FUND OF HEDGE FUNDS CUSTODIAL AGREEMENT
JPMORGAN
CHASE BANK, NATIONAL ASSOCIATION
FUND
OF HEDGE FUNDS CUSTODIAL AGREEMENT
THIS
CUSTODIAL AGREEMENT (the “Agreement”) is made
as of January 29, 2010, by and between JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
(the “Custodian”), SALIENT
ABSOLUTE RETURN MASTER FUND, L.P. (the “Customer”), a
Delaware Statutory Trust.
BACKGROUND
A. The
Customer is registered under the Investment Company Act of 1940, as amended
(“1940 Act”) as a closed end investment company. The Customer is a
fund of hedge funds which invests principally in shares, units and other
interests (“Interests”) of
underlying investment funds (the “Underlying
Funds”).
B. The
Customer will or may from time-to-time own cash, other investment securities
(including, but not limited to investment companies such as exchange-traded
funds) and short-term cash management investments, securities and other
financial instruments received from or with respect to an investment in an
Underlying Fund, and swap, forward, futures, repurchase or other privately
negotiated or publicly traded traded agreements relating to financial
instruments.
C. Salient
Advisers, L.P. (the “Manager”) is
Customer’s investment adviser and is registered under the Investment Advisers
Act of 1940, as amended. Manager manages the Customer’s assets and is
authorized to make investment decisions on behalf of the Customer.
D. Customer
is overseen by its Board of Trustees (the "Board") pursuant to the 1940 Act
and rules promulgated thereunder. The Board has authorized Customer to enter
into this Agreement through action of the Customer’s general
partner.
E. The
Customer wishes to retain the Custodian to provide custody services for the
Customer’s assets, and the Custodian wishes to furnish such custody services, as
more fully described herein.
F. The
Customer and the Custodian desire to evidence their intent to properly bring
about the custody of assets of the Customer as described in this
Agreement.
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:
ARTICLE
I: DEFINITIONS
1. DEFINITIONS.
(a) “Administrator” means
Citi Fund Services, Ohio, Inc., or any other entity or entities designated as
such in Written Instructions.
(b) “Agreement” means this
Custodial Agreement, as it may be amended from time to time, and includes all
schedules and exhibits to this Custodial Agreement, as they may be amended from
time to time.
(c) “Authorized Person”
means any person authorized by the Customer, including but not limited to
employees of the Manager or Administrator, to give Written Instructions to the
Custodian
on behalf of the Customer, and listed on Schedule B. An Authorized
Person’s scope of authority may be limited by setting forth such limitation in
Schedule B. Schedule B may be amended only upon Written
Instructions.
(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 maintained by an exchange registered with
the SEC under the Securities Exchange Act of 1934, as amended.
(e) “Confidential
Information” has the meaning specified in Section 9 of this
Agreement.
(f) “Indemnitees” has the
meaning provided in Section 14 of this Agreement.
(g) “Interests” means the
shares, units and other interests of the Underlying Funds in which the Customer
invests or proposes to invest.
(h) “Property”
means:
(i) any
and all cash, securities and other investment items and financial instruments
owned by the Customer, which the Customer may from time to time deposit, or
cause to be deposited, with the Custodian or which the Custodian may from time
to time hold for the Customer;
(ii) all
income and distributions, whether in cash or in kind, in respect of any Property
identified in clause (i);
(iii) all
proceeds, whether in cash or in kind, from the sale or other disposition of any
Property identified in clause (i);
(iv) all
proceeds, whether in cash or in kind, from the sale of securities issued by the
Customer, which are received by the Custodian from or on behalf of the
Customer;
(v) all
proceeds from the Customer’s loans, borrowings or other financings pursuant to
which cash, securities or other investment items are received by the Custodian
for or on behalf of the Customer; and
(vi) any
other assets or other property of the Company that the Custodian agrees to hold
for the Customer.
(i) “SEC” means the United
States Securities and Exchange Commission.
(j) “Underlying Fund”
means underlying funds and/or portfolios, including without limitation managed
accounts in which the Customer has invested or will or may invest.
(k) “Written Instructions”
means written instructions (1) on the form attached hereto as Exhibit 2 (or a
different form the use of which must be approved by the Custodian in its sole
and absolute discretion) delivered by facsimile sending device to the facsimile
number indicated on Exhibit 2, and signed by two Authorized Persons, and receipt
of which has been acknowledged by the Custodian, (2) instructions transmitted
via JPMAccess as set forth on Schedule C.
ARTICLE
II: APPOINTMENT, RIGHTS AND RESPONSIBILITIES OF THE
CUSTODIAN
3
2. APPOINTMENT.
(a) The
Customer hereby appoints the Custodian to provide the custody services provided
for in this Agreement to the Customer, and the Custodian accepts such
appointment and agrees to furnish such services, as set forth in this
Agreement.
(b) The
Custodian shall perform the custody services set forth in Schedule A
hereto. The Custodian may sub-contract with affiliates and/or third
parties to perform any or all of the services to be performed by the Custodian
hereunder; provided that the Custodian shall remain primarily liable for the
proper performance of custody services under this Agreement in accordance with
applicable law.
(c) In
performing its duties hereunder, the Custodian shall have the authority to do
all acts the Custodian reasonably determines are necessary, proper or convenient
for it to perform its obligations under this Agreement.
(d) The
Custodian undertakes to perform only such duties as are expressly set forth
herein and no duties or obligations shall be implied. In performing
these duties, the Custodian shall have no liability under, and no duty to
inquire as to the provisions of, any agreement or document other than this
Agreement. The Custodian shall have no duty to solicit any payments
which may be due it or the Customer.
3. INSTRUCTIONS.
(a) Written
Instructions will be required for any action requested of the Custodian,
including without limitation those transactions described in Section 4 of
Schedule A hereto, and except for those transactions described in Section 6 of
Schedule A hereto.
(b) Written
Instructions shall not be deemed received by the Custodian until the Customer
has received via facsimile or email a signed (or in the case of email, unsigned)
acknowledgement of receipt from the Custodian.
(c) The
Custodian shall be entitled to rely upon any Written Instructions it receives
from an Authorized Person (or from a person reasonably believed by the Custodian
to be an Authorized Person) pursuant to this Agreement.
(d) The
Custodian may assume that any Written Instructions received hereunder are not in
any way inconsistent with the provisions of organizational documents of the
Customer or of any vote, resolution, or proceeding of the Board and that the
Customer is authorized to take the actions specified in the Written
Instructions, unless and until the Custodian receives Written Instructions to
the contrary.
(e) The
Custodian shall have no duty to inquire into or investigate the validity,
accuracy or content of any Written Instructions.
(f) The
Customer acknowledges that the Custodian will verify all cash movement
instructions via telephone with an Authorized Person other than the Authorized
Signer transmitting the instructions, for all cash movement instructions not
received via the electronic transaction reporting system set forth on Schedule
C, which requires the use of a password or other authorized identifier in order
to gain access.
(g) Unless
otherwise agreed to in writing by the Custodian and the Customer,
Written Instructions must be received by the Custodian at least three (3)
business days prior to the business day on which the Customer wishes the
Custodian to perform pursuant to the Written Instructions. Written
Instructions received after such date shall be executed on a reasonable
4
efforts
basis by the Custodian, however, the Custodian shall have no liability
whatsoever for failure to perform pursuant to such Written Instructions except
in the case of Custodian’s gross negligence, recklessness, willful misfeasance
or bad faith.
(h) The
Customer acknowledges that where Written Instructions require the Custodian to
prepare and submit forms, letters or other writings to third parties on behalf
of the Customer, including but not limited to subscription agreements,
redemption requests, stock transfers and exchanges of cash for Interests or
Interests in one Underlying Fund for Interests in another Underlying Fund,
(“Writings”)
the Custodian will prepare but will not submit such Writings unless
and until the Writings have been approved by an Authorized Person whose name is
set forth in Part II of Schedule B, which approval may take the form of a signed
writing or e-mail from an Authorized Person. The Customer agrees to
make available Authorized Persons during normal business hours to review and
approve such Writings for the Custodian. The Customer acknowledges
that the Custodian shall not be liable for failure to perform its obligations
with respect to Writings if such failure results from any delay, error,
unavailability or non-approval by the Customer or Authorized Person of the
Customer. The Custodian shall exercise its reasonable efforts to
provide Writings to the Customer for approval as soon as reasonably practicable
following the Custodian’s receipt of Written Instructions.
4. RIGHT
TO RECEIVE ADVICE.
(a) ADVICE
OF CUSTOMER. If the Custodian is in doubt as to any action it should
or should not take, the Custodian may request and be entitled to rely upon
directions or advice from the Customer or its designated agents, including but
not limited to Written Instructions.
(b) ADVICE
OF COUNSEL. If the Custodian is in doubt as to any action it should
or should not take, the Custodian may request and, upon notice to the Customer
that the Custodian has engaged counsel in connection with the action at issue,
be entitled to reasonably rely upon advice from counsel of its own choosing (who
may be counsel for the Customer, or the Custodian, at the option of the
Custodian), and such cost shall be borne by the Customer provided that such cost
is reasonable.
(c) CONFLICTING
ADVICE. In the event of a conflict between directions or advice or
Written Instructions the Custodian receives from the Customer and the advice it
receives from counsel, the Custodian will inform the Customer and the Manager of
the conflict and make reasonable commercial efforts to resolve the conflict;
provided that, the Custodian, if unable to resolve the conflict within a
reasonable period of time, shall be entitled to rely upon and follow the advice
of counsel.
