Title:
-----------------------------------
29
