CUSTODIAN AGREEMENT
This Agreement, dated as of March 5, 1992, is between State Street Bank and
Trust Company, a Massachusetts trust company, having its principal place of
business at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, 00000 ("State
Street" or the "Custodian"), and Acacia Capital Corporation, a Maryland
corporation (the "Fund"), having its principal place of business at 0000
Xxxxxxxxxx Xxxxxx, Xxxxx 0000X, Xxxxxxxx, Xxxxxxxx, 00000. In consideration
of the mutual covenants and agreements contained in this Agreement, the
parties agree as follows:
1. Employment of Custodian and Property to be Held by It
The Fund hereby employs State Street as the custodian of assets, including
securities, of the Fund's portfolios ("Portfolios"). The Portfolios agree to
deliver to the Custodian all securities and cash now or hereafter owned or
acquired, and all payments of income, principal or capital distributions
received by them on securities owned at any given time, and the cash
consideration received for shares of the Portfolios. The Custodian will not
be responsible for any property held or received by any Portfolio and not
delivered to the Custodian.
Upon receipt of "Proper Instructions" (as defined in Section 4), the
Custodian will employ one or more subcustodians located in the United
States, but only in accordance with an applicable vote by the Board of
Directors of the Fund, and provided that the Custodian will have no more or
less responsibility or liability to the Fund on account of any actions or
omissions of any subcustodian so employed than any such subcustodian has to
the Custodian, and further provided that the Custodian will not release the
subcustodian from any responsibility or liability unless mutually agreed on
by the parties in writing.
All duties undertaken by the Custodian will be performed in a timely manner.
What constitutes timeliness in connection with a particular action will be
determined by the standards of the industry as they apply to the specific
type of transaction in question and taking into account relevant facts and
circumstances.
2. Duties of the Custodian with Respect to Property of the Fund
2.1 Holding Securities. The Custodian will hold and physically segregate for
the account of each Portfolio all non-cash property other than (a)
securities maintained in a clearing agency acting as a securities depository
or in a book-entry system authorized by the U.S. Department of the Treasury
(collectively referred to as "Securities System;" see Section 2.10), and (b)
commercial paper of an issuer for which the Custodian acts as issuing and
paying agent ("Direct Paper") which is deposited and/or maintained in the
Direct Paper System of the Custodian (see Section 2.11).
2.2 Delivery of Securities. The Custodian will release and deliver Portfolio
securities held by the Custodian or in a Securities System account of the
Custodian or in the Custodian's Direct Paper book entry system account
("Direct Paper System Account") only upon receipt of Proper Instructions,
which may be continuing instructions when deemed appropriate by mutual
agreement of the parties, and only in the following cases:
1) Sale. Upon the sale of and receipt of payment for a Portfolio's
securities;
2) Repurchase Agreements. Upon receipt of payment in connection with any
repurchase agreement entered into by the Fund related to the securities
being held;
3) Securities System. In She case of a sale effected through a Securities
System, in accordance with the provisions of Section 2.10;
4) Tender Offer. To the depository agent or other receiving agent in
connection with tender or other similar offers for a Portfolio's securities;
5) Redemption by Issuer. To the issuer or its agent when a Portfolio's
securities are called, redeemed, retired or otherwise become payable;
provided that, in any such case, the cash or other consideration is to be
delivered to the Custodian;
6) Transfer to Issuer, Nominee; Exchange. To the issuer or its agent for
transfer into the name of a Portfolio or into the name of any nominee or
nominees of the Custodian or into the name or nominee name of any agent
appointed pursuant to this Agreement or into the name or nominee name of any
subcustodian appointed pursuant to Section 1; or for exchange for a
different number of bonds, certificates or other evidence representing the
same aggregate face amount or number of units and bearing the same interest
rate, maturity date and call provisions, if any; provided that, in any such
case, the new securities are to be delivered to the Custodian;
7) Sale to Broker or Dealer. Upon the sale of a Portfolio's securities to
the broker or its clearing agent or dealer, against a receipt, for
examination in accordance with "street delivery" custom; provided that the
Custodian will have no responsibility or liability for any loss arising from
the delivery of such securities prior to receiving payment for such
securities except as may arise from the Custodian's failure to act in
accordance with its duties as set forth in this Agreement.
8) Exchange or Conversion. For exchange or conversion pursuant to any plan
of merger, consolidation, recapitalization, reorganization, split-up of
shares, change of par value or readjustment of the securities of the issuer
of such securities, or pursuant to provisions for conversion contained in
such securities, or pursuant to any deposit agreement provided that, in any
such case, the new securities and cash, if any, are to be delivered to the
Custodian;
9) Warrants. Rights, in the case of warrants, rights or similar securities,
the surrender thereof in the exercise of such warrants, rights or similar
securities or the surrender of interim receipts or temporary securities for
definitive securities; provided that, in any such case, the new securities
and cash, if any, are to be delivered to the Custodian;
10) Loans of Securities. For delivery in connection with any loans of
securities made by a Portfolio, made only against receipt of adequate
collateral as agreed on from time to time by the Custodian and the Fund on
behalf of the Portfolio. Loans may be in the form of cash, obligations
issued by the United States government, its agencies or instrumentalities,
or such other property as mutually agreed by the parties, except that in
connection with any loans for which collateral is to be credited to the
Custodian's account in the book-entry system authorized by the U.S.
Department of the Treasury, the Custodian will not be held liable or
responsible for the delivery of securities owned by the Portfolio prior to
the receipt of such collateral, unless the Custodian fails to act in
accordance with its duties set forth in this Agreement;
11) Borrowings. For delivery as security in connection with any borrowings
by a Portfolio requiring a pledge of assets by the Portfolio, made only
against receipt of amounts borrowed; except, where additional collateral is
required to secure a borrowing already made, further securities may be
released for that purpose, subject to Proper Instructions;
12) Options. For delivery in accordance with the provisions of any agreement
among the Fund, the Custodian and a broker dealer registered under the
Securities Exchange Act of 1934 (the "Exchange Act") and a member of The
National Association of Securities Dealers, Inc. ("NASD"), relating to
compliance with the rules of The Options Clearing Corporation, any
registered national securities exchange, any similar organization or
organizations, or the Investment Company Act of 1940, regarding escrow or
other arrangements in connection with transactions by the Fund;
13) Futures. For delivery in accordance with the provisions of any agreement
among the Fund, the Custodian, and a Futures Commission merchant registered
under the Commodity Exchange Act, relating to compliance with the rules of
the Commodity Futures Trading Commission and/or any Contract Market, any
similar organization or organizations, or the Investment Company Act of
1940, regarding account deposits in connection with transactions by the Fund;
14) In-Kind Distributions. Upon receipt of instructions from the Fund's
transfer agent, for delivery to the transfer agent or to the holders of
shares in connection with distributions in kind, as may be described from
time to time in the Portfolio's currently effective prospectus and statement
of additional information, in satisfaction of shareholder requests for
repurchase or redemption;
15) Miscellaneous. For any other proper corporate purpose, made only upon
receipt of, in addition to Proper Instructions, a certified copy of a
resolution of the Board of Directors signed by an officer of the Fund and
certified by the Secretary or an Assistant Secretary, specifying the
securities to be delivered, setting forth the purpose for which such
delivery is to be made, declaring such purpose to be a proper corporate
purpose, and naming the person or persons to whom delivery of the securities
will be made.
In all cases, payments to the Portfolio will be made in cash, by a certified
check or a treasurer's or cashier's check of a bank, by effective bank wire
transfer through the Federal Reserve Wire System or, if appropriate, outside
of the Federal Reserve Wire System and subsequent credit to the Fund's
Custodial account, or, in case of delivery through a stock clearing company,
by book-entry credit by the stock clearing company in accordance with the
then current street custom, or such other form of payment as may be mutually
agreed on by the parties, in all such cases collected funds to be promptly
credited to the Fund.
