EX-99.B(g)(4)
CUSTODIAN AGREEMENT
This Agreement is made as of February 25, 2002 by and between Xxxxx
Fargo Funds Trust, a business trust organized and existing under the laws of
Delaware (the "Fund"), and State Street Bank and Trust Company, a Massachusetts
trust company (the "Custodian"),
Witnesseth:
Whereas, the Fund is authorized to issue shares of common stock or
shares of beneficial interest in separate series ("Shares"), with each such
series representing interests in a separate portfolio of securities and other
assets; and
Whereas, the Fund intends that this Agreement be applicable to one
series, Xxxxx Fargo SIFE Specialized Financial Services Fund (such series
together with all other series subsequently established by the Fund and made
subject to this Agreement in accordance with Section 18.5, be referred to herein
as the "Portfolio(s)").
Now, Therefore, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
Section 1. Employment Of Custodian And Property To Be Held By It
The Fund hereby employs the Custodian as a custodian of assets of the
Portfolios, including securities which the Fund, on behalf of the applicable
Portfolio, desires to be held in places within the United States ("domestic
securities") and securities it desires to be held outside the United States
("foreign securities"). The Custodian shall not be responsible for any property
of a Portfolio which is not received by it or which is delivered out in
accordance with Proper Instructions (as such term is defined in Section 7
hereof) including, without limitation, Portfolio property (i) held by brokers,
private bankers or other entities on behalf of the Portfolio (each a "Local
Agent"), (ii) held by Special Sub-Custodians (as such term is defined in Section
5 hereof), (iii) held by entities which have advanced monies to or on behalf of
the Portfolio and which have received Portfolio property as security for such
advance(s) (each a "Pledgee"), or (iv) delivered or otherwise removed from the
custody of the Custodian (a) in connection with any Free Trade (as such term is
hereinafter defined) or (b) pursuant to Special Instructions (as such term is
defined in Section 7 hereof). With respect to uncertificated shares (the
"Underlying Shares") of registered "investment companies" (as defined in Section
3(a)(1) of the Investment Company Act of 1940, as amended (the "1940 Act")
whether in the same "group of investment companies" (as defined in Section
12(d)(I)(G)(ii) of the 0000 Xxx) or otherwise, including pursuant to Section
12(d)(I)(F) of the 1940 Act (hereinafter sometimes referred to as the
"Underlying Portfolios") the holding of confirmation statements that identify
the shares as being recorded in the Custodian's name on behalf of the Portfolios
will be deemed custody for purposes hereof.
Upon receipt of Proper Instructions, the Custodian shall on behalf of the
applicable Portfolio(s) from time to time employ one or more sub-custodians
located in the United States, but only in accordance with an applicable vote by
the Board of Trustees of the Fund (the "Board") on behalf of the applicable
Portfolio(s), and provided that the Custodian shall have no more or less
responsibility or liability to the Fund on account of any actions or omissions
of any sub-custodian so employed than any such sub-custodian has to the
Custodian. The Custodian may employ as sub-custodian for the Fund's foreign
securities on behalf of the applicable Portfolio(s) the foreign banking
institutions and foreign securities depositories designated in Schedules A and B
hereto, but only in accordance with the applicable provisions of Sections 3 and
4 hereof.
Section 2. Duties Of The Custodian With Respect To Property Of The
Portfolios To Be Held In The United States
Section 2.1 Holding Securities. The Custodian shall hold and physically
segregate for the account of each Portfolio all non-cash property, to be held by
it in the United States, including all domestic securities owned by such
Portfolio other than (a) securities which are maintained pursuant to Section 2.8
in a clearing agency which acts as a securities depository or in a book-entry
system authorized by the U.S. Department of the Treasury (each, a "U.S.
Securities System") and (b) Underlying Shares owned by the Fund which are
maintained pursuant to Section 2.10 hereof in an account with State Street Bank
and Trust Company or such other entity which may from time to time act as a
transfer agent for the Underlying Portfolios and with respect to which the
Custodian is provided with Proper Instructions (the "Underlying Transfer
Agent").
Section 2.2. Delivery Of Securities. The Custodian shall release and
deliver domestic securities owned by a Portfolio held by the Custodian, in a
U.S. Securities System account of the Custodian or in an account at the
Underlying Transfer Agent, only upon receipt of Proper Instructions on behalf of
the applicable Portfolio, which may be continuing instructions when deemed
appropriate by the parties, and only in the following cases:
1) Upon sale of such securities for the account of the Portfolio and
receipt of payment therefor;
2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Portfolio;
3) In the case of a sale effected through a U.S. Securities System, in
accordance with the provisions of Section 2.8 hereof;
4) To the depository agent in connection with tender or other similar
offers for securities of the Portfolio;
5) To the issuer thereof or its agent when such securities are called,
redeemed, retired or otherwise become payable; provided that, in any
such case, the cash or other consideration is to be delivered to the
Custodian;
6) To the issuer thereof, or its agent, for transfer into the name of
the Portfolio or
2
into the name of any nominee or nominees of the Custodian or into
the name or nominee name of any agent appointed pursuant to Section
2.7 or into the name or nominee name of any sub-custodian appointed
pursuant to Section 1; or for exchange for a different number of
bonds, certificates or other evidence representing the same
aggregate face amount or number of units; provided that, in any such
case, the new securities are to be delivered to the Custodian;
7) Upon the sale of such securities for the account of the Portfolio,
to the broker or its clearing agent, against a receipt, for
examination in accordance with "street delivery" custom; provided
that in any such case, the Custodian shall have no responsibility or
liability for any loss arising from the delivery of such securities
prior to receiving payment for such securities except as may arise
from the Custodian's own negligence or willful misconduct;
8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of
the securities of the issuer of such securities, or pursuant to
provisions for conversion contained in such securities, or pursuant
to any deposit agreement; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the Custodian;
9) In the case of warrants, rights or similar securities, the surrender
thereof in the exercise of such warrants, rights or similar
securities or the surrender of interim receipts or temporary
securities for definitive securities; provided that, in any such
case, the new securities and cash, if any, are to be delivered to
the Custodian;
10) For delivery in connection with any loans of securities made by the
Portfolio (a) against receipt of collateral as agreed from time to
time by the Fund on behalf of the Portfolio, except that in
connection with any loans for which collateral is to be credited to
the Custodian's account in the book-entry system authorized by the
U.S. Department of the Treasury, the Custodian will not be held
liable or responsible for the delivery of securities owned by the
Portfolio prior to the receipt of such collateral or (b) to the
lending agent, or the lending agent's custodian, in accordance with
written Proper Instructions (which may not provide for the receipt
by the Custodian of collateral therefor) agreed upon from time to
time by the Custodian and the Fund;
11) For delivery as security in connection with any borrowing by the
Fund on behalf of a Portfolio requiring a pledge of assets by the
Fund on behalf of such Portfolio;
12) For delivery in accordance with the provisions of any agreement
among the Fund on behalf of the Portfolio, the Custodian and a
broker-dealer registered under the Securities Exchange Act of 1934
(the "Exchange Act") and a member of The National Association of
Securities Dealers, Inc. (the "NASD"), relating to compliance with
the rules of The Options Clearing Corporation and of any registered
national. securities exchange, or of any similar organization or
organizations, regarding escrow or other arrangements in connection
with transactions by the Fund on behalf of a Portfolio;
3
13) For delivery in accordance with the provisions of any agreement
among the Fund on behalf of the Portfolio, the Custodian, and a
futures commission merchant registered under the Commodity Exchange
Act, relating to compliance with the rules of the Commodity Futures
Trading Commission (the "CFTC') and/or any contract market, or any
similar organization or organizations, regarding account deposits in
connection with transactions by the Fund on behalf of a Portfolio;
14) Upon the sale or other delivery of such investments (including,
without limitation, to one or more (a) Special Sub-Custodians or (b)
additional custodians appointed by the Fund, and communicated to the
Custodian from time to time via a writing duly executed by an
authorized officer of the Fund, for the purpose of engaging in
repurchase agreement transactions(s), each a "Repo Custodian"), and
prior to receipt of payment therefor, as set forth in written Proper
Instructions (such delivery in advance of payment, along with
payment in advance of delivery made in accordance with Section
2.6(7), as applicable, shall each be referred to herein as a "Free
Trade"), provided that such Proper Instructions shall set forth (a)
the securities of the Portfolio to be delivered and (b) the
person(s) to whom delivery of such securities shall be made;
15) Upon receipt of instructions from the Fund's transfer agent (the
"Transfer Agent") for delivery to such Transfer Agent or to the
holders of Shares in connection with distributions in kind, as may
be described from time to time in the currently effective prospectus
and statement of additional information of the Fund related to the
Portfolio (the "Prospectus"), in satisfaction of requests by holders
of Shares for repurchase or redemption;
16) In the case of a sale processed through the Underlying Transfer
Agent or Underlying Shares, in accordance with Section 2.10 hereof;
and
17) For any other purpose, but only upon receipt of Proper Instructions
from the Fund on behalf of the applicable Portfolio specifying (a)
the securities of the Portfolio to be delivered and (b) the
person(s) to whom delivery of such securities shall be made.
Section 2.3. Registration Of Securities. Domestic securities held by
the Custodian (other than bearer securities) shall be registered in the name of
the Portfolio or in the name of any nominee of the Fund on behalf of the
Portfolio or of any nominee of the Custodian which nominee shall be assigned
exclusively to the Portfolio, unless the Fund has authorized in writing the
appointment of a nominee to be used in common with other registered management
investment companies having the same investment adviser as the Portfolio, or in
the name or nominee name of any agent appointed pursuant to Section 2.7 or in
the name or nominee name of any sub-custodian appointed pursuant to Section 1.
All securities accepted by the Custodian on behalf of the Portfolio under the
terms of this Agreement shall be in "street name" or other good delivery form.
If, however, the Fund directs the Custodian to maintain securities in "street
name", the Custodian shall utilize its best efforts only to timely collect
income due the Fund on such securities and to notify the Fund on a best efforts
basis only of relevant corporate actions including, without limitation, pendency
of calls, maturities, tender or exchange offers.
4
Section 2.4. Bank Accounts. The Custodian shall open and maintain a
separate bank account or accounts in the United States in the name of each
Portfolio of the Fund, subject only to draft or order by the Custodian acting
pursuant to the terms of this Agreement, and shall hold in such account or
accounts, subject to the provisions hereof, all cash received by it from or for
the account of the Portfolio, other than cash maintained by the Portfolio in a
bank account established and used in accordance with Rule 17f-3 under the 1940
Act. Funds held by the Custodian for a Portfolio may be deposited by it to its
credit as Custodian in the banking department of the Custodian or in such other
banks or trust companies as it may in its discretion deem necessary or
desirable; provided, however, that every such bank or trust company shall be
qualified to act as a custodian under the 1940 Act and that each such bank or
trust company and the funds to be deposited with each such bank or trust company
shall on behalf of each applicable Portfolio be approved by vote of a majority
of the Board. Such funds shall be deposited by the Custodian in its capacity as
Custodian and shall be withdrawable by the Custodian only in that capacity.
Section 2.5. Collection Of Income. Except with respect to Portfolio
property released and delivered pursuant to Section 2.2(14) or purchased
pursuant to Section 2.6(7), and subject to the provisions of Section 2.3, the
Custodian shall collect on a timely basis all income and other payments with
respect to registered domestic securities held hereunder to which each Portfolio
shall be entitled either by law or pursuant to custom in the securities
business, and shall collect on a timely basis all income and other payments with
respect to bearer domestic securities if, on the date of payment by the issuer,
such securities are held by the Custodian or its agent thereof and shall credit
such income, as collected, to such Portfolio's custodian account. Without
limiting the generality of the foregoing, the Custodian shall detach and present
for payment all coupons and other income items requiring presentation as and
when they become due and shall collect interest when due on securities held
hereunder. Income due each Portfolio on securities loaned pursuant to the
provisions of Section 2.2(10) shall be the responsibility of the Fund. The
Custodian will have no duty or responsibility in connection therewith, other
than to provide the Fund with such information or data as may be necessary to
assist the Fund in arranging for the timely delivery to the Custodian of the
income to which the Portfolio is properly entitled.
