CUSTODY AND INVESTMENT ACCOUNTING AGREEMENT
THIS AGREEMENT is made effective the 10th day of March, 2000 by and
between STATE STREET BANK AND TRUST COMPANY, a trust company chartered under the
laws of the Commonwealth of Massachusetts, having its principal office and place
of business at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 ("State
Street"), Fixed Income SHares, a trust having its principal office and place of
business at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000 (the "Fund"), and
PIMCO Advisory Services a partnership having its principal office and place of
business at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000 ("PIMCO"), acting as
administrator for the Fund.
WITNESSETH:
WHEREAS, PIMCO administers all of the operations of the Fund, a trust that
is registered with the Securities and Exchange Commission ("SEC") as an open-end
management investment company, pursuant to an Administration Agreement between
the Fund and PIMCO, and procures or provides for the procurement on behalf of
the Fund at PIMCO's expense certain services, including custody services; and
WHEREAS, PIMCO desires to appoint State Street as custodian of the assets
of the Fund's investment portfolio or portfolios (each a "Portfolio", and
collectively the "Portfolios") and as the Fund's agent to perform certain
investment accounting and recordkeeping functions; and
WHEREAS, State Street is willing to accept such appointment on the terms
and conditions hereinafter set forth;
NOW THEREFORE, for and in consideration of the mutual promises contained
herein, the parties hereto, intending to be legally bound, mutually covenant and
agree as follows:
1. APPOINTMENT OF CUSTODIAN AND AGENT. PIMCO hereby constitutes and appoints
State Street as:
A. Custodian of the investment securities, interests in loans and other
non-cash investment property and monies at any time owned by each of
the Portfolios and delivered to State Street as custodian hereunder
("Assets"); and
B. Agent to perform certain accounting and recordkeeping functions
relating to portfolio transactions required of a duly registered
investment company under Rule 31a of the Investment Company Act of
1940 as amended (the "1940 Act") and to calculate the net asset
value of the Portfolios.
2. REPRESENTATIONS AND WARRANTIES.
A. Fund hereby represents, warrants and acknowledges to State Street:
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1. That it is a trust duly organized and existing and in good standing
under the laws of its state of organization, and that it is
registered under the 1940 Act; and
2. That it has the requisite power and authority under applicable law
and its articles of incorporation and its bylaws or its trust
instrument, as the case may be, to enter into this Agreement; that
it has taken all requisite action necessary to appoint State Street
as custodian and investment accounting and recordkeeping agent, that
this Agreement has been duly executed and delivered by Fund; and
that this Agreement constitutes a legal, valid and binding
obligation of Fund, enforceable in accordance with its terms, except
that such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors' rights
generally, and general principles of equity.
B. State Street hereby represents, warrants and acknowledges to Fund
and to PIMCO:
1. That it is a trust company duly organized and existing and in good
standing under the laws of the Commonwealth of Massachusetts; and
2. That it has the requisite power and authority under applicable law,
its charter and its bylaws to enter into and perform this Agreement;
that this Agreement has been duly executed and delivered by State
Street; and that this Agreement constitutes a legal, valid and
binding obligation of State Street, enforceable in accordance with
its terms, except that such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors' rights generally, and general principles of
equity.
C. PIMCO hereby represents, warrants and acknowledges to State Street:
1. That it is a partnership duly organized and existing and in good
standing under the laws of the state of its organization; and
2. That it has the requisite power and authority under applicable law
and its articles of incorporation or partnership agreement to enter
into and perform this Agreement; that this Agreement has been duly
executed and delivered by PIMCO; and that this Agreement constitutes
a legal, valid and binding obligation of PIMCO, enforceable in
accordance with its terms, except that such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors' rights generally, and general
principles of equity.
3. DUTIES AND RESPONSIBILITIES OF THE PARTIES.
A. Delivery of Assets . Except as permitted by the 1940 Act, PIMCO will
deliver or cause to be delivered to State Street on the effective
date hereof, or as soon thereafter as practicable, and from time to
time thereafter, all Assets acquired by,
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owned by or from time to time coming into the possession of each of
the Portfolios during the term hereof. State Street has no
responsibility or liability whatsoever for or on account of assets
not so delivered.
B. Delivery of Accounts and Records. PIMCO will turn over or cause to
be turned over to State Street all accounts and records needed by
State Street to fully and properly perform its duties and
responsibilities hereunder. State Street may rely conclusively on
the completeness and correctness of such accounts and records.
C. Delivery of Assets to Third Parties. State Street will receive
delivery of and keep safely the Assets of each Portfolio segregated
in a separate account. State Street will not deliver, assign, pledge
or hypothecate any such Assets to any person except as permitted by
the provisions hereof or any agreement executed according to the
terms of Section 3.P hereof. Upon delivery of any such Assets to a
subcustodian appointed pursuant hereto (hereinafter referred to as
"Subcustodian"), State Street will create and maintain records
identifying such Assets as belonging to the applicable Portfolio.
State Street is responsible for the safekeeping of the Assets only
until they have been transmitted to and received by other persons as
permitted under the terms hereof, except for Assets transmitted to
Subcustodians, for which State Street remains responsible to the
extent provided herein. State Street may participate directly or
indirectly through a subcustodian in the Depository Trust Company
(DTC), Treasury/Federal Reserve Book Entry System (Fed System),
Participant Trust Company (PTC) or other depository approved by Fund
(as such entities are defined at 17 CFR Section 270.17f-4(b)) (each
a "Depository" and collectively the "Depositories"). State Street
will be responsible to Fund for any loss, damage or expense suffered
or incurred by Fund resulting from the actions or omissions of any
Depository only to the same extent such Depository is responsible to
State Street. State Street shall be liable to the Fund for any loss
or damage resulting from the use of a Depository arising by reason
of any negligence, willful misconduct or bad faith on the part of
State Street or any of its officers, employees or agents.
D. Registration. State Street will at all times hold registered Assets
in the name of State Street as custodian, the applicable Portfolio,
or a nominee of either of them, unless specifically directed by
Instructions, as hereinafter defined, to hold such registered Assets
in so-called "street name;" provided that, in any event, State
Street will hold all such Assets in an account of State Street as
custodian containing only Assets of the applicable Portfolio, or
only assets held by State Street as a fiduciary or custodian for
customers; and provided further, State Street's records will at all
times indicate the Portfolio or other customer for which such Assets
are held and the respective interests therein. If, however, PIMCO
directs State Street to maintain Assets in "street name",
notwithstanding anything contained herein to the contrary, State
Street will be obligated only to utilize its best efforts to timely
collect income due the Portfolio on such Assets and to notify the
Portfolio of relevant information, such as maturities and pendency
of calls, and corporate actions including, without limitation, calls
for redemption, tender or
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exchange offers, declaration, record and payment dates and amounts
of any dividends or income, reorganization, recapitalization,
merger, consolidation, split-up of shares, change of par value, or
conversion ("Corporate Actions"). All Assets and the ownership
thereof by a Portfolio will at all times be identifiable on the
records of State Street. PIMCO agrees to hold State Street and its
nominee harmless for any liability as a shareholder of record of
securities held in custody.
E. Exchange. Upon receipt of Instructions, State Street will exchange,
or cause to be exchanged, Assets held for the account of a Portfolio
for other Assets issued or paid in connection with any Corporate
Action or otherwise, and will deposit any such Assets in accordance
with the terms of any such Corporate Action. Without Instructions,
State Street is authorized to exchange Assets in temporary form for
Assets in definitive form, to effect an exchange of shares when the
par value of stock is changed, and, upon receiving payment therefor,
to surrender bonds or other Assets at maturity or when advised of
earlier call for redemption, except that State Street will receive
Instruction prior to surrendering any convertible security.
F. Purchases of Investments -- Other Than Options and Futures. On each
business day on which a Portfolio makes a purchase of Assets other
than options and futures, PIMCO will deliver to State Street
Instructions specifying with respect to each such purchase:
1. If applicable, the name of the Portfolio making such purchase;
2. The name of the issuer and description of the Asset;
3. The number of shares and the principal amount purchased, and accrued
interest, if any;
4. The trade date;
5. The settlement date;
6. The purchase price per unit and the brokerage commission, taxes and
other expenses payable in connection with the purchase;
7. The total amount payable upon such purchase,
8. The name of the person from whom or the broker or dealer through
whom the purchase was made; and
9. Whether the Asset is to be received in certificated form or via a
specified Depository.
In accordance with such Instructions, State Street will pay for out of
monies held for the purchasing Portfolio, but only insofar as such monies
are available for such purpose, and receive the Assets so purchased by or
for the account of such Portfolio, except that State Street, or a
Subcustodian, may in its sole discretion advance funds to such Portfolio
which may result in an overdraft because the monies held on behalf of such
Portfolio are insufficient to pay the total amount payable upon such
purchase. Except as otherwise instructed by PIMCO, State Street will make
such payment only upon receipt of Assets: (a) by State Street; (b) by a
clearing corporation of a national exchange of which State Street is a
member; or (c) by a Depository. Notwithstanding the foregoing, (i) State
Street may release funds to a Depository prior to the receipt of advice
from the Depository that
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the Assets underlying a repurchase agreement have been transferred by
book-entry into the account maintained with such Depository by State
Street on behalf of its customers; provided that State Street's
instructions to the Depository require that the Depository make payment of
such funds only upon transfer by book-entry of the Assets underlying the
repurchase agreement in such account; (ii) State Street may make payment
for time deposits, call account deposits, currency deposits and other
deposits, foreign exchange transactions, futures contracts or options,
before receipt of an advice or confirmation evidencing said deposit or
entry into such transaction; and (iii) State Street may make, or cause a
Subcustodian to make, payment for the purchase of Assets the settlement of
which occurs outside of the United States of America in accordance with
generally accepted local custom and market practice.
