CUSTODIAN CONTRACT
Between
ALLIANCE GOVERNMENT RESERVES
and
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
Page
1. Employment of Custodian and Property to be Held By
It ................................................... 1
2. Duties of the Custodian with Respect to Property
of the Fund Held by the Custodian..................... 2
2.1 Holding Securities............................... 2
2.2 Delivery of Securities........................... 2
2.3 Registration of Securities....................... 7
2.4 Bank Accounts.................................... 8
2.5 Payments for Shares.............................. 9
2.6 Investment and Availability of Federal Funds..... 9
2.7 Collection of Income............................. 10
2.8 Payment of Fund Moneys........................... 10
2.9 Liability for Payment in Advance of Receipt of
Securities Purchased............................. 13
2.10 Payments for Repurchases or Redemptions
of Shares of the Fund............................ 14
2.11 Appointment of Agents............................ 15
2.12 Deposit of Fund Assets in Securities System...... 15
2.13 Segregated Account............................... 18
2.14 Ownership Certificates for Tax Purposes.......... 20
2.15 Proxies.......................................... 20
2.16 Communications Relating to Fund
Portfolio Securities............................. 20
2.17 Proper Instructions.............................. 21
2.18 Actions Permitted Without Express Authority...... 22
2.19 Evidence of Authority............................ 23
3. Duties of Custodian With Respect to the Books of Account
and Calculation of Net Asset Value and Net
Income................................................ 23
4. Records............................................... 24
5. Opinion of Fund's Independent Accountants............. 25
6. Reports to Fund by Independent Public Accountants..... 25
7. Compensation of Custodian............................. 26
8. Responsibility of Custodian........................... 26
9. Effective Period, Termination and Amendment........... 27
10. Successor Custodian................................... 29
11. Interpretive and Additional Provisions................ 30
12. Massachusetts Law to Apply............................ 31
13. Prior Contracts....................................... 31
CUSTODIAN CONTRACT
This Contract between Alliance Government Reserves, a
business trust organized and existing under the laws of
Massachusetts, having its principal place of business at
000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 hereinafter called the
"Fund", and State Street Bank and Trust Company, a Massachusetts
trust company, having its principal place of business at
000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, 00000, hereinafter
called the "Custodian",
WITNESSETH: That in consideration of the mutual
covenants and agreements hereinafter contained, the parties
hereto agree as follows:
1. Employment of Custodian and Property to be Held by It
The Fund hereby employs the Custodian as the custodian
of its assets pursuant to the provisions of the Declaration of
Trust. The Fund agrees to deliver to the Custodian all
securities and cash owned by it, and all payments of income,
payments of principal or capital distributions received by it
with respect to all securities owned by the Fund from time to
time, and the cash consideration received by it for such new or
treasury shares of beneficial interest ("Shares") of the Fund as
may be issued or sold from time to time. The Custodian shall not
be responsible for any property of the Fund held or received by
the Fund and not delivered to the Custodian.
Upon receipt of "Proper Instructions" (within the
meaning of Section 2.17), the Custodian shall from time to time
employ one or more sub-custodians, but only in accordance with an
applicable vote by the Trustees of the Fund, and provided that
the Custodian shall have no more or less responsibility or
liability to the Fund on account of any actions or omissions of
any sub-custodian so employed than any such sub-custodian has to
the Custodian.
2. Duties of the Custodian with Respect to Property of the
Fund Held By the Custodian
2.1 Holding Securities. The Custodian shall hold and
physically segregate for the account of the Fund all
non-cash property, including all securities owned by the
Fund, other than securities which are maintained
pursuant to Section 2.12 in a clearing agency which acts
as a securities depository or in a book-entry system
authorized by the U.S. Department of the Treasury,
collectively referred to herein as "Securities System".