Section 2.6. Payment Of Fund Monies. Upon receipt of Proper
Instructions on behalf of the applicable Portfolio, which may be continuing
instructions when deemed appropriate by the parties, the Custodian shall pay out
monies of a Portfolio in the following cases only:
1) Upon the purchase of domestic securities, options, futures
contracts or options on futures contracts for the account of
the Portfolio but only (a) against the delivery of such
securities or evidence of title to such options, futures
contracts or options on futures contracts to the Custodian (or
any bank, banking firm or trust company doing business in the
United States or abroad which is qualified under the 1940 Act
to act as a custodian and has been designated by the Custodian
as its agent for this purpose) registered in the name of the
Portfolio or in the name of a nominee of the Custodian
referred to in Section 2.3 hereof or in proper form for
transfer; (b) in the case of a purchase effected through a
U.S. Securities System, in accordance with the conditions set
forth in Section 2.8 hereof; (c) in the case of a purchase of
Underlying Shares, in accordance with the conditions set forth
in
5
Section 2.10 hereof; (d) in the case of repurchase agreements
entered into between the Fund on behalf of the Portfolio and the
Custodian, or another bank, or a broker-dealer which is a member of
NASD, (i) against delivery of the securities either in certificate
form or through an entry crediting the Custodian's account at the
Federal Reserve Bank with such securities or (ii) against delivery
of the receipt evidencing purchase by the Portfolio of securities
owned by the Custodian along with written evidence of the agreement
by the Custodian to repurchase such securities from the Portfolio;
or (e) for transfer to a time deposit account of the Fund in any
bank, whether domestic or foreign; such transfer may be effected
prior to receipt of a confirmation from a broker and/or the
applicable bank pursuant to Proper Instructions from the Fund as
defined herein;
2) In connection with conversion, exchange or surrender of securities
owned by the Portfolio as set forth in Section 2.2 hereof;
3) For the redemption or repurchase of Shares issued as set forth in
Section 6 hereof;
4) For the payment of any expense or liability incurred by the
Portfolio, including but not limited to the following payments for
the account of the Portfolio: interest, taxes, management,
accounting, transfer agent and legal fees, and operating expenses of
the Fund whether or not such expenses are to be in whole or part
capitalized or treated as deferred expenses;
5) For the payment of any dividends on Shares declared pursuant to the
Fund's articles of incorporation or organization and by-laws or
agreement or declaration of trust, as applicable, and Prospectus
(collectively, the "Governing Documents");
6) For payment of the amount of dividends received in respect of
securities sold short;
7) Upon the purchase of domestic investments including, without
limitation, repurchase agreement transactions involving delivery of
Portfolio monies to Repo Custodian(s), and prior to receipt of such
investments, as set forth in written Proper Instructions (such
payment in advance of delivery, along with delivery in advance of
payment made in accordance with Section 2.2(14), as applicable,
shall each be referred to herein as a "Free Trade"), provided that
such Proper Instructions shall also set forth (a) the amount of such
payment and (b) the person(s) to whom such payment is made; and
8) For any other purpose, but only upon receipt of Proper Instructions
from the Fund on behalf of the Portfolio specifying (a) the amount
of such payment and (b) the person(s) to whom such payment is to be
made.
Section 2.7. Appointment of Agents. The Custodian may at any time or
times in its discretion appoint (and may at any time remove) any other bank or
trust company which is itself qualified under the 1940 Act to act as a
custodian, as its agent to carry out such of the provisions of this Section 2 as
the Custodian may from time to time direct; provided, however, that the
6
appointment of any agent shall not relieve the Custodian of its responsibilities
or liabilities hereunder. The Underlying Transfer Agent shall not be deemed an
agent or subcustodian of the Custodian for purposes of this Section 2.7 or any
other provision of this Agreement.
Section 2.8 Deposit Of Fund Assets in U.S. Securities Systems. The
Custodian may deposit and/or maintain securities owned by a Portfolio in a U.S.
Securities System subject to the following provisions:
1) The Custodian may keep securities of the Portfolio in a U.S.
Securities System provided that such securities are represented in
an account of the Custodian in the U.S. Securities System (the "U.S.
Securities System Account") which account shall not include any
assets of the Custodian other than assets held as a fiduciary,
custodian or otherwise for customers;
2) The records of the Custodian with respect to securities of the
Portfolio which are maintained in a U.S. Securities System shall
identify by book-entry those securities belonging to the Portfolio;
3) The Custodian shall pay for securities purchased for the account of
the Portfolio upon (a) receipt of advice from the u.s. Securities
System that such securities have been transferred to the U.S.
Securities System Account and (b) the making of an entry on the
records of the Custodian to reflect such payment and transfer for
the account of the Portfolio. The Custodian shall transfer
securities sold for the account of the Portfolio upon (i) receipt of
advice from the U.S. Securities System that payment for such
securities has been transferred to the U.S. Securities System
Account and (ii) the making of an entry on the records of the
Custodian to reflect such transfer and payment for the account of
the Portfolio. Copies of all advices from the U.S. Securities System
of transfers of securities for the account of the Portfolio shall
identify the Portfolio, be maintained for the Portfolio by the
Custodian and be provided to the Fund at its request. Upon request,
the Custodian shall furnish the Fund confirmation of each transfer
to or from the account of the Portfolio in the form of a written
advice or notice and shall furnish to the Fund copies of daily
transaction sheets reflecting each day's transactions in the U.S.
Securities System for the account of the Portfolio;
4) The Custodian shall provide the Fund with any report obtained by the
Custodian on the U.S. Securities System's accounting system,
internal accounting control and procedures for safeguarding
securities deposited in the U.S. Securities System; and
5) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Fund for the benefit of the
Portfolio for any loss or damage to the Portfolio resulting from use
of the U.S. Securities System by reason of any negligence,
misfeasance or misconduct of the Custodian or any of its agents or
of any of its or their employees or from failure of the Custodian or
any such agent to enforce effectively such rights as it may have
against the U.S. Securities System; at the election of the Fund, it
shall be entitled to be subrogated to the rights of the
7
Custodian with respect to any claim against the U.S. Securities
System or any other person which the Custodian may have as a
consequence of any such loss or damage if and to the extent that
the Portfolio has not been made whole for any such loss or
damage.
Section 2.9 Segregated Account. The Custodian shall upon receipt of
Proper Instructions on behalf of each applicable Portfolio, establish and
maintain a segregated account or accounts for and on behalf of each such
Portfolio, into which account or accounts may be transferred cash and/or
securities, including securities maintained in an account by the Custodian
pursuant to Section 2.8 hereof, (a) in accordance with the provisions of any
agreement among the Fund on behalf of the Portfolio, the Custodian and a
broker-dealer registered under the Exchange Act and a member of the NASD (or any
futures commission merchant registered under the Commodity Exchange Act),
relating to compliance with the rules of The Options Clearing Corporation and of
any registered national securities exchange (or the CFTC or any registered
contract market), or of any similar organization or organizations, regarding
escrow or other arrangements in connection with transactions by the Portfolio,
(b) for purposes of segregating cash or government securities in connection with
options purchased, sold or written by the Portfolio or commodity futures
contracts or options thereon purchased or sold by the Portfolio, (c) for the
purposes of compliance by the Portfolio with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release of the U.S.
Securities and Exchange Commission (the "SEC'), or interpretative opinion of the
staff of the SEC, relating to the maintenance of segregated accounts by
registered management investment companies, and (d) for any other purpose in
accordance with Proper Instructions.
Section 2.10 Deposit Of Fund Assets With The Underlying Transfer Agent.
Underlying Shares shall be deposited and/or maintained in an account or accounts
maintained with the Underlying Transfer Agent. The Underlying Transfer Agent
shall be deemed to be acting as if it is a "securities depository" for purposes
of Rule 17f -4 under the 1940 Act. The Fund hereby directs the Custodian to
deposit and/or maintain such securities with the Underlying Transfer Agent,
subject to the following provisions:
1) The Custodian shall keep Underlying Shares owned by a Portfolio with
the Underlying Transfer Agent provided that such securities are
maintained in an account or accounts on the books and records of the
Underlying Transfer Agent in the name of the Custodian as custodian
for the Portfolio.
2) The records of the Custodian with respect to Underlying Shares which
are maintained with the Underlying Transfer Agent shall identify by
book-entry those Underlying Shares belonging to each Portfolio;
3) The Custodian shall pay for Underlying Shares purchased for the
account of a Portfolio upon (a) receipt of advice from the
Portfolio's investment adviser that such Underlying Shares have been
purchased and will be transferred to the account of the Custodian,
on behalf of the Portfolio, on the books and records of the
Underlying Transfer Agent and (b) the making of an entry on the
records of the Custodian to reflect such payment and transfer for
the account of the Portfolio. The Custodian shall receive
confirmation from the Underlying Transfer Agent of
8
the purchase of such securities and the transfer of such securities
to the Custodian's account with the Underlying Transfer Agent only
after such payment is made. The Custodian shall transfer Underlying
Shares redeemed for the account of a Portfolio (i) upon receipt of
an advice from the Portfolio's investment adviser that such
securities have been redeemed and that payment for such securities
will be transferred to the Custodian and (ii) the making of an entry
on the records of the Custodian to reflect such transfer and payment
for the account of the Portfolio. The Custodian will receive
confirmation from the Underlying Transfer Agent of the redemption of
such securities and payment therefor only after such securities are
redeemed. Copies of all advices from the Portfolio's investment
adviser of purchases and sales of Underlying Shares for the account
of the Portfolio shall identify the Portfolio, be maintained for the
Portfolio by the Custodian, and be provided to the Portfolio's
investment adviser at its request; and
4) The Custodian shall be not be liable to the Fund or any Portfolio
for any loss or damage to the Fund or any Portfolio resulting from
maintenance of Underlying Shares with Underlying Transfer Agent
except for losses resulting directly from the negligence,
misfeasance or misconduct of the Custodian or any of its agents or
of any of its or their employees.
Section 2.11 Ownership Certificates For Tax Purposes. The Custodian
shall execute ownership and other certificates and affidavits for all federal
and state tax purposes in connection with receipt of income or other payments
with respect to domestic securities of each Portfolio held by it and in
connection with transfers of securities.
Section 2.12 Proxies. Except with respect to Portfolio property
released and delivered pursuant to Section 2.2(14), or purchased pursuant to
Section 2.6(7), the Custodian shall, with respect to the domestic securities
held hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name of the
Portfolio or a nominee of the Portfolio, all proxies, without indication of the
manner in which such proxies are to be voted, and shall promptly deliver to the
Fund such proxies, all proxy soliciting materials and all notices relating to
such securities.
Section 2.10 Communications Relating To Portfolio Securities. Except
with respect to Portfolio property released and delivered pursuant to Section
2.2(14), or purchased pursuant to Section 2.6(7), and subject to the provisions
of Section 2.3, the Custodian shall transmit promptly to the Fund for each
Portfolio all written information (including, without limitation, pendency of
calls and maturities of domestic securities and expirations of rights in
connection therewith and notices of exercise of call and put options written by
the Fund on behalf of the Portfolio and the maturity of futures contracts
purchased or sold by the Fund on behalf of the Portfolio) received by the
Custodian from issuers of the securities being held for the Portfolio. With
respect to tender or exchange offers, the Custodian shall transmit promptly to
the Fund all written information received by the Custodian from issuers of the
securities whose tender or exchange is sought and from the party (or its agents)
making the tender or exchange offer. If the Fund desires to take action with
respect to any tender offer, exchange offer or any other similar transaction,
the Fund shall notify the Custodian at least three business days prior to
9
the date on which the Custodian is to take such action.
Section 3. Provisions Relating To Rules 17f-5 And 17f-7
Section 3.1 Definitions. As used throughout this Agreement, the capitalized
terms set forth below shall have the indicated meanings:
"Country Risk" means all factors reasonably related to the systemic risk of
holding Foreign Assets in a particular country including, but not limited to,
such country's political environment, economic and financial infrastructure
(including any Eligible Securities Depository operating in the country),
prevailing or developing custody and settlement practices, and laws and
regulations applicable to the safekeeping and recovery of Foreign Assets held in
custody in that country.
"Eligible Foreign Custodian" has the meaning set forth in Section (a)(1) of Rule
17f-5, including a majority-owned or indirect subsidiary of a U.S. Bank (as
defined in Rule 17f-5), a bank holding company meeting the requirements of an
Eligible Foreign Custodian (as set forth in Rule 17f-5 or by other appropriate
action of the SEC, or a foreign branch of a Bank (as defined in Section 2(a)(5)
of the 0000 Xxx) meeting the requirements of a custodian under Section 17(f) of
the 1940 Act; the term does not include any Eligible Securities Depository.
"Eligible Securities Depository" has the meaning set forth in Section (b)(1) of
Rule 17f-7.
"Foreign Assets" means any of the Portfolios' investments (including foreign
currencies) for which the primary market is outside the United States and such
cash and cash equivalents as are reasonably necessary to effect the Portfolios'
transactions in such investments.
"Foreign Custody Manager" has the meaning set forth in Section (a)(3) of Rule
17f-5.
"Rule 17f-5" means Rule 17f-5 promulgated under the 1940 Act.
"Rule 17f-7" means Rule 17f-7 promulgated under the 1940 Act.
Section 3.2 The Custodian As Foreign Custody Manager.
3.2.1. Delegation To The Custodian As Foreign Custody Manager. The
Fund, by resolution adopted by the Board, hereby delegates to the Custodian,
subject to Section (b) of Rule 17f-5, the responsibilities set forth in this
Section 3.2 with respect to Foreign Assets of the Portfolios held outside the
United States, and the Custodian hereby accepts such delegation as Foreign
Custody Manager with respect to the Portfolios.
3.2.2. Countries Covered. The Foreign Custody Manager shall be
responsible for performing the delegated responsibilities defined below only
with respect to the countries and custody arrangements for each such country
listed on Schedule A to this Agreement, which list of countries may be amended
from time to time by the Fund with the agreement of the Foreign Custody Manager.
The Foreign Custody Manager shall list on Schedule A the Eligible Foreign
Custodians selected by the Foreign Custody Manager to maintain the assets of the
Portfolios, which list of Eligible Foreign Custodians may be amended
10
from time to time in the sole discretion of the Foreign Custody Manager. The
Foreign Custody Manager will provide amended versions of Schedule A in
accordance with Section 3.2.5 hereof.