(d) PROTECTION
OF THE CUSTODIAN. Notwithstanding any other provision in this
Agreement to the contrary, the Custodian shall be indemnified by the Customer
and held without liability for any action that the Custodian takes or does not
take in reliance upon directions or advice or Written Instructions the Custodian
receives from or on behalf of the Customer and which the Custodian believes, in
good faith, to be consistent with those directions or advice or Written
Instructions, except in the case of Custodian’s gross negligence, recklessness,
or willful misfeasance in the processing of that instruction. Nothing
in this Agreement shall be construed so as to impose an obligation upon the
Custodian (i) to seek such directions or advice or Written Instructions, or (ii)
to act in accordance with such directions or advice or Written
Instructions.
ARTICLE
III: RIGHTS AND RESPONSIBILITIES OF THE CUSTOMER
5. DELIVERY
OF THE PROPERTY.
(a) During
the period during which this Agreement is effective the Customer
will:
5
(i) deliver
or provide for the delivery to the Custodian of all of the Customer’s tangible
Property that is subject to this Agreement, including without limitation cash,
certificated securities, and other certificated financial
instruments;
(ii) deliver
or provide for the delivery to the Custodian evidence satisfactory to the
Custodian of the Customer’s ownership of all uncertificated
securities that are the subject of this Agreement, including without limitation:
(A) executed subscription agreements or similar documents evidencing the
Customer’s ownership of Interests, as well as any subsequent subscription or
similar agreements to purchase additional Interests in an Underlying Fund in
which the Customer previously had invested, and any redemption or similar
agreements or notices to redeem or otherwise dispose of Interests
previously owned by the Customer; and (B) evidence of the Customer’s ownership
of securities held through a Book-Entry System;
(iii) deliver
or provide for the delivery to the Custodian evidence satisfactory to the
Custodian of the Customer’s ownership of all other uncertificated
financial instruments that are subject to this Agreement; and
(iv) deliver
or provide for the delivery to the Custodian any other Property owned by the
Customer that is subject to this Agreement, and any other evidence of ownership
of Property by the Customer that is subject to this Agreement, in either case in
a form and manner satisfactory to the Custodian.
Custodian
acknowledges that as of the date hereof, Customer has delivered to Custodian
certain documentation and evidence required to be delivered pursuant to this
Section 4(a) with respect to the assets to be custodied by the Custodian on the
date hereof. Custodian agrees that it shall not require Customer to
deliver any document or evidence previously delivered by Customer to the
Custodian.
(b) The
Custodian is not responsible for any Property or any other items referred to in
Section 5(a) until actual receipt by the Custodian.
(c) The
Customer hereby authorizes the Custodian to hold any and all such Property and
other items in the name of the Custodian for the benefit of the
Customer.
6. DELIVERY
OF DOCUMENTS.
(a) At
the request of the Custodian, the Customer will provide the Custodian with the
following (and on an ongoing basis, with any updates, revisions, amendments,
restatements or replacements to the following):
(i) documents
regarding the formation and continued good-standing of the Customer under the
laws of its jurisdiction of formation, as well as any documents authorizing the
transactions contemplated herein;
(ii) a
copy of the Customer’s most recent offering memorandum;
(iii) a
copy of any other significant agreements entered into by the Customer, or other
documents that have a material impact, or impose limitations, on the Customer’s
ability to perform its obligations under this Agreement or the provision of
services by the Custodian; and
(iv) any
opinions from a lawyer or accountant that relate to the Services described in
this Agreement; and
6
(v) a
certification in the form of the letter attached at Exhibit 3 duly executed by
the Manager. This certification shall be provided no less frequently than
annually.
(vi) any
other documents concerning the Customer that the Bank may reasonably
request.
.
(b) The
Customer hereby agrees and acknowledges that: (i) any such documents and
other information provided to the Custodian will be for the Custodian’s
informational purposes only; (ii) the Custodian has no obligation to review
any of these documents and any other information, in whole or in part; and
(iii) if the Custodian does review any of these documents or any other
information, in whole or in part, the Custodian has no obligation to take any
action as a result of that review, including without limitation, advising the
Customer of any actions that either or both of them should take or should
refrain from taking.
7. REPRESENTATIONS,
WARRANTIES AND COVENANTS.
The Customer represents,
warrants, and covenants to the Custodian as follows:
(a) The
Customer shall, and shall cause the Manager to, at all times and at its own cost
and expense, comply with all applicable laws, rules, and regulations, including
without limitation all laws, rules and regulations applicable to its exercise of
any of its rights and obligations hereunder.
(b) Without
limiting the generality of Section 7(a), the Customer shall, directly or through
agents other than the Custodian: (i) comply with all applicable
provisions of the USA Patriot Act and United States Bank Secrecy Act, and any
applicable rules and regulations thereunder, as well as any other United States,
State, or other applicable anti-money laundering, know-your-customer, customer
identification and similar laws, rules and regulations; and (ii) in any
event, take all required steps to establish the identity, address, and source of
funds of each investor of the Customer and conduct due diligence with regard to
all prospective investors of the Customer and, where applicable, the beneficial
owners on whose behalf an investor of the Customer is seeking to make an
investment. The Customer agrees to immediately notify the Custodian
if it becomes aware of any suspicious activity or pattern of activity or
activity that may require further review (beyond Customer’s established review
procedures) to determine whether the activity or pattern of activity is
suspicious.
(c) The
Customer expressly agrees and acknowledges that: (i) the
Custodian is not responsible for, and will not conduct, any of the activities
described in Section 7(b) on behalf of the Manager or the Customer; and
(ii) the Custodian has no responsibility to take any action on behalf of
the Customer if the Customer notifies the Custodian of any suspicious activity,
pattern of activity or other activity required to be reported to the Custodian
pursuant to Section 7(b).
(d) The
Customer represent and warrant that: (i) the Customer owns, and
will at all times own, all Property provided to the Custodian for custody
services under this Agreement, subject only to liens and encumbrances created as
part of the Customer’s business; and (ii) the Customer has all powers, and
have taken all actions necessary, to enter into and perform this Agreement
pursuant to its terms.
(e) The
Customer expressly agrees and acknowledges that it will be responsible for the
reconciliation of any bank accounts established by the Custodian to deliver
services required by this Agreement. The Custodian shall not be
responsible for such reconciliation.
(f) With
respect to the Customer’s investments, the Customer represents and warrants
that (i)All
investments made by the Customer into Underlying Funds for the
7
duration
of this Agreement will be instructed and duly authorized by the Customer, acting
in a manner which is consistent with the Prospectus, constitutional documents,
policies and procedures in accordance with the terms of the investment
management agreement between the Manager and the Customer, dated ▇▇▇▇▇ ▇, ▇▇▇▇,
(▇▇) the Customer will invest only in Underlying Funds which are administered
and custodied/brokered independently of the Manager, its affiliates,
subsidiaries and any party in common control with the
Manager, (iii) the investments in Underlying Funds shall
not result in a breach of any duty owed to any owners of an equity or other
interest in the Customer or any other person, whether imposed by law, contract
or otherwise, and (iv) the Customer is not relying on any
advice or representation from the Bank or its affiliates in connection with the
decision to make any investment in an Underlying Fund.
ARTICLE
IV: TREATMENT OF BOOKS, RECORDS AND CONFIDENTIAL
INFORMATION
8. RECORDS;
VISITS.
(a) Subject
to Section 9, the Customer is entitled to receive, at its own cost and expense
and upon reasonable notice to the Custodian, copies of any or all books and
records pertaining to the Customer that:
(i) are
in the possession or under the control of the Custodian; and
(ii) have
been prepared by the Customer or third parties and provided to the Custodian by
or on behalf of the Customer, or have been distributed to the Customer or third
parties by the Custodian.
(b) The
books and records described in Section 8(a) and (b) shall be prepared and
maintained as required by the 1940 Act as applicable to the Custodian and other
applicable securities laws, rules and regulations.
(c) The
Custodian reserves the right to maintain originals or copies of all books and
records relating to the Customer for the Custodian’s own use.
(d) The
Customer and Authorized Persons shall have access to the Customer’s books and
records described in Section 8(a), upon reasonable prior written notice, during
the Custodian’s normal business hours. Further, the staff of the SEC
(or other regulators) shall have access to such books and records at all times
during Custodian’s normal business hours.
9. CONFIDENTIALITY.
(a) Each
party shall keep confidential any information relating to the other party’s
business (“Confidential
Information”). Confidential Information shall include: (i) any
data or information that is competitively sensitive material, and not generally
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 Customer or the Custodian, their respective subsidiaries and affiliated
companies and the customers, clients and suppliers of any of them; (ii) any
scientific or technical information, design, process, procedure, formula, or
improvement that is commercially valuable and secret in the sense that its
confidentiality affords the Customer or the Custodian a competitive advantage
over its competitors; (iii) all confidential or proprietary concepts,
documentation, reports, data, specifications, computer software, source code,
object code, flow charts, databases, inventions, know-how, and trade secrets,
whether or not
8
patentable
or copyrightable; and (iv) anything reasonably designated in writing as
confidential, or communicated as such.
(b) Notwithstanding
Section 9(a), information shall not be subject to such confidentiality
obligations if it: (i) is already known to the receiving party at the first time
it is obtained; (ii) is or becomes publicly known or available through no
wrongful act of the receiving party; (iii) is rightfully received from a third
party who, to the receiving party’s knowledge, is not under a duty of
confidentiality; (iv) is released by the protected party to a third party
without restriction; (v) is 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, as soon as reasonably practicable, of such requirement, to
the extent such notice is permitted); (vi) is relevant to the defense of any
claim or cause of action asserted against the receiving party; or (vii) has been
or is independently developed or obtained by the receiving party.