2.3 Registration of Securities. Securities held by the Custodian (other than
bearer securities) will be registered (a) in the name of the Portfolio or
(b) in the name of any nominee of the Portfolio or of any nominee of the
Custodian assigned exclusively to the Portfolio, unless the Fund has
authorized in writing the appointment of a nominee to be used in common with
other registered investment companies having the same investment adviser as
any of the Portfolios, or in the name or nominee name of any agent appointed
pursuant to Section 2.9 or in the name or nominee name of any subcustodian
appointed pursuant to Section 1. All securities accepted by the Custodian on
behalf of a Portfolio under the terms of this Agreement will be in "street
name" or other good delivery form.
2.4 Bank Accounts. The Custodian will open and maintain a separate bank
account or accounts in the name of each Portfolio, subject only to draft or
order by the Custodian acting pursuant to the terms of this Agreement. The
Custodian will hold in the account(s), in accordance with the provisions of
this Agreement, all cash received by it from or for the account of the Fund,
other than cash maintained by the Fund in a bank account established and
used in accordance with Rule 17f-3 under the Investment Company Act of 1940.
Funds held by the Custodian for a Portfolio may be deposited for the
Portfolio's credit in the bank affiliate of the Custodian or in such other
banks or trust companies as the Custodian may in its discretion deem
necessary or desirable; provided, however, that every such bank or trust
company must be qualified to act as a custodian under the Investment Company
Act of 1940. Funds will be deposited by the Custodian in its capacity as
Custodian and will be withdrawable by the Custodian only in that capacity.
2.5 Sale of Shares and Availability of Federal Funds. Upon mutual agreement
between the Fund and the Custodian, the Custodian will, upon the receipt of
Proper Instructions, make federal funds available to the Portfolios as of
specified times agreed upon from time to time by the Fund and the Custodian
in the amount of checks received in payment for shares of the Portfolio
which are deposited into the Portfolio's account.
2.6 Collection of Income, Dividends. The Custodian will collect on a timely
basis all income and other payments with respect to registered securities
held to which the Portfolios are entitled either by law or pursuant to
custom in the securities business. The Custodian will also collect on a
timely basis all income and other payments with respect to bearer securities
if, on the date of payment by the issuer, the securities are held by the
Custodian or its agent. The Custodian will credit a Portfolio's account with
all income or other payments on securities held in a domestic depository, on
the contractual payment date, in Clearinghouse Funds or Federal Funds as the
case may be, regardless of whether the Custodian succeeds in collecting the
item on a timely basis. This credit is subject to the Custodian's right to
reverse the credit in the event of a default in the issuer's payment of such
income. Without limiting the generality of the foregoing, the Custodian will
detach and present for payment all coupons and other income items requiring
presentation as and when they become due and will collect interest when due
on securities held pursuant to this Agreement. The Custodian will also
receive and collect all stock dividends, rights and other items of like
nature as and when they become due or payable. Income due the Portfolio on
securities loaned pursuant to the provisions of Section 2.2(10) will be the
responsibility of the Portfolio; the Custodian will have no duty or
responsibility in connection with loaned securities other than to provide
the Portfolio with such information or data as may be necessary to assist
the Portfolio in arranging for the timely delivery to the Custodian of the
income to which the Fund is properly entitled.
2.7 Payment of Portfolio Monies. Upon receipt of Proper Instructions, which
may be continuing instructions when deemed appropriate by mutual agreement
of the parties, the Custodian will pay out monies of a Portfolio in the
following cases only:
1) Purchases. Upon the purchase of domestic securities, options, futures
contracts or options on futures contracts for the account of the Portfolio
but only (a) against the delivery of such securities, or evidence of title
to such options, futures contracts or options on futures contracts, to the
Custodian (or any bank, banking firm or trust company doing business in the
United States or abroad which is qualified under the Investment Company Act
of 1940, as amended, to act as a custodian and has been designated by the
Custodian as its agent for this purpose in accordance with Section 2.9 of
this Agreement) registered in the name of the Portfolio or in the name of a
nominee of the Portfolio or of the Custodian referred to in Section 2.3 of
this Agreement, or in other proper form for transfer; (b) in the case of a
purchase effected through a Securities System, in accordance with the
conditions set forth in Section 2.10 of this Agreement; (c) in the case of a
purchase involving the Direct Paper System, in accordance with the
conditions set forth in Section 2.11; or (d) in the case of repurchase
agreements entered into between the Fund and the Custodian, or another bank,
or a broker-dealer which is a member of NASD, (i) against delivery of the
securities either in certificate form or through an entry crediting the
Custodian's account at the Federal Reserve Bank with such securities or (ii)
against delivery of the receipt evidencing purchase by the Fund of
securities owned by the Custodian along with written evidence of the
agreement by the Custodian to repurchase such securities from the Fund. All
coupon bonds accepted by the Custodian must have the coupons attached or
must be accompanied by a due xxxx or a check payable on coupon payable date
for the interest due on that date. Payment may be made for purchases in
advance of receipt of securities when the Custodian receives authorization
to do so on a case-by-case basis; however, the Custodian will be absolutely
liable to the Portfolio for such payment in the absence of specific written
instructions to make the payment.
2) Exchanges. In connection with conversion, exchange or surrender of
securities owned by the Fund as set forth in Section 2.2 hereof;
3) Redemptions. For the redemption or repurchase of shares issued by the
Fund as set forth in this Agreement;
4) Expense and Liability. For the payment of any expense or liability
incurred by the Fund, including but not limited to the following payments
for the account of the Fund: interest, taxes, management, accounting,
transfer agent and legal fees, and operating expenses of the Fund whether or
not such expenses are to be in whole or part capitalized or treated as
deferred expenses;
5) Dividends. For the payment of any dividends or other distributions to
shareholders declared by the Fund;
6) Short Sale Dividend. For payment of the amount of dividends received in
respect of securities sold short;
7) Loan. For repayment of a loan upon redelivery of pledged securities and
upon surrender of the note(s), if any, evidencing the loan;
8) Miscellaneous. For any other proper purpose upon receipt of, in addition
to Proper Instructions, a certified copy of a resolution of the Board of
Directors signed by an officer of the Fund and certified by its Secretary or
an Assistant Secretary, specifying the amount of such payment, setting forth
the purpose for which such payment is to be made, declaring such purpose to
be a proper purpose, and naming the person or persons to whom such payment
is to be made.
2.8 Appointment of Agents. At its discretion, the Custodian may at any time
appoint (and may at any time remove) any other bank or trust company
qualified to act as a custodian under the Investment Company Act of 1940 as
its agent to carry out such of the provisions of this Section 2 as the
Custodian may from time to time direct; provided, however, that the
appointment of any agent will not relieve the Custodian of its
responsibilities or liabilities under this Agreement.
2.9 Deposit of Securities in Securities Systems. The Custodian may deposit
and/or maintain a Portfolio's securities in a Securities System in
accordance with applicable Federal Reserve Board and Securities and Exchange
Commission rules and regulations, if any, and subject to the following
provisions:
1) Account of Custodian. The Custodian may keep a Portfolio's securities in
a Securities System provided that such securities are represented in an
account of the Custodian in the Securities System that does not include any
assets of the Custodian other than assets held as a fiduciary, custodian or
otherwise for customers;
2) Records. The Custodian's records, with respect to a Portfolio's
securities maintained in a Securities System, must identify by book entry
those securities belonging to the Portfolio;
3) Payment/Delivery.