Upon the receipt by the Foreign Custody Manager of Proper Instructions to open
an account or to place or maintain Foreign Assets in a country listed on
Schedule A, and the fulfillment by the Fund, on behalf of the applicable
Portfolio(s), of the applicable account opening requirements for such country,
the Foreign Custody Manager shall be deemed to have been delegated by the Board
on behalf of such Portfolio(s) responsibility as Foreign Custody Manager with
respect to that country and to have accepted such delegation. Execution of this
Agreement by the Fund shall be deemed to be a Proper Instruction to open an
account, or to place or maintain Foreign Assets, in each country listed on
Schedule A. Following the receipt of Proper Instructions directing the Foreign
Custody Manager to close the account of a Portfolio with the Eligible Foreign
Custodian selected by the Foreign Custody Manager in a designated country, the
delegation by the Board on behalf of such Portfolio to the Custodian as Foreign
Custody Manager for that country shall be deemed to have been withdrawn and the
Custodian shall immediately cease to be the Foreign Custody Manager with respect
to such Portfolio with respect to that country.
The Foreign Custody Manager may withdraw its acceptance of delegated
responsibilities with respect to a designated country upon written notice to the
Fund. Thirty days (or such longer period to which the parties agree in writing)
after receipt of any such notice by the Fund, the Custodian shall have no
further responsibility in its capacity as Foreign Custody Manager to the Fund
with respect to the country as to which the Custodian's acceptance of delegation
is withdrawn.
3.2.3. Scope of Delegated Responsibilities:
(a) Selection Of Eligible Foreign Custodians. Subject to the provisions of
this Section 3.2, the Foreign Custody Manager may place and maintain the Foreign
Assets in the care of the Eligible Foreign Custodian selected by the Foreign
Custody Manager in each country listed on Schedule A, as amended from time to
time. In performing its delegated responsibilities as Foreign Custody Manager to
place or maintain Foreign Assets with an Eligible Foreign Custodian, the Foreign
Custody Manager shall determine that the Foreign Assets will be subject to
reasonable care, based on the standards applicable to custodians in the country
in which the Foreign Assets will be held by that Eligible Foreign Custodian,
after considering all factors relevant to the safekeeping of such assets,
including, without limitation the factors specified in Rule 17f-5(c)(1).
(b) Contracts With Eligible Foreign Custodians. The Foreign Custody
Manager shall determine that the contract governing the foreign custody
arrangements with each Eligible Foreign Custodian selected by the Foreign
Custody Manager will satisfy the requirements of Rule 17f-5(c)(2).
(c) Monitoring. In each case in which the Foreign Custody Manager
maintains Foreign Assets with an Eligible Foreign Custodian selected by the
Foreign Custody Manager, the Foreign Custody Manager shall establish a system to
monitor (i) the appropriateness of maintaining the Foreign Assets with such
Eligible Foreign Custodian and (ii) the contract
11
governing the custody arrangements established by the Foreign Custody Manager
with the Eligible Foreign Custodian. In the event the Foreign Custody Manager
determines that the custody arrangements with an Eligible Foreign Custodian it
has selected are no longer appropriate, the Foreign Custody Manager shall notify
the Board in accordance with Section 3.2.5 hereunder.
3.2.4. Guidelines For The Exercise Of Delegated Authority. For
purposes of this Section 3.2, the Board shall be deemed to have considered and
determined to accept such Country Risk as is incurred by placing and maintaining
the Foreign Assets in each country for which the Custodian is serving as Foreign
Custody Manager of the Portfolios.
3.2.5. Reporting Requirements. The Foreign Custody Manager shall
report the withdrawal of the Foreign Assets from an Eligible Foreign Custodian
and the placement of such Foreign Assets with another Eligible Foreign Custodian
by providing to the Board an amended Schedule A at the end of the calendar
quarter in which an amendment to such Schedule has occurred. The Foreign Custody
Manager shall make written reports notifying the Board of any other material
change in the foreign custody arrangements of the Portfolios described in this
Section 3.2 after the occurrence of the material change.
3.2.6. Standard Of Care As Foreign Custody Manager Of A Portfolio. In
performing the responsibilities delegated to it, the Foreign Custody Manager
agrees to exercise reasonable care, prudence and diligence such as a person
having responsibility for the safekeeping of assets of management investment
companies registered under the 1940 Act would exercise.
3.2.7. Representations With Respect To Rule 17f-5. The Foreign
Custody Manager represents to the Fund that it is a U.S. Bank as defined in
Section (a)(7) of Rule 17f-5. The Fund represents to the Custodian that the
Board has determined that it is reasonable for the Board to rely on the
Custodian to perform the responsibilities delegated pursuant to this Agreement
to the Custodian as the Foreign Custody Manager of the Portfolios.
3.2.8. Effective Date And Termination Of The Custodian As Foreign
Custody Manager. The Board's delegation to the Custodian as Foreign Custody
Manager of the Portfolios shall be effective as of the date hereof and shall
remain in effect until terminated at any time, without penalty, by written
notice from the terminating party to the non-terminating party. Termination will
become effective thirty (30) days after receipt by the non-terminating party of
such notice. The provisions of Section 3.2.2 hereof shall govern the delegation
to and termination of the Custodian as Foreign Custody Manager of the Portfolios
with respect to designated countries.
Section 3.3 Eligible Securities Depositories.
3.3.1. Analysis And Monitoring. The Custodian shall (a) provide the
Fund (or its duly-authorized investment manager or investment adviser) with an
analysis of the custody risks associated with maintaining assets with the
Eligible Securities Depositories set forth on Schedule B hereto in accordance
with Section (a)(1)(i)(A) of Rule 17f- 7, and (b) monitor such risks on a
continuing basis, and promptly notify the Fund (or its duly-authorized
12
investment manager or investment adviser) of any material change in such risks,
in accordance with Section (a)(1)(i)(B) of Rule 17f- 7.
3.3.2. Standard Of Care. The Custodian agrees to exercise reasonable
care, prudence and diligence in performing the duties set forth in Section
3.3.1.
Section 4. Duties Of The Custodian With Respect To Property Of The Portfolios
To Be Held Outside The United States
Section 4.1 Definitions. As used throughout this Agreement, the
capitalized terms set forth below shall have the indicated meanings:
"Foreign Securities System" means an Eligible Securities Depository listed on
Schedule B hereto.
"Foreign Sub-Custodian" means a foreign banking institution serving as an
Eligible Foreign Custodian.
Section 4.2. Holding Securities. The Custodian shall identify on its books
as belonging to the Portfolios the foreign securities held by each Foreign
Sub-Custodian or Foreign Securities System. The Custodian may hold foreign
securities for all of its customers, including the Portfolios, with any Foreign
Sub-Custodian in an account that is identified as belonging to the Custodian for
the benefit of its customers, provided however, that (i) the records of the
Custodian with respect to foreign securities of the Portfolios which are
maintained in such account shall identify those securities as belonging to the
Portfolios and (ii) to the extent permitted and customary in the market in which
the account is maintained, the Custodian shall require that securities so held
by the Foreign Sub-Custodian be held separately from any assets of such Foreign
Sub-Custodian or of other customers of such Foreign Sub-Custodian.
Section 4.3. Foreign Securities Systems. Foreign securities shall be
maintained in a Foreign Securities System in a designated country through
arrangements implemented by the Custodian or a Foreign Sub-Custodian, as
applicable, in such country.
Section 4.4. Transactions In Foreign Custody Account.
4.4.1. Delivery Of Foreign Assets. The Custodian or a Foreign
Sub-Custodian shall release and deliver foreign securities of the Portfolios
held by the Custodian or such Foreign Sub-Custodian, or in a Foreign Securities
System account, only upon receipt of Proper Instructions, which may be
continuing instructions when deemed appropriate by the parties, and only in the
following cases:
(i) Upon the sale of such foreign securities for the Portfolio in
accordance with commercially reasonable market practice in the country
where such foreign securities are held or traded, including, without
limitation: (A) delivery against expectation of receiving later
payment; or (B) in the case of a sale effected through a Foreign
Securities System, in accordance with the rules governing the
operation of the Foreign Securities System;
13
(ii) In connection with any repurchase agreement related to foreign
securities;
(iii) To the depository agent in connection with tender or other similar
offers for foreign securities of the Portfolios;
(iv) To the issuer thereof or its agent when such foreign securities are
called, redeemed, retired or otherwise become payable;
(v) To the issuer thereof, or its agent, for transfer into the name of
the Custodian (or the name of the respective Foreign Sub-Custodian
or of any nominee of the Custodian or such Foreign Sub-Custodian) or
for exchange for a different number of bonds, certificates or other
evidence representing the same aggregate face amount or number of
units;
(vi) To brokers, clearing banks or other clearing agents for examination
or trade execution in accordance with market custom; provided that
in any such case, the Foreign Sub-Custodian shall have no
responsibility or liability for any loss arising from the delivery
of such foreign securities prior to receiving payment for such
foreign securities except as may arise from the Foreign
Sub-Custodian's own negligence or willful misconduct;
(vii) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of
the securities of the issuer of such securities, or pursuant to
provisions for conversion contained in such securities, or pursuant
to any deposit agreement;
(viii) In the case of warrants, rights or similar foreign securities, the
surrender thereof in the exercise of such warrants, rights or
similar securities or the surrender of interim receipts or temporary
securities for definitive securities;
(ix) For delivery as security in connection with any borrowing by the
Fund on behalf of a Portfolio requiring a pledge of assets by the
Fund on behalf of such Portfolio;
(x) In connection with trading in options and futures contracts,
including delivery as original margin and variation margin;
(xi) Upon the sale or other delivery of such foreign securities
(including, without limitation, to one or more Special
Sub-Custodians or Repo Custodians) as a Free Trade, provided that
applicable Proper Instructions shall set forth (A) the foreign
securities to be delivered and (B) the person(s) to whom delivery
shall be made;
(xii) In connection with the lending of foreign securities; and
(xiii) For any other purpose, but only upon receipt of Proper Instructions
specifying (A) the foreign securities to be delivered and (B) the
person or persons to whom delivery of such securities shall be made.
14
4.4.2. Payment Of Portfolio Monies. Upon receipt of Proper
Instructions, which may be continuing instructions when deemed appropriate by
the parties, the Custodian shall pay out, or direct the respective Foreign
Sub-Custodian or the respective Foreign Securities System to pay out, monies of
a Portfolio in the following cases only:
(i) Upon the purchase of foreign securities for the Portfolio, unless
otherwise directed by Proper Instructions, by (A) delivering money
to the seller thereof or to a dealer therefor (or an agent for such
seller or dealer) against expectation of receiving later delivery of
such foreign securities; or (B) in the case of a purchase effected
through a Foreign Securities System, in accordance with the rules
governing the operation of such Foreign Securities System;
(ii) In connection with the conversion, exchange or surrender of foreign
securities of the Portfolio;
(iii) For the payment of any expense or liability of the Portfolio,
including but not limited to the following payments: interest,
taxes, investment advisory fees, transfer agency fees, fees under
this Agreement, legal fees, accounting fees, and other operating
expenses;
(iv) For the purchase or sale of foreign exchange or foreign exchange
contracts for the Portfolio, including transactions executed with or
through the Custodian or its Foreign Sub-Custodians;
(v) In connection with trading in options and futures contracts,
including delivery as original margin and variation margin;
(vi) Upon the purchase of foreign investments including, without
limitation, repurchase agreement transactions involving delivery of
Portfolio monies to Repo Custodian(s), as a Free Trade, provided
that applicable Proper Instructions shall set forth (A) the amount
of such payment and (B) the person(s) to whom payment shall be made;
(vii) For payment of part or all of the dividends received in respect of
securities sold short;
(viii) In connection with the borrowing or lending of foreign securities;
and
(ix) For any other purpose, but only upon receipt of Proper Instructions
specifying (A) the amount of such payment and (B) the person(s) to
whom such payment is to be made.
4.4.3. Market Conditions. Notwithstanding any provision of this
Agreement to the contrary, settlement and payment for Foreign Assets received
for the account of the Portfolios and delivery of Foreign Assets maintained for
the account of the Portfolios may be effected in accordance with the customary
established securities trading or processing practices and procedures in the
country or market in which the transaction occurs, including, without
limitation, delivering Foreign Assets to the purchaser thereof or to a dealer
therefor (or an agent
15
for such purchaser or dealer) with the expectation of receiving later payment
for such Foreign Assets from such purchaser or dealer.
The Custodian shall provide to the Board the information with respect to custody
and settlement practices in countries in which the Custodian employs a Foreign
Sub-Custodian described on Schedule C hereto at the time or times set forth on
such Schedule. The Custodian may revise Schedule C from time to time, provided
that no such revision shall result in the Board being provided with
substantively less information than had been previously provided hereunder.
Section 4.5. Registration Of Foreign Securities. The foreign securities
maintained in the custody of a Foreign Sub-Custodian (other than bearer
securities) shall be registered in the name of the applicable Portfolio or in
the name of the Custodian or in the name of any Foreign Sub-Custodian or in the
name of any nominee of the foregoing, and the Fund on behalf of such Portfolio
agrees to hold any such nominee harmless from any liability as a holder of
record of such foreign securities. The Custodian or a Foreign Sub-Custodian
shall not be obligated to accept securities on behalf of a Portfolio under the
terms of this Agreement unless the form of such securities and the manner in
which they are delivered are in accordance with reasonable market practice.
Section 4.6. Bank Accounts. The Custodian shall identify on its books
as belonging to the Fund cash (including cash denominated in foreign currencies)
deposited with the Custodian. Where the Custodian is unable to maintain, or
market practice does not facilitate the maintenance of, cash on the books of the
Custodian, a bank account or bank accounts shall be opened and maintained
outside the United States on behalf of a Portfolio with a Foreign Sub-Custodian.