(c) The
Customer hereby acknowledges and agrees that:
(i) the
confidentiality restrictions provided for in Sections 9(a) and 9(b), as they
relate to the Custodian’s obligation to maintain the confidentiality of
information relating to the Customer, apply only to the Custodian, and only to
the extent the Custodian receives the Confidential Information in connection
with the services it provides under this Agreement; and
(ii) the
Custodian and its affiliates may acquire Confidential Information relating to
the Customer in connection with other services the Custodian and its affiliates
offer and activities they perform (for the Customer or for third parties) that
are not subject to this Agreement, and that any Confidential Information so
acquired shall not be subject to Sections 9(a) or 9(b) of this
Agreement.
(d) The
parties hereto acknowledge and agree that this Section 9 shall survive the
expiration or early termination of this Agreement until the second anniversary
of the earliest to occur of such date
10. THE
CUSTODIAN’S SYSTEM/OWNERSHIP OF PROPERTY.
The
Custodian 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 (whether or not a patent or copyright application has been
filed or approved), concepts, expertise, patents, copyrights, trade secrets, and
other related legal rights utilized by the Custodian in connection with the
services provided by the Custodian to the Customer.
11. DISASTER
RECOVERY.
The
Custodian shall make commercially reasonable provisions for emergency use of
electronic data processing equipment to the extent appropriate equipment is
available. In the event of equipment failures, the Custodian shall
take commercially reasonable steps to minimize service
interruptions. The Custodian shall have no liability with respect to
the loss of data or service interruptions or any fees, expenses, losses or
damages caused by, or suffered as a consequence of, equipment failure provided
such loss or interruption is not caused by the Custodian’s own willful
misconduct, bad faith, recklessness, fraud or gross negligence.
12. COOPERATION WITH
ACCOUNTANTS. The Custodian shall reasonably cooperate with the
Customer’s independent public accountants and shall use its reasonable efforts
to make the requested information available to such accountants as reasonably
requested by the Customer.
9
Any
reasonable costs incurred by the Custodian in complying with this Section 12
shall be paid by the Customer.
ARTICLE
V: COMPENSATION
13. COMPENSATION.
As
compensation for the services rendered by the Custodian under this Agreement,
the Customer will pay to the Custodian a fee or fees as set forth in a separate
Fee Schedule between the Customer and the Custodian, which may be amended from
time to time. The Customer acknowledges that the Custodian may
receive float benefits in connection with maintaining certain accounts required
to provide services under this Agreement.
ARTICLE
VI: INDEMNIFICATION AND LIABILITY
14. INDEMNIFICATION.
(a) The
Customer agrees to indemnify, defend and hold harmless the Custodian and its
affiliates, (including their respective officers, directors, agents, and
employees (the “Indemnitees”) from
all loss, liability or expense, including the reasonable fees and expenses of
outside counsel) arising out of or in connection with:
(i) the
Custodian’s execution and performance of this Agreement, except in the case of
any Indemnitee to the extent that such loss, liability or expense is due to the
gross negligence, bad faith, recklessness or willful misconduct of such
Indemnitee, or
(ii) its
following any Written Instruction or other notice, instruction, direction or
request furnished to the Custodian, except to the extent that it’s following any
Written Instruction or other notice, instruction, direction or request is
expressly forbidden by this Agreement.
(b) The
foregoing indemnities shall survive the resignation or removal of the Custodian
or the termination of this Agreement.
(c) The
Customer hereby grants the Custodian a lien on, right of set off against and
security interest in the Property for the payment of any claim for
indemnification, compensation, expenses and amounts due hereunder.
15. LIABILITY
OF THE CUSTODIAN.
(a) The
Custodian shall not be liable for any action taken or omitted by it pursuant to,
or in connection with, this Agreement except to the extent that a court of
competent jurisdiction determines in a final and non-appealable judgment that
the Custodian’s gross negligence, bad faith, recklessness, willful misconduct or
negligent handling of funds was the direct cause of any loss to the Customer,
and subject to the limitations set forth in Section 15(d) of this
Agreement.
(b) Notwithstanding
anything to the contrary in this Agreement, the Custodian shall be under no
obligation to inquire into and shall not be liable for any damages, other
liabilities or harm to any person or entity relating to:
|
(i)
|
the
title, validity or genuineness of any Property;
|
|
|
(ii)
|
the
legality or effectiveness of the purchase or delivery or transfer of any
Property or the propriety of the price by which the same is acquired or
sold;
|
10
|
(iii)
|
the
due authority of any Authorized Person to act on behalf of the Customer
with respect to the Property;
|
|
|
(iv)
|
the
due authority of the Customer to purchase or hold any
Property;
|
|
|
(v)
|
the
accuracy or completeness of any data or information with respect to
the Property which has been provided to the Custodian by the
Manager or the Administrator of the Customer, the Customer or any third
party at any time pursuant to this Agreement;
|
|
|
(vi)
|
the
collectability, insurability, effectiveness, marketability or suitability
of any Property;
|
|
|
(vii)
|
the
legal content of the provisions of any documentation provided to the
Custodian for custody with respect to the Property or the legal adequacy
thereof or of any purported transfer thereof; or
|
|
|
(viii)
|
the
accuracy of any representation regarding the Customer or the Customer’s
investment made in any agreement or writing signed by the Custodian as
custodian for the Customer.
|
(c) The
Customer understands and accepts that:
|
(i)
|
the
Bank relies solely on information provided by the managers or
administrators of the Underlying Funds and does not independently verify
or test such information. Prices of interests in Underlying
Funds are provided by the Underlying Fund or third
parties. Holdings for which prices are not readily available
may be priced by the Manager. The Bank is not responsible for
reviewing the reliability of prices or other information received from
these sources. The Bank takes no responsibility, and shall have
no responsibility, for the valuations given to the Customer’s holdings in
Underlying Funds, and shall have no liability therefor.
|
|
|
(ii)
|
the
Bank relies on statements of holdings in Underlying Funds as evidence of
the existence of such holdings and has no duty to enquire beyond such
statements. The Bank is not responsible for reviewing the reliability of
the description or prices of these holdings. To the maximum
extent permitted by law, the Bank expressly disclaims any liability to the
Manager or any person for the accuracy, timeliness, completeness or
availability of such information. Furthermore, the Bank shall
not be liable to the Manager, the Customer or any other person for any
loss resulting from reliance in whole or in part by the Manager, the
Customer or any other person on such
information.
|
(d) Notwithstanding
anything in this Agreement to the contrary, the Custodian shall not be liable
for losses, delays, failures, errors, interruptions, or loss of data occurring
directly or indirectly by reason of circumstances beyond its 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 other than
any sub-custodian. The Custodian is not responsible for any act or
failure to act by any correspondent bank, Federal Reserve Bank, SWIFT, any
global, national, regional or local automated clearing house, any global,
national, regional or local check clearing house, or any other third party other
than any sub-custodian or designee.
(e) Notwithstanding
anything in this Agreement to the contrary:
(i) neither
party hereto shall be liable for any consequential, special, punitive, or
indirect losses or damages, including lost profits, whether or not the
likelihood of such losses or damages was known by the Custodian or its
affiliates; and
11
(ii) the
Custodian’s cumulative liability to the Customer for losses, claims, suits,
controversies, breaches, or damages arising out of or related to this Agreement,
and regardless of the form of action or legal theory, shall not exceed the
greater of $100,000 or the fees received by the Custodian for services provided
hereunder during the twelve (12) months immediately prior to the date of such
loss or damage; provided however, that the there shall be no limitation on
liability of the Custodian for all losses, claims, suits, controversies,
breaches, or damages resulting from the Custodian’s willful misconduct, fraud or
negligent handling of funds.
(f) The
Custodian shall not be liable for any expense, loss, claim or damage, including
counsel fees and expenses, which the Customer or any of their officers,
directors, employees, agents, affiliates or investors or any third party may
suffer by reason of any error by, or inaccuracy of, any price or valuation
received by the Custodian from any recognized pricing source, the Customer, or
any person (including the Custodian or an affiliate of the Custodian) designated
by the Customer or pursuant to Written Instructions to furnish such information,
including any price or valuation resulting from any formula used to obtain such
prices or valuations. The Custodian shall have no duty to inquire
into the appropriateness or relative change of any price.
(g) Except
with respect to a cause of action alleging fraudulent or willful misconduct, no
party may assert a cause of action against the Custodian or any of its
affiliates that allegedly occurred more than two (2) years immediately prior to
the filing of the suit alleging such cause of action.
(h) Both
parties hereto shall have a duty to reasonably mitigate damages for which the
Custodian may become responsible under or related to this
Agreement.
The
provisions of this Section 15 shall survive termination of this
Agreement.
ARTICLE
VII: TERMINATION
16. DURATION
AND TERMINATION.
(a) This
Agreement shall continue until terminated by the Customer, or by the Custodian,
on sixty (60) calendar days’ prior written notice to the other party or
parties.