G. Sales and Deliveries of Investments -- Other Than Options and Futures.
On each business day on which a Portfolio makes a sale of Assets other
than options and futures, PIMCO will deliver to State Street Instructions
specifying with respect to each such sale:
1. If applicable, the name of the Portfolio making such sale;
2. The name of the issuer and description of the Asset;
3. The number of shares and principal amount sold, and accrued
interest, if any;
4. The date on which the Assets sold were purchased or other
information identifying the Assets sold and to be delivered;
5. The trade date;
6. The settlement date;
7. The sale price per unit and the brokerage commission, taxes or other
expenses payable in connection with such sale;
8. The total amount to be received by the Portfolio upon such sale; and
9. The name and address of the broker or dealer through whom or person
to whom the sale was made.
State Street will deliver or cause to be delivered the Assets thus
designated as sold for the account of the selling Portfolio as specified
in the Instructions. Except as otherwise instructed by PIMCO, State Street
will make such delivery upon receipt of: (a) payment therefor in such form
as is satisfactory to State Street; (b) credit to the account of State
Street with a clearing corporation of a national securities exchange of
which State Street is a member; or (c) credit to the account maintained by
State Street on behalf of its customers with a Depository. Notwithstanding
the foregoing: (i) State Street will deliver Assets held in physical form
in accordance with "street delivery custom" to a broker or its clearing
agent; or (ii) State Street may make, or cause a Subcustodian to make,
delivery of Assets the settlement of which occurs outside of the United
States of America upon payment therefor in accordance with generally
accepted local custom and market practice.
H. Purchases or Sales of Options and Futures. On each business day on
which a Portfolio makes a purchase or sale of the options and/or
futures listed below, PIMCO will deliver to State Street
Instructions specifying with respect to each such purchase or sale:
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1. If applicable, the name of the Portfolio making such purchase or
sale;
2. In the case of security options:
a. The underlying security;
b. The price at which purchased or sold;
c. The expiration date;
d. The number of contracts;
e. The exercise price;
f. Whether the transaction is an opening, exercising, expiring or
closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased;
i. Market on which option traded; and
j. Name and address of the broker or dealer through whom the sale
or purchase was made.
3. In the case of options on indices:
a. The index;
b. The price at which purchased or sold;
c. The exercise price;
d. The premium;
e. The multiple;
f. The expiration date;
g. Whether the transaction is an opening, exercising, expiring or
closing transaction;
h. Whether the transaction involves a put or call;
i. Whether the option is written or purchased; and
j. The name and address of the broker or dealer through whom the
sale or purchase was made, or other applicable settlement
instructions.
4. In the case of security index futures contracts:
a. The last trading date specified in the contract and, when
available, the closing level, thereof;
b. The index level on the date the contract is entered into;
c. The multiple;
d. Any margin requirements;
e. The need for a segregated margin account (in addition to
Instructions, and if not already in the possession of State
Street, PIMCO will deliver a substantially complete and
executed custodial safekeeping account and procedural
agreement, incorporated herein by this reference); and
f. The name and address of the futures commission merchant
through whom the sale or purchase was made, or other
applicable settlement instructions.
5. In the case of options on index future contracts:
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a. The underlying index future contract;
b. The premium;
c. The expiration date;
d. The number of options;
e. The exercise price;
f. Whether the transaction involves an opening, exercising
expiring or closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased; and
i. The market on which the option is traded.
I. Assets Pledged or Loaned. If specifically allowed for in the
prospectus or registration statement of a Portfolio, and subject to
such additional term and conditions as State Street may require:
1. Upon receipt of Instructions, State Street will release or
cause to be released Assets to the designated pledgee by way
of pledge or hypothecation to secure any loan incurred by a
Portfolio; provided, however, that State Street will release
Assets only upon payment to State Street of the monies
borrowed, except that in cases where additional collateral is
required to secure a borrowing already made, further Assets
may be released or caused to be released for that purpose.
Upon receipt of Instructions, State Street will pay, but only
from funds available for such purpose, any such loan upon
redelivery to it of the Assets pledged or hypothecated
therefor and upon surrender of the note or notes evidencing
such loan.
2. Upon receipt of Instructions, State Street will release Assets
to the designated borrower; provided, however, that the Assets
will be released only upon deposit with State Street of full
cash collateral as specified in such Instructions, and that
the lending Portfolio will retain the right to any dividends,
interest or distribution on such loaned Assets. Upon receipt
of Instructions and the loaned Assets, State Street will
release the cash collateral to the borrower.
J. Routine Matters. State Street will, in general, attend to all
routine and mechanical matters in connection with the sale,
exchange, substitution, purchase, transfer, or other dealings with
the Assets except as may be otherwise provided herein or upon
Instruction from PIMCO.
K. Deposit Accounts. State Street will open and maintain one or more
special purpose deposit accounts for each Portfolio in the name of
State Street in such banks or trust companies (including, without
limitation, affiliates of State Street) as may be designated by it
or PIMCO in writing ("Accounts"), subject only to draft or order by
State Street upon receipt of Instructions. State Street will deposit
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all monies received by State Street from or for the account of a
Portfolio in an Account maintained for such Portfolio. Subject to
Section 5.K hereof, State Street agrees:
1. To make Fed Funds available to the applicable Portfolio at
9:00 a.m., Kansas City time, on the second business day after
deposit of any check into an Account, in the amount of the
check;
2. To make funds available immediately upon a deposit made by
Federal Reserve wire; and
3. To make funds available on the next business day after deposit
of ACH wires.
L. Income and Other Payments. State Street will:
1. Collect, claim and receive and deposit for the account of the
applicable Portfolio all income (including income from the
Accounts) and other payments which become due and payable on
or after the effective date hereof with respect to the Assets,
and credit the account of such Portfolio in accordance with
the schedule attached hereto as Exhibit A. If for any reason,
a Portfolio is credited with income that is not subsequently
collected, State Street may reverse that credited amount. If
monies are Collected after such reversal, State Street will
credit the Portfolio in that amount;
2. Execute ownership and other certificates and affidavits for
all federal, state and local tax purposes in connection with
the collection of bond and note coupons; and
3. Take such other action as may be necessary or proper in
connection with (a) the collection, receipt and deposit of
such income and other payments, including but not limited to
the presentation for payment of all coupons and other income
items requiring presentation; and all other Assets which may
mature or be called, redeemed, retired or otherwise become
payable and regarding which State Street has actual knowledge,
or should reasonably be expected to have knowledge; and (b)
the endorsement for collection, in the name of Fund or a
Portfolio, of all checks, drafts or other negotiable
instruments.
State Street, however, will not be required to institute suit or take
other extraordinary action to enforce collection except upon receipt of
Instructions and upon being indemnified to its satisfaction against the
costs and expenses of such suit or other actions. State Street will
receive, claim and collect all stock dividends, rights and other similar
items and will deal with the same pursuant to Instructions.
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M. Proxies and Notices. State Street will promptly deliver or mail or
have delivered or mailed to PIMCO all proxies properly signed, all
notices of meetings, all proxy statements and other notices,
requests or announcements affecting or relating to Assets and will,
upon receipt of Instructions, execute and deliver or mail (or cause
its nominee to execute and deliver or mail) such proxies or other
authorizations as may be required. Except as provided herein or
pursuant to Instructions hereafter received by State Street, neither
it nor its nominee will exercise any power inherent in any such
Assets, including any power to vote the same, or execute any proxy,
power of attorney, or other similar instrument voting any of such
Assets, or give any consent, approval or waiver with respect
thereto, or take any other similar action.
N. Disbursements. State Street will pay or cause to be paid, insofar as
funds are available for the purpose, bills, statements and other
obligations of each Portfolio (including but not limited to
obligations in connection with the conversion, exchange or surrender
of Assets, interest charges, dividend disbursements, taxes,
management fees, custodian fees, legal fees, auditors' fees,
transfer agents' fees, brokerage commissions, compensation to
personnel and other operating expenses of such Portfolio) pursuant
to Instructions setting forth the name of the person to whom payment
is to be made, and the amount and purpose of the payment,
O. Daily Statement of Accounts. State Street will, within a reasonable
time, render to PIMCO a detailed statement of the amounts received
or paid and of Assets received or delivered for the account of each
Portfolio during each business day. State Street will maintain such
books and records as are necessary to enable it to render, from time
to time upon request by PIMCO, a detailed statement of the Assets.
State Street will permit, and upon Instruction will cause any
Subcustodian to permit, such persons as are authorized by the Fund,
including Fund's independent public accountants, reasonable access
to such records or will provide reasonable confirmation of the
contents of such records, and if demanded, State Street will permit,
and will cause any Subcustodian to permit, federal and state
regulatory agencies to examine the Assets, books and records of any
Portfolio.
P. Appointment of Subcustodians. Notwithstanding any other provisions
hereof:
1. All or any of the Assets may be held in State Street's own
custody or in the custody of one or more other banks or trust
companies (including, without limitation, affiliates of State
Street) acting as Subcustodians as may be selected by State
Street. Any such Subcustodian selected by State Street must
have the qualifications required for a custodian under the
0000 Xxx. Xxxxx Xxxxxx will be responsible to the applicable
Portfolio for any loss, damage or expense suffered or incurred
by such Portfolio resulting from the actions or omissions of
any Subcustodians selected and appointed by State Street
(except Subcustodians appointed at the request of PIMCO and as
provided in Subsection 2 below) to the same extent State
Street would be responsible to Fund hereunder if it committed
the act or omission itself.