All accounts referred to in this Section shall be subject only to draft or order
by the Custodian (or, if applicable, such Foreign Sub-Custodian) acting pursuant
to the terms of this Agreement to hold cash received by or from or for the
account of the Portfolio. Cash maintained on the books of the Custodian
(including its branches, subsidiaries and affiliates), regardless of currency
denomination, is maintained in bank accounts established under, and subject to
the laws of, The Commonwealth of Massachusetts.
Section 4.7. Collection Of Income. The Custodian shall use reasonable
commercial efforts to collect all income and other payments with respect to the
Foreign Assets held hereunder to which the Portfolios shall be entitled and
shall credit such income, as collected, to the applicable Portfolio. In the
event that extraordinary measures are required to collect such income, the Fund
and the Custodian shall consult as to such measures and as to the compensation
and expenses of the Custodian relating to such measures.
Section 4.8. Shareholder Rights. With respect to the foreign securities
held pursuant to this Section 4, the Custodian shall use reasonable commercial
efforts to facilitate the exercise of voting and other shareholder rights,
subject always to the laws, regulations and practical constraints that may exist
in the country where such securities are issued. The Fund acknowledges that
local conditions, including lack of regulation, onerous procedural obligations,
lack of notice and other factors may have the effect of severely limiting the
ability of the Fund to exercise shareholder rights.
16
Section 4.9. Communications Relating To Foreign Securities. The
Custodian shall transmit promptly to the Fund written information with respect
to materials received by the Custodian via the Foreign Sub-Custodians from
issuers of the foreign securities being held for the account of the Portfolios
(including, without limitation, pendency of calls and maturities of foreign
securities and expirations of rights in connection therewith). With respect to
tender or exchange offers, the Custodian shall transmit promptly to the Fund
written information with respect to materials so received by the Custodian from
issuers of the foreign securities whose tender or exchange is sought or from the
party (or its agents) making the tender or exchange offer. The Custodian shall
not be liable for any untimely exercise of any tender, exchange or other right
or power in connection with foreign securities or other property of the
Portfolios at any time held by it unless (i) the Custodian or the respective
Foreign Sub-Custodian is in actual possession of such foreign securities or
property and (ii) the Custodian receives Proper Instructions with regard to the
exercise of any such right or power, and both (i) and (ii) occur at least three
business days prior to the date on which the Custodian is to take action to
exercise such right or power.
Section 4.10. Liability Of Foreign Sub-Custodians. Each agreement
pursuant to which the Custodian employs a Foreign Sub-Custodian shall, to the
extent possible, require the Foreign Sub-Custodian to exercise reasonable care
in the performance of its duties, and to indemnify, and hold harmless, the
Custodian from and against any loss, damage, cost, expense, liability or claim
arising out of or in connection with the Foreign Sub-Custodian's performance of
such obligations. At the Fund's election, the Portfolios shall be entitled to be
subrogated to the rights of the Custodian with respect to any claims against a
Foreign Sub-Custodian as a consequence of any such loss, damage, cost, expense,
liability or claim if and to the extent that the Portfolios have not been made
whole for any such loss, damage, cost, expense, liability or claim.
Section 4.11. Tax Law. The Custodian shall have no responsibility or
liability for any obligations now or hereafter imposed on the Fund, the
Portfolios or the Custodian as custodian of the Portfolios by the tax law of the
United States or of any state or political subdivision thereof. It shall be the
responsibility of the Fund to notify the Custodian of the obligations imposed on
the Fund with respect to the Portfolios or the Custodian as custodian of the
Portfolios by the tax law of countries other than those mentioned in the above
sentence, including responsibility for withholding and other taxes, assessments
or other governmental charges, certifications and governmental reporting. The
sole responsibility of the Custodian with regard to such tax law shall be to use
reasonable efforts to assist the Fund with respect to any claim for exemption or
refund under the tax law of countries for which the Fund has provided such
information.
Section 4.12. Liability Of Custodian. The Custodian shall be liable for
the acts or omissions of a Foreign Sub-Custodian to the same extent as set forth
with respect to sub-custodians generally in this Agreement and, regardless of
whether assets are maintained in the custody of a Foreign Sub-Custodian or a
Foreign Securities System, the Custodian shall not be liable for any loss,
damage, cost, expense, liability or claim resulting from nationalization,
expropriation, currency restrictions, or acts of war or terrorism, or any other
loss where the Sub-Custodian has otherwise acted with reasonable care.
17
Section 5. Special Sub-Custodians
Upon receipt of Special Instructions (as such term is defined in Section 7
hereof), the Custodian shall, on behalf of one or more Portfolios, appoint one
or more banks, trust companies or other entities designated in such Special
Instructions to act as a sub-custodian for the purposes of effecting such
transaction as may be designated by a Fund in Special Instructions. Each such
designated sub-custodian is referred to herein as a "Special Sub-Custodian."
Each such duly appointed Special Sub-Custodian shall be listed on Schedule D
hereto, as it may be amended from time to time by the Fund, with the
acknowledgment of the Custodian. In connection with the appointment of any
Special Sub-Custodian, and in accordance with Special Instructions, the
Custodian shall enter into a sub-custodian agreement with the Fund and the
Special Sub-Custodian in form and substance approved by the Fund, provided that
such agreement shall in all events comply with the provisions of the 1940 Act
and the rules and regulations thereunder and the terms and provisions of this
Agreement.
Section 6. Payments For Sales Or Repurchases Or Redemptions Of Shares
The Custodian shall receive from the distributor of the Shares or from the
Transfer Agent and deposit into the account of the appropriate Portfolio such
payments as are received for Shares thereof issued or sold from time to time by
the Fund. The Custodian will provide timely notification to the Fund on behalf
of each such Portfolio and the Transfer Agent of any receipt by it of payments
for Shares of such Portfolio.
From such funds as may be available for the purpose, the Custodian shall, upon
receipt of instructions from the Transfer Agent, make funds available for
payment to holders of Shares who have delivered to the Transfer Agent a request
for redemption or repurchase of their Shares. In connection with the redemption
or repurchase of Shares, the Custodian is authorized upon receipt of
instructions from the Transfer Agent to wire funds to or through a commercial
bank designated by the redeeming shareholders. In connection with the redemption
or repurchase of Shares, the Custodian shall honor checks drawn on the Custodian
by a holder of Shares, which checks have been furnished by the Fund to the
holder of Shares, when presented to the Custodian in accordance with such
procedures and controls as are mutually agreed upon from time to time between
the Fund and the Custodian.
Section 7. Proper Instructions And Special Instructions
"Proper Instructions," as such term is used throughout this Agreement, means a
writing signed or initialed by one or more person or persons as the Board shall
have from time to time authorized. Each such writing shall set forth the
specific transaction or type of transaction involved. Oral instructions will be
considered Proper Instructions if the Custodian reasonably believes them to have
been given by a person authorized to give such instructions with respect to the
transaction involved; the Fund shall cause all oral instructions to be confirmed
in writing. Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the Fund and the
Custodian agree to security procedures including, but not limited to, the
security procedures selected by the Fund via the form of Funds Transfer Addendum
hereto. For purposes of this Section, Proper Instructions shall include
instructions received by the Custodian pursuant to any three-party agreement
which requires a
18
segregated asset account in accordance with Section 2.9 hereof.
"Special Instructions," as such term is used throughout this Agreement, means
Proper Instructions countersigned or confirmed in writing by the Treasurer or
any Assistant Treasurer of the Fund or any other person designated in writing by
the Treasurer of the Fund, which countersignature or confirmation shall be (a)
included on the same instrument containing the Proper Instructions or on a
separate instrument clearly relating thereto and (b) delivered by hand, by
facsimile transmission, or in such other manner as the Fund and the Custodian
agree in writing.
Concurrently with the execution of this Agreement, and from time to time
thereafter, as appropriate, the Fund shall deliver to the Custodian, duly
certified by the Fund's Treasurer or Assistant Treasurer, a certificate setting
forth: (i) the names, titles, signatures and scope of authority of all persons
authorized to give Proper Instructions or any other notice, request, direction,
instruction, certificate or instrument on behalf of the Fund and (ii) the names,
titles and signatures of those persons authorized to give Special Instructions.
Such certificate may be accepted and relied upon by the Custodian as conclusive
evidence of the facts set forth therein and shall be considered to be in full
force and effect until receipt by the Custodian of a similar certificate to the
contrary.
Section 8. Evidence Of Authority
The Custodian shall be protected in acting upon any instructions, notice,
request, consent, certificate or other instrument or paper believed by it to be
genuine and to have been properly executed by or on behalf of the Fund. The
Custodian may receive and accept a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Fund as conclusive evidence (a) of
the authority of any person to act in accordance with such resolution or (b) of
any determination or of any action by the Board as described in such resolution,
and such resolution may be considered as in full force and effect until receipt
by the Custodian of written notice to the contrary.
Section 9. Actions Permitted Without Express Authority
The Custodian may in its discretion, without express authority from the Fund on
behalf of each applicable Portfolio:
1) Make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this
Agreement; provided that all such payments shall be accounted for
to the Fund on behalf of the Portfolio;
2) Surrender securities in temporary form for securities in definitive
form;
3) Endorse for collection, in the name of the Portfolio, checks,
drafts and other negotiable instruments; and
4) In general, attend to all non-discretionary details in connection
with the sale, exchange, substitution, purchase, transfer and other
dealings with the securities
19
and property of the Portfolio except as otherwise directed by the
Board.
Section 10. Duties Of Custodian With Respect To The Books Of Account And
Calculation Of Net Asset Value And Net Income
The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the Board to keep the books of account of each
Portfolio and/or compute the net asset value per Share of the outstanding Shares
or, if directed in writing to do so by the Fund on behalf of a Portfolio, shall
itself keep such books of account and/or compute such net asset value per Share.
If so directed, the Custodian shall also calculate daily the net income of the
Portfolio as described in the Prospectus and shall advise the Fund and the
Transfer Agent daily of the total amounts of such net income and, if instructed
in writing by an officer of the Fund to do so, shall advise the Transfer Agent
periodically of the division of such net income among its various components.
The Fund acknowledges and agrees that, with respect to investments maintained
with the Underlying Transfer Agent, the Underlying Transfer Agent is the sole
source of information on the number of shares of a fund held by it on behalf of
a Portfolio and that the Custodian has the right to rely on holdings information
furnished by the Underlying Transfer Agent to the Custodian in performing its
duties under this Agreement, including without limitation, the duties set forth
in this Section 10 and in Section 11 hereof; provided, however, that the
Custodian shall be obligated to reconcile information as to purchases and sales
of Underlying Shares contained in trade instructions and confirmations received
by the Custodian and to report promptly any discrepancies to the Underlying
Transfer Agent. The calculations of the net asset value per Share and the daily
income of each Portfolio shall be made at the time or times described from time
to time in' the Prospectus. The Fund acknowledges that, in keeping the books of
account of the Portfolio and/or making the calculations described herein with
respect to Portfolio property released and delivered pursuant to Section
2.2(14), or purchased pursuant to Section 2.6(7) hereof, the Custodian is
authorized and instructed to rely upon information provided to it by the Fund,
the Fund's counterparty(ies), or the agents of either of them.
Section 11. Records
The Custodian shall with respect to each Portfolio create and maintain all
records relating to its activities and obligations under this Agreement in such
manner as will meet the obligations of the Fund under the 1940 Act, with
particular attention to Section 31 thereof and Rules 31a-l and 31a-2 thereunder.
All such records shall be the property of the Fund and shall at all times during
the regular business hours of the Custodian be open for inspection by duly
authorized officers, employees or agents of the Fund and employees and agents of
the SEC. The Custodian shall, at the Fund's request, supply the Fund with a
tabulation of securities owned by each Portfolio and held by the Custodian and
shall, when requested to do so by the Fund and for such compensation as shall be
agreed upon between the Fund and the Custodian, include certificate numbers in
such tabulations. The Fund acknowledges that, in creating and maintaining the
records as set forth herein with respect to Portfolio property released and
delivered pursuant to Section 2.2(14), or purchased pursuant to Section 2.6(7)
hereof, the Custodian is authorized and instructed to rely upon information
provided to it by the Fund, the Fund's counterparty(ies), or the agents of
either of them.
20
Section 12. Opinion Of Fund's Independent Accountant
The Custodian shall take all reasonable action, as the Fund with respect to a
Portfolio may from time to time request, to obtain from year to year favorable
opinions from the Fund's independent accountants with respect to its activities
hereunder in connection with the preparation of the Fund's Form N-1A, and Form
N-SAR or other annual reports to the SEC and with respect to any other
requirements thereof.
Section 13. Reports To Fund By Independent Public Accountants
The Custodian shall provide the Fund, on behalf of each of the Portfolios at
such times as the Fund may reasonably require, with reports by independent
public accountants on the accounting system, internal accounting control and
procedures for safeguarding securities, futures contracts and options on futures
contracts, including securities deposited and/or maintained in a U.S. Securities
System or a Foreign Securities System, relating to the services provided by the
Custodian under this Agreement; such reports, shall be of sufficient scope and
in sufficient detail, as may reasonably be required by the Fund to provide
reasonable assurance that any material inadequacies would be disclosed by such
examination, and, if there are no such inadequacies, the reports shall so state.