(b) The
Custodian may terminate this Agreement at any time, upon prior written notice if
the Custodian reasonably determines, in its sole discretion, that:
(i) the
Customer is in material breach of any provision of or representation or warranty
in this Agreement, and such breach remains uncured for fifteen (15)
business days from the date written notice is provided to the Customer by the
Custodian, and at the time the Agreement is terminated;
(ii) the
Customer is deemed by a court of competent jurisdiction to have acted
fraudulently, with gross negligence or with willful misconduct with respect to
the Property;
(iii) the
Customer has become bankrupt or insolvent, or a judicial or similar proceeding
has been instituted seeking to declare the Customer bankrupt or insolvent and
such proceeding has not been withdrawn within sixty (60) days of the initiation
of such proceeding;
(iv) the
Customer fails to receive an audit opinion, or receives an audit opinion with a
“going concern” or similar significant qualification and in either case such
opinion has not been withdrawn or altered within sixty (60) days of the
rendering of such opinion; or
12
(v) in-house
or outside counsel for the Custodian issues a written statement to Customer that
continuation of this Agreement could cause the Custodian or any of its
affiliates to be deemed to have acted illegally, or to incur civil or criminal
liability.
(c) In
the event this Agreement is terminated for any reason, the Custodian shall
deliver the Customer’s cash, securities, and any other Property to a successor
custodian chosen by the Customer, or if no successor has been identified, to a
bank or trust company (including without limitation, the Custodian or an
affiliate of the Custodian) of the Custodian’s choice and at the Customer’s
expense. The Custodian shall in good faith cooperate with Customer
and its successor custodian with respect to the timely transfer and handling of
the transition in custodial services. However, the Custodian shall
not be required to make any delivery or payment of assets upon termination of
the Agreement (or otherwise) until full payment shall have been made to the
Custodian of all of its fees, compensation, costs, and expenses (such expenses
include, without limitation, expenses associated with movement (or duplication)
of records and materials and conversion thereof to a successor service provider,
or to a bank or trust company pending appointment of such successor, and all
trailing expenses incurred by the Custodian, and all such fees, compensation,
costs, and expenses shall be reasonable). The Custodian shall have a
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.
(d) The
Custodian also may, prior to making any delivery or payment of assets on
termination (or otherwise), liquidate any Property (at the Customer’s expense
and in the Custodian’s sole discretion) and use the proceeds of that liquidation
to pay any or all amounts it is owed hereunder, upon ten (10) calendar days
prior written notice to the Customer (unless the Customer pays all amounts owed
to the Custodian prior to the end of that 10-day period).
(e) Sections
1, 9, 13, 14, 15 and 22 shall survive termination of this
Agreement.
ARTICLE
VIII: MISCELLANEOUS
17. NOTICES.
Notices
shall be addressed (a) if to the Custodian at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ Attention: Hedge Fund Custody Manager; and (b) if
to the Customer at ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇. Attention: Mr. ▇▇▇▇ ▇▇▇▇▇, with a copy to
K&L Gates LLP, State Street Financial Center, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.; 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, 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 when
received by the party to whom the notice is directed. If notice is
sent by messenger, it shall be deemed to have been given on the day it is
delivered. Any party may change the address listed in this Section 17
by written notice to each other party.
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.
Subsequent
to the execution of the Agreement, the Custodian may assign any or all of its
rights and delegate any or all of its duties hereunder to any person or entity,
including any affiliate of
13
the
Custodian; provided that such assignment shall not cause the Customer to be in
violation of the 1940 Act and applicable rules of the 1940 Act, and provided
further, that the Custodian shall remain primarily liable for the proper
performance of custody services and compliance with requirements applicable to
the maintenance of assets under the ▇▇▇▇ ▇▇▇. The Customer may not assign this
Agreement or any or all of its rights or obligations under the Agreement without
obtaining the prior written consent of the Custodian.
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. OTHER.
(a) ENTIRE
AGREEMENT. This Agreement embodies the entire agreement and
understanding between the parties with respect to the accounts set forth in
Schedule D hereto, the references to which are incorporated herein by reference
as if set forth in full, and supersedes all prior agreements and understandings
relating to the subject matter hereof, provided that the parties may embody in
one or more separate documents their agreement, if any, with respect to
delegated duties.
(b) NO
REPRESENTATIONS OR WARRANTIES. Except as expressly provided in this
Agreement, the Custodian hereby disclaims all representations and warranties,
express or implied, made to the Customer 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. The Custodian
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 Customer agrees not to adopt any policies
which would adversely affect the obligations or responsibilities of the
Custodian hereunder without the prior written approval of the Custodian, which
approval shall not be unreasonably withheld.
(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) GOVERNING
LAW. This Agreement shall be deemed to be a contract made in New York
and governed by the laws of the State of New York, without regard to principles
of conflicts of law. The parties hereby agree to submit to the
non-exclusive jurisdiction of any appropriate court located in New York City,
New York, and to waive any objections based on venue or inconvenience of New
York City as a forum for litigation. Each of the parties hereto
hereby waives all right to trial by jury in any action, proceeding or
counterclaim arising out of this Agreement.
(f) 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.
14
(g) 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.
(h) FACSIMILE
SIGNATURES. The facsimile signature of any party to this Agreement
shall constitute the valid and binding execution hereof by such
party.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as
of the day and year first above written.
|
JPMORGAN
CHASE BANK, NATIONAL
|
|
|
ASSOCIATION (“CUSTODIAN”)
|
|
|
By: ________________________________
|
|
| Name: ______________________________ | |
|
Title:
_______________________________
|
|
(“CUSTOMER”)
|
|||
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ | ||
| Name: | ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ | ||
|
Title:
|
Secretary
|
||
15
SCHEDULE
A
DESCRIPTION
OF SERVICES.
The
Custodian shall provide the following list of services to the
Customer:
1. RECEIPTS
AND DISBURSEMENT OF MONEY. The Custodian, acting upon Written
Instructions, shall open and maintain separate accounts at an affiliate of the
Custodian, such accounts being in the name of the Custodian as custodian for the
Customer, using all cash received from or for the account of the Customer,
subject to the terms of this Agreement, and any applicable deposit account
agreement. The Custodian shall make cash payments from or for the
Accounts of the Customer only upon Written Instructions.
Disbursements
from the account shall be limited to 1) wires initiated and approved by the
Customer or Administrator, pursuant to the wire process of the depository bank,
and released by the Custodian pursuant to Written Instructions, and
2) disbursements by the Custodian pursuant to Paragraph 4(j) of this
Schedule. The Customer and Administrator shall have on-line, view
access to the accounts.
2. RECEIPT
OF PROPERTY; SUB-CUSTODIANS.
(a) The
Custodian shall hold all Property 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. The Customer shall indicate in its Written Instruction with
respect to Interests, that the Property being delivered (such as a subscription
agreement, limited partnership or limited liability company agreement or other
document) represents Interests in a particular Underlying Fund. All
such Property shall be held or disposed of only upon Written Instructions of the
Customer pursuant to the terms of this Agreement. The Custodian shall
have no power or authority to assign, hypothecate, pledge or otherwise dispose
of any such Property, except upon the express terms of this Agreement or upon
Written Instructions authorizing the transaction. Subject to Section 4(f), in no
case may any member of the Manager and the Customer’s Board of Directors, or any
officer, employee or agent of the Customer or Manager withdraw any securities
with corresponding Written Instructions.
(b) At
the Custodian’s own expense and for its own convenience, the Custodian may,
subject to the terms of the Agreement, enter into sub-custodian agreements with
other banks or trust companies to perform duties described in this Section 2
with respect to domestic assets; provided however, that all Property and other
items shall at all times be held in the name of the Custodian for the benefit of
the Customer. Any such arrangement will not be entered into without
prior written notice to the Customer.
(c) In
addition, the Custodian may, subject to the terms of the Agreement, enter into
arrangements with sub-custodians with respect to services regarding foreign
assets; provided however, that all Property and other items shall at all times
be held in the name of the Custodian for the benefit of the
Customer. Any such arrangement will not be entered into without prior
written notice to the Customer.
(d) The
Custodian shall remain responsible for the performance of all of its duties as
described in this Agreement and shall hold the Customer harmless from its own
acts or omissions, under the standards of care provided for herein, or the acts
and omissions of any sub-custodian chosen by the Custodian under the terms of
this Section 2.
3. SERVICES
AND OBLIGATIONS WITH RESPECT TO INTERESTS.
A-1
(a) All
Interests held for the Customer which are issued or issuable only in registered
form may be registered in the name of the Customer, the Custodian, a
sub-custodian, or any duly appointed nominee of the Customer, the Custodian, or
sub-custodian.
(b) The
Customer agrees to furnish to the Custodian appropriate instruments to enable
the Custodian to hold or deliver in proper form for transfer, or to register in
the name of its nominee or in the name of another appropriate entity, any
Interests which it may hold for the Accounts and which may from time to time be
in the name of the Customer.
(c) Upon
Written Instructions from the Customer the Custodian may purchase, redeem or
transfer Interests and execute subscription agreements.
(d) The
Custodian shall have no duty to review the completeness or substance of
documents related to any Interests and shall have no authority to act on such
documents without Written Instructions, unless otherwise provided in this
Agreement.
(e) The
Custodian is authorized to receive account statements, confirmations, notices
and other correspondence and documents from the Underlying Funds regarding the
Interests intended for the Customer. Further, Custodian shall create
an electronic mailbox on its servers to which correspondence and documents from
the Underlying Funds may be directed. Custodian shall be responsible
for checking the contents of such mailbox daily. The Custodian agrees
to promptly forward to the Customer any and all of such items
received.
(f) Without
limiting the foregoing, the Customer agrees that with respect to each
subscription for Interests in any Underlying Fund, a document substantially in
the form of Exhibit 1 (as the Custodian may amend it from time to time)
shall be attached to each subscription agreement by the Custodian or the
Customer will provide to the general partner, manager, adviser, trustee or
similar person or entity of the Underlying Fund) a form of such
document.
4. TRANSACTIONS
REQUIRING INSTRUCTIONS.