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2. Upon request of PIMCO, State Street will contract with other
Subcustodians reasonably acceptable to State Street for
purposes of (a) effecting third-party repurchase transactions
with banks, brokers, dealers, or other entities through the
use of a common custodian or subcustodian, or (b) providing
depository and clearing agency services with respect to
certain variable rate demand note securities, or (c) for other
reasonable purposes specified by PIMCO; provided, however,
that State Street will be responsible to PIMCO for any loss,
damage or expense suffered or incurred by Fund resulting from
the actions or omissions of any such Subcustodian only to the
same extent such Subcustodian is responsible to State Street.
PIMCO may review State Street's contracts with such
Subcustodians.
Q. Foreign Custody Manager.
1. Definitions. Capitalized terms in this Section Q have the following
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; financial
infrastructure (including financial institutions such as any
Mandatory Securities Depositories (but not Eligible Foreign
Custodians) operating in the country); prevailing 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, except that the term does not include
Mandatory Securities Depositories.
"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 in amounts deemed
by PIMCO to be reasonably necessary to effect the Portfolios'
transactions in such investments.
"Foreign Custody Manager" or "FCM" has the meaning set forth in
Section (a)(2) of Rule 17f-5.
"Mandatory Securities Depository" means a foreign securities
depository or clearing agency that, either as a legal or practical
matter, must be used if the manager of a Portfolio determines to
place Foreign Assets in a country outside the United States (i)
because required by law or regulation; (ii) because securities
cannot be withdrawn from such foreign securities depository or
clearing agency; or (iii) because maintaining or effecting trades in
securities outside the foreign securities depository or clearing
agency is not consistent with prevailing or developing custodial or
market practices.
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2. Delegation to State Street as FCM. Fund, pursuant to resolution
adopted by its Board of Trustees or Directors ("Board"), hereby
delegates to State Street, subject to Section (b) of Rule 17f-5, the
responsibilities set forth in this Section Q with respect to Foreign
Assets held outside the United States, and State Street hereby
accepts such delegation, as FCM of each Portfolio.
3. Countries Covered. The FCM is responsible for performing the
delegated responsibilities defined below only with respect to the
countries and custody arrangements for each such country listed on
Exhibit D hereto, which may be amended from time to time by the FCM.
The FCM will list on Exhibit D the Eligible Foreign Custodians
selected by the FCM to maintain the assets of each Portfolio.
Mandatory Securities Depositories are listed on Exhibit E hereto,
which Exhibit E may be amended from time to time by the FCM. The FCM
will provide amended versions of Exhibits D and E in accordance with
subsection 7 of this Section Q.
Upon the receipt by the FCM of Instructions to open an account, or
to place or maintain Foreign Assets, in a country listed on Exhibit
D, and the fulfillment by PIMCO of the applicable account opening
requirements for such country, the FCM is deemed to have been
delegated by the Board responsibility as FCM with respect to that
country and to have accepted such delegation. Following the receipt
of Instructions directing the FCM to close the account of a
Portfolio with the Eligible Foreign Custodian selected by the FCM in
a designated country, the delegation by the Board to State Street as
FCM for that country is deemed to have been withdrawn and State
Street will immediately cease to be the FCM of the Portfolio with
respect to that country unless a substitute Eligible Foreign
Custodian is identified and added to Exhibit D.
The FCM may withdraw its acceptance of delegated responsibilities
with respect to a designated country upon written notice to PIMCO.
Commencing sixty (60) days (or such longer period as to which the
parties agree in writing) after receipt of any such notice by PIMCO,
State Street will have no further responsibility as FCM to a
Portfolio with respect to the country as to which State Street's
acceptance of delegation is withdrawn.
4. Scope of Delegated Responsibilities.
a. Selection of Eligible Foreign Custodians. Subject to the
provisions of this Section Q, the FCM may place and maintain
the Foreign Assets in the care of the Eligible Foreign
Custodian selected by the FCM in each country listed on
Exhibit D, as amended from time to time.
In performing its delegated responsibilities as FCM to place
or maintain Foreign Assets with an Eligible Foreign Custodian,
the FCM will determine that the Foreign Assets will be subject
to reasonable care, based on the standards applicable to
custodians in the country in which the
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Foreign Assets will be held by that Eligible Foreign
Custodian, after considering all factors relevant to the
safekeeping of such assets, including, without limitation,
those set forth in Rule 17f5(c)(1)(i) through (iv).
b. Contracts With Eligible Foreign Custodians. The FCM will
determine that the contract (or the rules or established
practices or procedures in the case of an Eligible Foreign
Custodian that is a foreign securities depository or clearing
agency) governing the foreign custody arrangements with each
Eligible Foreign Custodian selected by the FCM will provide
reasonable care for the Foreign Assets held by that Eligible
Foreign Custodian based on the standards applicable to
custodians in the particular country and referred to in the
second paragraph of Section 4.a. Each such contract will
include the provisions set forth in Rule 17f-5(c)(2)(i)(A)
through (F), or, in lieu of any or all of the provisions set
forth in said (A) through (F), such other provisions that the
FCM determines will provide, in their entirety, the same or
greater level of care and protection for the Foreign Assets as
the provisions set forth in said (A) through (F) in their
entirety.
c. Monitoring. In each case in which the FCM maintains Foreign
Assets with an Eligible Foreign Custodian selected by the FCM
the FCM will establish a system to monitor (a) the
appropriateness of maintaining the Foreign Assets with such
Eligible Foreign Custodian as provided in Section 4.a. and (b)
the contract governing the custody arrangements established by
the FCM with the Eligible Foreign Custodian as provided in
Section 4.b. In the event the FCM determines that the custody
arrangements with an Eligible Foreign Custodian it has
selected are no longer appropriate, the FCM will notify the
Board in accordance with subsection 7 of this Section Q.
5. Guidelines for the Exercise of Delegated Authority. For purposes of
this Section Q, the Board will be solely responsible for considering
and determining to accept such Country Risk as is incurred by
placing and maintaining the Foreign Assets in each country for which
State Street is serving as FCM of a Portfolio, and the Board will be
solely responsible for monitoring on a continuing basis such Country
Risk to the extent that the Board considers necessary or
appropriate. PIMCO, on behalf of the Fund, and State Street each
expressly acknowledge that the FCM will not be delegated any
responsibilities under this Section Q with respect to Mandatory
Securities Depositories.
6. Standard of Care as FCM of a Portfolio. In performing the
responsibilities delegated to it the FCM 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.
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7. Reporting Requirements. The FCM will 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 amended Exhibits D and E at the end of the
calendar quarter in which an amendment to either Exhibit has
occurred. The FCM will make written reports notifying the Board of
any other material change in the foreign custody arrangements of a
Portfolio described in this Section Q promptly Mowing after the
occurrence of the material change.
8. Representations With Respect to Rule 17f-5. The FCM represents to
PIMCO that it is a U.S. Bank as defined in Section (a)(7) of Rule
17f-5.
PIMCO, on behalf of Fund, represents to State Street that the Board
has determined that it is reasonable for it to rely on State Street
to perform the responsibilities delegated pursuant to this Agreement
to State Street as the FCM of each Portfolio.
Each party represents that it will in good faith negotiate revised
terms for this Agreement to reflect future guidance from the SEC
staff or regulatory amendments affecting Rule 17f-5.
9. Effective Date and Termination of State Street as FCM . The Board's
delegation to State Street as FCM of a Portfolio will be effective
as of the effective date of the 1997 Amendments to Rule 17f-5 and
will 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 days after receipt
by the non-terminating party of such notice. The provisions of
subsection 3 of this Section Q govern the delegation to and
termination of State Street as FCM of Fund with respect to
designated countries.
R. Accounts and Records. State Street will prepare and maintain, with
the direction and as interpreted by PIMCO, a Fund's or a Portfolio's
accountants and/or other advisors, in complete, accurate and current
form all accounts and records: (1) required to be maintained by a
Fund with respect to portfolio transactions under Section 31(a) of
the 1940 Act and the rules and regulations from time to time adopted
thereunder; (2) required to be maintained as a basis for calculation
of each Portfolio's net asset value and (3) as otherwise agreed upon
by the parties. PIMCO will advise State Street in writing of all
applicable record retention requirements, other than those set forth
in the 1940 Act or the regulations thereunder. State Street will
preserve such accounts and records in the manner and for the periods
prescribed in the 1940 Act or the regulations thereunder or for such
longer period as is agreed upon by the parties. PIMCO will furnish,
in writing or its electronic or digital equivalent, accurate and
timely information needed by State Street to complete such accounts
and records, including Corporate Actions, when such information is
not readily available from generally accepted securities industry
services or publications.
13
S. Accounts and Records Property of Fund. State Street acknowledges
that all of the accounts and records maintained by State Street
pursuant hereto are the property of the Fund, and will be made
available to the Fund and PIMCO on behalf of Fund for inspection or
reproduction within a reasonable period of time, upon demand. State
Street will assist Fund's independent auditors, or upon approval of
PIMCO, or upon demand, any regulatory body, in any requested review
of Fund's accounts and records but PIMCO will reimburse State Street
for all expenses and employee time invested in any such review
outside of routine and normal periodic reviews. Upon receipt from
PIMCO of the necessary information or instructions, State Street
will supply information from the books and records it maintains for
Fund that Fund needs for tax returns, questionnaires, periodic
reports to shareholders and such other reports and information
requests as PIMCO and State Street agree upon from time to time.
T. Adoption of Procedures. State Street and PIMCO, on behalf of Fund,
hereby adopt the Funds Transfer Operating Guidelines attached hereto
as Exhibit B. State Street and PIMCO may from time to time adopt
such additional procedures as they agree upon, and State Street may
conclusively assume that no procedure approved or directed by PIMCO,
Fund's or any Portfolio's accountants or other advisors conflicts
with or violates any requirements of the prospectus or registration
statement, articles of incorporation and bylaws or trust instrument,
any applicable law, rule or regulation, or any order, decree or
agreement by which the Fund may be bound. PIMCO will be responsible
for notifying State Street of any changes in statutes, regulations,
rules, requirements or policies which may impact State Street's
performance of its responsibilities hereunder or its related
operational policies and procedures as they relate to the Fund in a
manner different from or in addition to requirements applicable to
investment companies registered under the 1940 Act in general.