Section 14. Compensation Of Custodian
The Custodian shall be entitled to reasonable compensation for its services and
expenses as Custodian, as agreed upon from time to time between the Fund on
behalf of each applicable Portfolio and the Custodian.
Section 15. Responsibility Of Custodian
So long as and to the extent that it is in the exercise of reasonable care, the
Custodian shall not be responsible for the title, validity or genuineness of any
property or evidence of title thereto received by it or delivered by it pursuant
to this Agreement and shall be held harmless in acting upon any notice, request,
consent, certificate or other instrument reasonably believed by it to be genuine
and to be signed by the proper party or parties, including any futures
commission merchant acting pursuant to the terms of a three-party futures or
options agreement. The Custodian shall be held to the exercise of reasonable
care in carrying out the provisions of this Agreement, but shall be kept
indemnified by and shall be without liability to the Fund for any action taken
or omitted by it in good faith without negligence, including, without
limitation, acting in accordance with any Proper Instruction. It shall be
entitled to rely on and may act upon the written advice of counsel (who may be
counsel for the Fund) on all matters, and shall be without liability for any
action reasonably taken or omitted pursuant to such advice. The Custodian shall
be without liability to the Fund and the Portfolios for any loss, liability,
claim or expense resulting from or caused by anything which is part of Country
Risk (as defined in Section 3 hereof), including without limitation
nationalization, expropriation, currency restrictions, or acts of war,
revolution, riots or terrorism.
Except as may arise from the Custodian's own negligence or willful misconduct or
the
21
negligence or willful misconduct of a sub-custodian or agent, the Custodian
shall be without liability to the Fund for any loss, liability, claim or expense
resulting from or caused by; (i) events or circumstances beyond the reasonable
control of the Custodian or any sub-custodian or Securities System or any agent
or nominee of any of the foregoing, including, without limitation, the
interruption, suspension or restriction of trading on or the closure of any
securities market, power or other mechanical or technological failures or
interruptions, computer viruses or communications disruptions, work stoppages,
natural disasters, or other similar events or acts; (ii) errors by the Fund or
its duly authorized investment manager or investment adviser in their
instructions to the Custodian provided such instructions have been in accordance
with this Agreement; (iii) the insolvency of or acts or omissions by a
Securities System; (iv) any act or omission of a Special Sub-Custodian
including, without limitation, reliance on reports prepared by a Special
Sub-Custodian; (v) any delay or failure of any broker, agent or intermediary,
central bank or other commercially prevalent payment or clearing system to
deliver to the Custodian's sub-custodian or agent securities purchased or in the
remittance or payment made in connection with securities sold; (vi) any delay or
failure of any company, corporation, or other body in charge of registering or
transferring securities in the name of the Custodian, the Fund, the Custodian's
sub-custodians, nominees or agents or any consequential losses arising out of
such delay or failure to transfer such securities including non-receipt of
bonus, dividends and rights and other accretions or benefits; (vii) delays or
inability to perform its duties due to any disorder in market infrastructure
with respect to any particular security or Securities System; and (viii) any
provision of any present or future law or regulation or order of the United
States of America, or any state thereof, or any other country, or political
subdivision thereof or of any court of competent jurisdiction.
In the event of equipment failures beyond the Custodian's control, the Custodian
shall, at no additional expense to the Fund, take reasonable steps to minimize
service interruptions. The Custodian shall enter into and shall maintain in
effect with appropriate parties one or more agreements making reasonable
provision for (i) periodic back-up of the computer files and data with respect
to the Fund and (ii) emergency use of electronic data processing equipment to
provide services under this Agreement.
The Custodian shall be liable for the acts or omissions of a Foreign
Sub-Custodian (as such term is defined in Section 4 hereof) to the same extent
as set forth with respect to sub-custodians generally in this Agreement.
If the Fund on behalf of a Portfolio requires the Custodian to take any action
with respect to securities, which action involves the payment of money or which
action may, in the opinion of the Custodian, result in the Custodian or its
nominee assigned to the Fund or the Portfolio being liable for the payment of
money or incurring liability of some other form, the Fund on behalf of the
Portfolio, as a prerequisite to requiring the Custodian to take such action,
shall provide indemnity to the Custodian in an amount and form satisfactory to
it.
If the Fund requires the Custodian, its affiliates, subsidiaries or agents, to
advance cash or securities for any purpose (including but not limited to
securities settlements, foreign exchange contracts and assumed settlement) or in
the event that the Custodian or its nominee shall incur or be assessed any
taxes, charges, expenses, assessments, claims or liabilities in connection with
the performance of this Agreement, except such as may arise from its or its
nominee's own negligent
22
action, negligent failure to act or willful misconduct, any property at any time
held for the account of the applicable Portfolio shall be security therefor and
should the Fund fail to repay the Custodian promptly, the Custodian shall be
entitled to utilize available cash and to dispose of such Portfolio's assets to
the extent necessary to obtain reimbursement.
Except as may arise from the Custodian's own negligence or willful misconduct,
the Fund shall indemnify and hold the Custodian harmless from and against any
and all costs, expenses, losses, damages, charges, counsel fees, payments and
liabilities which may be asserted against the Custodian (a) acting in accordance
with any Proper Instruction or Special Instruction including, without
limitation, any Proper Instruction with respect to Free Trades including, but
not limited to, cost, expense, loss, damage, liability, tax, charge, assessment
or claim resulting from (i) the failure of the Fund to receive income with
respect to purchased investments, (ii) the failure of the Fund to recover
amounts invested on maturity of purchased investments, (iii) the failure of the
Custodian to respond to or be aware of notices or other corporate communications
with respect to purchased investments, or (iv) the Custodian's reliance upon
information provided by the Fund, the Fund's counterparty(ies) or the agents of
either of them with respect to Fund property released, delivered or purchased
pursuant to either of Section 2.2{ 14) or Section 2.6(7) hereof; (b) for the
acts or omissions of any Special Sub-Custodian; or (c) for the acts or omissions
of any Local Agent or Pledgee.
In no event shall either of the Custodian or the Fund be liable for indirect,
special or consequential damages.
Section 15A. Performance Goals.
The Custodian and the Fund may from time to time agree on the manner in
which they expect to deliver and receive the services contemplated by this
Agreement. The parties agree that such agreement(s) (hereinafter referred to as
"Service Level Document(s)") reflect performance goals and any failure to
perform in accordance with the provisions thereof shall not be considered a
breach of contract that gives rise to contractual or other remedies. It is the
intention of the parties that the sole remedy for failure to perform in
accordance with the provisions of a Service Level Document, or any dispute
relating to performance goals set forth in a Service Level Document, will be a
meeting of the parties to resolve the failure pursuant to the consultation
procedure described in Sections 15A.l and 15A.2 below.
Section 15A.1 Consulation Procedure. If a party hereto is consistently
unable to meet the provisions of a Service Level Document, or in the event that
a dispute arises relating to performance goals set forth in a Service Level
Document, either party to this Agreement shall address any concerns it may have
by requiring a consultation with the other party.
Section 15A.2 Purpose Of Consulation Procedure. The purpose of the
consultation procedure is to endeavor to resolve a consistent failure to meet
the provisions of a Service Level Document. If a consultation occurs under this
Section 15A, all parties must negotiate in good faith to endeavor to:
(a) implement changes which will enable the Service Level Document
provisions to be more regularly met;
23
(b) agree to alternative Service Level Document provisions which
meet the parties' respective business requirements; or
(c) otherwise find a solution such that within 30 days after the
consultation, the inability to meet the Service Level Document
provisions may be less likely to occur in the future.
Section 16. Effective Period, Termination And Amendment
This Agreement shall become effective as of its execution, shall continue in
full force and effect until terminated as hereinafter provided, may be amended
at any time by mutual agreement of the parties hereto and may be terminated by
either party by an instrument in writing delivered or mailed, postage prepaid to
the other party, such termination to take effect not sooner than sixty (60) days
after the date of such delivery or mailing; provided, however, that the Fund
shall not amend or terminate this Agreement in contravention of any applicable
federal or state regulations, or any provision of the Fund's Governing
Documents, and further provided, that the Fund on behalf of one or more of the
Portfolios may at any time by action of its Board (i) substitute another bank or
trust company for the Custodian by giving notice as described above to the
Custodian, or (ii) immediately terminate this Agreement in the event of the
appointment of a conservator or receiver for the Custodian by the Comptroller of
the Currency or upon the happening of a like event at the direction of an
appropriate regulatory agency or court of competent jurisdiction.
Upon termination of the Agreement, the Fund on behalf of each applicable
Portfolio shall pay to the Custodian such compensation as may be due as of the
date of such termination and shall likewise reimburse the Custodian for its
costs, expenses and disbursements.
Section 17. Successor Custodian
If a successor custodian for one or more Portfolios shall be appointed by the
Board, the Custodian shall, upon termination and receipt of Proper Instructions,
deliver to such successor custodian at the office of the Custodian, duly
endorsed and in the form or transfer, all securities of each applicable
Portfolio then held by it hereunder and shall transfer to an account of the
successor custodian all of the securities of each such Portfolio held in a
Securities System or at the Underlying Transfer Agent.
If no such successor custodian shall be appointed, the Custodian shall, in like
manner, upon receipt of Proper Instructions, deliver at the office of the
Custodian and transfer such securities, funds and other properties in accordance
with such resolution.
In the event that no Proper Instructions designating a successor custodian or
alternative arrangements shall have been delivered to the Custodian on or before
the date when such termination shall become effective, then the Custodian shall
have the right to deliver to a bank or trust company, which is a "bank" as
defined in the 1940 Act, doing business in Boston, Massachusetts or New York,
New York, of its own selection, having an aggregate capital, surplus, and
undivided profits, as shown by its last published report, of not less than
$25,000,000, all securities, funds and other properties held by the Custodian on
behalf of each applicable Portfolio and all instruments held by the Custodian
relative thereto and all other
24
property held by it under this Agreement on behalf of each applicable Portfolio,
and to transfer to an account of such successor custodian all of the securities
of each such Portfolio held in any Securities System or at the Underlying
Transfer Agent. Thereafter, such bank or trust company shall be the successor of
the Custodian under this Agreement.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Fund to provide Proper Instructions as aforesaid, the Custodian
shall be entitled to fair compensation for its services during such period as
the Custodian retains possession of such securities, funds and other properties
and the provisions of this Agreement relating to the duties and obligations of
the Custodian shall remain in full force and effect.
Section 18. General
Section 18.1 Massachusetts Law To Apply. This Agreement shall be
construed and the provisions thereof interpreted under and in accordance with
laws of The Commonwealth of Massachusetts.
Section 18.2 Prior Agreements. This Agreement supersedes and
terminates, as of the date hereof, all prior Agreements between the Fund on
behalf of each of the Portfolios and the Custodian relating to the custody of
the Fund's assets.
Section 18.3 Assignment. This Agreement may not be assigned by
either party without the written consent of the other.
Section 18.4 Interpretive And Additional ProvisionS. In connection
with the operation of this Agreement, the Custodian and the Fund on behalf of
each of the Portfolios, may from time to time agree on such provisions
interpretive of or in addition to the provisions of this Agreement as may in
their joint opinion be consistent with the general tenor of this Agreement. Any
such interpretive or additional provisions shall be in a writing signed by both
parties and shall be annexed hereto, provided that no such interpretive or
additional provisions shall contravene any applicable federal or state
regulations or any provision of the Fund's Governing Documents. No interpretive
or additional provisions made as provided in the preceding sentence shall be
deemed to be an amendment of this Agreement.
Section 18.5 Additional Funds. In the event that the Fund
establishes one or more series of Shares in addition to XXXXX FARGO SIFE
SPECIALIZED FINANCIAL SERVICES FUND with respect to which it desires to have the
Custodian render services as custodian under the terms hereof, it shall so
notify the Custodian in writing, and if the Custodian agrees in writing to
provide such services, such series of Shares shall become a Portfolio hereunder.
Section 18.6 Notices. Any notice, instruction or other instrument
required to be given hereunder may be delivered in person to the offices of the
parties as set forth herein during normal business hours or delivered prepaid
registered mail or by telex, cable or telecopy to the parties at the following
addresses or such other addresses as may be notified by any party from time to
time.
25
To the Fund: XXXXX FARGO FUNDS TRUST
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxx, Assistant Treasurer Telephone:
000-000-0000
Telecopy: 000-000-0000
To the Custodian: STATE STREET BANK AND TRUST COMPANY
Xxxxxxxxx Xxxxxxxxx Xxxxxx
0 Xxxxxx xx Xxxxxxxxx, 0XXXX
Xxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Vice President Telephone:
000-000-0000
Telecopy: 000-000-0000
Such notice, instruction or other instrument shall be deemed to have been served
in the case of a registered letter at the expiration of five business days after
posting, in the case of cable twenty-four hours after dispatch and, in the case
of telex, immediately on dispatch and if delivered outside normal business hours
it shall be deemed to have been received at the next time after delivery when
normal business hours commence and in the case of cable, telex or telecopy on
the business day after the receipt thereof. Evidence that the notice was
properly addressed, stamped and put into the post shall be conclusive evidence
of posting.
Section 18.7 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original, and all such
counterparts taken together shall constitute one and the same Agreement.
Section 18.8 Severability. If any provision or provisions of this
Agreement shall be held to be invalid, unlawful or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired.