Upon
receipt of Written Instructions and not otherwise, the Custodian
shall:
(a) deliver
any Property held for the Customer against the receipt of payment for the sale
of such Property;
(b) execute
and deliver to such Underlying Funds as may be designated in Written
Instructions, (i) subscription agreements and similar documents (including the
form of Addendum to Subscription Agreement attached as Exhibit 1) for the
purposes of effectuating a purchase of, or subscription for, Interests on behalf
of the Customer, and (ii) redemption requests, transfer requests or similar
documents for the purpose of effectuating a redemption or transfer of Interests
on behalf of the Customer.
(c) execute
and deliver to such persons as may be designated in Written Instructions,
proxies, consents, authorizations, and any other instruments whereby the
authority of the Customer as owner of any Property may be
exercised;
(d) deliver
any Property to the issuer thereof, or its agent, when such Property is 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 the
Custodian;
(e) deliver
any Property held for the Customer against receipt of other Property or cash
issued or paid in connection with the liquidation, reorganization, refinancing,
tender offer,
A-2
merger,
consolidation or recapitalization of any corporation, or the exercise of any
conversion privilege;
(f) deliver
any Property held for the Customer 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;
(g) make
such transfer or exchanges of the Property of the Customer and take such other
steps as shall be stated in Written Instructions to be for the purpose of
effectuating a duly authorized plan of liquidation, reorganization, merger,
consolidation or recapitalization of the Customer;
(h) release
and deliver or exchange Property owned by the Customer in connection with any
conversion of such securities or other Property, pursuant to their terms, into
other securities or other Property;
(i) release
and deliver Property owned by the Customer for the purpose of
redeeming in kind shares or units of the Customer upon delivery thereof to the
Custodian; and
(j) release
and deliver or exchange Property owned by the Customer for other
purposes.
The
Custodian 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 Section 4(i).
(k) in
connection with any grant of credit to the Customer by an affiliate of
the Custodian, to borrow money against the grant of a security
interest in, lien on, charge over or pledge of the Property, for which purpose,
the Customer hereby expressly authorizes such grant and pledge by the Custodian
on behalf of the Customer; provided that the Customer hereby also authorizes,
directs and instructs the Custodian, as a standing instruction with respect to
any such borrowing, that principal and interest charges on such borrowing shall
be timely paid by the Custodian to the lender, upon demand, out of the Property
as the lender may require, shall in no event be payable by the Custodian out of
proprietary funds of the Custodian, and such obligation for payment from the
Property shall constitute an obligation secured hereunder by the security
interest, lien on, pledge of and right of set-off against the Property granted
to the lending affiliate of Custodian by the Customer.
5. REGISTRATION
OF SECURITIES.
All
securities held for the Customer which are issued or issuable only in registered
form, shall be held by the Custodian in registered form; all other securities
held for the Customer may be registered in the name of the Customer, the
Custodian, the Book-Entry System, or any duly appointed nominee of the Customer
or Book-Entry System, as long as the status of the assets as being in custody is
preserved. The Customer reserves the right to instruct the Custodian
as to the method of registration and safekeeping of the securities of the
Customer, subject to Custodian’s right to ensure that method preserves the
status of the assets as being in the custody of the Custodian. The Customer
agrees to furnish to the Custodian appropriate instruments to enable the
Custodian to hold or deliver in proper form for transfer, or to register in the
name of the Book-Entry System or in the name of another appropriate entity, any
securities which it may hold for the Accounts and which may from time to time be
registered in the name of the Customer.
A-3
6. TRANSACTIONS
NOT REQUIRING INSTRUCTIONS.
In the
absence of contrary Written Instructions, the Custodian is authorized to take
the following actions:
(a)
RECEIPT OF INCOME AND OTHER PAYMENTS.
(i) take
all reasonable steps to receive for the account of the Customer, 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 the Customer of such receipt and credit such income, as collected, to the
Customer’s custodian account;
(ii) receive
and hold for the account of the Customer all Property received as a
distribution on the Customer’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 or Property issued
with respect to any Property belonging to the Customer and held by the Custodian
hereunder;
(iii) take
any action which may be necessary and proper in connection with the receipt of
such income and other payments.
(b)
MISCELLANEOUS TRANSACTIONS.
(i) The
Custodian is authorized to deliver or cause to be delivered Property against
payment or other consideration or written receipt therefor in the following
cases:
|
(a)
|
for
examination by a broker or dealer selling for the account of the Customer
in accordance with street delivery custom;
|
|
|
(b)
|
for
the exchange of interim receipts or temporary securities for definitive
securities; and
|
|
|
(c)
|
for
transfer of Property into the name of the Customer or the Custodian 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 that, in any such case, the new
Property is to be delivered to the
Custodian.
|
(ii) unless
and until the Custodian receives Written Instructions to the contrary, the
Custodian shall:
|
(a)
|
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 the
Customer;
|
|
|
(b)
|
collect
interest and cash dividends received, with notice to the Customer, to the
account of the Customer;
|
|
|
(c)
|
hold
for the account of the Customer all stock dividends, rights and similar
securities issued with respect to any Property held by the Custodian;
and
|
A-4
|
(d)
|
execute
as agent on behalf of the Customer all necessary ownership certificates
required by the Internal Revenue Code or the Income Tax Regulations of the
United States Treasury Department or under the laws of any state now or
hereafter in effect, inserting the Customer’s name on such certificate as
the owner of the Property covered thereby, to the extent it may lawfully
do so.
|
7. PURCHASES
OF PROPERTY.
The
Custodian shall settle purchased securities upon receipt of Written Instructions
that specify:
|
(a)
|
the
name of the issuer and the title of the securities or other Property,
including CUSIP number if applicable;
|
|
|
(b)
|
the
number of shares or the principal amount or amount of Interests purchased
and accrued interest, if any;
|
|
|
(c)
|
the
date of purchase and settlement;
|
|
|
(d)
|
the
purchase price per unit;
|
|
|
(e)
|
the
total amount payable upon such purchase;
|
|
|
(f)
|
the
name of the person from whom or the broker through whom the purchase was
made. The Custodian shall upon receipt of Property purchased by
or for the Customer shall release wires previously initiated by the
Customer to pay out of the moneys held for the account of the Customer 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 Written
Instructions.
|
8. SALES OF PROPERTY. The
Custodian shall settle sold Property upon receipt of Written Instructions that
specify:
|
(a)
|
the
name of the issuer and the title of the security or other Property,
including CUSIP number if applicable;
|
|
|
(b)
|
the
number of shares or principal amount or amount of Interests sold, and
accrued interest, if any;
|
|
|
(c)
|
the
date of trade and settlement;
|
|
|
(d)
|
the
sale price per unit;
|
|
|
(e)
|
the
total amount payable to the Customer upon such sale;
|
|
|
(f)
|
the
name of the broker through whom or the person to whom the sale was
made;
|
|
|
(g)
|
the
location to which the security must be delivered and delivery deadline, if
any; and
|
The
Custodian shall deliver the Property upon receipt of the total amount payable to
the Customer upon such sale, provided that the total amount payable is the same
as was set forth in the Written Instructions. Notwithstanding the
other provisions thereof, the Custodian may
A-5
accept
payment in such form as shall be satisfactory to it, and may deliver Property
and arrange for payment in accordance with the customs prevailing among dealers
in securities. It is understood that the Custodian shall have no duty
hereunder to solicit or request payment for any such sale.
9. REPORTS;
PROXY MATERIALS.
(a) The
Custodian shall furnish to the Customer the following reports:
(1) a
monthly statement summarizing all transactions and entries for the account of
the Customer, listing each portfolio security belonging to the Customer at the
end of such month as indicated in the most recent final or estimated NAV
statement received from each Underlying Fund and stating the balance as of the
date of the report in any bank account opened in connection with this
Agreement;
(2) monthly
statements regarding any bank accounts opened in connection with this Agreement;
and
(3) such
other information as may be agreed upon from time to time between the Customer
and the Custodian.
(b) Neither
the Custodian nor its nominee shall vote any of the securities or other Property
held pursuant to this Agreement by or for the account of the Customer, except in
accordance with Written Instructions. The Custodian shall transmit
promptly to the Customer any proxy statement, proxy material, notice of a call
or conversion or similar communication received by it as custodian of the
Property. The Custodian shall be under no other obligation to inform
the Customer as to such actions or events. For clarification, upon
termination of this Agreement the Custodian shall have no responsibility to
transmit such material or to inform the Customer or any other person of such
actions or events.
10. CREDITING
OF ACCOUNTS.
If the
Custodian in its sole discretion 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 the Custodian’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 the Custodian’s actual receipt of the amount due or (c) provisional
crediting of any amounts due, and (i) the Custodian 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 the Custodian is required to repay
to a third party such amounts so credited, or if any Property has been
incorrectly credited, the Custodian 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 otherwise
pursue recovery of any such amounts so credited from the
Customer. Nothing herein or otherwise shall require the Custodian to
make any advances or to credit any amounts until the Custodian’s actual receipt
thereof. The Customer 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 the Custodian of any advance or credit made by the Custodian
(including charges related thereto) to such Account.
A-6
SCHEDULE
B
Part
I:
List
of Authorized Persons of the Manager and Administrator for all
purposes
|
Name, Organization and
Title
|
Signature
|
|
|
▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇, CEO
|
||
|
A.