(a) Subject to Section 2.7 (Payment of Fund Monies), the Custodian will pay
for a Portfolio's securities upon (i) receipt of advice from the Securities
System that such securities have been transferred to the Account, and (ii)
the making of an entry on the records of the Custodian to reflect such
payment and transfer for the account of the Portfolio;
(b) Subject to Section 2.2 (Delivery of Securities), the Custodian will
transfer a Portfolio's securities upon (i) receipt of advice from the
Securities System that payment for such securities has been transferred to
the Custodian's account, and (ii) the making of an entry on the records of
the Custodian to reflect such transfer and payment for the account of the
Portfolio;
(c) Copies of all advices from the Securities System of transfers of a
Portfolio's securities will identify the Portfolio, be maintained for the
Portfolio by the Custodian and be provided to the Portfolio at its request.
The Custodian will furnish daily transaction sheets reflecting each day's
transactions in the Securities System for the account of the Portfolio.
4) Reports. The Custodian will provide the Portfolio with any report
obtained by the Custodian on the Securities System's accounting system,
internal accounting control and procedures for safeguarding securities
deposited in the Securities System, and further agrees to provide the
Portfolio with copies of any documentation it has relating to its
arrangements with the Securities Systems as set forth in this Agreement or
as otherwise required by the Securities and Exchange Commission or any other
regulatory agency or organization;
5) Liability. Anything to the contrary in this Agreement notwithstanding,
the Custodian will be liable to the Portfolio for any loss or expense, which
may include reasonable attorneys fees, or damage to the Portfolio resulting
from use of the Securities System by reason of any negligence, misfeasance
or misconduct of the Custodian, its agents, or any employee or agent of the
Custodian or agent, or from failure of the Custodian or any such agent to
enforce effectively such rights as it may have against the Securities
System. At the election of the Portfolio, it will be entitled to be
subrogated to the rights of the Custodian with respect to any claim against
the Securities System or any other person that the Custodian may have as a
consequence of any such loss, expense or damage if and to the extent that
the Portfolio has not been made whole for any such loss, expense or damage.
2.10 Fund Assets Held in the Custodian's Direct Paper System. The Custodian
may deposit and/or maintain securities owned by a Portfolio in the Direct
Paper System of the Custodian subject to the following provisions:
1) No transaction relating to securities in the Direct Paper System will be
effected in the absence of Proper Instructions;
2) The Custodian may keep securities of a Portfolio in the Direct Paper
System only if such securities are represented in an account of the
Custodian in the Direct Paper System that does not include any assets of the
Custodian other than assets held as a fiduciary, custodian or otherwise for
customers;
3) The records of the Custodian, with respect to securities of a Portfolio,
that are maintained in the Direct Paper System will identify by book entry
those securities belonging to the Portfolio;
4) The Custodian will pay for securities purchased for the account of a
Portfolio upon the making of an entry on the records of the Custodian to
reflect such payment and transfer of securities to the account of the
Portfolio. The Custodian will transfer securities sold for the account of
the Fund upon the making of an entry on the records of the Custodian to
reflect such transfer and receipt of payment for the account of the Fund;
5) The Custodian will furnish each Portfolio confirmation of every transfer
to or from its account, in the form of a written advice or notice, of Direct
Paper on the next business day following such transfer and will furnish to
the Portfolio copies of daily transaction sheets reflecting each day's
transaction in the Securities System for its account;
6) The Custodian will provide each Portfolio with any report on its system
of internal accounting control as the Portfolio may reasonably request from
time to time;
2.11 Segregated Account. The Custodian will, upon receipt of Proper
Instructions, establish and maintain a segregated account or accounts for
and on behalf of each Portfolio, into which may be transferred cash and/or
securities, including securities maintained in an account by the Custodian
pursuant to Section 2.9 of this Agreement: (i) in accordance with the
provisions of any agreement among the Fund, the Custodian and a
broker-dealer registered under the Exchange Act and a member of the NASD (or
any futures commission merchant registered under the Commodity Exchange
Act), relating to compliance with the rules of the Options Clearing
Corporation and of any registered national securities exchange (or the
Commodity Futures Trading Commission or any registered contract market), or
of any similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by a Portfolio, (ii) for
purposes of segregating cash or government securities in connection with
options purchased, sold or written by a Portfolio or commodity futures
contracts or options purchased or sold by the Portfolio, (iii) for the
purposes of compliance by the Fund with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release, rule or
policy of the Securities and Exchange Commission relating to the maintenance
of segregated accounts by registered investment companies and (iv) for other
proper corporate purposes, but only in the case of clause (iv) upon receipt
of, in addition to Proper Instructions, a certified copy of a resolution of
the Board of Directors setting forth the purpose or purposes of such
segregated account and declaring such purposes to be proper corporate
purposes.
2.12 Ownership Certificates for Tax Purposes. The Custodian will execute
ownership and other certificates and affidavits for all federal and state
tax purposes in connection with receipt of income or other payments for a
Portfolio's securities and in connection with transfers of such securities.
2.13 Proxies. If the securities are registered other than in the name of a
Portfolio or a nominee of the Portfolio, the Custodian will cause all
proxies promptly to be executed by the registered holder of such securities,
without indication of the manner in which such proxies are to be voted, and
will promptly deliver to the Portfolio all proxy soliciting materials and
all notices relating to such securities.
2.14 Communications Relating to Fund Securities. The Custodian will transmit
promptly to each Portfolio all written information (including, without
limitation, pendency of calls and maturities of domestic securities and
expirations of rights in connection therewith and notices of exercise of
call and put options written by the Portfolio and the maturity of futures
contracts purchased or sold by the Portfolio) received by the Custodian from
issuers of the Portfolio's securities by the Custodian, an agent appointed
under Section 2.9, or subcustodian appointed under Section 1. With respect
to tender or exchange offers, the Custodian will transmit promptly to the
Portfolio all written information received by the Custodian, an agent
appointed under Section 2.9, or subcustodian appointed under Section 1 from
issuers of the securities whose tender or exchange is sought and from the
party (or its agents) making the tender or exchange offer. If a Portfolio
desires to take action with respect to any tender offer, exchange offer or
any other similar transaction, the Portfolio will notify the Custodian of
such desired action at least three business days prior to the time such
action must be taken under the terms of the tender, exchange offer, or other
similar transaction, and it will be the responsibility of the Custodian to
timely transmit to the appropriate person(s) the Portfolio's notice. Where
the Portfolio does not notify the Custodian of its desired action within the
three business day period, the Custodian will use its best efforts to timely
transmit the Portfolio's notice to the appropriate person.
2.15 Reports to Fund by Independent Public Accountants. At the request of
the Fund, the Custodian will provide the Fund, for the benefit of each of
its Portfolios, with audited annual reports. The Custodian will further
provide the Fund, at such times as the Fund may reasonably require, with
reports by independent public accountants on the accounting system, internal
accounting control and procedures for safeguarding securities, futures
contracts and options on futures contracts, including securities deposited
and/or maintained in a Securities System, relating to the services provided
by the Custodian under this Contract. Such reports will be of sufficient
scope and in sufficient detail, as may reasonably be required by the Fund to
provide reasonable assurance that any material inadequacies existing or
arising since the prior examination would be disclosed by such examination.
The reports must describe any material inadequacies disclosed and, if there
are no such inadequacies, the reports will so state.
Payments for Redemptions of Shares of a Portfolio
From such funds as may be available for the purpose but subject to the
limitations of the Governing Documents of the Fund and any applicable votes
of the Board of Directors of the Fund pursuant to those Documents, the
Custodian will, upon receipt of instructions from the Transfer Agent, make
funds available for payment to holders of shares who have delivered to the
Transfer Agent a request for redemption of their shares. In connection with
the redemption of shares of a Portfolio, the Custodian is authorized upon
receipt of instructions from the Transfer Agent to wire funds to or through
a commercial bank designated by the redeeming shareholder.
The Custodian will receive payments for a Portfolio's shares issued or sold
from the distributor for the Portfolio's shares or from the Transfer Agent
of the Portfolio and deposit as received into the Portfolio's account such
payments as are received for shares of the Portfolio issued or sold from
time to time by the Portfolio. The Custodian will provide timely
notification to the Portfolio and the Transfer Agent of any receipt by it of
payments for shares of the Portfolio.