Section 18.9 Reproduction Of Documents. This Agreement and all schedules,
addenda, exhibits, attachments and amendments hereto may be reproduced by any
photographic, photostatic, microfilm, micro-card, miniature photographic or
other similar process. The parties hereto all/each agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
Section 18.10 Remote Access Services Addendum. The Custodian and the Fund
agree to be bound by the terms of the Remote Access Services Addendum hereto.
Section 18.11 Shareholder Communications Election. SEC Rule 14b-2 requires
banks which hold securities for the account of customers to respond to requests
by issuers of securities for the names, addresses and holdings of beneficial
owners of securities of that issuer
26
held by the bank unless the beneficial owner has expressly objected to
disclosure of this information. In order to comply with the rule, the Custodian
needs the Fund to indicate whether it authorizes the Custodian to provide the
Fund's name, address, and share position to requesting companies whose
securities the Fund owns. lithe Fund tells the Custodian "no," the Custodian
will not provide this information to requesting companies. If the Fund tells the
Custodian "yes" or does not check either "yes" or "no" below, the Custodian is
required by the rule to treat the Fund as consenting to disclosure of this
information for all securities owned by the Fund or any funds or accounts
established by the Fund. For the Fund's protection, the Rule prohibits the
requesting company from using the Fund's name and address for any purpose other
than corporate communications. Please indicate below whether the Fund consents
or objects by checking one of the alternatives below.
YES [_] The Custodian is authorized to release the Fund's name, address, and
share positions.
NO [X] The Custodian is not authorized to release the Fund's name, address,
and share positions.
Remainder Of Page Intentionally Left Blank
27
Signature Page
In Witness Whereof, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the date first above-written.
Xxxxx Fargo Funds Trust
Fund Signature Attested to By:
/s/ C. Xxxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------- --------------------------------
C. Xxxxx Xxxxxxx, Secretary Xxxxxxx X. Xxxxx, President
State Street Bank and Trust Company
Signature Attested to By:
/s/ Xxxxxxxxx X. Poster By: /s/ Xxxxxx X. Xxxxxx
--------------------------------------- --------------------------------
Xxxxxxxxx X. Poster, Vice President Xxxxxx X. Xxxxxx, Executive Vice
President
28
SCHEDULE A
STATE STREET
GLOBAL CUSTODY NETWORK
SUBCUSTODIANS
Country Subcustodian
Argentina Citibank, N.A.
Australia Westpac Banking Corporation
Austria Erste Bank der Osterreichischen Sparkassen AG
Bahrain HSBC Bank Middle East (as delegate of the Hongkong and
Shanghai Banking Corporation Limited)
Bangladesh Standard Chartered Bank
Belgium Fortis Bank nv-sa
Benin via Societe Generale de Banques en Cote d'Ivoire, Abidjan,
Ivory Coast
Bermuda The Bank of Bermuda Limited
Bolivia Citibank, N. A.
Botswana Barclays Bank of Botswana Limited
Brazil Citibank, N.A.
Bulgaria ING Bank N.V.
Burkina Faso via Societe Generale de Banques en Cote d'Ivoire, Abidjan,
Ivory Coast
Canada State Street Trust Company Canada
Chile BankBoston, N.A.
People's Republic of Hongkong and Shanghai Banking Corporation Limited,
China Shanghai and Shenzhen branches
Colombia Cititrust Colombia S.A. Sociedad Fiduciaria
Costa Rica Banco BCT S.A.
Croatia Privredna Banka Zagreb d.d
Cyprus The Cyprus Popular Bank Ltd.
Czech Republic Ceskoslovenska Obchodni Banka, A.S.
Denmark Danske Bank A/S
1
SCHEDULE A
STATE STREET
GLOBAL CUSTODY NETWORK
SUBCUSTODIANS
Country Subcustodian
Ecuador Citibank, N.A.
Egypt HSBC Bank Egypt SAE.
(as delegate of the Hongkong and Shanghai Banking Corporation
Limited)
Estonia Hansabank
Finland Nordea Bank Finland Plc.
France BNP Pari bas Securities Services, S.A.
Germany Dresdner Bank AG
Ghana Barclays Bank of Ghana Limited
Greece National Bank of Greece S.A.
Guinea-Bissau via Societe Generale de Banques en Cote d'Ivoire, Abidjan, Ivory
Coast
Hong Kong Standard Chartered Bank
Hungary HVB Bank Hungary Rt.
Iceland Icebank Ltd.
India Deutsche Bank AG
Hongkong and Shanghai Banking Corporation Limited
Indonesia Standard Chartered Bank
Ireland Bank of Ireland
Israel Bank Hapoalim B.M.
Italy BNP Pari bas Securities Services, S.A.
Ivory Coast Societe Generale de Banques en Cote d'Ivoire
Jamaica Scotiabank Jamaica Trust and Merchant Bank Ltd.
Japan The Fuji Bank, Limited
Sumitomo Mitsui Banking Corporation
Jordan HSBC Bank Middle East
2
SCHEDULE A
STATE STREET
GLOBAL CUSTODY NETWORK
SUBCUSTODIANS
Country Subcustodian
(as delegate of the Hongkong and Shanghai Banking Corporation Limited)
Kazakhstan HSBC Bank Kazakhstan (as delegate of the Hongkong and Shanghai Banking Corporation Limited)
Kenya Barclays Bank of Kenya Limited
Republic of Korea Hongkong and Shanghai Banking Corporation Limited
Latvia A/s Hansabanka
Lebanon HSBC Bank Middle East (as delegate of the Hongkong and Shanghai Banking Corporation Limited)
Lithuania Vilniaus Bankas AB
Malaysia Standard Chartered Bank Malaysia Berhad
Mali via Societe Generale de Banques en Cote d'Ivoire, Abidjan, Ivory Coast
Mauritius Hongkong and Shanghai Banking Corporation Limited
Mexico Banco Nacional de Mexico S.A.
Morocco Banque Commerciale du Maroc
Namibia Standard Bank Namibia Limited
Netherlands Fortis Bank (Nederland) N.V.
New Zealand Westpac Banking Corporation
Niger via Societe Generale de Banques en Cote d'Ivoire, Abidjan, Ivory Coast
Nigeria Stanbic Merchant Bank Nigeria Limited
Norway Nordea Bank Norge ASA
Oman HSBC Bank Middle East
(as delegate of the Hongkong and Shanghai Banking Corporation Limited)
Pakistan Deutsche Bank AG
Palestine HSBC Bank Middle East (as delegate of the Hongkong and Shanghai Banking Corporation Limited)
3
SCHEDULE A
STATE STREET
GLOBAL CUSTODY NETWORK
SUBCUSTODIANS
Country Subcustodian
Panama BankBoston, N.A.
Peru Citibank, N.A.
Philippines Standard Chartered Bank
Poland Bank Handlowy w Warszawie S.A.
Portugal Banco Comercial Portugues
Qatar HSBC Bank Middle East (as delegate of the Hongkong and Shanghai Banking Corporation Limited)
Romania ING Bank N.V.
Russia Credit Suisse First Boston AO - Moscow (as delegate of Credit Suisse First Boston - Zurich)
Senegal via Societe Generale de Banques en Cote d'Ivoire, Abidjan, Ivory Coast
Singapore The Development Bank of Singapore Limited
Slovak Republic Eeskoslovenska Obchodni' Banka, AS.
Slovenia Bank Austria Creditanstalt d.d. - Ljubljana
South Africa Standard Bank of South Africa Limited
Spain Banco Santander Central Hispano S.A.
Sri Lanka Hongkong and Shanghai Banking Corporation Limited
Swaziland Standard Bank Swaziland Limited
Sweden Skandinaviska Enskilda Banken
Switzerland UBS AG
Taiwan-RO.C. Central Trust of China
Thailand Standard Chartered Bank
Togo via Societe Generale de Banques en Cote d'Ivoire, Abidjan, Ivory Coast
4
SCHEDULE A
STATE STREET
GLOBAL CUSTODY NETWORK
SUBCUSTODIANS
Country Subcustodian
Trinidad & Tobago Republic Bank Limited
Tunisia Banque Internationale Arabe de Tunisie
Turkey Citibank, N.A.
Ukraine ING Bank Ukraine
United Arab Emirates HSBC Bank Middle East (as delegate of the Hongkong and Shanghai Banking Corporation Limited)
United Kingdom State Street Bank and Trust Company, London Branch
Uruguay BankBoston, N.A.
Venezuela Citibank, N.A.
Vietnam The Hongkong and Shanghai Banking Corporation Limited
Zambia Barclays Bank of Zambia Limited
Zimbabwe Barclays Bank of Zimbabwe Limited
5
SCHEDULE B
STATE STREET
GLOBAL CUSTODY NETWORK
DEPOSITORIES OPERATING IN NETWORK MARKETS
Country Depositories
Argentina Caja de Valores S.A.
Australia Austraclear Limited
Reserve Bank Information and Transfer System
Austria Oesterreichische Kontrollbank AG
(Wertpapiersammelbank Division)
Belgium Caisse Interprofessionnelle de Depots et de Virements de Titres, S.A.
Banque Nationale de Belgique
Benin Depositaire Central- Banque de Reglement
Brazil Companhia Brasileira de Liquidacao e Custodia
Sistema Especial de Liquidacao e Custodia (SELIC)
Central de Custodia de Liquidacao Financeira de Titulos Privados (CETIP)
Bulgaria Central Depository AD
Bulgarian National Bank
Burkina Faso Depositaire Central - Banque de Reglement
Canada Canadian Depository for Securities Limited
Chile Deposito Central de Valores S.A.
People's Republic of China China Securities Depository and Clearing Corporation Limited Shanghai Branch
China Securities Depository and Clearing Corporation Limited Shenzhen Branch
Colombia Deposito Centralizado de Valores
Costa Rica Central de Valores S.A.
Croatia Ministry of Finance
1
SCHEDULE B
STATE STREET
GLOBAL CUSTODY NETWORK
DEPOSITORIES OPERATING IN NETWORK MARKETS
Country Depositories
National Bank of Croatia
Sredisnja Depozitarna Agencija d.d.
Czech Republic Stredisko cennych papiru - Ceska republika
Czech National Bank
Denmark Vrerdipapircentralen (Danish Securities Center)
Egypt Misr for Clearing, Settlement, and Depository S.A.E.
Estonia Eesti Vaartpaberite Keskdepositoorium
Finland Finnish Central Securities Depository
France Euroclear France
Germany Clearstream Banking AG, Frankfurt
Greece Bank of Greece,
System for Monitoring Transactions in Securities in Book-Entry Form
Apothetirion Titlon AE - Central Securities Depository
Guinea-Bissau Depositaire Centeral - Banque de Reglement
Hong Kong Hong Kong Securities Clearing Company Limited
Central Moneymarkets Unit
Hungary Kozponti Elszamolohaz es Ertektar (Budapest) Rt. (KELER)
Iceland Iceland Securities Depository Limited
India National Securities Depository Limited
Central Depository Services India Limited
Reserve Bank of India
Indonesia Bank Indonesia
2
SCHEDULE B
STATE STREET
GLOBAL CUSTODY NETWORK
DEPOSITORIES OPERATING IN NETWORK MARKETS
Country Depositories
PT Kustodian Sentral Efek Indonesia
Israel Tel Aviv Stock Exchange Clearing House Ltd.
(TASE Clearinghouse)
Italy Monte Titoli S.p.A.
Ivory Coast Depositaire Central - Banque de Reglement
Jamaica Jamaica Central Securities Depository
Japan Japan Securities Depository Center (JASDEC)
Bank of Japan
Kazakhstan Central Depository of Securities
Kenya Central Bank of Kenya
Republic of Korea Korea Securities Depository
Latvia Latvian Central Depository
Lebanon Custodian and Clearing Center of Financial
Instruments for Lebanon and the Middle East
(Midclear) X.X.X.
Banque du Liban
Lithuania Central Securities Depository of Lithuania
Malaysia Malaysian Central Depository Sdn. Bhd.
Bank Negara Malaysia
Mali Depositaire Central - Banque de Reglement
Mauritius Central Depository and Settlement Co. Ltd.
Bank of Mauritius
Mexico S.D. Indeval, S.A. de C.V.
Moroocco Maroclear
3
SCHEDULE B
STATE STREET
GLOBAL CUSTODY NETWORK
DEPOSITORIES OPERATING IN NETWORK MARKETS
Country Depositories
Netherlands Nederlands Centraal Instituut voor Giraal
Effectenverkeer B.V. (NECIGEF)
New Zealand New Zealand Central Securities Depository
Limited
Niger Depositaire Central - Banque de Reglement
Nigeria Central Securities Clearing System Limited
Norway Verdipapirsentralen (Norwegian Central
Securities Depository)
Oman Muscat Depository & Securities Registration
Company, SAOC
Pakistan Central Depository Company of Pakistan Limited
State Bank of Pakistan
Palestine Clearing Depository and Settlement, a
department of the Palestine Stock Exchange
Peru Caja de Valores y Liquidaciones, Institucion
de Compensacion y Liquidacion de Valores S.A.
Philippines Philippine Central Depository, Inc.
Registry of Scripless Securities (XXXX) of the
Bureau of Treasury
Poland National Depository of Securities (Krajowy
Depozyt Papierow Wartosciowych S.A.)
Central Treasury Bills Registrar
Portugal INTERBOLSA - Sociedade Gestora de Sistemas de
Liquidacao e de Sistemas Centralizados de
Valores Mobiliarios, S.A.