▇▇▇▇ ▇▇▇▇▇▇▇, CEO
|
||
|
▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇, CEO
|
||
|
▇▇▇▇
▇. ▇▇▇▇▇, Treasurer
|
||
|
▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇, Secretary
|
Part
II:
List
of Authorized Persons of the Manager and Administrator solely for purposes of
providing the approval of Customer for the payment of expenses and the transfers
of funds to other accounts of the Customer.
|
Name, Organization and
Title
|
Signature
|
|
|
▇▇▇▇
▇▇▇▇▇
|
||
|
▇▇▇
▇▇▇▇▇▇▇
|
||
|
▇▇▇▇▇
▇▇▇▇▇
|
||
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇
|
||
|
▇▇▇▇
▇▇▇▇▇▇▇▇▇▇
|
||
|
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
|
The
Custodian acknowledges and agrees that that those persons employed by the
Administrator and listed in this Schedule B shall only be permitted to have
access to information of the Customer for purposes of paying Customer-related
expenses due and payable to the Custodian under this Agreement.
A-1
SCHEDULE
C
USE
OF JPMORGAN ACCESS
JPMorgan
Access is accessible through open networks such as the internet. The
Customer acknowledges that there are certain security, corruption, transmission
error and access availability risks associated with using such networks, and the
Customer hereby expressly assumes such risks. The Customer shall make
its own independent assessment of the adequacy of the internet and of the
security procedures made available by the Custodian. The Customer
acknowledges and agrees that the selection and use by it of third party security
and communications software and third party service providers is the sole
responsibility of the Customer, and the Custodian disclaims all risks related
thereto, notwithstanding that the Custodian may recommend certain security
and/or communications software packages. All such software must be
interoperable with the Custodian’s software. Each of the Customer and
the Custodian shall be responsible for the proper functioning, maintenance and
security of its own systems, services, software and other
equipment.
Electronic
Record Retention. The Custodian may
retain its copy of any documents or items relating to the Customer’s accounts
and Services (as defined below) in a form preserving an image of any such
documents or items, including that of the Customer signature (whether
electronic, digital, mechanical, magnetic or otherwise) as a regular business
record and discard the original documents or items. The Customer
waives any objection to the use of such records in lieu of their paper
equivalents for any purpose and in any forum, venue or jurisdiction, including,
without limitation, objections arising from the Custodian’s role or acquiescence
in the destruction of the originals.
Electronic
Instructions. The Custodian may
honor any instructions received by telecopier (facsimile), computer, internet or
other electronic transmissions if the Custodian reasonably believes such
instructions to be genuine or if such instructions are received in accordance
with any security procedures agreed upon by the Customer and the Custodian or in
accordance with any other agreements the Custodian may have with the Customer
regarding the acceptance of such instructions.
Software. Certain Services
may require the Customer’s use of computer software programs (“Software”) to be
provided by or through the Custodian, which are proprietary to the Custodian
and/or third parties. The Customer’s use of any Software in conjunction with the
Services shall constitute the Customer’s consent to any software license,
whether in written or electronic form, or to other terms and conditions
delivered or made available to the Customer or contained in any applicable
agreements.
1. Service. The Custodian will
provide to the Customer access to JPMorgan ACCESS (the “Service”), which is a
browser-based platform that provides the Custodian’s customers with integrated
access to their account information and the ability to conduct certain financial
transactions from a single application. All transactions and
information requests submitted using the Service must be input in such format as
is specified by the Custodian and must be received prior to the Custodian’s
deadlines. The Custodian reserves the right to modify the
transactions available through JPMorgan ACCESS.
2. System
Requirements. In order to
communicate electronically with the Custodian whether via the Internet, or
otherwise, to access information or effect transactions with respect to the
Service, Customer shall utilize Software, including: security devices, which may
include but shall not be limited to, authentication and/or encryption
algorithms, identification codes, passwords, digital signatures and private keys
(“Security Device(s)”) in conjunction with the Service. Software shall also
include all released modifications or updates, or successor or substitute
programs as may be provided by the Custodian in its discretion to Customer,
recorded in any manner, and all whole or partial copies thereof in any form or
medium (regardless of whether or not such copies are authorized hereunder).
Furthermore, Customer shall be bound by any terms of supplemental license
agreement, if any, applicable to Software.
Customer
agrees to, at its sole expense: (a) procure and maintain
all hardware, browsers, software and telecommunications equipment
necessary to access the Service via the Internet, including any updates or
upgrades required by the Custodian in order to continue using the Service, in
accordance with the
Custodian’s
recommended system configuration; (b) provide the Custodian with all information
reasonably necessary to setup or establish Service on Customer’s behalf,
including but not limited to specifying the country(ies) other than the United
States of America (which countries must be approved for accessing the Service
via the Internet by the Custodian) in which any User will access the
Service via the Internet and keep the Custodian informed of any changes in
countries where Users might access the Service via the Internet; (c)
advise each of its employees, officers, agents or other persons accessing any
Service by or on behalf of Customer (“Users”) of his or her obligations
hereunder or under any Service Material including but not limited to only using
the Service via the Internet in the United States of America and in the
countries approved for such use by the Custodian. Each of the Customer and the
Custodian shall be responsible for the proper functioning, maintenance and
security of its own systems, services, software and other
equipment.
3. Security
Procedures
The
Service may be accessed by entering an appropriate user identification code and
password (“Access Code”). Customer agrees to have the appropriate
officers within its company review and sign the JPMorgan ACCESS – Client Setup
Form, including the designation of at least two security administrators who
shall have equal authority (each a “Security Administrator”) in the Security
Administrator Designation Form, which is located in the JPMorgan ACCESS – Client
Setup Form. The Security Administrators of Customer agree to perform
the duties set forth herein, including identifying the individuals who are
authorized to use the Service (“Authorized Users”). Each Security
Administrator is also an authorized recipient on behalf of Customer of (1) all
Security Devices and (2) all other notices, documents and correspondence from
the Custodian, respecting the Service.
The
Custodian shall deliver to Customer’s Security Administrators all documents and
correspondence relating to Security Devices. The Security Administrator based
upon such documents and correspondence will be required to create or alter
certain Security Devices without disclosure to the Custodian. Customer’s
issuance and dissemination of Security Devices to employees and other persons
shall be under the exclusive control of Customer’s Security Administrators. The
Customer acknowledges that the security procedures for the Service have been
designed to place the issuance and dissemination of Access Codes to Authorized
Users under the control of Security Administrators. The Security
Administrators will have the capability and responsibility of identifying
Authorized Users who are to receive Access Codes, disseminating and controlling
such Access Codes and the applicable JPMorgan ACCESS user entitlements, and
restricting an Authorized User’s access to certain Service functions or granting
access to all functions in accordance with the Custodian’s standard
procedures. In addition, if a Security Administrator is to obtain an
Access Code to use the Service, other than in the capacity of a Security
Administrator, he must obtain authorization for such Access Code via two
Security Administrators not including himself. In the absence of a
valid designation at any time, the Custodian may direct materials otherwise
deliverable to a Security Administrator to any Authorized Individuals. Customer
is aware that delivery of materials to a single individual poses a security risk
to Customer and assumes all associated risks. Customer shall notify the
Custodian of any change of a Security Administrator by submission of a new, duly
executed, Security Administrator Designation Form.
Customer
agrees that the two Security Administrators shall notify the Custodian, in the
manner described above, of any change in user status (e.g. adding a user or
changing a user) designated user names, telephone numbers or user functions
using the applicable electronic forms function in the Service or by submitting a
Security Administrator Designation Form for Additions, Modifications and
Deletions in each case setting forth any changes. The Custodian may
rely upon a current form until replaced or withdrawn by notice. Any change will
be effective promptly following actual receipt and reasonable opportunity for
the Custodian to act thereon. The Security Administrators shall provide to the
Custodian, in writing or electronically upon the Custodian’s request, a list of
persons having been issued passwords and IDs permitting use of
Software.
4. Customer
Obligations
Customer
acknowledges that security administration is essential to the security of its
data and that access to the Software and the Service be strictly limited by
Customer solely to those authorized by Customer to use it. Customer agrees to
follow all security procedures as provided by the Custodian. Although the
Custodian shall use reasonable efforts to promptly inform Customer of a known
breach of security affecting Customer, the Custodian assumes no duty to discover
or report a possible breach of security,
unauthorized
disclosure or use of any Security Devices. The Custodian reserves the right to
change or supplement unilaterally its Security Devices or related procedures as
described in this Service Guide. In any such event, the Custodian shall endeavor
to give Customer prior written or electronic notice of such
changes.
Customer shall be solely responsible for the genuineness and
accuracy, both as to content and form, of all instructions, messages and other
communications properly received by the Custodian as contemplated hereby. The
Custodian may conclusively presume that all business conducted using an Access
Code emanates from an Authorized User and is conducted in the Customer’s
name. The Custodian is authorized to honor, rely and act upon any and
all information and instructions from Authorized Users, whether or not
authorized, which are transmitted in accordance with the agreed upon
security procedures. The Custodian shall have no obligation to
act upon any instruction unless and until same is verified in accordance with
such security procedures. The Service shall be used by Customer only after the
appropriate Access Code(s) have been created by means of the Security Devices
created by Customer’s Security Administrators. The Custodian may suspend a
Security Devise at any time if the Custodian determines that the security or
integrity of a Service is at risk. In connection with the foregoing, Customer’s
Security Administrators shall assure that such password and keys are given to
the designated user. Customer shall assure that Security Devices which are
provided for a specific user are given to and used exclusively by that user for
the security initialization process and, as required, to log into the
Custodian’s electronic services. It is understood that the security
procedures used by the parties are designed to verify the authenticity of, and
not to detect errors in instructions.