U. Calculation of Net Asset Value . PIMCO, on behalf of Fund, will give
Instructions to State Street specifying the outside pricing sources
to be utilized as sources of Asset prices ("Pricing Sources"). In
the event that PIMCO specifies Reuters America, Inc., it will enter
into the Agreement attached hereto as Exhibit C. State Street will
calculate each Portfolio's net asset value in accordance with the
Portfolio's prospectus or registration statement. State Street will
price the Assets, including foreign currency holdings, of each
Portfolio for which market quotations are available from the Pricing
Sources; all other Assets will be priced in accordance with PIMCO's
Instructions.
V. Advances. Fund will cause each Portfolio to pay on demand any
advance of cash or securities made by State Street or any
Subcustodian, in its sole discretion, for any purpose (including but
not limited to securities settlements, purchase or sale of foreign
exchange or foreign exchange contracts and assumed settlement) for
the benefit of any Portfolio. Any such cash advance will be subject
to an overdraft charge at the rate set forth in the then-current fee
schedule from the date
14
advanced until the date repaid. As security for each such advance,
Fund hereby grants State Street and such Subcustodian a lien on and
security interest in all of Fund's Assets at any time held for the
account of the applicable Portfolio, including without limitation
all Assets acquired with the amount advanced. Should the applicable
Portfolio fail to promptly repay the advance, the Fund agrees that
State Street and such Subcustodian may utilize available cash and
dispose of such Portfolio's Assets pursuant to applicable law to the
extent necessary to obtain reimbursement of the amount advanced and
any related overdraft charges; provided, however, that prior to such
utilization and disposition, (i) State Street or Subcustodian has
given PIMCO 2 days' notice of the amount due and of its intent to so
utilize and dispose of custodied Assets; and (ii) the applicable
Portfolio shall not have satisfied the obligation. During such 2 day
notice period, PIMCO shall have the option to direct State Street or
such Subcustodian by written notice regarding which and in what
priority order custodied Assets are to be utilized and disposed of.
W. Exercise of Rights; Tender Offers. Upon receipt of Instructions,
State Street will: (1) deliver warrants, puts, calls, rights or
similar securities to the issuer or trustee thereof, or to the agent
of such issuer or trustee, for the purpose of exercise or sale,
provided that the new Assets, if any, are to be delivered to State
Street; and (2) deposit securities upon invitations for tenders
thereof, provided that the consideration for such securities is to
be paid or delivered to State Street or the tendered securities are
to be returned to State Street.
X. Fund Shares.
1. PIMCO will deliver to State Street Instructions with respect to the
declaration and payment of any dividend or other distribution on the
shares of capital stock or beneficial interest, as the case may be,
of a Portfolio ("Fund Shares") by a Portfolio. On the date specified
in such Instruction, State Street will pay out of the monies held
for the account of the Portfolio, insofar as it is available for
such purposes, and credit to the account of the Dividend Disbursing
Agent for the Portfolio, the amount specified in such Instructions.
2. Whenever Fund Shares are repurchased or redeemed by a Portfolio,
PIMCO on behalf of such Portfolio or its agent will give State
Street Instructions regarding the aggregate dollar amount to be paid
for such shares. Upon receipt of such Instruction, State Street will
charge such aggregate dollar amount to the account of the Portfolio
and either deposit the same in the account maintained for the
purpose of paying for the repurchase or redemption of Fund Shares or
deliver the same in accordance with such Instruction. State Street
has no duty or responsibility to determine that Fund Shares have
been removed from the proper shareholder accounts or that the proper
number of Fund Shares have been canceled and removed from the
shareholder records.
15
3. Whenever Fund Shares are purchased from a Portfolio, PIMCO will
deposit or cause to be deposited with State Street the amount
received for such shares. State Street has no duty or responsibility
to determine that Fund Shares purchased from a Portfolio have been
added to the proper shareholder account or that the proper number of
such shares have been added to the shareholder records.
4. INSTRUCTIONS.
A. The term "Instructions", as used herein, means written (including
telecopied, telexed, or electronically transmitted) or oral
instructions which State Street reasonably believes were given by a
designated representative of PIMCO. PIMCO will deliver to State
Street, prior to delivery of any Assets to State Street and
thereafter from time to time as changes therein are necessary,
written Instructions naming one or more designated representatives
to give Instructions in the name and on behalf of Fund, which
Instructions may be received and accepted by State Street as
conclusive evidence of the authority of any designated
representative to act for the Fund and may be considered to be in
full force and effect until receipt by State Street of notice to the
contrary. Unless such written Instructions delegating authority to
any person to give Instructions specifically limit such authority to
specific matters or require that the approval of anyone else will
first have been obtained, State Street will be under no obligation
to inquire into the right of such person, acting alone, to give any
Instructions whatsoever. If PIMCO fails to provide State Street any
such Instructions naming designated representatives, any
Instructions received by State Street from a person reasonably
believed to be an appropriate representative of PIMCO will
constitute valid and proper Instructions hereunder. "Designated
representatives" may include a Fund's or a Portfolio's employees and
agents, including investment managers and their employees.
B. No later than the next business day immediately following each oral
Instruction, PIMCO will send State Street written confirmation of
such oral Instruction. At State Street's sole discretion, State
Street may record on tape, or otherwise, any oral Instruction
whether given in person or via telephone, each such recording
identifying the date and the time of the beginning and ending of
such oral Instruction.
C. PIMCO will provide, upon State Street's request, a certificate
signed by an officer or designated representative of PIMCO, as
conclusive proof of any fact or matter required to be ascertained
from PIMCO hereunder. PIMCO will also provide State Street
Instructions with respect to any matter concerning this Agreement
requested by State Street. If State Street reasonably believes that
it could not prudently act according to the Instructions, or the
instruction or advice of Fund's or a Portfolio's accountants or
counsel, it may in its discretion, with notice to PIMCO and Fund,
not act according to such Instructions.
5. LIMITATION OF LIABILITY OF STATE STREET.
16
A. State Street shall at all times use reasonable care and due
diligence and act in good faith in performing its duties under this
Agreement. Neither PIMCO nor Fund is responsible or liable for, and
State Street will indemnify and hold PIMCO and Fund harmless from
and against, any and all costs, expenses, losses, damages, charges,
counsel fees, payments and liabilities which may be asserted against
or incurred by PIMCO or Fund or for which PIMCO or Fund may be held
to be liable, arising out of or attributable to State Street's
failure to comply with the terms of this Agreement or arising out of
State. Street's (or its agents' or delegees') negligence, willful
misconduct or bad faith.
B. State Street is not responsible or liable for, and PIMCO will
indemnify and hold State Street harmless from and against, any and
all costs, expenses, losses, damages, charges, counsel fees,
payments and liabilities which may be asserted against or incurred
by State Street or for which State Street may be held to be liable,
arising out of or attributable to:
1. State Street's action or omission to act pursuant hereto; provided
that State Street has acted or failed to act in good faith and with
due diligence and reasonable care; and provided further, that
neither party is liable to the other for consequential, special, or
punitive damages in any event.
2. State Street's payment of money as requested by PIMCO, or the taking
of any action which might make it or its nominee liable for payment
of monies or in any other way; provided, however, that nothing
herein obligates State Street to take any such action or expend its
own monies in its sole discretion.
3. State Street's action or omission to act hereunder in reasonable
reliance upon any Instructions, advice, notice, request, consent,
certificate or other instrument or paper appearing to it to be
genuine and to have been properly executed, including any
Instructions, communications, data or other information received by
State Street by means of the Systems, as hereinafter defined, or any
electronic system of communication.
4. State Street's action or omission to act in good faith reliance on
the advice or opinion of counsel for PIMCO or of its own counsel
with respect to questions or matters of law, which advice or opinion
may be obtained by State Street from counsel for PIMCO at the
expense of PIMCO or from State Street's counsel at its own expense,
or on the Instructions, advice or statements of any officer or
employee of PIMCO, or the Fund's accountants or other authorized
individuals, and other persons believed by it in good faith to be
expert in matters upon which they are consulted.
5. The purchase or sale of any securities or foreign currency
positions. Without limiting the generality of the foregoing, State
Street is under no duty or obligation to inquire into:
17
a. The validity of the issue of any securities purchased by or
for any Portfolio, or the legality of the purchase thereof or
of foreign currency positions, or evidence of ownership
required by PIMCO to be received by State Street, or the
propriety of the decision to purchase or the amount paid
therefor;
b. The legality of the sale of any securities or foreign currency
positions by or for any Portfolio, or the propriety of the
amount for which the same are sold; or
c. The legality of the issue or sale of any Fund Shares, or the
sufficiency of the amount to be received therefor, the
legality of the repurchase or redemption of any Fund Shares,
or the propriety of the amount to be paid therefor, or the
legality of the declaration of any dividend by either Fund, or
the legality of the issue of any Fund Shares in payment of any
stock dividend.
6. Any error, omission, inaccuracy or other deficiency in any
Portfolio's accounts and records or other information provided by or
on behalf of a Portfolio to State Street, including the accuracy of
the prices quoted by the Pricing Sources or for the information
supplied by PIMCO to price the Assets, or the failure of PIMCO to
provide, or provide in a timely manner, any accounts, records, or
information needed by State Street to perform hereunder.
7. PIMCO's or Fund's refusal or failure to comply with the terms hereof
(including without limitation PIMCO's or Fund's failure to pay or
reimburse State Street under Section 5 or 6 hereof), PIMCO's or
Fund's negligence or willful misconduct, or the failure of any
representation or warranty of PIMCO or Fund hereunder to be and
remain true and correct in all respects at all times.
