EXHIBIT 2
[IBT LETTERHEAD]
May 30, 2003
GMO Trust
00 Xxxxx Xxxxx
Xxxxxx, XX 00000
Xxxxxxxx, Xxxx, Xxx Xxxxxxxx & Co. LLC
00 Xxxxx Xxxxx
Xxxxxx, XX 00000
Re: Amendment to the Custodian Agreement (the "Agreement"), dated August 1,
1991, by and among GMO Trust (the "Trust"), on behalf of certain series of
the Trust (the "Funds"), Grantham, Mayo, Xxx Xxxxxxxx & Co. LLC ("GMO") and
Investors Bank & Trust Co. (the "Bank"), as amended.
Ladies and Gentlemen:
Pursuant to Section 15 of the Agreement, this letter amends the
Agreement as required by recently adopted amendments to Rule 17f-4 under the
Investment Company Act of 1940, as amended ("Rule 17-4"), governing investment
companies' use of securities depositories. Capitalized terms used, but not
otherwise defined herein, shall have the meanings ascribed to them in the
Agreement. The terms "financial assets," "securities entitlements," "securities
intermediary," "securities depository," and "intermediary custodian," as used
herein, shall have the same meaning as when such terms are used in Rule 17f-4
for purposes of Rule 17f-4.
The Bank hereby agrees to the following as of the date hereof:
(1) In addition to, and not in lieu of, any standard of care set
forth in the Agreement, the Bank shall be obligated to
exercise due care in accordance with reasonable commercial
standards when placing and maintaining financial assets
corresponding to the Trust's securities entitlements with a
securities depository or an intermediary custodian;
(2) In addition to the Bank's obligations under Section 11 of the
Agreement, the Bank shall provide, promptly upon request by
the Trust, such reports as are available regarding its
internal accounting controls and financial strength;
(3) In addition to, and not in lieu of, any standard of care set
forth in the Agreement that is applicable to an intermediary
custodian appointed by the Bank pursuant to the terms of the
Agreement, any such intermediary custodian shall be obligated,
pursuant to the terms of its agreement or other arrangement
with the Bank, at a minimum to exercise due care in accordance
with reasonable commercial standards in discharging its duty
as a securities intermediary to obtain and
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GMO Trust
Grantham, Mayo, Xxx Xxxxxxxx & Co. LLC May 30, 2003
thereafter maintain financial assets, corresponding to the
security entitlements of its entitlement holders (as defined
in U.C.C. Sections 8-102(a)(7) (2002));
(4) Notwithstanding requirements to the contrary in Sections
6.2(a) through (c) of the Agreement, the Trustees of the Trust
shall not be required to provide prior approval or annual
reapproval of the Bank's use of the Book-Entry System, a
Depository, or a system maintained by the Bank for the holding
of Book-Entry Paper, and the Trust hereby agrees that the Bank
may so use such systems or depositories; and
(5) The clause ", specifically identified in a certified copy of a
resolution of the Trustees of the Trust" in the last sentence
of Section 2.6 of the Agreement is hereby deleted.
This letter agreement shall constitute an amendment to the Agreement
and, as such, a binding agreement among the Trust, on behalf of the Funds, the
Manager, and the Bank in accordance with its terms. The terms of this letter
agreement shall be effective as of March 28, 2003.
Sincerely,
INVESTORS BANK & TRUST
COMPANY
By: /S/ Xxxxxx X. Xxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxx
Title: Managing Director
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GMO Trust
Grantham, Mayo, Xxx Xxxxxxxx & Co. LLC May 30, 2003
The foregoing is hereby
accepted and agreed.
GMO TRUST, on behalf of the Funds
By: /S/ Xxxxxx X. Xxxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President and Secretary
XXXXXXXX, XXXX, XXX XXXXXXXX & CO. LLC
By: /S/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx
Title: Associate General Counsel