▇.▇▇▇▇▇▇
eMail. Customers using the Service will have access to a
secured email client (the “e-mail Client”) for the transmission of electronic
mail (“e-mail”) between the Customer and the Custodian (“e-mail Service”). The
Customer shall use the Service solely for the Customer’s business use. Customer
acknowledges that the e-mail Client is not intended for the transmission of
instructions to transfer cash, securities or other assets. The Customer shall
not transmit, and the Custodian shall have no obligation to act upon, any such
instructions. The Customer acknowledges that in the event of the termination or
suspension of the Service the Customer will be prohibited from accessing e-mails
stored on the designated server.
6. Message
Notification: The Customer may request the transmission of an
electronic notification upon the occurrence of certain account-related
transactions. Such notification may be sent to devices capable of
receiving text messages sent by e-mail, such as alphanumeric pagers and cellular
phones. The Customer is responsible for setting up and maintaining the accuracy
of the messaging components and conditions which will trigger the transmission
of the electronic notification, including but not limited to the e-mail address
the Customer designates to receive the information, and the Custodian will have
no liability in connection therewith. Any modification of such messaging
components and conditions will be effective when the Custodian has received same
and has had a reasonable opportunity to act upon it.
7. Warranties:
CUSTOMER
REPRESENTS AND WARRANTS TO THE CUSTODIAN THAT: (A)
CUSTOMER AND ITS USERS WILL ONLY USE THE SERVICE FOR LAWFUL PURPOSES AND IN
ACCORDANCE WITH THE CUSTODIAN’S REASONABLE INSTRUCTIONS, RULES, POLICIES,
SPECIFICATIONS, TERMS AND CONDITIONS, AND OPERATING PROCEDURES, AS WELL AS ALL
ELECTRONIC FUNDS TRANSFER LAWS AND REGULATIONS AND INDUSTRY RULES, INCLUDING BUT
NOT LIMITED TO THE OPERATING RULES AND GUIDELINES OF THE NATIONAL CLEARING HOUSE
ASSOCIATION AND CARD ASSOCIATION RULES, IF APPLICABLE, AND WILL NOT VIOLATE ANY
LAW OF ANY COUNTRY OR THE INTELLECTUAL PROPERTY RIGHTS OF ANY THIRD PARTY;
(B) CUSTOMER AND ITS USERS WILL NOT (I) PROVIDE, DISCLOSE, DIVULGE OR
MAKE AVAILABLE TO, OR PERMIT USE OF THE SERVICE BY, ANY THIRD PARTY; WITHOUT THE
CUSTODIAN’S PRIOR WRITTEN CONSENT OR AS EXPRESSLY AUTHORIZED HEREIN (II) ENGAGE
IN SPAMMING, MAILBOMBING, SPOOFING OR ANY OTHER FRAUDULENT, ILLEGAL OR
UNAUTHORIZED USE OF THE SERVICE; (III) INTRODUCE OR TRANSMIT, WITHOUT
LIMITATION, THROUGH THE SERVICE, OR OTHERWISE, “JUNK MAIL”, “CHAIN LETTERS” ANY
VIRUS, WORM, OR OTHER DESTRUCTIVE ELEMENT; (IV) REMOVE, OBSCURE OR ALTER ANY
COPYRIGHT NOTICE, TRADEMARKS OR OTHER PROPRIETARY RIGHTS NOTICES AFFIXED TO OR
CONTAINED WITHIN THE SERVICE.
CUSTOMER
FURTHER REPRESENTS AND WARRANTS TO THE CUSTODIAN THAT CUSTOMER
HAS ACCURATELY DESIGNATED IN WRITING TO THE CUSTODIAN THE GEOGRAPHIC LOCATION OF
ITS USERS AND SHALL PROVIDE
ANY
UPDATES OR CHANGES TO SUCH INFORMATION TO THE CUSTODIAN. WITH RESPECT
TO THE OBLIGATIONS OF CUSTOMER UNDER THIS SECTION, CUSTOMER SHALL BE RESPONSIBLE
FOR, AND SHALL INDEMNIFY, DEFEND AND HOLD THE CUSTODIAN HARMLESS FROM AND
AGAINST, ANY AND ALL CLAIMS, DAMAGES, COSTS, DEMANDS, EXPENSES, LIABILITIES AND
LOSSES, INCLUDING REASONABLE LEGAL FEES AND EXPENSES AND ANY AND ALL FINES AND
PENALTIES, ARISING FROM THE (1) USE OF THE SERVICE OR (2) ACCESS OF THE SERVICE
BY CUSTOMER OR ITS USERS IN GEOGRAPHIC LOCATIONS OTHER THAN THOSE DESIGNATED BY
CUSTOMER IN WRITING TO THE CUSTODIAN. SHOULD CUSTOMER RECEIVE NOTICE
OF ANY CLAIM REGARDING THE SERVICE, CUSTOMER SHALL PROMPTLY PROVIDE THE
CUSTODIAN WITH A WRITTEN NOTICE OF SUCH CLAIM.
8. Proprietary
Rights. All intellectual property rights in or relating to the Service,
including any trademarks, service marks, logos, and trade names used in
conjunction with the Services hereunder are the property of the Custodian or its
licensors and are protected by applicable copyright, patent, trademark and other
intellectual property law. Except as provided herein, the Customer shall not
reproduce, transmit, sell, display, distribute, establish any hyperlink to,
provide access to, modify, or commercially exploit in whole or in part any part
of the Service, without the prior written consent of the Custodian.
U.S.
DOLLAR FUNDS TRANSFER
1. Credits
of Incoming Wire Transfers. Deposits may be
made to the Customer’s account by means of transfers of funds from other
accounts at the Bank, other financial institutions or other
parties. All funds received for credit to the Customer’s accounts
will be credited in the same type of funds that the Custodian receives unless
the Custodian notifies the Customer to the contrary. The Custodian
reserves the right to refuse or to limit any such credit. Advices of
incoming payment orders will be delivered to the Customer by mail or by such
other method as may be agreed upon by the Customer and the Custodian, unless the
Customer requests the Custodian not to deliver such advices.
2. Issuance
of Payment Orders; Cut-Off Times. The Customer may
issue payment orders against its accounts with the Custodian by telephone,
tested telex or electronically, as specified in the relevant Implementation
Forms, subject to the Custodian’s acceptance. The Customer authorizes
the Custodian to comply with all such payment orders. The Custodian will debit
the Customer’s account for the amount of each payment order accepted by the
Custodian. No restrictions upon the acceptance of payment orders by
the Custodian or upon the accounts which the Custodian may debit will be binding
unless agreed to in an Implementation Form or otherwise agreed in writing by the
Custodian.
Payment
orders and other instructions will be received and processed only on the
Custodian’s U.S. dollar funds transfer business days (“Banking Days”) and within
its established cut-off hours (which may vary depending upon the initiation
method). Depending upon the initiation method, payment orders and
other instructions received after the Custodian’s established cut-off time for
such method will either be (a) accepted and processed by the Custodian on the
following Banking Day, although the Custodian will use reasonable efforts to
process on the same day, or (b) ineffective, in which case they will have to be
re-initiated by the Customer.
3. Execution
of Payment Orders. The Custodian
will determine the order in which it processes payment orders. In
executing payment orders, the Custodian may use the payment and communication
systems in which the Custodian participates, such as CHIPS, Fedwire and
S.W.I.F.T. and the Custodian may override instructions of the Customer regarding
use of a payment system if the Custodian deems it appropriate to route such
payment order through an alternate equivalent system. Unless
otherwise arranged, the Customer will be responsible for identifying the routing
(i.e., intermediary and beneficiary banks) of all funds transfers.
In
accepting a payment order issued in the Customer’s name, the Custodian may rely
upon the identifying number (such as Fedwire routing number or account number)
of the beneficiary, the beneficiary’s bank or any intermediary bank, as
instructed. Also, the beneficiary’s bank in the payment order may
make payment on the basis of the identifying number even though it identifies a
person different from the named beneficiary. Accordingly, the
Customer will be responsible for the consequences of any inconsistency between
the name and identifying number, as instructed, of any party in such a payment
order.
If the
Customer’s payment order bears the codeword “PRIORITY” in such field as the
Custodian specifies, the Custodian will use reasonable efforts to move such
payment order to the front of the Custodian’s processing queue.
4. Security
Procedures. All payment
orders issued in the Customer’s name are subject to verification by the
Custodian pursuant to the security procedures specified in the Implementation
Form(s) completed and signed by the Customer, or in the Service Guides covering
access products used by the Customer.
The
Custodian will deliver test key materials, authentication software and other
authentication devices, user IDs, passwords, reference numbers, authorization
codes, keys and other security procedure materials (“Security Materials”) by a
mutually agreed upon method to a person designated to receive same on the
relevant Implementation Form or to a Security Administrator designated on a form
supplied by the Custodian. The Custodian will not accept payment
orders using the Security Materials until such Security Materials have been
received and acknowledged. It is the Customer’s responsibility to
treat the Security Materials with extreme care and to assure that the same are
available only to authorized individuals. It is understood that the
security procedures agreed upon by the Custodian and the Customer are designed
to verify the authenticity, and not the correctness, of payment orders and
communications requesting amendment or cancellation of payment
orders.
5. Settlement
of Funds Transfers; Authorized Account. The
Implementation Forms may designate one or more demand deposit accounts at the
Custodian or an affiliate bank approved by the Custodian, which will be used for
wire transfer transactions initiated by the Customer. The Customer
authorizes the Custodian to debit such account(s), or if no account is
designated, any account maintained by the Customer at the Custodian, in
connection with such transactions.