8. The use or misuse, whether authorized or unauthorized, of the
Systems or any electronic system of communication used hereunder, by
PIMCO or by any person who acquires access to the Systems or such
other systems through the terminal device, passwords, access
instructions or other means of access to such Systems or such other
system which are utilized by, assigned to or otherwise made
exclusively available to PIMCO, except to the extent attributable to
any negligence or willful misconduct by State Street.
9. Any money represented by any check, draft, wire transfer,
clearinghouse funds, uncollected funds, or instrument for the
payment of money to be received by State Street on behalf of a
Portfolio until actually received; provided, however, that State
Street will advise PIMCO promptly if it fails to receive any such
money in the ordinary course of business and will cooperate with
PIMCO toward the end that such money is received.
18
10. Except as provided in Section 3.P hereof, and subject to Section
5.B.1 hereof, loss occasioned by the acts, neglects, defaults or
insolvency of any broker, bank, trust company, or any other person
with whom State Street may deal.
11. The failure or delay in performance of its obligations hereunder, or
those of any entity for which it is responsible hereunder, arising
out of or caused, directly or indirectly, by circumstances beyond
the affected entity's reasonable control or ability to take
preemptive measures against, including, without limitation: any
interruption, loss or malfunction of any utility, transportation,
computer (hardware or software) or communication service; inability
to obtain labor, material, equipment or transportation, or a delay
in mails; governmental or exchange action, statute, ordinance,
rulings, regulations or direction; war, strike, riot, emergency,
civil disturbance, terrorism, vandalism, explosions, labor disputes,
freezes, floods, fires, tornadoes, acts of God or public enemy,
revolutions, or insurrection.
6. COMPENSATION. In consideration for its services hereunder, State Street
will be paid the compensation set forth in a separate fee schedule,
incorporated herein by this reference, to be agreed to by Fund, PIMCO and
State Street from time to time, and reimbursement for State Street's cash
disbursements and reasonable out-of-pocket costs and expenses, including
attorney's fees, incurred by State Street in connection with the
performance of services hereunder, on demand. State Street, subject to
Section 10 hereof, may charge such compensation against monies held by it
for the accounts of the Portfolios following notice to PIMCO. State Street
will, subject to Section 10 hereof, be entitled to charge against any
monies held by it for the accounts of the Portfolios the amount of any
loss, damage, liability, advance, overdraft or expense for which it is
entitled to reimbursement from PIMCO. State Street will be entitled to
reimbursement by the Fund or PIMCO for the losses, damages, liabilities,
advances, overdrafts and expenses of Subcustodians only to the extent that
(a) State Street would have been entitled to reimbursement hereunder if it
had incurred the same itself directly, and (b) State Street is obligated
to reimburse the Subcustodian therefor. As between the Fund and PIMCO, it
is agreed that the compensation due State Street hereunder shall be paid
by PIMCO.
7. TERM AND TERMINATION. The initial term of this Agreement is for a period
of one (1) year. Thereafter, PIMCO or State Street may terminate the same
by notice in writing, delivered or mailed, postage prepaid, to the other
party and received not less than sixty (60) days prior to the date upon
which such termination will take effect. Upon termination hereof:
A. PIMCO will pay State Street its fees and compensation due hereunder
and its reimbursable disbursements, costs and expenses paid or
incurred to such date;
B. PIMCO will designate a successor investment accounting and
recordkeeping agent (which may be PIMCO or Fund) by Instruction to
State Street;
19
C. PIMCO will designate a successor custodian by Instruction to State
Street. In the event no such Instruction has been delivered to State
Street on or before the date when such termination becomes
effective, then State Street may, at its option, (i) choose as
successor custodian a bank or trust company meeting the
qualifications for custodian set forth in the 1940 Act and having
not less than Two Million Dollars ($2,000,000) aggregate capital
surplus and undivided profits, as shown by its last published
report, or (ii) apply to a court of competent jurisdiction for the
appointment of a successor or other proper relief, or take any other
lawful action under the circumstances; provided, however, that PIMCO
will reimburse State Street for its costs and expenses, including
reasonable attorney's fees, incurred in connection therewith; and
D. State Street will, upon payment of all sums due to State Street from
PIMCO hereunder, deliver at State Street's office (i) all accounts
and records to the successor investment accounting and recordkeeping
agent or, if none, to PIMCO; and (ii) all Assets, duly endorsed and
in form for transfer, to the successor custodian, or as specified by
the court. State Street will cooperate in effecting changes in
book-entries at all Depositories. Upon delivery to a successor or as
specified by the court, State Street will have no further
obligations or liabilities hereunder. Thereafter such successor will
be the successor hereunder and will be entitled to reasonable
compensation for its services.
In the event that accounts, records or Assets remain in the
possession of State Street after the date of termination hereof for
any reason other than State Street's failure to deliver the same,
State Street is entitled to compensation as provided in the
then-current fee schedule for its services during such period, and
the provisions hereof relating to the duties and obligations of
State Street will remain in full force and effect.
8. NOTICES. Notices, requests, instructions and other writings addressed to
PIMCO or Fund at the address set forth above, or at such other address as
PIMCO or Fund may have designated to State Street in writing will be
deemed to have been properly given to PIMCO or Fund hereunder. Notices,
requests, Instructions and other writings addressed to State Street at 000
Xxxxxxxxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000, Attention: Custody
Department, or to such other address as it may have designated to PIMCO
and the Fund in writing, will be deemed to have been properly given to
State Street hereunder.
9. THE SYSTEMS; CONFIDENTIALITY.
A. If State Street provides PIMCO direct access to the computerized
investment portfolio custody, recordkeeping and accounting systems
used by State Street ("Systems") or if State Street and PIMCO agree
to utilize any electronic system of communication, PIMCO agrees to
implement and enforce appropriate security policies and procedures
to prevent unauthorized or improper access to or use of the Systems
or such other system.
20
B. PIMCO will preserve the confidentiality of the Systems and the
tapes, books, reference manuals, instructions, records, programs,
documentation and information of, and other materials relevant to,
the Systems and the business of State Street ("Confidential
Information"). PIMCO agrees that it will not voluntarily disclose
any such Confidential Information to any other person other than its
own employees who reasonably have a need to know such information
pursuant hereto. PIMCO will return all such Confidential Information
to State Street upon termination or expiration hereof.
C. PIMCO has been informed that the Systems are licensed for use by
State Street from one or more third parties ("Licensors"), and PIMCO
acknowledges that State Street and Licensors have proprietary rights
in and to the Systems and all other State Street or Licensor
programs, code, techniques, know-how, data bases, supporting
documentation, data formats, and procedures, including without
limitation any changes or modifications made at the request or
expense or both of PIMCO (collectively, the "Protected
Information"). PIMCO acknowledges that the Protected Information
constitutes confidential material and trade secrets of State Street
and Licensors. PIMCO will preserve the confidentiality of the
Protected Information, and PIMCO hereby acknowledges that any
unauthorized use, misuse, disclosure or taking of Protected
Information, residing or existing internal or external to a
computer, computer system, or computer network, or the knowing and
unauthorized accessing or causing to be accessed of any computer,
computer system, or computer network, may be subject to civil
liabilities and criminal penalties under applicable law. PIMCO will
so inform employees and agents who have access to the Protected
Information or to any computer equipment capable of accessing the
same. Licensors are intended to be and are third party beneficiaries
of PIMCO's obligations and undertakings contained in this Section.
D. PIMCO hereby represents and warrants to State Street that it has
determined to its satisfaction that the Systems are appropriate and
suitable for its use. THE SYSTEMS ARE PROVIDED ON AN AS IS, AS
AVAILABLE BASIS. State Street EXPRESSLY DISCLAIMS ALL WARRANTIES
EXCEPT THOSE EXPRESSLY STATED HEREIN INCLUDING, BUT NOT LIMITED TO,
THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.
E. State Street agrees to defend any claim or action brought against
PIMCO or Fund on the issue of infringement of any United States
patent, copyright, trade secret or trademark by the Systems as used
within the scope of this Agreement, and to indemnify PIMCO and Fund
against all damages and costs, subject to the provisions of Section
5 hereof, which may be assessed against them under any such claim or
action.
21
10. MULTIPLE PORTFOLIOS. If a Fund is comprised of more than one Portfolio:
A. Each Portfolio will be regarded for all purposes hereunder as a
separate party apart from each other Portfolio. Unless the context
otherwise requires, with respect to every transaction covered
hereby, every reference herein to a Portfolio is deemed to relate
solely to the particular Portfolio to which such transaction
relates. Under no circumstances will the rights, obligations or
remedies with respect to a particular Portfolio constitute a right,
obligation or remedy applicable to any other Portfolio. The use of
this single document to memorialize the separate agreement of each
Portfolio is understood to be for clerical convenience only and will
not constitute any basis for joining the Portfolios for any reason.
B. PIMCO may appoint State Street as its custodian and investment
accounting and recordkeeping agent for additional Portfolios from
time to time by written notice, provided that State Street consents
to such addition. Rates or charges for each additional Portfolio
will be as agreed upon by State Street and PIMCO in writing.
11. MISCELLANEOUS.
A. This Agreement will be construed according to, and the rights and
liabilities of the parties hereto will be governed by, the laws of
the Commonwealth of Massachusetts without reference to the choice of
laws principles thereof.
B. All terms and provisions hereof will be binding upon, inure to the
benefit of and be enforceable by the parties hereto and their
respective successors and permitted assigns.
C. The representations and warranties, the indemnifications extended
hereunder, and the provisions of Section 9 hereof are intended to
and will continue after and survive the expiration, termination or
cancellation hereof.
D. No provisions hereof may be amended or modified in any manner except
by a written agreement properly authorized and executed by each
party hereto.