2.2 Delivery of Securities. The Custodian shall release and
deliver securities owned by the Fund held by the
Custodian or in a Securities System account of the
Custodian only upon receipt of Proper Instructions,
which may be continuing instructions when deemed
appropriate by the parties, and only in the following
cases:
2
1) Upon sale of such securities for the account
of the Fund and receipt of payment therefor;
2) Upon the receipt of payment in connection with
any repurchase agreement related to such
securities entered into by the Fund;
3) In the case of a sale effected through a
Securities System, in accordance with the
provisions of Section 2.12 hereof;
4) To the depository agent in connection with
tender or other similar offers for portfolio
securities of the Fund;
5) To the issuer thereof or its agent when such
securities are called, redeemed, retired or
otherwise become payable; provided that, in
any such case, the cash or other consideration
is to be delivered to the Custodian;
6) To the issuer thereof, or its agent, for
transfer into the name of the Fund 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 Section 2.11
or into the name or nominee name of any sub-
custodian appointed pursuant to Article 1; or
for exchange for a different number of bonds,
certificates or other evidence representing
3
the same aggregate face amount or number of
units; provided that, in any such case, the
new securities are to be delivered to the
Custodian;
7) To the broker selling the same for examination
in accordance with the "street delivery"
custom;
8) For exchange or conversion pursuant to any
plan of merger, consolidation,
recapitalization, reorganization or
readjustment of the securities of the issuer
of such securities, or pursuant to provisions
for conversion contained in such securities,
or pursuant to any deposit agreement; provided
that, in any such case, the new securities and
cash, if any, are to be delivered to the
Custodian;
9) In the case of warrants, rights or similar
securities, the surrender thereof in the
exercise of such warrants, rights or similar
securities or the surrender of interim
receipts or temporary securities for
definitive securities; provided that, in any
such case, the new securities and cash, if
any, are to be delivered to the Custodian;
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10) For delivery in connection with any loans of
securities made by the Fund, but only against
receipt of adequate collateral as agreed upon
from time to time by the Custodian and the
Fund, which may be in the form of cash or
obligations issued by the United States
government, its agencies or instrumentalities,
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 Fund prior to the
receipt of such collateral;
11) For delivery as security in connection with
any borrowings by the Fund requiring a pledge
of assets by the Fund, but only against
receipt of amounts borrowed;
12) 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 0000 ("xxx Xxxxxxxx
Xxx") and a member of The National Association
of Securities Dealers, Inc. ("NASD"), relating
5
to compliance with the rules of The Options
Clearing Corporation and of any registered
national securities exchange, or of any
similar organization or organizations,
regarding escrow or other arrangements in
connection with transactions by the Fund;
13) 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, or any similar
organization or organizations, regarding
account deposits in connection with
transactions by the Fund;
14) Upon receipt of instructions from the transfer
agent ("Transfer Agent") for the Fund, for
delivery to such Transfer Agent or to the
holders of shares in connection with
distributions in kind, as may be described
from time to time in the Fund's currently
effective prospectus and statement of
additional information ("prospectus"), in
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satisfaction of requests by holders of Shares
for repurchase or redemption; and
15) For any other proper corporate purpose, but
only upon receipt of, in addition to Proper
Instructions, a certified copy of a resolution
of the Trustees or of the Executive Committee
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
purposes to be proper corporate purposes, and
naming the person or persons to whom delivery
of such securities shall be made.
2.3 Registration of Securities. Securities held by the
Custodian (other than bearer securities) shall be
registered in the name of the Fund or in the name of any
nominee of the Fund or of any nominee of the Custodian
which nominee shall be assigned exclusively to the Fund,
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 the Fund, or in the name or
nominee name of any agent appointed pursuant to
Section 2.11 or in the name or nominee name of any
7
sub-custodian appointed pursuant to Article 1. All
securities accepted by the Custodian on behalf of the
Fund under the terms of this Contract shall be in
"street name" or other good delivery form.
2.4 Bank Accounts. The Custodian shall open and maintain a
separate bank account or accounts in the name of the
Fund, subject only to draft or order by the Custodian
acting pursuant to the terms of this Contract, and shall
hold in such account or accounts, subject to the
provisions hereof, all cash received by it from or for
the account of the 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 the Fund
may be deposited by it to its credit as Custodian in the
Banking Department of the Custodian or in such other
banks or trust companies as it may in its discretion
deem necessary or desirable; provided, however, that
every such bank or trust company shall be qualified to
act as a custodian under the Investment Company Act of
1940 and that each such bank or trust company and the
funds to be deposited with each such bank or trust
company shall be approved by vote of a majority of the
Trustees of the Fund. Such funds shall be deposited by
8
the Custodian in its capacity as Custodian and shall be
withdrawable by the Custodian only in that capacity.