4. Proper Instructions
"Proper Instructions" means a writing signed or initialed by one or more
persons authorized by the Board of Directors. Each such writing must set
forth the specific transaction or type of transaction involved, including a
statement of the purpose for which such action is requested, and may be a
blanket instruction authorizing specific transactions of a routine nature or
occurring repeatedly. Oral instructions will be considered Proper
Instructions if the Custodian reasonably believes them to have been given by
a person authorized to give such instructions with respect to the
transaction involved. The Fund will cause all oral instructions to be
confirmed in writing. Upon receipt of a certificate of the Secretary or an
Assistant Secretary as to the authorization by the Board of Directors of the
Fund, accompanied by a detailed description of procedures approved by the
Board of Directors, Proper Instructions may include communications effected
directly between electromechanical or electronic devices provided that the
Board of Directors and the Custodian are satisfied that such procedures
afford adequate safeguards for the Fund's assets.
5. Actions Permitted without Express Authority
In its discretion the Custodian may, without express authority from the Fund:
1) surrender securities in temporary form for securities in definitive form;
2) endorse for collection, in the name of a Portfolio, checks, drafts and
other negotiable instruments on the same day as received: and
3) in general, attend to all nondiscretionary details in connection with the
sale, exchange, substitution, purchase, transfer and other dealings with the
securities and property of a Portfolio except as otherwise directed by the
Board of Directors of the Fund.
6. Evidence of Authority, Reliance on Documents
The Custodian will not be liable for actions taken pursuant to instructions,
notice, request, consent, certificate or other instrument or paper
reasonably and in good faith believed by it to be genuine and to have been
properly executed by or on behalf of the Fund or a Portfolio in accordance
with Proper Instructions as defined in Section 4 of this Agreement. The
Custodian may receive and accept a certified copy of a vote of the Board of
Directors of the Fund as conclusive evidence (a) of the authority of any
person to act in accordance with such vote or (b) of any determination or of
any action by the Board of Directors pursuant to the Governing Documents of
the Fund as described in such vote, and such vote may be considered as in
full force and effect until receipt by the Custodian of written notice to
the contrary. So long as and to the extent that it is in the exercise of the
standard of care set forth in Section 10 of this Agreement, the Custodian
will not be responsible for the title, validity or genuineness of any
property or evidence of title received by it or delivered by it pursuant to
this Agreement and will be held harmless in acting upon any notice, request,
consent, certificate or other instrument reasonably believed by it to be
genuine and to be signed by the proper party or parties.
7. Records, Inventory
The Custodian will create and maintain all records relating to its
activities and obligations under this Agreement in such manner as will meet
the obligations of the Fund under the Investment Company Act of 1940, with
particular attention to Section 31 and Rules 31a-1 and 31a-2 thereunder. All
such records will be the property of the Fund and will at all times during
the regular business hours of the Custodian be open for inspection and audit
by duly authorized officers, employees or agents of the Fund and employees
and agents of the Securities and Exchange Commission, and, in the event of
termination of this Agreement, will be delivered in accordance with Section
12 of this Agreement. The Custodian will, at the Fund's request, supply the
Fund with a tabulation of securities owned by any Portfolio and held by the
Custodian and will, when requested to do so by the Fund and for such
compensation as is agreed on by the Portfolio and the Custodian, include
certificate numbers in such tabulations. The Custodian will conduct a
periodic inventory of all securities and other property subject to this
Agreement and provide to the Fund a periodic reconciliation of the vaulted
position of each Portfolio to the appraised position of the Portfolio. The
Custodian will promptly report to the Fund the results of the
reconciliation, indicating any shortages or discrepancies uncovered thereby,
and take appropriate action to remedy any such shortages or discrepancies.
8. Opinion of the Fund's Independent Accountant
The Custodian will cooperate with the Fund's independent public accountants
in connection with the annual and other audits of the books and records of
the Fund and take all reasonable action, as the Fund may from time to time
request, to provide the necessary information to such accountants for the
expression of their opinion without any qualification as to the scope of
their examination, including but not limited to, any opinion in connection
with the preparation of the Fund's Form N-1A, and Form N-SAR or other
reports to the Securities and Exchange Commission or state regulatory agency
and with respect to any other legal requirements.
9. Compensation of Custodian
The Custodian will be entitled to reasonable compensation for its services
and expenses as Custodian, as detailed in the attached Addendum.
10. Responsibility of Custodian - Indemnification
Reasonable Care - Notwithstanding anything to the contrary in this
Agreement, the Custodian will be held to the exercise of reasonable care in
carrying out the provisions of this Agreement, but will be kept indemnified
by and will be without liability to the Fund for any action taken or omitted
by it in good faith without negligence.
Notice to Fund - in order for the indemnification provision contained in
this Section to apply, it is understood that if in any case the Fund may be
asked to indemnify or hold the Custodian harmless, the Fund will be fully
and promptly advised of all pertinent facts concerning the situation in
question, and it is further understood that the Custodian will use all
reasonable care to identify and notify the Fund promptly concerning any
situation which presents or appears likely to present the probability of
such a claim for indemnification against the Fund.
Defense of Custodian - The Fund will have the option to defend the Custodian
against any claim which may be the subject of this indemnification, and in
the event that the Fund so elects, it will so notify the Custodian, and
thereupon the Fund will take over complete defense of the claim and the
Custodian will in such situation initiate no further legal or other expenses
for which it will seek indemnification under this Section. The Custodian
will in no case confess any claim or make any compromise in any case in
which the Fund will be asked to indemnify the Custodian except with the
Fund's prior written consent. Nothing in this Section will be construed to
limit any right or cause of action on the part of the Custodian under this
Agreement which is independent of any right or cause of action on the part
of the Fund. The Custodian will be entitled to rely on and may act upon
advice of counsel (who may be counsel for the Fund or such other counsel as
may be agreed to by the parties) on all matters, and will be without
liability for any action reasonably taken or omitted pursuant to such advice.
If the Fund requires the Custodian to take any action with respect to
securities that involves the payment of money, or that may, in the opinion
of the Custodian, result in the Custodian or its nominee assigned to the
Fund being liable for the payment of money or incurring liability of some
other form, the Fund, as a prerequisite to requiring the Custodian to take
such action, will indemnify the Custodian in an amount and form satisfactory
to it.
If a Portfolio requires the Custodian to advance cash or securities for any
purpose or in the event that the Custodian or its nominee incurs or is
assessed any taxes, charges, expenses, assessments, claims or liabilities in
connection with the performance of this Agreement, except as may arise from
the Custodian's or its agent's negligent action or omission, or willful
misconduct, any property held for the account of the Portfolio will serve as
security. If the Portfolio fails to repay the Custodian promptly, the
Custodian will be entitled to use available cash and to dispose of the
Portfolio's assets to the extent necessary for reimbursement. If the
Custodian exercises this option, it must give the Portfolio reasonable
notice so as to enable the Portfolio to repay the cash or securities
advanced. Such notice will not preclude the Custodian from asserting any
lien under this provision.
11. Effective Period, Termination and Amendment
This Agreement will become effective as of its execution, provided that the
Custodian will have received proof of initial approval of a particular
Securities System pursuant to Rule 17f-4 under the Investment Company Act of
1940 (see Section 2.9 of this Agreement) or of the Direct Paper System (see
Section 2.10 of this Agreement). The Portfolio will provide proof of annual
approval to the Custodian. This Agreement will continue in force until
terminated as provided in this Section. It may be amended at any time by
mutual agreement of the parties, and may be terminated by either party with
60 days written notice. The Fund may, by action of the Fund's Board of
Directors, immediately terminate this Agreement in the event of the
appointment of a conservator or receiver for the Custodian by the
Comptroller of the Currency or a like event at the direction of an
appropriate regulatory agency or court of competent jurisdiction.