E. The failure of any party to insist upon the performance of any terms
or conditions hereof or to enforce any rights resulting from any
breach of any of the terms or conditions hereof, including the
payment of damages, will not be construed as a continuing or
permanent waiver of any such terms, conditions, rights or
privileges, but the same will continue and remain in full force and
effect as if no such forbearance or waiver had occurred. No waiver,
release or discharge of any party's rights hereunder will be
effective unless contained in a written instrument signed by the
party sought to be charged.
F. The captions herein are included for convenience of reference only,
and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
22
G. This Agreement may be executed in two or more counterparts, each of
which is deemed an original but all of which together constitute one
and the same instrument.
H. If any provision hereof is determined to be invalid, illegal, in
conflict with any law or otherwise unenforceable, the remaining
provisions hereof will be considered severable and will not be
affected thereby, and every remaining provision hereof will remain
in full force and effect and will remain enforceable to the fullest
extent permitted by applicable law.
I. This Agreement may not be assigned by either party hereto without
the prior written consent of the other party.
J. Neither the execution nor performance hereof will be deemed to
create a partnership or joint venture by and between State Street,
PIMCO and/or Fund or any Portfolio.
K. Except as specifically provided herein, this Agreement does not in
any way affect any other agreements entered into among the parties
hereto and any actions taken or omitted by any party hereunder will
not affect any rights or obligations of the other parties hereunder.
L. If a Fund is a Trust, notice is hereby given that this Agreement has
been executed on behalf of Fund by the undersigned duly authorized
representative of Fund in his/her capacity as such and not
individually; and that the obligations of this Agreement are binding
only upon the assets and property of Fund and not upon any trustee,
officer of shareholder of Fund individually.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective duly authorized officers.
STATE STREET BANK AND TRUST FIXED INCOME SHARES ("FISH")
COMPANY
By: /s/ XXXXXX X. XXXXXXXX By:/s/ XXXXX X. XXXXXX
------------------------------ -------------------------------------
Title: Vice President Title: President, CEO
--------------------------- ---------------------------------
PIMCO ADVISORS L.P.
By: /s/ XXXXX X. XXXXXX
------------------------------------
Title: COO, PIMCO Advisory Services
---------------------------------
23
EXHIBIT A - INCOME AVAILABILITY SCHEDULE
Foreign--Income will be credited contractually on pay day in the markets noted
with Contractual Income Policy. The markets noted with Actual income policy will
be credited income when it is received.
----------------------------------------------------------------------------------------------------------------
Market Income Market Income Market Income
Policy Policy Policy
----------------------------------------------------------------------------------------------------------------
Argentina Actual Hong Kong Contractual Poland Actual
----------------------------------------------------------------------------------------------------------------
Australia Contractual Hungary Actual Portugal Contractual
----------------------------------------------------------------------------------------------------------------
Austria Contractual India Actual Russia Actual
----------------------------------------------------------------------------------------------------------------
Bahrain Actual Indonesia Actual Singapore Contractual
----------------------------------------------------------------------------------------------------------------
Bangladesh Actual Ireland Actual Slovak Actual
Republic
----------------------------------------------------------------------------------------------------------------
Belgium Contractual Israel Actual South Africa Actual
----------------------------------------------------------------------------------------------------------------
Bermuda Actual Italy Contractual South Korea Actual
----------------------------------------------------------------------------------------------------------------
*Bolivia Actual Ivory Coast Actual Spain Contractual
----------------------------------------------------------------------------------------------------------------
Botswana Actual *Jamaica Actual Sri Lanka Actual
----------------------------------------------------------------------------------------------------------------
Brazil Actual Japan Contractual Swaziland Actual
----------------------------------------------------------------------------------------------------------------
Canada Contractual Jordan Actual Sweden Contractual
----------------------------------------------------------------------------------------------------------------
Chile Actual Kenya Actual Switzerland Contractual
----------------------------------------------------------------------------------------------------------------
China Actual Lebanon Actual Taiwan Actual
----------------------------------------------------------------------------------------------------------------
Colombia Actual Luxembourg Actual Thailand Actual
----------------------------------------------------------------------------------------------------------------
Cyprus Actual Malaysia Actual *Trinidad & Actual
Tobago
----------------------------------------------------------------------------------------------------------------
Czech Actual Mauritius Actual *Tunisia Actual
Republic
----------------------------------------------------------------------------------------------------------------
Denmark Contractual Mexico Actual Turkey Actual
----------------------------------------------------------------------------------------------------------------
Ecuador Actual Morocco Actual United Contractual
Kingdom
----------------------------------------------------------------------------------------------------------------
Egypt Actual Namibia Actual United States See Attached
----------------------------------------------------------------------------------------------------------------
Contractual/
**Euroclear Actual Netherlands Contractual Uruguay Actual
----------------------------------------------------------------------------------------------------------------
Euro CDs Actual New Zealand Contractual Venezuela Actual
----------------------------------------------------------------------------------------------------------------
Finland Contractual Norway Contractual Zambia Actual
----------------------------------------------------------------------------------------------------------------
France Contractual Oman Actual Zimbabwe Actual
----------------------------------------------------------------------------------------------------------------
Germany Contractual Pakistan Actual
----------------------------------------------------------------------------------------------------------------
Ghana Actual Peru Actual
----------------------------------------------------------------------------------------------------------------
Greece Actual Philippines Actual
----------------------------------------------------------------------------------------------------------------
* Market is not 17F-5 eligible
** For Euroclear, contractual income paid only in markets listed with Income
Policy of Contractual.
24
--------------------------------------------------------------------------------------------------------
Income Type DTC FED PTC Physical
--------------------------------------------------------------------------------------------------------
Dividends Contractual N/A N/A Actual
--------------------------------------------------------------------------------------------------------
Fixed Rate Contractual Contractual N/A Actual
Interest
--------------------------------------------------------------------------------------------------------
Variable Rate Contractual Contractual N/A Actual
Interest
--------------------------------------------------------------------------------------------------------
GNMA I N/A N/A Contractual N/A
PD+1
--------------------------------------------------------------------------------------------------------
GNMA II N/A N/A Contractual PD N/A
***
--------------------------------------------------------------------------------------------------------
Mortgages Actual Contractual Contractual Actual
--------------------------------------------------------------------------------------------------------
Maturities Actual Contractual N/A Actual
--------------------------------------------------------------------------------------------------------
Exceptions to the above Contractual Income Policy include securities that are:
< Involved in a trade whose settlement either failed, or is pending over the
record date, (excluding the United States);
< On loan under a self directed securities lending program other than State
Street own vendor lending program;
< Known to be in a condition of default, or suspected to present a risk of
default or payment delay;
< In the asset categories, without limitation, of Private Placements,
Derivatives, Options, Futures, CMOs, and Zero Coupon Bonds.
Securities whose amount of income and redemption cannot be calculated in
advance of payable date, or determined in advance of actual collection,
examples include ADRs; Payments received as the result of a corporate
action, not limited to, bond calls, mandatory or optional puts, and tender
offers.
*** For GNMA II securities, if the 19th day of the month is a business day,
Payable/Distribution Date is the next business day. If the 19th is not a
business day, but the 20th is a business day, Payable/Distribution date is the
first business day after the 20th. If both the 19th and 20th are not business
days, Payable/Distribution will be the next business day thereafter.
25
EXHIBIT B - FUNDS TRANSFER OPERATING GUIDELINES
1. OBLIGATION OF THE SENDER: State Street is authorized to promptly debit
Fund's ("Client's") account(s) upon the receipt of a payment order in
compliance with any of the Security Procedures chosen by the Client, from
those offered on the attached selection form (and any updated selection
forms hereafter executed by the Client), for funds transfers and in the
amount of money that State Street has been instructed to transfer. State
Street is hereby instructed to accept funds transfer instructions only via
the delivery methods and Security Procedures indicated on the attached
selection form (and any update executed by the Client). 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. State
Street shall execute payment orders in compliance with the selected
Security Procedures and with the Client's/Investment Manager'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. State Street will use reasonable
efforts to execute on the execution date payment orders received after the
customary deadline, but if it is unable to execute any such payment order
on the execution date, such payment order will be deemed to have been
received on the next business day.
2. SECURITY PROCEDURES: The Client acknowledges that the selected Security
Procedures were selected by the Client from Security Procedures offered by
State Street. The Client shall restrict access to confidential information
relating to the Security Procedures 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 selected Security Procedures.
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
26
applicable volume, aggregate dollar, network, time, credit or similar
limits upon wire transfers; 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 selected Security Procedures provided that such
requests are received in sufficient time to afford State Street a
reasonable opportunity to act prior to executing the payment order.
However, State Street assumes no liability if the request for amendment or
cancellation cannot be satisfied by State Street's reasonable efforts.
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
selected Security Procedures. The Security Procedures are 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
(including but not limited to failure to execute a payment order) shall
State Street be liable for special, indirect or consequential damages,
even if advised of the possibility of such damages.
8. AUTOMATED CLEARING HOUSE ("ACH") CREDIT ENTRIES/PROVISIONAL PAYMENTS: When
the 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 Mid-America Payment Exchange or other similar body,
State Street or its agent will act as an Originating Depository Financial
Institution and/or Receiving Depository Financial Institution, as the case
may be, with respect to such entries. Credits given with respect to an ACH
credit entry are provisional until final settlement for such entry is
received from the Federal Reserve Bank. If such final settlement is not
received, the Client agrees to promptly refund 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. CONFIRMATIONS: Confirmation of State Street's execution of payment orders
shall ordinarily be provided within 24 hours. Notice may be delivered
through State Street's account statements, advices, information systems,
or by facsimile or callback. The Client must report any objections to the
execution of a payment order within 30 days.