2.5 Payments for Shares. The Custodian shall receive from
the distributor for the Fund's Shares or from the
Transfer Agent of the Fund and deposit into the Fund's
account such payments as are received for Shares of the
Fund issued or sold from time to time by the Fund. The
Custodian will provide timely notification to the Fund
and the Transfer Agent of any receipt by it of payments
for Shares of the Fund.
2.6 Investment and Availability of Federal Funds. Upon
mutual agreement between the Fund and the Custodian, the
Custodian shall, upon the receipt of Proper
Instructions,
1) invest in such instruments as may be set forth
in such instructions on the same day as
received all federal funds received after a
time agreed upon between the Custodian and the
Fund; and
2) make federal funds available to the Fund 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
Fund which are deposited into the Fund's
account.
9
2.7 Collection of Income. The Custodian shall collect on a
timely basis all income and other payments with respect
to registered securities held hereunder to which the
Fund shall be entitled either by law or pursuant to
custom in the securities business, and shall collect on
a timely basis all income and other payments with
respect to bearer securities if, on the date of payment
by the issuer, such securities are held by the Custodian
or agent thereof and shall credit such income, as
collected, to the Fund's custodian account. Without
limiting the generality of the foregoing, the Custodian
shall detach and present for payment all coupons and
other income items requiring presentation as and when
they become due and shall collect interest when due on
securities held hereunder. Income due the Fund on
securities loaned pursuant to the provisions of
Section 2.2 (10) shall be the responsibility of the
Fund. The Custodian will have no duty or responsibility
in connection therewith, other than to provide the Fund
with such information or data as may be necessary to
assist the Fund in arranging for the timely delivery to
the Custodian of the income to which the Fund is
properly entitled.
2.8 Payment of Fund Moneys. Upon receipt of Proper
Instructions, which may be continuing instructions when
10
deemed appropriate by the parties, the Custodian shall
pay out moneys of the Fund in the following cases only:
(l) Upon the purchase of securities, futures
contracts or options on futures contracts for
the account of the Fund but only (a) against
the delivery of such securities, or evidence
of title to 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) registered in the name
of the Fund or in the name of a nominee of the
Custodian referred to in Section 2.3 hereof or
in proper form for transfer; (b) in the case
of a purchase effected through a Securities
System, in accordance with the conditions set
forth in Section 2.12 hereof or (c) 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
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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
2) In connection with conversion, exchange or
surrender of securities owned by the Fund as
set forth in Section 2.2 hereof;
3) For the redemption or repurchase of Shares
issued by the Fund as set forth in
Section 2.10 hereof;
4) 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) For the payment of any dividends declared
pursuant to the governing documents of the
Fund;
12
6) For payment of the amount of dividends
received in respect of securities sold short;
7) For any other proper purpose, but only upon
receipt of, in addition to Proper
Instructions, a certified copy of a resolution
of the Trustees or of the Executive Committee
of the Fund 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.
2.9 Liability for Payment in Advance of Receipt of
Securities Purchased. In any and every case where
payment for purchase of securities for the account of
the Fund is made by the Custodian in advance of receipt
of the securities purchased in the absence of specific
written instructions from the Fund to so pay in advance,
the Custodian shall be absolutely liable to the Fund for
such securities to the same extent as if the securities
had been received by the Custodian, except that in the
case of repurchase agreements entered into by the Fund
with a bank which is a member of the Federal Reserve
13
System, the Custodian may transfer funds to the account
of such bank prior to the receipt of written evidence
that the securities subject to such repurchase agreement
have been transferred by book-entry into a segregated
non-proprietary account of the custodian maintained with
the Federal Reserve Bank of Boston or of the safe-
keeping receipt, provided that such securities have in
fact been so transferred by book-entry.
