THIS CUSTODY AGREEMENT ("Agreement") is made and entered into as of
December 15, 1992, by and between The Money Market Portfolios, a Delaware
business trust (the "Trust"), and Xxxxxx Guaranty Trust Company of New York (the
"Custodian").
RECITALS
A. The Trust is an open-end management investment company consisting
of two separate and distinct series registered under the Investment Company Act
that invests and reinvests, on behalf of its various series, in Securities.
B. The Custodian is, and has represented to the Trust that the
Custodian is, a "bank" as that term is defined in Section 2(a)(5) of the
Investment Company Act and is eligible to receive and maintain custody of
investment company assets pursuant to Section 17(f) and Rule 17f-2 thereunder.
C. The Trust and the Custodian desire to provide for the retention
of the Custodian as the custodian under separate accounts for each of the
following: (1) the assets of the series of the Trust representing interests in
the Money Market Portfolio; (2) the assets of the series of the Trust
representing interests in the U.S. Government Securities Money Market Portfolio;
and (3) the assets of one or more additional series of the Trust which may be
added to the Trust at some future date and which assets may be delivered to
Xxxxxx pursuant to a written amendment to this Agreement which specifically
identifies each such additional series (each series is referred to in the
singular as a "Fund" and collectively as the "Funds").
D. The Trust and the Custodian agree that each Fund shall be viewed
as a separate and distinct entity under this Agreement and that the Custodian
will (1) separately account for the assets of each Fund and (2) hold and
physically segregate the assets of each Fund from the assets of the other Funds.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
as follows:
1. DEFINITIONS
For purposes of this Agreement, the following terms shall have the
respective meanings specified below:
"Agreement" shall mean this Custody Agreement.
"Authorized Instructions" has the meaning set forth in Section 6.
"Authorized Persons" means such officers or such agents of the Trust
as have been designated by a resolution of the Board of trustees or of the
Executive Committee, a certified copy of which has been provided to the
Custodian, to act on behalf of the Trust under this Agreement. Each of such
persons shall continue to be an Authorized Person until such time as the
Custodian receives Proper Instructions that any such officer or agent is no
longer an Authorized Person.
"Board of Trustees" shall mean the Board of Trustees of the Trust.
"Business Day" with respect to any Security means any day, other
than a Saturday or Sunday, that is not a day on which banking institutions are
authorized or required by law to be closed in The City of New York.
"Cash" has the meaning set forth in Section 5
"Cash Account has the meaning set forth in Section 5
"Custodian" shall mean Xxxxxx Guaranty Trust Company of New York.
"Executive Committee" shall mean the executive committee of the Board
of Trustees.
"Fund" shall mean each of the following:
(a) the series of the Trust representing interests in the
Money Market Portfolio (the "Money Market Fund"); or
(b) the series of the Trust representing interests in the U.S.
Government Securities Money Market Portfolio (the "U.S.
Government Funds"); or
"Funds" shall mean, collectively, each Fund.
"Investment Company Act" shall mean the Investment Company Act of
1940, as amended (15 U.S.C. 80a-1 et seq.).
"Xxxxxx Affiliate" means any office, branch or affiliate of Xxxxxx
Guaranty Trust Company of New York or its successors
"Securities" means any shares, stocks, bonds, notes, debentures or
other securities held (either physically or by book-entry) from time to time for
the account of each Fund by the Custodian pursuant to this Agreement
"Securities System" shall have the meaning provided in Paragraph 4(a)
hereof
"Securities System Account" shall have the meaning provided in
Subparagraph 4(g)(i) hereof.
"Securities Depository" means any securities depository or clearing
system set forth on Appendix A
"Shares" shall mean shares of beneficial interest of the Funds.
"Subcustodian" shall have the meaning provided in subparagraph 3(c).
"Transfer Agent" shall mean the duly appointed and acting transfer
agent for the Trust.
"Trust" shall mean The Money Market Portfolios, an investment
company registered under the Investment Company Act and organized as a Delaware
business trust.
"Writing" shall mean a communication in writing, a communication by
telex, facsimile transmission, bankwire or other teleprocess or electronic
instruction system acceptable to the Custodian.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE TRUST.
The Trust represents and warrants that the execution, delivery and
performance by the Trust of the Agreement are within the Trust's corporate trust
or other constitutive powers, have been duly authorized by all necessary
corporate, trust or appropriate action under its constitutive documents, require
no action by or in respect of, or filing with, any governmental body, agency or
official and do not contravene, or constitute a default under, any provision of
applicable law or regulation or of the organic documents of the Trust or of any
agreement, judgment, injunction, order, decree or other instrument binding upon
the Trust. The Trust shall safeguard, and shall be solely responsible for the
safekeeping of, any testkeys, identification codes of other security devices
with which the Custodian provides it. If applicable, the Trust shall execute a
license agreement governing its use of any electronic instruction system
proprietary to the Custodian or any Xxxxxx Affiliate.
3. APPOINTMENT OF CUSTODIAN; DELIVERY OF ASSETS
(a) Appointment of Custodian. The Trust hereby appoints and designates the
Custodian as the custodian of the assets of each Fund consisting of Cash and
Securities. The Custodian hereby accepts such appointment and designation and
agrees that it shall separately hold and account for the assets each Fund that
are delivered to it hereunder and in the manner provided for herein. The
Custodian hereby further agrees that it will separately hold and account for the
assets of each Fund as if each Fund were a separate and distinct legal entity
contracting for the Custodian's services under this Agreement.