In the event the Agreement terminates, the Fund will pay the Custodian
whatever compensation is due as of the date of the termination, and will
reimburse the Custodian for costs, expenses and disbursements incurred in
connection with termination, but only to the extent the Fund gives prior
approval for the expenditures. Approval will not be unreasonably withheld.
12. Successor Custodian
If a successor Custodian is appointed by the Board of Directors of the Fund,
the Custodian will, upon termination, deliver to the successor custodian at
the office of the Custodian, duly endorsed and in the form for transfer, all
securities, funds and other properties then held by it pursuant to this
Agreement, and will transfer to an account of the successor custodian all of
each Portfolio's securities held in a Securities System. The Custodian will
cooperate in assisting the successor Custodian so that it may continue any
subcustodian agreement entered into by the Custodian and any subcustodian on
behalf of the Fund.
If no successor is to be appointed, the Custodian will make the securities,
funds and other properties available as above to the Fund upon receipt of a
certified copy of a vote of the Board of Directors of the Fund.
If no written order designating a successor Custodian or certified copy of a
vote of the Board of Directors is delivered to the Custodian on or before
the effective date of the termination, the Custodian will have the right to
make delivery to a bank (as defined in the Investment Company Act of 1940)
or trust company of its own selection having aggregate capital, surplus, and
undivided profits, as shown by its last published report, of not less than
$50,000,000, which will become the successor custodian under this Agreement.
In the event the securities, funds and other properties remain in the
possession of the Custodian after the termination date due to failure by the
Fund to procure the certified copy of the appropriate vote of the Board of
Directors, the Custodian will be entitled to fair compensation for its
services during the period during which it retains possession of the
property, and the provisions of this Agreement relating to the duties and
obligations of the Custodian will remain in full force.
If during the term of this Agreement any Portfolio is liquidated pursuant to
law, the Custodian will distribute the remaining assets of the Portfolio
after satisfying all expenses and liabilities of that Portfolio. Such
distributions will be pro rata among the Portfolio's shareholders as
certified by the Transfer Agent, and will be in cash or, if the Portfolio so
orders, in portfolio securities. Section 10 (Responsibility of Custodian -
Indemnification) will survive any termination of this Agreement.
13. Interpretive and Additional Provisions
In connection with the operation of this Agreement, the Custodian and the
Fund may from time to time agree on such provisions interpretive of or in
addition to the provisions of this Agreement as may in their joint opinion
be consistent with the general tenor of this Agreement. Any such
interpretive or additional provisions will be in a writing signed by both
parties and will be annexed to this Agreement. No interpretive or additional
provisions will contravene any applicable federal or state regulations or
any provision of the Governing Documents of the Fund, nor will they be
deemed amendments to this Agreement.
14. Notice
Notice will be considered sufficient if sent by registered or certified
mail, or by such other means as the parties agree, to the other party at the
address set forth above or at any other address specified in writing and
delivered to the other party.
15. Bond
The Custodian will, at all times, maintain a bond issued by a reputable
fidelity insurance company authorized to do business in the place where the
bond is issued. The bond will be issued against larceny and embezzlement,
and will cover each officer and employee of the Custodian who may, singly or
jointly with others, have access to securities or funds of the Fund, either
directly or through authority to receive and carry out any certificate
instruction, order request, note or other instrument required or permitted
by this Agreement. The Custodian agrees that it will not cancel, terminate
or modify the bond so as to affect adversely the Fund, except after written
notice to the Fund not less than 10 days prior to the effective date of such
cancellation, termination or modification. At the request of the Fund, the
Custodian will furnish to the Fund a copy of each such bond and each
amendment thereto.
16. Confidentiality
The Custodian agrees to treat all records and other information relative to
the Portfolios and their prior, present or future shareholders as
confidential, and the Custodian, on behalf of itself and its employees,
agrees to keep confidential all such information except when requested to
divulge such information by duly constituted authorities, or when so
requested by the Fund. If requested to divulge confidential information to
anyone other than persons normally authorized by the Fund to receive
information, such as the Fund's auditors or attorneys, the Custodian will
not release the information until it notifies the Fund in writing and
receives approval in writing from the Fund, unless required by law to do
otherwise. Approval by the Fund will not be unreasonably withheld and may
not be withheld where the Custodian may be exposed to civil or criminal
contempt proceedings for failure to comply.
17. Exemption from Liens
Except as provided in Section 10 of this Agreement, the securities and other
assets held by the Custodian for a Portfolio will be subject to no lien or
charge of any kind in favor of the Custodian or any person claiming through
the Custodian, but nothing herein will be deemed to deprive the Custodian of
its right to invoke any and all remedies available at law or equity to
collect amounts due it under this Agreement. Neither the Custodian nor any
subcustodian appointed pursuant to Section 1 of this Agreement will have any
power or authority to assign, hypothecate, pledge or otherwise dispose of
any securities held by it for the Portfolio, except upon the direction of
the Fund, duly given as herein provided, and only for the account of the
Portfolio.
18. Massachusetts Law to Apply
This Agreement will be construed and the provisions thereof interpreted
under and in accordance with laws of the Commonwealth of Massachusetts.
19. Governing Documents
The term "Governing Documents" refers to the Fund's Articles of
Incorporation, Bylaws and Registration Statement filed under the Securities
Act of 1933, as amended from time to time.
20. Directors and Shareholders
Neither the holders of shares in the Portfolios nor any Directors of the
Fund will be personally liable under this Agreement.
21. Massachusetts Business Trust
With respect to the Fund, which is a party to this Agreement any which is
organized as a business trust under the laws of the Commonwealth of
Massachusetts, the term Fund means and refers to the Directors serving under
the applicable incorporation document. It is expressly agreed that the
obligations of the Fund under this Agreement will not be binding on any of
the Directors, Portfolio shareholders, nominees, officers, agents or
employees of the Fund personally, but bind only the property of the Fund's
Portfolios.
22. Successors of Parties
This Contract will be binding on and will inure to the benefit of the Fund
and the Custodian and their respective successors.
23. Integration Clause
The parties agree that all aspects of their agreement are contained in this
document, its Addendum, supplemental agreements and all amendments thereto,
and that any disputes arising in connection with this Agreement will be
decided with reference to those documents.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and
its seal to be affixed hereunder as of the dates indicated below.
ACACIA CAPITAL CORPORATION
By: /s/ Date: 5/18/92
Xxxxxxx X. Xxxxxxxxx
Attest: /s/ Date: 5/18/92
Xxxx-xxx Xxxx
STATE STREET BANK AND TRUST COMPANY
By: /s/ Date: 6/4/92
Xxxxxx X. Xxxxx
Attest: /s/ Date: 6/4/92
Illegible
LETTER AGREEMENT BETWEEN
ACACIA CAPITAL CORPORATION AND
STATE STREET BANK AND TRUST COMPANY
SUPPLEMENTING THE CUSTODIAN AGREEMENT
DATED AS OF MARCH 5, 1992
The following items supplement the Custodian Agreement
("Agreement") dated March 5, 1992, and are considered part of the Agreement:
1. The initial Addendum to the Agreement, dated as of March 5, 1992,
will remain in effect for a minimum of three years; that is, until at least
March 5, 1995, unless mutually agreed by the parties.
2. The Fund is entitled to pay fees to the Custodian by analysis on
collected funds, which will earn the rate stated in the Addendum to the
Agreement.
IN WITNESS WHEREOF, each of the parties has caused this instrument
to be executed in its name and behalf by its duly authorized representative
and its seal to be affixed hereunder as of the dates indicated below.