Qatar Central Clearing and Registration (CCR), a
department of the Doha Securities Market
Romania National Securities Clearing, Settlement and
Depository Company
Bucharest Stock Exchange Registry Division
National Bank of Romania
4
SCHEDULE B
STATE STREET
GLOBAL CUSTODY NETWORK
DEPOSITORIES OPERATING IN NETWORK MARKETS
Country Depositories
Russia Vneshtorgbank, Bank for Foreign Trade of the
Russian Federation
Senegal Depositaire Central - Banque de Reglement
Singapore Central Depository (Pte) Limited
Monetary Authority of Singapore
Slovak Republic Stredisko cennych papierov SR, a.s.
National Bank of Slovakia
Slovenia KDD - Centralna klirinsko depotna xxxxxx x.x.
South Africa Central Depository Limited
Share Transactions Totally Electronic (STRATE)
Ltd.
Spain Servicio de Compensacion y Liquidacion de
Valores, S.A.
Banco de Espana, Central de Anotaciones en
Cuenta
Sri Lanka Central Depository System (Pvt) Limited
Sweden Vardepapperscentralen VPC AB (Swedish Central
Securities Depository)
Switzerland SegaIntersettle AG (SIS)
Taiwan - R.O.C. Taiwan Securities Central Depository Co., Ltd.
Thailand Thailand Securities Depository Company Limited
Togo Depositaire Central - Banque de Reglement
Tunisia Societe Tunisienne Interprofessionelle pour la
Compensation et de Depots des Valeurs
Mobilieres
Turkey Takas ve Saklama Bankasi A.S. (TAKASBANK)
Central Bank of Turkey
Ukraine National Bank of Ukraine
5
SCHEDULE B
STATE STREET
GLOBAL CUSTODY NETWORK
DEPOSITORIES OPERATING IN NETWORK MARKETS
Country Depositories
Mizhregionalny Fondovy Souz
United Arab Emirates Clearing and Depository System, a department
of the Dubai Financial Market
Venezuela Banco Central de Venezuela
Zambia XxXX Central Shares Depository Limited
Bank of Zambia
TRANSNATIONAL
Euroclear
Clearstream Banking AG
6
SCHEDULE C
MARKET INFORMATION
Publication/Type of Information Brief Description
(scheduled frequency)
The Guide to Custody in World An overview of settlement and safekeeping
Markets (hardcopy annually procedures, custody practices and foreign
and regular website updates) inventor considerations for the markets in
which State Street offers custodial services.
Global Custody Network Review Information relating to Foreign Sub-Custodians
(annually) in State Street's Global Custody Network.
The Review stands as an integral part of the
materials that State Street provides to its
U.S. mutual fund clients to assist them in
complying with SEC Rule 17f-5. The Review also
gives insight into State Street's market
expansion and Foreign Sub-Custodian selection
processes, as well as the procedures and
controls used to monitor the financial
condition and performance of our Foreign Sub-
Custodian banks.
Securities Depository Review Custody risk analyses of the Foreign
(annually) Securities Depositories presently operating in
Network markets. This publication is an
integral part of the materials that State
Street provides to its U.S. mutual fund
clients to meet informational obligations
created by SEC Rule 17f-7.
Global Legal Survey With respect to each market in which State
(annually) Street offers custodial services, opinions
relating to whether local law restricts
(i) access of a fund's independent public
accountants to books and records of a Foreign
Sub-Custodian or Foreign Securities System,
(ii) a fund's ability to recover in the event
of bankruptcy or insolvency of a Foreign
Sub-Custodian or Foreign Securities System,
(iii) a fund's ability to recover in the event
of a loss by a Foreign Sub-Custodian or
Foreign Securities System, and (iv) the
ability of a foreign investor to convert cash
and cash equivalents to U.S. dollars.
SCHEDULE C
MARKET INFORMATION
Publication/Type of Information Brief Description
(scheduled frequency)
Subcustodian Agreements Copies of the contracts that State Street
(annually) has entered into with each Foreign Sub-
Custodian that maintains U.S. mutual fund
assets in the markets in which State
Street offers custodial services.
Global Market Bulletin Information on changing settlement and
(daily or as necessary) custody conditions in markets where State
Street offers custodial services. Includes
changes in market and tax regulations,
depository developments, dematerialization
information, as well as other market
changes that may impact State Street's
clients.
Foreign Custody Advisories For those markets where State Street
(as necessary) offers custodial services that exhibit
special risks or infrastructures impacting
custody, State Street issues market
advisories to highlight those unique
market factors which might impact our
ability to offer recognized custody
service levels.
Material Change Notices Informational letters and accompanying
(presently on a quarterly materials confirming State Street's
basis or as otherwise necessary) foreign custody arrangements, including a
summary of material changes with Foreign
Sub-Custodians that have occurred during
the previous quarter. The notices also
identify any material changes in the
custodial risks associated with
maintaining assets with Foreign Securities
Depositories.
SCHEDULE D
TO
Custodian Agreement
Special Sub-Custodians
None
FUNDS TRANSFER ADDENDUM
OPERATING GUIDELINES
1. OBLIGATION OF THE SENDER: State Street is authorized to promptly debit
Client's account(s) upon the receipt of a payment order in compliance with the
selected Security Procedure chosen for funds transfer and in the amount of money
that State Street has been instructed to transfer. State Street shall execute
payment orders in compliance with the Security Procedure and with the Client's
instructions on the execution date provided that such payment order is received
by the customary deadline for processing such a request, unless the payment
order specifies a later time. All payment orders and communications received
after this time will be deemed to have been received on the next business day.
2. SECURITY PROCEDURE: The Client acknowledges that the Security Procedure it
has designated on the Selection Form was selected by the Client from Security
Procedures offered by State Street. The Client agrees that the Security
Procedures are reasonable and adequate for its wire transfer transactions and
agrees to be bound by any payment orders, amendments and cancellations, whether
or not authorized, issued in its name and accepted by State Street after being
confirmed by any of the selected Security Procedures. The Client also agrees to
be bound by any other valid and authorized payment order accepted by State
Street. The Client shall restrict access to confidential information relating to
the Security Procedure to authorized persons as communicated in writing to State
Street. The Client must notify State Street immediately if it has reason to
believe unauthorized persons may have obtained access to such information or of
any change in the Client's authorized personnel. State Street shall verify the
authenticity of all instructions according to the Security Procedure.
3. ACCOUNT NUMBERS: State Street shall process all payment orders on the basis
of the account number contained in the payment order. In the event of a
discrepancy between any name indicated on the payment order and the account
number, the account number shall take precedence and govern. Financial
institutions that receive payment orders initiated by State Street at the
instruction of the Client may also process payment orders on the basis of
account numbers, regardless of any name included in the payment order. State
Street will also rely on any financial institution identification numbers
included in any payment order, regardless of any financial institution name
included in the payment order.
4. REJECTION: State Street reserves the right to decline to process or delay the
processing of a payment order which (a) is in excess of the collected balance in
the account to be charged at the time of State Street's receipt of such payment
order; (b) if initiating such payment order would cause State Street, in State
Street's sole judgment, to exceed any volume, aggregate dollar, network, time,
credit or similar limits upon wire transfers which are applicable to State
Street; or (c) if State Street, in good faith, is unable to satisfy itself that
the transaction has been properly authorized.
5. CANCELLATION OR AMENDMENT: State Street shall use reasonable efforts to act
on all authorized requests to cancel or amend payment orders received in
compliance with the Security Procedure provided that such requests are received
in a timely manner affording State Street reasonable opportunity to act.
However, State Street assumes no liability if the request for amendment or
cancellation cannot be satisfied.
FUNDS TRANSFER ADDENDUM
6. ERRORS: State Street shall assume no responsibility for failure to detect
any erroneous payment order provided that State Street complies with the payment
order instructions as received and State Street complies with the Security
Procedure. The Security Procedure is established for the purpose of
authenticating payment orders only and not for the detection of errors in
payment orders.
7. INTEREST AND LIABILITY LIMITS: State Street shall assume no responsibility
for lost interest with respect to the refundable amount of any unauthorized
payment order, unless State Street is notified of the unauthorized payment order
within thirty (30) days of notification by State Street of the acceptance of
such payment order. In no event shall State Street be liable for special,
indirect or consequential damages, even if advised of the possibility of such
damages and even for failure to execute a payment order.
8. AUTOMATED CLEARING HOUSE ("ACH") CREDIT ENTRIES/PROVISIONAL PAYMENTS: When a
Client initiates or receives ACH credit and debit entries pursuant to these
Guidelines and the rules of the National Automated Clearing House Association
and the New England Clearing House Association, State Street will act as an
Originating Depository Financial Institution and/or Receiving Depository
Institution, as the case may be, with respect to such entries. Credits given by
State Street with respect to an ACH credit entry are provisional until State
Street receives final settlement for such entry from the Federal Reserve Bank.
If State Street does not receive such final settlement, the Client agrees that
State Street shall receive a refund of the amount credited to the Client in
connection with such entry, and the party making payment to the Client via such
entry shall not be deemed to have paid the amount of the entry.
9. CONFIRMATION STATEMENTS: Confirmation of State Street's execution of payment
orders shall ordinarily be provided within 24 hours. Notice may be delivered
through State Street's proprietary information systems, such as, but not limited
to Horizon and GlobalQuest(R), account statements, advices, or by facsimile or
callback. The Client must report any objections to the execution of a payment
order within 30 days.
10. LIABILITY ON FOREIGN ACCOUNTS: State Street shall not be required to repay
any deposit made at a non-U.S. branch of State Street, or any deposit made with
State Street and denominated in a non-U.S. dollar currency, if repayment of such
deposit or the use of assets denominated in the non-U.S. dollar currency is
prevented, prohibited or otherwise blocked due to: (a) an act of war,
insurrection or civil strife; (b) any action by a non-U.S. government or
instrumentality or authority asserting governmental, military or police power of
any kind, whether such authority be recognized as a defacto or a dejure
government, or by any entity, political or revolutionary movement or otherwise
that usurps, supervenes or otherwise materially impairs the normal operation of
civil authority; or (c) the closure of a non-U.S. branch of State Street in
order to prevent, in the reasonable judgment of State Street, harm to the
employees or property of State Street. The obligation to repay any such deposit
shall not be transferred to and may not be enforced against any other branch of
State Street.
The foregoing provisions constitute the disclosure required by Massachusetts
General laws, Chapter 167D, Section 36.
FUNDS TRANSFER ADDENDUM
While State Street is not obligated to repay any deposit made at a non-U.S.
branch or any deposit denominated in a non-U.S. currency during the period in
which its repayment has been prevented, prohibited or otherwise blocked, State
Street will repay such deposit when and if all circumstances preventing,
prohibiting or otherwise blocking repayment cease to exist.
11. MISCELLANEOUS: State Street and the Client agree to cooperate to attempt to
recover any funds erroneously paid to the wrong party or parties, regardless of
any fault of State Street or the Client, but the party responsible for the
erroneous payment shall bear all costs and expenses incurred in trying to effect
such recovery. These Guidelines may not be amended except by a written agreement
signed by the parties.
FUNDS TRANSFER ADDENDUM
Security Procedure(s) Selection Form
Please select one or more of the funds transfer security procedures indicated
below.
[_]SWIFT
SWIFT (Society for Worldwide Interbank Financial Telecommunication) is a
cooperative society owned and operated by member financial institutions that
provides telecommunication services for its membership. Participation is limited
to securities brokers and dealers, clearing and depository institutions,
recognized exchanges for securities, and investment management institutions.
SWIFT provides a number of security features through encryption and
authentication to protect against unauthorized access, loss or wrong delivery of
messages, transmission errors, loss of confidentiality and fraudulent changes to
messages. SWIFT is considered to be one of the most secure and efficient
networks for the delivery of funds transfer instructions.
Selection of this security procedure would be most appropriate for existing
SWIFT members.
[_]Standing Instructions
Standing Instructions may be used where funds are transferred to a broker on the
Client's established list of brokers with which it engages in foreign exchange
transactions. Only the date, the currency and the currency amount are variable.
In order to establish this procedure, State Street will send to the Client a
list of the brokers that State Street has determined are used by the Client. The
Client will confirm the list in writing, and State Street will verify the
written confirmation by telephone. Standing Instructions will be subject to a
mutually agreed upon limit. If the payment order exceeds the established limit,
the Standing Instruction will be confirmed by telephone prior to execution.
[_]Remote Batch Transmission
Wire transfer instructions are delivered via Computer-to-Computer (CPU-CPU) data
communications between the Client and State Street. Security procedures include
encryption and or the use of a test key by those individuals authorized as
Automated Batch Verifiers. Clients selecting this option should have an existing
facility for completing CPU-CPU transmissions. This delivery mechanism is
typically used for high-volume business.
[_]Global Horizon Interchange(SM) Funds Transfer Service
Global Horizon Interchange Funds Transfer Service (FTS) is a State Street
proprietary microcomputer-based wire initiation system. FTS enables Clients to
electronically transmit authenticated Fedwire, CHIPS or internal book transfer
instructions to State Street. This delivery mechanism is most appropriate for
Clients with a low-to-medium number of
FUNDS TRANSFER ADDENDUM
transactions (5-75 per day), allowing Clients to enter, batch, and review wire
transfer instructions on their PC prior to release to State Street.
[_]Telephone Confirmation (Callback)
Telephone confirmation will be used to verify all non-repetitive funds transfer
instructions received via untested facsimile or phone. This procedure requires
Clients to designate individuals as authorized initiators and authorized
verifiers. State Street will verify that the instruction contains the signature
of an authorized person and prior to execution, will contact someone other than
the originator at the Client's location to authenticate the instruction.