6. Legality. The Customer will
promptly procure and maintain in effect any and all licenses, permits or the
like required by the governmental or regulatory authorities of any country to
which funds transfers or other transactions are directed. The
Customer hereby represents and warrants to the Custodian that no payment order
will be for a purpose prohibited by the laws or regulations of the United States
or the country of any other party to the transaction, or in violation of United
States trade, currency control, foreign asset control or other regulation or
governmental order applicable at the date thereof.
The
Custodian will not execute payment orders or effect any other transaction
hereunder where the beneficiary or other payee is a person or entity with whom
the Custodian is prohibited to do business by law or regulation or in any case
where compliance would, in the Custodian’s judgment, conflict with applicable
law or good banking practice.
7. Amendments,
Cancellations and Recalls of Payment Orders; Debit Authorizations. The Customer
authorizes the Custodian to (a) accept and act upon requests for amendment,
cancellation and recall of funds transfers or (b) debit a Customer account upon
receiving authorization to do so.
(i) Any
request for funds transfer amendment, cancellation or recall and any debit
authorization must be given by one of the following methods: (A)
tested telex, (B) authenticated S.W.I.F.T. message, (C) telephone at the
telephone number designated from time to time by the Custodian for that purpose,
or (D) computer, internet or other electronic platform approved by the Custodian
for that purpose.
(ii) Concurrently
with any request given by telephone, the Customer must transmit a faxed request
signed by an authorized signatory on the designated Customer account with the
Custodian.
(iii) In
the case of amendment requests given by telephone, the Custodian will place a
callback to an authorized signatory on the designated Customer account with the
Custodian other than the issuer of the amendment request.
Communications
requesting amendment or cancellation of payment orders must be received at a
time affording the Custodian a reasonable opportunity to act prior to the
Custodian’s execution of the payment order.
If the
Customer uses the Custodian’s future advising Service, S.W.I.F.T. same day
amendment and cancellation Service, or Multibank Payment Service, the provisions
relating to amendment
and
cancellation in the Service Guides for such Services will prevail over this
Section 8 to the extent of any inconsistencies.
8. Notification
Request. Upon the Customer’s request given by S.W.I.F.T message in such
manner as the Custodian specifies, electronic notification of the occurrence of
account-related activity will be delivered to any party designated by the
Customer to receive such notification. Electronic notification may be
sent to devices capable of receiving text messages sent by e-mail, such as
alphanumeric pagers and cellular phones.
9. Conflict. In the event of
any conflict between these terms and any Funds Transfer Implementation Form, the
Funds Transfer Implementation Form will control.
EXHIBIT
1
Addendum
to Subscription Agreement
for
Investment by
[Fund of
Funds]
in
[Hedge
Fund]
JPMorgan
Chase Bank, National Association (“JPM”) is executing the
subscription agreement to which this Addendum is attached by executing this
Addendum. This Addendum confirms JPM will act as custodian for [Fund of Funds] (“Investor”), in connection with
its investment in [name of
Underlying Fund] (“Fund”).
JPM is
acting solely as custodian in connection with the Investor’s investment in the
Fund and holding of Interests. JPM does not exercise any investment
responsibility or authority for the Investor, and can act in connection with the
assets of the Investor only at the direction of the Investor, and only through
authorized representatives of the Investor. JPM receives a fee to
provide its services as custodian, but has no economic interest in the
Fund.
Please be
advised that:
(i) JPM
is not the owner of, has no beneficial ownership interest in, and has no
liability for the payment for any obligations or liabilities relating to the
Interests;
(ii) JPM
will not be and is not liable to you, the Fund, the Fund’s investors or any
other person or entity for any damages, costs, liabilities or expenses arising
out of the investment by Investor in the Fund, or in connection with the
Interests;
(iii) JPM
has not made, is not responsible for, and in no way confirms, guarantees or
supports any representations, warranties, covenants or similar assertions
(collectively, “Representations”) made by
Investor to the Fund or any other person or entity in connection with Investor’s
investment in the Fund and purchase or purchases of Interests (including without
limitation all Representations in any Subscription
Agreement). Representations in any Subscription Agreement are made by
the Investor;
(iv) Notwithstanding
anything else to the contrary, JPM will not be deemed to have received any
Distribution or other asset of the Investor until that Distribution or other
asset has in fact been received by JPM at the address and in the manner directed
above; and
(v) Without
limiting any of the foregoing, JPM makes no representations to the Fund or any
other person or entity regarding the Investor’s qualifications to invest in the
Fund, the Investor’s status under any anti-money laundering or similar statutes,
the Investor’s financial status or condition, or any other information relating
to the Investor. Representations regarding such matters in any
subscription agreement or similar document are representations of the
Investor. In this regard, other parts of JPM, and affiliates of JPM,
may have business or other relationships with the Investor, and may have
confidential or public knowledge about the Investor. JPM has no
obligation to provide any such information to the Fund or any person or entity
related to the Fund.
JPMorgan
Chase Bank, National Association
By:______________________________
[Name]
[Title]
E-1
EXHIBIT
2
INVESTMENT
NOTIFICATION
Fax
Investment Notification to:
JPMorgan
Chase Bank, N.A.
(▇▇▇) ▇▇▇
▇▇▇▇
|
Type: ______________________________ (New
Investment, Add-On)
|
|
|
Fund
Name:
|
|
|
Wire
Amount:
|
|
|
Settlement
Date:
|
|
|
Fund
Contact:
|
|
|
Phone
#:
|
|
|
Fax
#:
|
|
|
Address:
|
|
|
Email:
|
|
|
Fund
Wiring Instructions:
|
|
|
Additional
Comments:
|
|
|
Redemption:
|
|
|
Fund
Name:
|
|
|
Redemption
Amount/# of shares to be Redeemed:
|
|
|
Settlement
Date:
|
|
|
Fund
Contact:
|
|
|
Phone
#:
|
E2-1
INVESTMENT
NOTIFICATION
(continued)
SWITCH
|
FROM:
|
|
|
Fund
Name:
|
|
|
Fund
Contact:
|
|
|
Phone
#:
|
|
|
Amount:
|
|
|
Settlement
Date:
|
|
|
Share
Class Switch:
|
|
|
Currency:
|
|
|
TO:
|
|
|
Fund
Name:
|
|
|
Fund
Contact:
|
|
|
Phone
#:
|
|
|
Amount:
|
|
|
Settlement
Date:
|
|
|
Share
Class Switch:
|
|
|
Currency:
|
|
|
Fund
Wiring Instructions:
(If
Applicable)
|
|
|
Additional
Comments:
|
|
SIGNATURES
OF TWO AUTHORIZED PERSONS:
|
Date:
|
||
|
Date:
|
E2-2
Exhibit
3
JPMorgan
Hedge Fund Services
(Fund of
Hedge Fund Custody Operations / Fund of Hedge Fund Administration)
Address
[as per contract with Fund of Hedge Funds]
Re: Investments in Self
Administered Underlying Funds
Ladies
and Gentlemen:
JPMorgan
Hedge Fund Services (“JPMorgan”) has requested a letter of attestation
concerning the investment by
[ ](the
“Fund”) in underlying funds and/or portfolios, including without limitation
managed accounts (together “Underlying Funds”).
Accordingly,
each of the undersigned hereby represents, certifies, acknowledges and agrees as
follows:
1. All
investments made by the Fund into Underlying Funds during the period [fiscal
year beginning – fiscal year ended] have been instructed and duly authorized by
the Manager, acting in a manner which is consistent with the Fund’s prospectus,
constitutional documents, policies and procedures in accordance with the terms
of the investment management agreement between the Manager and the Fund, dated
[].
2. The
Underlying Funds are, administered and custodied/brokered independently of the
Manager, its affiliates, subsidiaries and any party in common control with the
Manager.
3. The
investments in Underlying Funds shall not result in a breach of any duty owed to
any owners of an equity or other interest in the Fund or any other person,
whether imposed by law, contract or otherwise.
4. The
Fund is not relying on any advice or representation from JPMorgan or its
affiliates in connection with the decision to make any investment in an
Underlying Fund.
5. It
is understood and accepted that JPMorgan relies solely on information provided
by the managers or administrators of the Underlying Funds and has not
independently verified or tested such information. Prices of
interests in Underlying Funds are provided by the Underlying Fund or third
parties. Holdings for which prices are not readily available may be
priced by the Fund’s Manager. JPMorgan is not responsible for
reviewing the reliability of prices or other information received from these
sources. JPMorgan takes and shall have no responsibility for the
valuations given to the Fund’s holdings in Underlying Funds, and shall have no
liability therefor.
6. In
preparing statements of account showing positions held by the Fund, JPMorgan has
relied solely on information provided by the managers or administrators of
Underlying funds and has not independently verified or tested such
information. JPMorgan relies on statements of holdings in Underlying
Funds as evidence of the existence of such holdings and has no duty to enquire
beyond such statements. JPMorgan is not responsible for reviewing the
reliability of the description or prices of these holdings. To the
maximum extent permitted by law, JPMorgan expressly disclaims any liability to
the Manager or any person for the accuracy, timeliness, completeness or
availability of such information. Furthermore, JPMorgan shall not be
liable to the Manager, the Fund or any other person for any loss resulting from
reliance in whole or in part by the Manager, the Fund or any other person on
such information.
Sincerely,
[Investment
Manager]
E2-3
|
By
|
|
|
Name:
|
|
|
Title:
|
E2-4
SCHEDULE
D
DESCRIPTION
OF ACCOUNTS
Cash
Accounts:
Securities
Accounts:
E2-5