10. MISCELLANEOUS: State Street may use the Federal Reserve System Fedwire to
execute payment orders, and any payment order carried in whole or in part
through Fedwire will be subject to applicable Federal Reserve Board rules
and regulations. State Street and the Client agree to cooperate to attempt
to recover any funds erroneously paid
27
to wrong 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.
28
SECURITY PROCEDURES SELECTION FORM
Please select one or more of the funds transfer security procedures indicated
below.
|X| 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.
Selection of this security procedure would be most appropriate for
existing SWIFT members.
|X| REMOTE BATCH TRANSMISSION Wire transfer instructions are delivered via
Computer-to-Computer (CPU-CP) data communications between the Client
and/or its agent and State Street and/or its agent. Security procedures
include encryption and/or the use of a test key by those individuals
authorized as Automated Batch Verifiers or a callback procedure to those
individuals. Clients selecting this option should have an existing
facility for completing CPU-CPU transmissions. This delivery mechanism is
typically used for high volume business such as shareholder redemptions
and dividend payments.
|X| TELEPHONE CONFIRMATION (CALL BACK) 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 of the payment order, 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.
|_| TEST KEY Test Key confirmation will be used to verify all non-repetitive
funds transfer instructions received via facsimile or phone. State Street
will provide test keys if this option is chosen. State Street will verify
that the instruction contains the signature of an authorized person and
prior to execution of the payment order, will authenticate the test key
provided with the corresponding test key at State Street. Selection of
this alternative is appropriate for Clients who do not have the capability
to use other security procedures.
|X| REPETITIVE WIRES For situations where funds are transferred periodically
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
$10 million limit. If the payment order exceeds the $10 million limit, the
instruction will be confirmed by telephone or test key prior to execution.
Repetitive wire instructions must be reconfirmed annually. Clients may
establish Repetitive Wires by following the agreed upon security
procedures for as
29
described by Telephone Confirmation (Call Back) or Test Key. This
alternative is recommended whenever funds are frequently transferred
between the same two accounts.
|X| STANDING INSTRUCTIONS Funds are transferred by State Street to a counter
party on the Client's established list of authorized counter parties. Only
the date and the dollar amount are variable. Clients may establish Standby
Instructions by following the agreed upon security procedures for
Non-Repetitive Wire Transfers as described by Telephone Confirmation (Call
Back) or Test Key. This option is used for transactions that include but
are not limited to Foreign Exchange Contracts, Time Deposits and Tri-Party
Repurchase Agreements.
|_| AUTOMATED CLEARING HOUSE (ACH) State Street or its agent receives an
automated transmission 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. The transmission is sent from the Client's or its agent's
system to State Street's or its agent's system with encryption.
30
KEY CONTACT INFORMATION
Whom shall we contact to implement your selection(s)?
CLIENT OPERATIONS CONTACT ALTERNATE CONTACT
Xxxxx X. Xxxxxxxx Xxxxxx X. Xxxxx
1345 Avenue of the Americas, New York, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx,
XX 00000 XX 00000
(000) 000-0000 (000) 000-0000
Telephone Number Telephone Number
Facsimile Number (000)-000-0000
SWIFT Number
31
EXIBIT C - REUTERS DATA SERVICE AGREEMENT
The undersigned acknowledges and agrees that some of the data being provided in
the service by State Street to either Fund contains information supplied to
State Street by Reuters America Inc. ("Reuters") (the "Data"). Such Fund agrees
that:
(i) although Reuters makes every effort to ensure the accuracy and
reliability of the Data, the Fund acknowledges that Reuters, its
employees, agents, contractors, subcontractors, contributors and
third party providers will not be liable for any loss, cost or
damage suffered or incurred by the Fund arising out of any fault,
interruption or delays in the Data or out of any inaccuracies,
errors or omissions in the Data however such faults, interruptions,
delays, inaccuracies, errors or omissions arise, unless due to the
gross negligence or willful misconduct of Reuters;
(ii) it will not transfer, transmit, recirculate by digital or analogue
means, republish or resell all or part of the Data; and
(iii) certain parts of the Data are proprietary and unique to Reuters.
The undersigned further agrees that the benefit of this clause will inure to the
benefit of Reuters.
/s/ XXXXX X. XXXXXX
----------------------------------
By: Xxxxx X. Xxxxxx
Title: President
Date: March 9, 2000
----------------------------------
By:_______________________________
Title:____________________________
Date:_____________________________
00
XXXXXXX X
XXXXX XXXXXX GLOBAL CUSTODY NETWORK SUBCUSTODIANS
AND OPTIONAL DEPOSITORIES
Country Subcustodian Optional Depositories
Argentina Citibank, N.A --
Australia Westpac Banking Corporation --
Austria Erste Bank der Oesterreichischen --
Sparkassen AG
Bahrain The British Bank of the Middle East (as delegate of the --
Hongkong and Shanghai Banking Corporation Limited)
Bangladesh Standard Chartered Bank --
Belgium Generale de Banque --
Bermuda The Bank of Bermuda Limited --
Bolivia Banco Boliviano Americano S.A. --
Botswana Barclays Bank of Botswana Limited --
Brazil Citibank, N.A --
Bulgaria ING Bank N.V. --
CanadaCanada Trustco Mortgage Company --
Chile Citibank, N.A --
People's The Hongkong and Shanghai Banking Corporation --
Republic of Limited, Shanghai and Shenzhen branches
China
Colombia Cititrust Colombia S.A. Sociedad Fiduciaria --
Costa Rica Banco BCT S.A. --
Croatia Prfivredana Banka Zagreb d.d --
Cyprus Barclays Bank Plc. Cyprus Offshore Banking Unit --
Czech Ceskoslovenska Obchodni Banka, A.S. --
Republic
33
Denmark Den Danske Bank --
34
EXHIBIT D
STATE STREET GLOBAL CUSTODY NETWORK SUBCUSTODIANS
AND OPTIONAL DEPOSITORIES
Country Subcustodian Optional Depositories
Ecuador Citibank, N.A. --
Egypt National Bank of Egypt --
Estonia Hansabank --
FinlandMerita Bank Limited --
France Banque Paribas --
Germany Dresdner Bank AG --
Ghana Barclays Bank of Ghana Limited --
Greece National Bank of Greece S.A. Bank of Greece,
System for Monitoring Transactions in
Securities in Book-Entry Form
Hong Kong Standard Chartered Bank --
Hungary Citibank Budapest Rt. --
Iceland Icebank Ltd. --
India Deutsche Bank AG; The Hongkong and Shanghai --
Banking Corporation Limited
Indonesia Standard Chartered Bank --
Ireland Bank of Ireland --
Israel Bank Hapoalim B.M. --
Italy Banque Paribas --
Ivory Coast Societe Generale de Banques en Cote d'Ivoire --
Jamaica Scotiabank Jamaica Trust and Merchant Bank, Ltd. --
35
Japan The Daiwa Bank, Limited; The Fuji Bank Japan Securities
Limited Depository
Jordan British Bank of the Middle East (as delegate of The --
Hongkong and Shanghai Banking Corporation
Limited)
36
EXHIBIT D
STATE STREET GLOBAL CUSTODY NETWORK SUBCUSTODIANS AND OPTIONAL
DEPOSITORIES
Country Subcustodian Optional Depositories
Kenya Barclays Bank of Kenya Limited --
Republic of The Hongkong and Shanghai Banking --
Korea Corporation Limited
Latvia JSC Hansabank-Latvija --
Lebanon British Bank of the Middle East --
(as delegate of The Hongkong and
Shanghai Banking Corporation Limited)
Lithuania Vilniaus Bankas AB --
Malaysia Standard Chartered Bank Malaysia Berhad --
Mauritius The Hongkong and Shanghai Banking Corporation --
Limited
Mexico Citibank Mexico, S.A. --
Morocco Banque Commerciale du Maroc --
Namibia (via) Standard Bank of South Africa --
Netherlands MeesPierson N.V. --
New Zealand ANZ Banking Group (New Zealand) Limited --
Norway Chrisitiania Bank og Kreditkasse --
Oman The British Bank of the Middle East (as delegate of The --
Hongkong and Shanghai Banking Corporation Limited)
Pakistan Deutsche Bank AG --
Peru Citibank, N.A. --
Philippines Standard Chartered Bank --
Poland Citibank (Poland) S.A. --
Bank Polska Kasa Opieki S.A.
37
EXHIBIT E
STATE STREET GLOBAL CUSTODY NETWORK MANDATORY DEPOSITORIES
Country Mandatory Depositories (Includes entities for which
use is mandatory as a matter of law or effectively
mandatory as a matter of market practice)
Switzerland -Schweizerische Effekten - Giro AG;
Taiwan - R.O.C. -The Taiwan Securities Central Depository Company,
Ltd.
Thailand -Thailand Securities Depository Company Limited
Tunisia -Societe Tunisienne Interprofessionelle de
Compensation et de Depot de Valeurs Mobilieres
-Central Bank of Tunisia;
-Tunisian Treasury
Turkey -Takas ve Saklama Bankasi A.S. (TAKASBANK)
-Central Bank of Turkey
Ukraine -The National Bank of Ukraine
United Kingdom -The Bank of England, The Central Gilts Office; The
Central Moneymarkets Office
Uruguay -Central Bank of Uruguay
Venezuela -Central Bank of Venezuela
Zambia-Lusaka Central -Bank of Zambia
Depository Limited
38
EXHIBIT E
STATE STREET GLOBAL CUSTODY NETWORK MANDATORY DEPOSITORIES
Country Mandatory Depositories (Includes entities for which
use is mandatory as a matter of law or effectively
mandatory as a matter of market practice)
Morocco -Maroclear
The Netherlands -Nederlands Centraal Instituut voor Giraal
Effectenverkeer B.V. (NECIGEF)
-De Nederlandsche Bank N.V.