ACACIA CAPITAL CORPORATION
By: /s/ Date: 5/18/92
Xxxxxxx X. Xxxxxxxxx
Attest: /s/ Date: 5/18/92
Xxxx-xxx Xxxx
STATE STREET BANK AND TRUST COMPANY
By: /s/ Date: 6/4/92
Xxxxxx X. Xxxxx
Attest: /s/ Date: 6/4/92
Illegible
APPENDIX A
The following Portfolios are covered by the Custodian Agreement
between Acacia Capital Corporation and State Street Bank and Trust Company:
Xxxxxxx Responsibly Invested Ariel Appreciation Portfolio (Xxxxxxx-Xxxxx
Appreciation II)
Xxxxxxx Responsibly Invested Bond Portfolio
Xxxxxxx Responsibly Invested Equity Portfolio
Xxxxxxx Responsibly Invested Managed Growth Portfolio (Xxxxxxx Socially
Responsible Series)
Xxxxxxx Responsibly Invested Global Equity Portfolio
Xxxxxxx Responsibly Invested Money Market Portfolio
Money Market Series
Growth Series
Bond Series
Managed Series
Government Series
Zero Coupon 1996 and 2006 Series
ADDENDUM TO CUSTODIAN AGREEMENT
The Fund will pay the following fees to State Street Bank and Trust Company
pursuant to the Custodian Agreement dated as of March 5, 1992. The rates,
which may be adjusted annually according to the Consumer Price Index (CPI),
will remain in effect until March 31, 1995, or for three years from the
commencement of services by the Custodian.
1. Administration - Three levels of service are listed below. Specific
services are outlined in the proposal. Each service includes maintenance of
one demand deposit per account per portfolio. All fees will be billed
monthly and payable quarterly.
A. Custody Service
B. Custody, Portfolio and Fund Accounting Service
C. Custody and Remote Service
Annual Charges
B. Custody,
Portfolio
Portfolio and Fund C. Custody &
Assets A. Custody Accounting Remote Service
less than $25 million $500 $40,000 $6,000
$25 - 100 MM $2,000 $40,000 $7,500
more than $100 MM $3,500 $40,000 $9,000
Annual Horizon Base Charge $25,000
2. Portfolio Trades - There will be a charge for each of the following
line items processed:
State Street Bank Repos $7.00
DTC or Fed Book Entry $12.00
New York Physical Settlements $25.00
Maturity Collections $8.00
PTC Purchase, Sale, Deposit or Withdrawal $20.00
Internal Transfers $8.00
All other trades $16.00
3. Options - The following charges will apply per issue and per broker:
Option charge for each option written or closing contract price $25.00
Option expiration charge $15.00
Option exercised charge $15.00
4. Lending of Securities
Deliver loaned securities versus cash collateral $20.00
Deliver loaned securities versus securities collateral $30.00
Receive/deliver additional cash collateral $6.00
Substitutions of securities collateral $30.00
Deliver cash collateral versus receipt of loaned securities $15.00
Deliver securities collateral versus receipt of loaned securities $25.00
Loan administration - xxxx - to - market per day, per loan $3.00
5. Interest Rate Futures
Transactions - no security movement $8.00
6. Holdings Charge
For each issue maintained - monthly charge $5.00
7. Principal Reduction Payments
Per paydown $10.00
8. Dividend Charges
For items held at the request of traders over record date
in street form $50.00
9. Global Custody
Group l Group 2 Group 3 Group 4 Group 5
Austria Australia Denmark Indonesia Argentina
Canada Belgium Finland Korea Brazil
Euroclear Netherlands France Mexico Chile
Germany New Zealand Ireland Portugal Greece
Hong Kong Norway Italy Spain Philippines
Japan Singapore Malaysia Sweden Turkey
Switzerland Thailand Taiwan* Venezuela
United Kingdom
A. Net Assets (fees indicated in basis points)
Group l Group 2 Group 3 Group 4 Group 5
First $50 Million 12 15 18 25 30
Next $50 Million 10 13 16 25 30
Over $100 Million 8 11 14 25 30
B. Transaction Charge
Group l Group 2 Group 3 Group 4 Group 5
$30 $45 $60 $75 $125**
* Transaction fee indicated below does not include agent, depository and
local auditor's fees.
** Except Turkey, for which the transaction charge is $0.50 per security
settled with a minimum charge of $250 and a maximum charge of $7,500.
10. Special Services - Fees for activities of a nonrecurring nature,
such as fund consolidations or reorganizations, extraordinary security
shipments and the preparation of special reports, will be subject to
negotiation. Fees for automated pricing, yield calculation and other special
items will be negotiated separately.
11. Balance Credit - Balance credits for all funds will be applied
against the foregoing fees based on the 13 week Treasury xxxx xxxx
equivalent adjusted by the current federal reserve and FDIC insurance
requirements. The rate in effect at each prior month end will be used,
adjusted to a monthly basis, times the average collected balance in the
demand deposit accounts.
12. Out-of-Pocket Expenses - Billing for recovery of out-of-pocket
expenses will be made as of the end of each month, and will be payable
quarterly. Where a dollar amount is indicated below, the fee that may be
charged to the Fund is limited as noted. Out-of-pocket expenses include, but
are not limited to:
Wire charges ($4.75)
Telephone/Line Charges
Postage and Insurance
Courier Service
Duplicating
Legal Fees
Supplies Related to Fund Records
Rush Transfer ($8.00)
Transfer Fees
Subcustodian Charges
Audit Letter
Federal Reserve Fee for Return Cheek items Over $2,500 ($4.25)
GNMA Transfer ($15.00)
PTC Deposit/Withdrawal for same-day turnaround ($50.00)
Overdrafts (Prime Rate)
13. Demand Deposit Services - [Note: Demand Deposit Account Services
are charged for accounts other than the portfolio custody account(s)]
Account Maintenance $12.00
Statements (Duplicate and Additional) $4.00
Check(s) Paid $0.18
Deposit Ticket Processed $0.85
Deposit item Based
Commercial Encoded varies
Commercial Unencoded $0.10
Return Deposited Item (Commercial) $3.00
* Redeposit of Item
Per Deposit $1.00
Per Item $0.50
Pay/Return Checks Against Zero,
NFS or UNC Funds $15.00
Check Certification $7.00
Stop Payment Order (Manual) $15.00
Wire Transfer Out $4.75
Wire Transfer In $4.75
Photo Requests Adjustments $5.00
Auditors Confirmations $25.00
** FDIC $0.195/$100/yr.
Treasurers Checks $7.00
Money Orders $2.50
Counter Checks $1.50
* In addition to the charges for Redeposit of item, an adjustment to the
daily float calculation will be assessed.
** The rate utilized for FDIC compensation will reflect that which is
charged by the agency for the applicable period.
15. Cash Management
Automated Wires (via Terminal) -
Per log-on $2.00
Automated Wires (CPU to CPU) - Monthly Fees; Set-up (one-time charge)
Installation $2,500.00
Modems (2) $3,000.00
Encryption (2) $5,200.00
Outgoing wires will be charged as noted in Demand Deposit Section
Automated Clearing House (ACH) Processing
Per Tape $15.00
Per item $0.06
Controlled Disbursement
Monthly Funding and Reporting $125.00
Per Check Paid $0.08
Balance Reporting (SSCAN)
Annual-Base (Per Client) $1,000.00
Per Account, Per Report $50.00
("Report" daily, 1,000 transactions/month)
Intraday Report, per account $200.00
Reconcilement Services (Partial)
Monthly Maintenance $100.00
Per item $0.06
Monthly Minimum $140.00
Full - Electronic input
Monthly Maintenance. $145.00
Per hem $0.06
Monthly Minimum $205.00
Additional Reconcilement Services
On-line inquiry
3 Month Storage, Per item $0.01
6 Month Storage, Per item $0.02
On-line Photo Request, Per item $1.00
On-line Stop Payment, Per item $6.00
Microfilm of Check, Per item $0.02
Check Redemption, Per item $0.02
IN WITNESS WHEREOF, each of the parties has caused this instrument
to be executed in its name and behalf by its duly authorized representative
and its seal to be affixed hereunder as of the dates indicated below.