Selection of this alternative is appropriate for Clients who do not have the
capability to use other security procedures.
[_]Repetitive Wires
For situations where funds are transferred periodically (minimum of one
instruction per calendar quarter) from an existing authorized account to the
same payee (destination bank and account number) and only the date and currency
amount are variable, a repetitive wire may be implemented. Repetitive wires will
be subject to a mutually agreed upon limit. If the payment order exceeds the
established limit, the instruction will be confirmed by telephone prior to
execution. Telephone confirmation is used to establish this process. Repetitive
wire instructions must be reconfirmed annually. This alternative is recommended
whenever funds are frequently transferred between the same two accounts.
[_]Transfers Initiated by Facsimile
The Client faxes wire transfer instructions directly to State Street Mutual Fund
Services. Standard security procedure requires the use of a random number test
key for all transfers. Every six months the Client receives test key logs from
State Street. The test key contains alpha-numeric characters, which the Client
puts on each document faxed to State Street. This procedure ensures all wire
instructions received via fax are authorized by the Client.
We provide this option for Clients who wish to batch wire instructions and
transmit these as a group to State Street Mutual Fund Services once or several
times a day.
[_]Automated Clearing House (ACH)
State Street receives an automated transmission or a magnetic tape from a Client
for the initiation of payment (credit) or collection (debit) transactions
through the ACH network. The transactions contained on each transmission or tape
must be authenticated by the Client. Clients using ACH must select one or more
of the following delivery options:
FUNDS TRANSFER ADDENDUM
[_]Global Horizon Interchange Automated Clearing House Service
Transactions are created on a microcomputer, assembled into batches and
delivered to State Street via fully authenticated electronic transmissions in
standard NACHA formats.
[_]Transmission from Client PC to State Street Mainframe
with Telephone Callback
[_]Transmission from Client Mainframe to State Street
Mainframe with Telephone Callback
[_]Transmission from DST Systems to State Street
Mainframe with Encryption
[_]Magnetic Tape Delivered to State Street with
Telephone Callback
State Street is hereby instructed to accept funds transfer instructions only via
the delivery methods and security procedures indicated. The selected delivery
methods and security procedure(s) will be effective _________________ for
payment orders initiated by our organization.
Key Contact Information
Whom shall we contact to implement your selection(s)?
CLIENT OPERATIONS CONTACT ALTERNATE CONTACT
____________________________________ ____________________________________
Name Name
____________________________________ ____________________________________
Address Address
____________________________________ ____________________________________
City/State/Zip Code City/State/Zip Code
____________________________________ ____________________________________
Telephone Number Telephone Number
____________________________________ ____________________________________
Facsimile Number Facsimile Number
FUNDS TRANSFER ADDENDUM
___________________________________
SWIFT Number
___________________________________
Telex Number
FUNDS TRANSFER ADDENDUM
INSTRUCTION(S)
TELEPHONE CONFIRMATION
Fund: Xxxxx Fargo Funds Trust with regard to its series, Xxxxx Fargo SIFE
Specialized Financial Services Fund
Investment Adviser: Xxxxx Fargo Funds Management. LLC
Investment Sub-Adviser: Xxxxx Capital Management
Authorized Initiators
Please Type or Print
Please provide a listing of Fund officers or other individuals who are currently
authorized to INITIATE wire transfer instructions to State Street:
NAME TITLE (Specify whether position is SPECIMEN SIGNATURE
with Fund or Investment Adviser or
Investment Sub-Adviser)
_______________________ _______________________ _____________________
_______________________ _______________________ ______________________
_______________________ _______________________ ______________________
_______________________ _______________________ ______________________
_______________________ _______________________ ______________________
Authorized Verifiers
Please Type or Print
Please provide a listing of Fund officers or other individuals who will be
CALLED BACK to verify the initiation of repetitive wires of $10 million or more
and all non-repetitive wire instructions:
FUNDS TRANSFER ADDENDUM
NAME CALLBACK PHONE DOLLAR LIMITATION
NUMBER (IF ANY)
_______________________ _______________________ _______________________
_______________________ _______________________ _______________________
_______________________ _______________________ _______________________
_______________________ _______________________ _______________________
_______________________ _______________________ _______________________
REMOTE ACCESS SERVICES ADDENDUM TO CUSTODIAN AGREEMENT
ADDENDUM to that certain Custodian Agreement dated as of February 25,
2002 (the "Custodian Agreement") between Xxxxx Fargo Funds Trust (the
"Customer") and State Street Bank and Trust Company, including its subsidiaries
and affiliates ("State Street").
State Street has developed and utilizes proprietary accounting and
other systems in conjunction with the custodian services which State Street
provides to the Customer. In this regard, State Street maintains certain
information in databases under its control and ownership which it makes
available to its customers (the "Remote Access Services").
The Services
State Street agrees to provide the Customer, and its designated investment
advisors, consultants or other third parties authorized by State Street
("Authorized Designees") with access to In-Sight(SM)as described in Exhibit A or
such other systems as may be offered from time to time (the "System") on a
remote basis.
Security Procedures
The Customer agrees to comply, and to cause its Authorized Designees to comply,
with remote access operating standards and procedures and with user
identification or other password control requirements and other security
procedures as may be issued from time to time by State Street for use of the
System and access to the Remote Access Services. The Customer agrees to advise
State Street immediately in the event that it learns or has reason to believe
that any person to whom it has given access to the System or the Remote Access
Services has violated or intends to violate the terms of this Addendum and the
Customer will cooperate with State Street in seeking injunctive or other
equitable relief. The Customer agrees to discontinue use of the System and
Remote Access Services, if requested, for any security reasons cited by State
Street.
Fees
Fees and charges, if any, for the use of the System and the Remote Access
Services and related payment terms shall be as set forth in the custody fee
schedule in effect from time to time between the parties. The Customer shall be
responsible for any tariffs, duties or taxes imposed or levied by any government
or governmental agency by reason of the transactions contemplated by this
Addendum, including, without limitation, federal, state and local taxes, use,
value added and personal property taxes (other than income, franchise or similar
taxes which may be imposed or assessed against State Street). Any claimed
exemption from such tariffs, duties or taxes shall be supported by proper
documentary evidence delivered to State Street.
Proprietary Information/Injunctive Relief
The System and Remote Access Services described herein and the databases,
computer programs, screen formats, report formats, interactive design
techniques, formulae, processes, systems, software, know-how, algorithms,
programs, training aids, printed materials regarding the System, methods, books,
records, files, documentation and other information made available
i
to the Customer by State Street as part of the Remote Access Services and
through the use of the System and all copyrights, patents, trade secrets and
other proprietary rights of State Street related thereto are the exclusive,
valuable and confidential property of State Street and its relevant licensors
(the "Proprietary Information"). The Customer agrees on behalf of itself and its
Authorized Designees to keep the Proprietary Information confidential and to
limit access to its employees and Authorized Designees (under a similar duty of
confidentiality) who require access to the System for the purposes intended. The
foregoing shall not apply to Proprietary Information in the public domain or
required by law to be made public.
The Customer agrees to use the Remote Access Services only in connection with
the proper purposes of this Addendum. The Customer will not, and will cause its
employees and Authorized Designees not to, (i) permit any third party to use the
System or the Remote Access Services, (ii) sell, rent, license or otherwise use
the System or the Remote Access Services in the operation of a service bureau or
for any purpose other than as expressly authorized under this Addendum, (iii)
use the System or the Remote Access Services for any fund, trust or other
investment vehicle without the prior written consent of State Street, or (iv)
allow or cause any information transmitted from State Street's databases,
including data from third party sources, available through use of the System or
the Remote Access Services, to be published, redistributed or retransmitted for
other than use for or on behalf of the Customer, as State Street's customer.
The Customer agrees that neither it nor its Authorized Designees will modify the
System in any way; enhance or otherwise create derivative works based upon the
System, nor will your or your Authorized Designees reverse engineer, decompile
or otherwise attempt to secure the source code for all or any part of the
System.
The Customer acknowledges that the disclosure of any Proprietary Information, or
of any information which at law or equity ought to remain confidential, will
immediately give rise to continuing irreparable injury to State Street
inadequately compensable in damages at law and that State Street shall be
entitled to obtain immediate injunctive relief against the breach or threatened
breach of any of the foregoing undertakings, in addition to any other legal
remedies which may be available.
Limited Warranties
State Street represents and warrants that it is the owner of and has the right
to grant access to the System and to provide the Remote Access Services
contemplated herein. Because of the nature of computer information technology
including, but not limited to, the use of the Internet, and the necessity of
relying upon third party sources, and data and pricing information obtained from
third parties, the System and Remote Access Services are provided "AS IS", and
the Customer and its Authorized Designees shall be solely responsible for the
investment decisions, results obtained, regulatory reports and statements
produced using the Remote Access Services. State Street and its relevant
licensors will not be liable to the Customer or its Authorized Designees for any
direct or indirect, special, incidental, punitive or consequential damages
arising out of or in any way connected with the System or the Remote Access
Services, nor shall either party be responsible for delays or nonperformance
under this Addendum arising out of any cause or event beyond such party's
control.
ii
State Street will take reasonable steps to ensure that its products (and those
of its third-party suppliers) reflect the available state of the art technology
to offer products that are Year 2000 compliant, including, but not limited to,
century recognition of dates, calculations that correctly compute same century
and multi century formulas and date values, and interface values that reflect
the date issues arising between now and December 31, 2099, and if any changes
are required, State Street will make the changes to its products at no cost to
you and in a commercially reasonable time frame and will require third-party
suppliers to do likewise. The Customer will do likewise for its systems.
EXCEPT AS EXPRESSLY SET FORTH IN THIS ADDENDUM, STATE STREET, FOR ITSELF AND ITS
RELEVANT LICENSORS, EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES CONCERNING THE
SYSTEM AND THE SERVICES TO BE RENDERED HEREUNDER, WHETHER EXPRESS OR IMPLIED
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTIBILITY OR FITNESS FOR A
PARTICULAR PURPOSE.
Infringement
State Street will defend or, at our option, settle any claim or action brought
against the Customer to the extent that it is based upon an assertion that
access to the System or use of the Remote Access Services by the Customer under
this Addendum constitutes direct infringement of any patent or copyright or
misappropriation of a trade secret, provided that the Customer notifies State
Street promptly in writing of any such claim or proceeding and cooperates with
State Street in the defense of such claim or proceeding. Should the System or
the Remote Access Services or any part thereof become, or in State Street's
opinion be likely to become, the subject of a claim of infringement or the like
under any applicable patent or copyright or trade secret laws, State Street
shall have the right, at State Street's sole option, to (i) procure for the
Customer the right to continue using the System or the Remote Access Services,
(ii) replace or modify the System or the Remote Access Services so that the
System or the Remote Access Services becomes noninfringing, or (iii) terminate
this Addendum without further obligation.
Termination
Either party to the Custodian Agreement may terminate this Addendum (i) for any
reason by giving the other party at least one-hundred and eighty (180) days
prior written notice in the case of notice of termination by State Street to the
Customer or thirty (30) days notice in the case of notice from the Customer to
State Street of termination, or (ii) immediately for failure of the other party
to comply with any material term and condition of the Addendum by giving the
other party written notice of termination. This Addendum shall in any event
terminate within ninety (90) days after the termination of the Custodian
Agreement. In the event of termination, the Customer will return to State Street
all copies of documentation and other confidential information in its possession
or in the possession of its Authorized Designees. The foregoing provisions with
respect to confidentiality and infringement will survive termination for a
period of three (3) years.
iii
Miscellaneous
This Addendum and the exhibit hereto constitute the entire understanding of the
parties to the Custodian Agreement with respect to access to the System and the
Remote Access Services. This Addendum cannot be modified or altered except in a
writing duly executed by each of State Street and the Customer and shall be
governed by and construed in accordance with the laws of The Commonwealth of
Massachusetts.
By its execution of the Custodian Agreement, the Customer (a) confirms to the
Custodian that it informs all Authorized Designees of the terms of this
Addendum; (b) accepts responsibility for its and its Authorized Designees'
compliance with the terms of this Addendum; and (c) indemnifies and holds the
Custodian harmless from and against any and all costs, expenses, losses,
damages, charges, counsel fees, payments and liabilities arising from any
failure of the Customer or any of its Authorized Designees to abide by the terms
of this Addendum.
iv
EXHIBIT A
to
REMOTE ACCESS SERVICES ADDENDUM TO CUSTODIAN AGREEMENT
IN~SIGHT(SM)
System Product Description
In~Sight(SM) provides bilateral information delivery, interoperability, and
on-line access to State Street. In~Sight(SM) allows users a single point of
entry into State Street's diverse systems and applications. Reports and data
from systems such as Investment Policy Monitor(SM), Multicurrency Horizon(SM),
Securities Lending, Performance & Analytics and Electronic Trade Delivery can be
accessed through In~Sight(SM). This Internet-enabled application is designed to
run from a Web browser and perform across low-speed data lines or corporate
high-speed backbones. In~Sight(SM) also offers users a flexible toolset,
including an ad-hoc query function, a custom graphics package, a report
designer, and a scheduling capability. Data and reports offered through
In~Sight(SM) will continue to increase in direct proportion with the customer
roll out, as it is viewed as the information delivery system will grow with
State Street's customers.