2.10 Payments for Repurchases or Redemptions of Shares of the
Fund. From such funds as may be available for the
purpose but subject to the limitations of the
Declaration of Trust and any applicable votes of the
Trustees of the Fund pursuant thereto, the Custodian
shall, upon receipt of instructions from the Transfer
Agent, make funds available for payment to holders of
Shares who have delivered to the Transfer Agent a
request for redemption or repurchase of their Shares.
In connection with the redemption or repurchase of
Shares of the Fund, the Custodian is authorized upon
receipt of instructions from the Transfer Agent to wire
funds to or through a commercial bank designated by the
redeeming shareholders. In connection with the
redemption or repurchase of Shares of the Fund, the
Custodian shall honor checks drawn on the Custodian by a
holder of Shares, which checks have been furnished by
14
the Fund to the holder of Shares, when presented to the
Custodian in accordance with such procedures and
controls as are mutually agreed upon from time to time
between the Fund and the Custodian.
2.11 Appointment of Agents. The Custodian may at any time or
times in its discretion appoint (and may at any time
remove) any other bank or trust company which is itself
qualified under the Investment Company Act of 1940, as
amended, to act as a custodian, as its agent to carry
out such of the provisions of this Article 2 as the
Custodian may from time to time direct; provided,
however, that the appointment of any agent shall not
relieve the Custodian of its responsibilities or
liabilities hereunder.
2.12 Deposit of Trust Assets in Securities Systems. The
Custodian may deposit and/or maintain securities owned
by the Fund in a clearing agency registered with the
Securities and Exchange Commission under Section 17A of
the Securities Exchange Act of 1934, which acts as a
securities depository, or in the book-entry system
authorized by the U.S. Department of the Treasury and
certain federal agencies, collectively referred to
herein as "Securities System" in accordance with
applicable Federal Reserve Board and Securities and
15
Exchange Commission rules and regulations, if any, and
subject to the following provisions:
1) The Custodian may keep securities of the Fund
in a Securities System provided that such
securities are represented in an account
("Account") of the Custodian in the Securities
System which shall not include any assets of
the Custodian other than assets held as a
fiduciary, custodian or otherwise for
customers;
2) The records of the Custodian with respect to
securities of the Fund which are maintained in
a Securities System shall identify by
book-entry those securities belonging to the
Fund;
3) The Custodian shall pay for securities
purchased for the account of the Fund 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 Fund. The Custodian
shall transfer securities sold for the account
of the Fund upon (i) receipt of advice from
16
the Securities System that payment for such
securities has been transferred to the
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
Fund. Copies of all advices from the
Securities System of transfers of securities
for the account of the Fund shall identify the
Fund, be maintained for the Fund by the
Custodian and be provided to the Fund at its
request. Upon request, the Custodian shall
furnish the Fund confirmation of each transfer
to or from the account of the Fund in the form
of a written advice or notice and shall
furnish to the Fund copies of daily
transaction sheets reflecting each day's
transactions in the Securities System for the
account of the Fund.
4) The Custodian shall provide the Fund 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;
17
5) The Custodian shall have received the initial
or annual certificate, as the case may be,
required by Article 9 hereof;
6) Anything to the contrary in this Contract
notwithstanding, the Custodian shall be liable
to the Fund for any loss or damage to the Fund
resulting from use of the Securities System by
reason of any negligence, misfeasance or
misconduct of the Custodian or any of its
agents or of any of its or their employees or
from failure of the Custodian or any such
agent to enforce effectively such rights as it
may have against the Securities System; at the
election of the Fund, it shall be entitled to
be subrogated to the rights of the Custodian
with respect to any claim against the
Securities System or any other person which
the Custodian may have as a consequence of any
such loss or damage if and to the extent that
the Fund has not been made whole for any such
loss or damage.