ACACIA CAPITAL CORPORATION
BY: /s/ Date: 6/24/92
Xxxxxxx. X. Xxxxxxxxx
STATE STREET BANK AND TRUST COMPANY
BY: /s/ Date: 7/8/92
X. X. Xxxxxxxx
AMENDMENT TO THE CUSTODIAN CONTRACT
AGREEMENT made by and between State Street Bank and Trust Company (the
"Custodian") and Acacia Capital Corporation (the "Fund").
WHEREAS, the Custodian and the Fund are parties to a custodian contract
dated March 5, 1992 (the "Custodian Contract") governing the terms and
conditions under which the Custodian maintains custody of the securities and
other assets of the Fund; and
WHEREAS, the Custodian and the Fund desire to amend the Custodian Contract
to provide for the maintenance of the Fund's foreign securities, and cash
incidental to transactions in such securities, in the custody of certain
foreign banking institutions and foreign securities depositories acting as
subcustodians in conformity with the requirements of Rule 1 7f-5 under the
Investment Company Act of 1940;
NOW THEREFORE, in consideration of the promises and covenants contained
herein, the Custodian and the Fund hereby amend the Custodian Contract by
the addition of the following terms and conditions:
1. Appointment of Foreign Subcustodians.
The Fund hereby authorizes and instructs the Custodian to employ as
subcustodians for the Fund's securities and other assets maintained outside
the United States the foreign banking institutions and foreign securities
depositories designated on Schedule A hereto ("foreign subcustodians"). Upon
receipt of "Proper Instructions", as defined in Section 2.17 of the
Custodian Contract, together with a certified resolution of the Fund's Board
of Directors, the Custodian and the Fund may agree to amend Schedule A
hereto from time to time to designate additional foreign banking
institutions and foreign securities depositories to act as subcustodian.
Upon receipt of Proper Instructions, the Fund may instruct the Custodian to
cease the employment of any one or more such subcustodians for maintaining
custody of the Fund's assets.
2. Assets to be Held.
The Custodian shall limit the securities and other assets maintained in the
custody of the foreign subcustodians to: (a) "foreign securities", as
defined in paragraph (c)(l) of Rule 17f-5 under the Investment Company Act
of 1940, and (b) cash and cash equivalents in such amounts as the Custodian
or the Fund may determine to be reasonably necessary to effect the Fund's
foreign securities transactions. The Custodian shall identify on its books
as belonging to the Fund, the foreign securities of the Fund held by each
foreign subcustodian.
3. Foreign Securities Depositories.
Except as may otherwise be agreed upon in writing by the Custodian and the
Fund, assets of the Funds shall be maintained in foreign securities
depositories only through arrangements implemented by the foreign banking
institutions serving as subcustodians pursuant to the terms hereof. Where
possible, such arrangements shall include entry into agreements containing
the provisions set forth in Section 5 hereof.
4. Segregation of Securities.
The Custodian shall identify on its books as belonging to the Fund, the
foreign securities of the Fund held by each foreign subcustodian. Each
agreement pursuant to which the Custodian employs a foreign banking
institution shall require that such institution establish a custody account
for the Custodian on behalf of the Fund and physically segregate in that
account, securities and other assets of the Fund, and, in the event that
such institution deposits the Fund's securities in a foreign securities
depository, that it shall identify in its books as belonging to the
Custodian, as agent for the Fund, the securities so deposited.
5. Agreements with Foreign Banking Institutions.
Each agreement with a foreign banking institution shall be substantially in
the form set forth in Exhibit 1 hereto and shall provide that: (a) the
Fund's assets will not be subject to any right, charge, security interest,
lien or claim of any kind in favor of the foreign banking institution or its
creditors or agents, except a claim of payment for their safe custody or
administration; (b) beneficial ownership of the Fund's assets will be freely
transferable without the payment of money or value other than for custody or
administration; (c) adequate records will be maintained identifying the
assets as belonging to the Fund; (d) officers of or auditors employed by, or
other representatives of the Custodian, including to the extent promised
under applicable law the independent public accountants for the Fund, will
be given access to the books and records of the foreign banking institution
relating to its actions under its agreement with the Custodian; and (e)
assets of the Fund held by the foreign subcustodian will be subject only to
the instructions of the Custodian or its agents.
6. Access of Independent Accountants of the Fund.
Upon request of the Fund, the Custodian will use its best efforts to arrange
for the independent accountants of the Fund to be afforded access to the
books and records of any foreign banking institution employed as a foreign
subcustodian insofar as such books and records relate to the performance of
such foreign banking institution under its agreement with the Custodian.
7. Reports by Custodian.
The Custodian will supply to the Fund from time to time, as mutually agreed
upon, statements in respect of the securities and other assets of the Fund
held by foreign subcustodians, including but not limited to an
identification of entities having possession of the Fund's securities and
other assets and advices or notifications of any transfers of securities to
or from each custodial account maintained by a foreign banking institution
for the Custodian on behalf of the Fund indicating, as to securities
acquired for the Fund, the identity of the entity having physical possession
of such securities.
8. Transactions in Foreign Custody Account.
(a) Except as otherwise provided in paragraph (b) of this Section 8, the
provision of Sections 2.2 and 2.8 of the Custodian Contract shall apply,
mutatis mutandis to the foreign securities of the Fund held outside the
United States by foreign subcustodians.
(b) Notwithstanding any provision of the Custodian Contract to the contrary,
settlement and payment for securities received for the account of the Fund
and delivery of securities maintained for the account of the Fund may be
effected in accordance with the customary established securities trading or
securities processing practices and procedures in the jurisdiction or market
in which the transaction occurs, including, without limitation, delivering
securities to the purchaser thereof or to a dealer therefor (or an agent for
such purchaser or dealer) against a receipt with the expectation of
receiving later payment for such securities from such purchaser or dealer.
(c) Securities maintained in the custody of a foreign subcustodian may be
maintained in the name of such entity's nominee to the same extent as set
forth in Section 2.3 of the Custodian Contract and the Fund agrees to hold
any such nominee harmless from any liability as a holder of record of such
securities.
9. Liability of Foreign Subcustodians.
Each agreement pursuant to which the Custodian employs a foreign banking
institution as a foreign subcustodian shall require the institution to
exercise reasonable care in the performance of its duties and to indemnify,
and hold harmless, the Custodian and each Fund from and against any loss,
damage, cost, expense, liability or claim arising out of or in connection
with the institution's performance of such obligations. At the election of
the Fund, it shall be entitled to be subrogated to the rights of the
Custodian with respect to any claims against a foreign banking institution
as a consequence of any such loss, damage, cost, expense, liability or claim
if and to the extent that the Fund has not been made whole for any such
loss, damage, cost, expense, liability or claim.
10. Liability of Custodian.
The Custodian shall be liable for the acts or omissions of a foreign banking
institution to the same extent as set forth with respect to subcustodians
generally in the Custodian Contract and, regardless of whether assets are
maintained in the custody of a foreign banking institution, a foreign
securities depository or a branch of a U.S. bank as contemplated by
paragraph 13 hereof, the Custodian shall not be liable for any loss, damage,
cost, expense, liability or claim resulting from nationalization,
expropriation, currency restrictions, or acts of war or terrorism or any
loss where the subcustodian has otherwise exercised reasonable care.
Notwithstanding the foregoing provisions of this paragraph 10, in delegating
custody duties to State Street London Ltd., the Custodian shall not be
relieved of any responsibility to the Fund for any loss due to such
delegation, except such loss as may result from (a) political risk
(including, but not limited to, exchange control restrictions, confiscation,
expropriation, nationalization, insurrection, civil strife or armed
hostilities) or (b) other losses (excluding a bankruptcy or insolvency of
State Street London Ltd. not caused by political risk) due to Acts of God,
nuclear incident or other losses under circumstances where the Custodian and
State Street London Ltd. have exercised reasonable care.