New Zealand -New Zealand Central Securities Depository Limited
Norway -Verdipapirsentralen (the Norwegian Registry of
Securities)
Oman -Muscat Securities Market
Pakistan -Central Depository Company of Pakistan Limited
Peru -Caja de Valores y Liquidaciones S.A. (CAVALI)
Philippines -The Philippines Central Depository Inc.
-The Registry of Scripless Securities (XXXX) of the
Bureau of the Treasury
Poland -The National Depository of Securities (Krajowy
Depozyt Papierow Wartos ciowych);
-Central Treasury Bills Registrar
Portugal -Central de Valores Mobiliarios (Central)
Romania -National Securities Clearing, Settlement and
Depository Co.;
-Bucharest Stock Exchange Registry Division;
Singapore -The Central Depository (Pte)Limited;
-Monetary Authority of Singapore
Slovak Republic -Stredisko Cennych Papierov;
-National Bank of Slovakia
Slovenia -Klirinsko Depotna Xxxxxx x.x.
South Africa -The Central Depository Limited
Spain -Servicio de Compensacion y Liquidacion de Valores,
S.A.;
39
-Banco de Espana, Central de Anotaciones en Cuenta
Sri Lanka -Central Depository System (Pvt) Limited
Sweden -Vardepapperscentralen AB (the Swedish Central
Securities Depository)
40
EXHIBIT E
STATE STREET GLOBAL CUSTODY NETWORK MANDATORY DEPOSITORIES
Country Mandatory Depositories (Includes entities for which
use is mandatory as a matter of law or effectively
mandatory as a matter of market practice)
Greece -The Central Securities Depository (Apothetirion
Titlon AE)
Hong Kong -The Central Clearing and Settlement System;
-Central Money Market Unit
Hungary -The Central Depository and Clearing House (Budapest)
Ltd. (KELER)
[Mandatory for Gov't Bonds only; SSB does not use for
other securities]
India -The National Securities Depository Limited
Indonesia -Bank Indonesia
Ireland -The Central Bank of Ireland, Securities Settlement
Office
Israel -The Tel Aviv Stock Exchange Clearing House Ltd;
-Bank of Israel
Italy -Monte Titoli S.p.A.;
-Banca d'Italia
Jamaica -The Jamaican Central Securities Depository
Japan -Bank of Japan Net System
Kenya -Central Bank of Kenya
Republic of -Korea Securities Depository Corporation
Korea
Latvia -The Latvian Central Depository
Lebanon -The Custodian and Clearing Center of Financial
Instruments for Lebanon and the Middle East
(MIDCLEAR) X.X.X.; -The Central Bank of Lebanon
Lithuania -The Central Securities Depository of Lithuania
Malaysia -The Malaysian Central Depository Sdn. Bhd.;
-Bank Negara Malaysia, Scripless Securities Trading
and Safekeeping Systems
Mauritius -The Central Depository & Settlement Co. Ltd.
41
Mexico -S.D. INDEVAL, S.A. de C.V. (Instituto para el
Deposito de Valores)
42
EXHIBIT E
STATE STREET GLOBAL CUSTODY NETWORK MANDATORY DEPOSITORIES
Country Mandatory Depositories (Includes entities for which
use is mandatory as a matter of law or effectively
mandatory as a matter of market practice)
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 Depot et de Virement
de Titres S.A.;
-Banque Nationale de Belgique
Brazil -Companhia Brasileira de Liquidacao e
-Custodia (CBLC)
-Bolsa de Valores de Rio de Janeiro
- All SSB clients presently use CBLC
-Central de Custodia e de Liquidacao Financeira de
Titulos
Bulgaria -Central Depository AD
-Bulgarian National Bank
Canada -The Canadian Depository for Securities Limited
People's Republic -Shanghai Securities Central Clearing and Registration
of China Corporation;
-Shenzhen Securities Central Clearing Co., Ltd.
Costa Rica -Central de Valores S.A. (CEVAL)
Croatia Ministry of Finance; - National Bank of Croatia
Czech Republic --Stredisko cennych papiru;
-Czech National Bank
Denmark -Vaerdipapircentralen (The Danish Securities Center)
Egypt -Misr Company for Clearing, Settlement, and Central
Depository
Estonia -Eesti Vaartpaberite Keskdepositooruim
Finland -The Finnish Central Securities Depository
43
France -Societe Interprofessionnelle pour la Compensation des
Valeurs Mobilieres (SICOVAM)
Germany -The Deutscher Borse Clearing AG
44
EXHIBIT D
STATE STREET GLOBAL CUSTODY NETWORK SUBCUSTODIANS AND OPTIONAL
DEPOSITORIES
Country Subcustodian Optional Depositories
Venezuela Citibank, N.A --
ZambiaBarclays Bank of Zambia Limited --
Zimbabwe Barclays Bank of Zimbabwe Limited --
Euroclear (The Euroclear System)/State Street London Limited
Cedel, S.A. (Cedel Bank, societe anonyme)/State Street London Limited
INTERSETTLE (for EASDAQ Securities)
45
EXHIBIT D
STATE STREET GLOBAL CUSTODY NETWORK SUBCUSTODIANS AND OPTIONAL
DEPOSITORIES
Country Subcustodian Optional Depositories
Portugal Banco Comercial Portugues --
Romania ING Bank, N.V. --
Russia Credit Suisse First Boston, AO, Moscow --
(as delegate of Credit Suisse First Boston, Zurich)
Singapore The Development Bank of Singapore Ltd. --
Slovak Republic Ceskoslovenska, Obchodna Banka A.S. --
Slovenia Banka Austria d.d. --
South Africa Standard Bank of South Africa Limited --
Spain Banco Santander, S.A. --
Sri Lanka The Hongkong and Shanghai Banking --
Corporation Limited
Swaziland Barclays Bank of Swaziland Limited --
Sweden Skandinaviska Enskilda Banken --
Switzerland UBS AS --
Taiwan - R.O.C. Central Trust of China --
Thailand Standard Chartered Bank --
Trinidad & Tobago Republic Bank Ltd. --
Tunisia Banque Internationale Arabe de Tunisie --
Turkey Citibank, N.A.; Ottoman Bank --
Ukraine ING Bank, Ukraine --
United State Street Bank and Trust Company, --
Kingdom London Branch
46
Uruguay Citibank, N.A. --
00
XXXXX XXXXXX
XXXXX ADVISORS
FEE SCHEDULE
I. INVESTMENT ACCOUNTING.
A. Minimum Monthly Fee
There is a monthly minimum fee of $3,000 per fund/portfolio. The
monthly minimum fee per portfolio does not apply to any portfolio if
the asset based fee discussed in I.B. below produces greater revenue
than the aggregate minimum.
B. Asset Based Fee on a Total Relationship Basis
1/100 of 1% (1.00 basis points) on the first $2 billion in assets.
.9/100 of 1% (.90 basis points) on the next $3 billion in assets.
.75/100 of 1% (.75 basis points) on all assets in excess of $5
billion in assets.
II SECURITY CUSTODY
A. Domestic Custody
Asset-Based Fee on a total relationship basis:
.75/100 of 1% (75 basis points) on all assets.
Transaction Fee, per transaction:
DTC or FED book entry - $8.00
Domestic Physical - $18.00
Mortgage Backed Securities Principal & Income Paydown - $10.00
Repo - $50.00 per Fund, Per Month
Federal Funds Wire Received or Delivered - $7.00 per wire
B. Foreign Securities
See Appendix I for Global Fee Agreement.
C. Balance Credits
State Street will offset fees with balance credits calculated at 75%
of the bank credit rate (see below) applied to average custody
collected cash balances for the month. Balance credits can be used
to offset fees. Any credits in excess of fees will be carried
forward from month to month through the end of the calendar year.
For calculation purposes, State Street uses an actual/actual basis.
48
Note: The bank credit rate is the equivalent to the lesser of: The average
91-day Treasury Xxxx discount rate for the month
or
The average Federal Funds rate for the month less 50 basis points.
D. Multi Class Fees
$500 (not included in minimum monthly fee discussed in I.A.).
E. Monthly SEC Calculation Fee Per Portfolio
$500 (not included in minimum monthly fee discussed in I.A.).
III. AUTOMATED PRICING
This service provides securities pricing daily.
Monthly Quote charge: Based on the number of positions priced during the
month.
o Municipal Bonds via Xxxxxx Data $ 16.00
o Municipal bonds via Xxxxx Information Systems $ 16.00
o Government, Corporate and Convertible Bonds via Xxxxxxx
Xxxxx $ 6.00
o Corporate and Government Bonds via Xxxxxx Data $ 6.00
o Options, Futures and Private Placement $ 6.00
o Foreign Equities and Bonds via Extel Ltd. $ 8.00
o Listed Equities, OTC Equities $ 6.00
o Corporate, Municipal, Convertible and Government Bonds,
Adjustable Rate Preferred Stocks via IDSI $ 6.00
IV NOTES TO THE ABOVE FEE SCHEDULE
A. Asset based fees will be billed monthly at 1/12th of the annual
stated rate based on monthly average net assets. Annual maintenance
fees are payable monthly at 1/12th of the annual stated rate.
B. The above schedule does not include out-of-pocket expenses that
would be incurred by State Street on the client's behalf. Examples
of out-of-pocket expenses include but are not limited to record
retention, microfiche, disaster recovery, pricing and research
services, overnight mailing services, foreign registration and
script fees, etc. State Street bills out-of-pocket expenses
separately from service fees.
C. The Fees stated above are exclusive of terminal equipment required
in the client's location(s) and communication line costs.
49
D. Any fees or out-of-pocket expenses not paid within 30 days of the
date of the original invoice will be charged a late payment fee of
1% per month until payment of the fees are received by State Street.
50