2.13 Segregated Account. The Custodian shall upon receipt of
Proper Instructions establish and maintain a segregated
account or accounts for and on behalf of the Fund, into
which account or accounts may be transferred cash and/or
18
securities, including securities maintained in an
account by the Custodian pursuant to Section 2.12
hereof, (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 the
Fund, (ii) for purposes of segregating cash or
government securities in connection with options
purchased, sold or written by the Fund or commodity
futures contracts or options thereon purchased or sold
by the Fund, (iii) for the purposes of compliance by the
Fund with the procedures required by Investment Company
Act Release No. 10666, or any subsequent release or
releases 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
19
Instructions, a certified copy of a resolution of the
Trustees or of the Executive Committee signed by an
officer of the Fund and certified by the Secretary or an
Assistant Secretary, setting forth the purpose or
purposes of such segregated account and declaring such
purposes to be proper corporate purposes.
2.14 Ownership Certificates for Tax Purposes. The Custodian
shall execute ownership and other certificates and
affidavits for all federal and state tax purposes in
connection with receipt of income or other payments with
respect to securities of the Fund held by it and in
connection with transfers of securities.
2.15 Proxies. The Custodian shall, with respect to the
securities held hereunder, cause to be promptly executed
by the registered holder of such securities, if the
securities are registered otherwise than in the name of
the Fund or a nominee of the Fund, all proxies, without
indication of the manner in which such proxies are to be
voted, and shall promptly deliver to the Fund such
proxies, all proxy soliciting materials and all notices
relating to such securities.
2.16 Communications Relating to Fund Portfolio Securities.
The Custodian shall transmit promptly to the Fund all
written information (including, without limitation,
pendency of calls and maturates of securities and
20
expirations of rights in connection therewith and
notices of exercise of call and put options written by
the Fund and the maturity of futures contracts purchased
or sold by the Fund) received by the Custodian from
issuers of the securities being held for the Fund. With
respect to tender or exchange offers, the Custodian
shall transmit promptly to the Fund all written
information received by the Custodian from issuers of
the securities whose tender or exchange is sought and
from the party (or his agents) making the tender or
exchange offer. If the Fund desires to take action with
respect to any tender offer, exchange offer or any other
similar transaction, the Fund shall notify the Custodian
at least three business days prior to the date on which
the Custodian is to take such action.
2.17 Proper Instructions. Proper Instructions as used
throughout this Article 2 means a writing signed or
initialled by one or more person or persons as the
Trustees shall have from time to time authorized. Each
such writing shall set forth the specific transaction or
type of transaction involved, including a specific
statement of the purpose for which such action is
requested. Oral instructions will be considered Proper
Instructions if the Custodian reasonably believes them
to have been given by a person authorized to give such
21
instructions with respect to the transaction involved.
The Fund shall 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 Trustees of the Fund accompanied by
a detailed description of procedures approved by the
Trustees, Proper Instructions may include communications
effected directly between electro-mechanical or
electronic devices provided that the Trustees and the
Custodian are satisfied that such procedures afford
adequate safeguards for the Fund's assets.
2.18 Actions Permitted without Express Authority. The
Custodian may in its discretion, without express
authority from the Fund:
1) make payments to itself or others for minor
expenses of handling securities or other
similar items relating to its duties under
this Contract, provided that all such payments
shall be accounted for to the Fund;
2) surrender securities in temporary form for
securities in definitive form;
3) endorse for collection, in the name of the
Fund, checks, drafts and other negotiable
instruments; and
22
4) in general, attend to all non-discretionary
details in connection with the sale, exchange,
substitution, purchase, transfer and other
dealings with the securities and property of
the Fund except as otherwise directed by the
Trustees of the Fund.
2.19 Evidence of Authority. The Custodian shall be protected
in acting upon any instructions, notice, request,
consent, certificate or other instrument or paper
believed by it to be genuine and to have been properly
executed by or on behalf of the Fund. The Custodian may
receive and accept a certified copy of a vote of the
Trustees 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
Trustees pursuant to the Declaration of Trust 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.
3. Duties of Custodian with Respect to the Books of Account
and Calculation of Net Asset Value and Net Income.