11. Reimbursement for Advances.
If the Fund requires the Custodian to advance cash or securities for any
purpose including the purchase or sale of foreign exchange or of contracts
for foreign exchange, or in the event that the Custodian or its nominee
shall incur or be assessed any taxes, charges, expenses, assessments, claims
or liabilities in connection with the performance of this Contract except
such as may arise from its or its nominee's own negligent action, negligent
failure to act or willful misconduct, any property at any time held for the
account of the Fund shall be security therefor and should the Fund fail to
repay the Custodian promptly, the Custodian shall be entitled to utilize
available cash and to dispose of the Fund assets to the extent necessary to
obtain reimbursement.
12. Monitoring Responsibilities.
The Custodian shall furnish annually to the Fund, during the month of June,
information concerning the foreign subcustodians employed by the Custodian.
Such information shall be similar in kind and scope to that furnished to the
Fund in connection with the initial approval of this amendment to the
Custodian Contract. In addition, the Custodian will promptly inform the Fund
in the event that the Custodian learns of a material adverse change in the
financial condition of a foreign subcustodian or any material loss of the
assets of the Fund or in the case of any foreign subcustodian not the
subject of an exemptive order from the Securities and Exchange Commission is
notified by such foreign subcustodian that there appears to be a substantial
likelihood that its shareholders' equity will decline below $200 million
(U.S. dollars or the equivalent thereof) or that its shareholders' equity
has declined below $200 million (in each case computed in accordance with
generally accepted U.S. accounting principles).
13. Branches of U.S. Banks.
(a) Except as otherwise set forth in this amendment to the Custodian
Contract, the provisions hereof shall not apply where the custody of the
Fund assets is maintained in a foreign branch of a banking institution which
is a "bank" as defined by Section 2(a)(5) of the Investment Company Act of
1940 meeting the qualification set forth in Section 26(a) of said Act. The
appointment of any such branch as a subcustodian shall be governed by
paragraph 1 of the Custodian Contract.
(b) Cash held for the Fund in the United Kingdom shall be maintained in an
interest bearing account established for the Fund with the Custodian's
London branch, which account shall be subject to the direction of the
Custodian, State Street London Ltd. or both.
14. Applicability of Custodian contract.
Except as specifically superseded or modified herein, the terms and
provisions of the Custodian Contract shall continue to apply with full force
and effect.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and
its seal to be hereunder affixed as of the 8th day of July, 1992.
ACACIA CAPITAL CORPORATION
By: /s/
Xxxxxxx X. Xxxxxxxxx, Vice President and Secretary
Attest: /s/
Xxxx-xxx Xxxx, Assistant Secretary
STATE STREET BANK AND TRUST COMPANY
By: /s/
Xxxxxx X. Xxxxx, Senior Vice President
Attest: /s/
Xxxxxx X. Xxxxxxxx, Assistant Secretary
Schedule A
The following foreign banking institutions foreign securities depositories
have been approved by the Board of Directors of Acacia Capital Corporation
for use as subcustodians for the Fund's securities and other assets:
[list of countries and banks inserted here from board book, subject to
change.]
SUPPLEMENT TO CUSTODIAN AGREEMENT
This Supplement is part of the custodian agreement dated as of
March 5,1992 (the "Custodian Agreement") between the Acacia Capital
Corporation (the "Fund") and State Street Bank and Trust Company (the
"Custodian");
Whereas, the Custodian Agreement governs the terms and conditions
under which the Custodian maintains custody of the securities and other
assets of the Fund; and
Whereas, the Custodian and the Fund desire to amend and supplement
the Custodian Agreement in order to (i) accurately reflect the terms and
conditions under which the Custodian maintains the Fund's securities and
other non-cash property in the custody of certain foreign subcustodians in
conformity with the requirements of Rule 1 7f-5 under the Investment Company
Act of 1940, as amended, and (ii) recognize that the Fund's investments in
non-U.S. securities markets may involve an assessment by the Fund of certain
risks inherent in participation in such markets and a balancing by the Fund
of the possibility of am enhanced return available m such markets against
such risks;
Now, Therefore, in consideration of the promises set forth herein
and in the Custodian Agreement, the Custodian and the Fund hereby amend and
supplement the Custodian Agreement as follows:
1. Notwithstanding any provisions to the contrary set forth
in the Custodian Agreement, including, but not limited to, Section 3.4
thereof, but subject to the requirements of Rule 17f-5 under the Investment
Company Act of 1940, the Custodian may hold securities and other non-cash
property for all of its customers, including the Fund, with a foreign
sub-custodian in a single account that is identified as belonging to the
Custodian for the benefit of its customers, provided however, that (i) the
records of the Custodian with respect to securities and other non-cash
property of the Fund which are maintained in such account shall identify by
book-entry those securities and other non-cash property belonging to the
Fund and (ii) the Custodian shall require that securities and other non-cash
property so held by the foreign sub-custodian be held separately from any
assets of the foreign sub-custodian or of others.
2. Article 10 of the Custodian Agreement is hereby supplemented by
adding the following:
Emerging Markets and "Country Risk" - Except as may arise from the
Custodians own negligence or willful misconduct or the negligence or willful
misconduct of a sub-custodian or agent, the Custodian shall be without
liability to the Fund for any loss, liability, claim or expense resulting
from or caused by; (i) events or circumstances beyond the reasonable control
of the Custodian or any sub-custodian or Securities System or any agent or
nominee of any of the foregoing, including, without limitation, the
interruption, suspension or restriction of trading on or the closure of any
securities market, power or other mechanical or technological failures or
interruptions, or computer viruses or communications disruptions; (ii)
errors by the Fund or the Fund's investment Advisor(s) in their instructions
to the Custodian, provided such instructions have been in accordance with
this Contract; (iii) the insolvency of or acts or omissions by a Securities
System; (iv) any delay or failure of any broker, agent or intermediary,
central bank or other commercially prevalent payment or clearing system to
deliver to the Custodian's sub-custodian or agent securities purchased or in
the remittance or payment made m connection with securities sold; (v) any
delay or failure of any company, corporation or other body in charge or
registering or transferring securities in the name of the Custodian, the
Fund, the Custodian's sub-custodians, nominees or agents or agents or any
consequential losses arising out of such delay or failure to transfer such
securities including nonreceipt of bonus, dividends and rights and other
accretions or benefits; (vi) delays or inability to perform its duties due
to any disorder in market infrastructure with respect to any particular
security or Securities System; and (vii) any provision of any present or
future law or regulation or order of the United States of America, or any
state thereof, or any other country, or political subdivision thereof or of
any court of competent jurisdiction. Regardless of whether assets are
maintained in the custody of a foreign banking institution or a foreign
securities depository, the Custodian shall not be liable for "country risk",
i.e. any loss, damage, cost, expense, liability or claim resulting from, or
caused by, the direction of or authorization by the Fund to maintain custody
of any securities or cash of the Fund or of a Portfolio in a foreign country
Including, but not limited to, losses resulting from nationalization
expropriation, imposition of currency controls or restrictions, acts of war
or terrorism, riots, revolutions, work stoppages, natural disasters or other
similar events or acts.
3. Except as specifically superseded or modified herein, the terms
and provisions of the Custodian Agreement shall continue to apply with full
force and effect.
IN WITNESS WHEREOF, of the parties hereto has caused this
instrument to be executed as a sealed instrument in its name and behalf by
its duly authorized representative as of March 5, 1992.
ACACIA CAPITAL CORPORATION
By: /s/
Xxxxxxx X. Xxxxxxxxx, Senior Vice President and General Counsel
STATE STREET BANK AND TRUST COMPANY
By: /s/
Xxxxxx X. Xxxxx, Executive Vice President