The Custodian shall cooperate with and supply necessary
information to the entity or entities appointed by the Trustees
of the Fund to keep the books of account of the Fund and/or
compute the net asset value per share of the outstanding shares
23
of the Fund or, if directed in writing to do so by the Fund,
shall itself keep such books of account and/or compute such net
asset value per share. If so directed, the Custodian shall also
calculate daily the net income of the Fund as described in the
Fund's currently effective prospectus and shall advise the Fund
and the Transfer Agent daily of the total amounts of such net
income and, if instructed in writing by an officer of the Fund to
do so, shall advise the Transfer Agent periodically of the
division of such net income among its various components. The
calculations of the net asset value per share and the daily
income of the Fund shall be made at the time or times described
from time to time in the Fund's currently effective prospectus.
4. Records
The Custodian shall create and maintain all records
relating to its activities and obligations under this Contract in
such manner as will meet the obligations of the Fund under the
Investment Company Act of 1940, with particular attention to
Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
applicable federal and state tax laws and any other law or
administrative rules or procedures which may be applicable to the
Fund. All such records shall be the property of the Fund and
shall at all times during the regular business hours of the
Custodian be open for inspection by duly authorized officers,
employees or agents of the Fund and employees and agents of the
Securities and Exchange Commission. The Custodian shall, at the
24
Fund's request, supply the Fund with a tabulation of securities
owned by the Fund and held by the Custodian and shall, when
requested to do so by the Fund and for such compensation as shall
be agreed upon between the Fund and the Custodian, include
certificate numbers in such tabulations.
5. Opinion of Fund's Independent Accountant
The Custodian shall take all reasonable action, as the
Fund may from time to time request, to obtain from year to year
favorable opinions from the Fund's independent accountants with
respect to its activities hereunder in connection with the
preparation of the Fund's Form N-1A, and Form N-SAR or other
annual reports to the Securities and Exchange Commission and with
respect to any other requirements of such Commission.
6. Reports to Fund by Independent Public Accountants
The Custodian shall 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, which shall be of sufficient scope and in sufficient
detail, as may reasonably be required by the Fund, to provide
reasonable assurance that any material inadequacies would be
25
disclosed by such examination, and, if there are no such
inadequacies, shall so state.
7. Compensation of Custodian
The Custodian shall be entitled to reasonable
compensation for its services and expenses as Custodian, as
agreed upon from time to time between the Fund and the Custodian.
8. Responsibility of Custodian
So long as and to the extent that it is in the exercise
of reasonable care, the Custodian shall not be responsible for
the title, validity or genuineness of any property or evidence of
title thereto received by it or delivered by it pursuant to this
Contract and shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably
believed by it to be genuine and to be signed by the proper party
or parties. The Custodian shall be held to the exercise of
reasonable care in carrying out the provisions of this Contract,
but shall be kept indemnified by and shall be without liability
to the Fund for any action taken or omitted by it in good faith
without negligence. It shall be entitled to rely on and may act
upon advice of counsel (who may be counsel for the Fund) on all
matters, and shall be without liability for any action reasonably
taken or omitted pursuant to such advice. Notwithstanding the
foregoing, the responsibility of the Custodian with respect to
redemptions effected by check shall be in accordance with a
26
separate Agreement entered into between the Custodian and the
Fund.
If the Fund requires the Custodian to take any action
with respect to securities, which action involves the payment of
money or which action may, in the opinion of the Custodian,
result in the Custodian or its nominee assigned to the Fund 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, shall provide indemnity to the
Custodian in an amount and form satisfactory to it.
If the Fund requires the Custodian to advance cash or
securities for any purpose 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 Fund assets
to the extent necessary to obtain reimbursement.
9. Effective Period, Termination and Amendment
This Contract shall become effective as of its
execution, shall continue in full force and effect until
terminated as hereinafter provided, may be amended at any time by
27
mutual agreement of the parties hereto and may be terminated by
either party by an instrument in writing delivered or mailed,
postage prepaid to the other party, such termination to take
effect not sooner than thirty (30) days after the date of such
delivery or mailing; provided, however that the Custodian shall
not act under Section 2.12 hereof in the absence of receipt of an
initial certificate of the Secretary or an Assistant Secretary
that the Trustees of the Fund have approved the initial use of a
particular Securities System and the receipt of an annual
certificate of the Secretary or an Assistant Secretary that the
Trustees have reviewed the use by the Fund of such Securities
System, as required in each case by Rule 17f-4 under the
Investment Company Act of 1940, as amended; provided further,
however, that the Fund shall not amend or terminate this Contract
in contravention of any applicable federal or state regulations,
or any provision of the Declaration of Trust, and further
provided, that the Fund may at any time by action of its Trustees
(i) substitute another bank or trust company for the Custodian by
giving notice as described above to the Custodian, or
(ii) immediately terminate this Contract in the event of the
appointment of a conservator or receiver for the Custodian by the
Comptroller of the Currency or upon the happening of a like event
at the direction of an appropriate regulatory agency or court of
competent jurisdiction.
28
Upon termination of the Contract, the Fund shall pay to
the Custodian such compensation as may be due as of the date of
such termination and shall likewise reimburse the Custodian for
its costs, expenses and disbursements.
10. Successor Custodian
If a successor custodian shall be appointed by the
Trustees of the Fund, the Custodian shall, upon termination,
deliver to such successor custodian at the office of the
Custodian, duly endorsed and in the form for transfer, all
securities then held by it hereunder and shall transfer to an
account of the successor custodian all of the Fund's securities
held in a Securities System.
If no such successor custodian shall be appointed, the
Custodian shall, in like manner, upon receipt of a certified copy
of a vote of the Trustees of the Fund, deliver at the office of
the Custodian and transfer such securities, funds and other
properties in accordance with such vote.
In the event that no written order designating a
successor custodian or certified copy of a vote of the Trustees
shall have been delivered to the Custodian on or before the date
when such termination shall become effective, then the Custodian
shall have the right to deliver to a bank or trust company, which
is a "bank" as defined in the Investment Company Act of 1940,
doing business in Boston, Massachusetts, of its own selection,
having an aggregate capital, surplus, and undivided profits, as
29
shown by its last published report, of not less than $25,000,000,
all securities, funds and other properties held by the Custodian
and all instruments held by the Custodian relative thereto and
all other property held by it under this Contract and to transfer
to an account of such successor custodian all of the Fund's
securities held in any Securities System. Thereafter, such bank
or trust company shall be the successor of the Custodian under
this Contract.
In the event that securities, funds and other properties
remain in the possession of the Custodian after the date of
termination hereof owing to failure of the Fund to procure the
certified copy of vote referred to or of the Trustees to appoint
a successor custodian, the Custodian shall be entitled to fair
compensation for its services during such period as the Custodian
retains possession of such securities, funds and other properties
and the provisions of this Contract relating to the duties and
obligations of the Custodian shall remain in full force and
effect.
11. Interpretive and Additional Provisions
In connection with the operation of this Contract, the
Custodian and the Fund may from time to time agree on such
provisions interpretive of or in addition to the provisions of
this Contract as may in their joint opinion be consistent with
the general tenor of this Contract. Any such interpretive or
additional provisions shall be in a writing signed by both
30
parties and shall be annexed hereto, provided that no such
interpretive or additional provisions shall contravene any
applicable federal or state regulations or any provision of the
Declaration of Trust of the Fund. No interpretive or additional
provisions made as provided in the preceding sentence shall be
deemed to be an amendment of this Contract.
12. Massachusetts Law to Apply
This Contract shall be construed and the provisions
thereof interpreted under and in accordance with laws of The
Commonwealth of Massachusetts.
13. Prior Contracts
This Contract supersedes and terminates, as of the date
hereof, all prior contracts between the Fund and the Custodian
relating to the custody of the Fund's assets.
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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 1st day of June, 1985.
ATTEST ALLIANCE GOVERNMENT RESERVES
/s/Xxxxxxx X. Xxxxxx /s/ Xxxxx X. Xxxxxx
_________________________ By ________________________________
Secretary President
ATTEST STATE STREET BANK AND TRUST COMPANY
/s/ X. X. Xxxxx /s/ Xxxxxxx Xxxxxxx
_________________________ By ________________________________
Assistant Secretary Vice President
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00250083.AD6