(b) Delivery of Assets. The Trust agrees to deliver to the Custodian
Securities and Cash owned by the Funds, payments of income, principal or capital
distributions received from time to time by the Trust with respect to Securities
owned by the Funds, and the consideration received by it for such Shares or
other securities of the Funds as may be issued and sold from time to time. The
Custodian shall have no responsibility whatsoever for any property or assets of
the Funds held or received by the Funds and not delivered to the Custodian
pursuant to and in accordance with the terms hereof. All Securities accepted by
the Custodian on behalf of the Funds under the terms of this Agreement shall be
in "street name" or other good delivery form as determined by the Custodian.
(c) Appointment of Subcustodians. The Custodian may, upon receipt of
Authorized Instructions, appoint another bank or trust company, which is itself
qualified under the Investment Company Act to act as a custodian (a
"Subcustodian"), as the agent of the Custodian to carry out such of the duties
of the Custodian hereunder as the custodian may from time to time direct;
provided, however, that the appointment of any Subcustodian shall not relieve
the Custodian of its responsibilities or liabilities hereunder.
(d) No Duty to Manage. The Custodian or a Subcustodian shall not have any
duty or responsibility to manage or recommend investments of the assets of the
Funds held by them or to initiate any purchase, sale or other investment
transaction in the absence of Authorized Instructions or except as otherwise
specifically provided herein.
4. TERMS OF CUSTODY
(a) Holding Securities. The Custodian shall hold and physically segregate
from any property owned by the Custodian, for the separate accounts of each
Fund, all non-cash property delivered by the Trust to the Custodian hereunder
other than Securities which, pursuant to Subparagraph 4(h) hereof, are held
through a clearing agency registered under Section 17A of the Securities
Exchange Act of 1934 which acts as a securities depository or the Federal
Reserve's book-entry securities system (referred to herein, individually, as a
"Securities System"), or held by a Subcustodian.
(b) Delivery of Securities. Except as otherwise provided in Subparagraph
4(e) hereof, the Custodian, upon receipt of Authorized Instructions, shall
release and deliver Securities owned by the Funds and held by the Custodian in
the following cases or as otherwise directed in Authorized Instructions:
(i) except as otherwise provided herein, upon sale of such
Securities for the account of a Fund and receipt by the Custodian or
a Subcustodian of payment therefor;
(ii) upon the receipt of payment by the Custodian or a
Subcustodian in connection with any repurchase agreement related to
such Securities entered into by a Fund;
(iii) in the case of a sale effected through a Securities
System, in accordance with the provisions of Subparagraph 4(h)
hereof;
(iv) to a tender agent or other authorized agent in connection
with (A) a tender or other similar offer for Securities owned by a
Fund, or (B) a tender offer or repurchase by a Fund of its own
Shares;
(v) 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 or a Subcustodian;
(vi) to the issuer thereof, or its agent, for transfer into
the name or nominee name of the Trust, (properly notated to include
the name of Fund that owns the Securities), the name or nominee name
of the Custodian, the name or nominee name of any Subcustodian or
Securities System; or for exchange for a different number of bonds,
certificates or other evidence representing the same aggregate face
amount or number of units; provided that, in any such case, the new
Securities are to be delivered to the Custodian or a Subcustodian;
(vii) to the broker selling the same for examination in
accordance with the "street delivery" custom;
(viii) for exchange or conversion pursuant to any plan of
merger, consolidation, recapitalization, or reorganization of the
issuer of such Securities, or pursuant to a conversion of such
Securities; provided that, in any such case, the new Securities and
cash, if any, are to be delivered to the Custodian or a
Subcustodian;
(ix) in the case of warrants, rights or similar securities,
the surrender thereof in connection with 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 or a Subcustodian;
(x) for delivery in connection with any loans of Securities
made by the Funds, but only against receipt by the Custodian or a
Subcustodian of collateral as determined by the Funds (and
identified in Authorized Instructions communicated to the
Custodian), 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 account of the Custodian or a Subcustodian in the
Federal Reserve's book-entry securities system, the Custodian will
not be held liable or responsible for the delivery of Securities
owned by the Funds prior to the receipt of such collateral;
(xi) for delivery as security in connection with any
borrowings by the Funds requiring a pledge of assets by the Funds,
but only against receipt by the Custodian or a Subcustodian of
amounts borrowed;
(xii) for delivery in accordance with the provisions of any
agreement among the Trust, the Custodian or a Subcustodian and a
broker-dealer relating to compliance with the rules of registered
clearing corporations 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
Funds;
(xiii) for delivery in accordance with the provisions of any
agreement among the Trust, the Custodian or a Subcustodian and a
futures commission merchant, 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 Funds;
(xiv) upon the receipt of instructions from the Transfer Agent
for delivery to the Transfer Agent or to the holders of Shares in
connection with distributions in kind in satisfaction of requests by
holders of Shares for repurchase or redemption; and
(xv) for any other purpose consistent with market practices,
upon receipt of Authorized Instructions 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 purpose, and
naming the person or persons to whom delivery of such securities
shall be made.
(c) Registration of Securities. Securities held by the Custodian or a
Subcustodian (other than bearer Securities) shall be registered in the name or
nominee name of the Trust (properly notated to include the name of the Fund that
owns the Securities), in the name or nominee name of the Custodian or in the
name or nominee name of any Subcustodian or Foreign Custodian. The Trust agrees
to hold the Custodian, any such nominee or Subcustodian harmless from any
liability as a holder of record of such Securities.
(d) Omitted
(e) Collection of Income; Trade settlement; Crediting of Accounts. The
Custodian shall collect income payable with respect to Securities owned by the
Funds, settle Securities trades for the account of each Fund and credit and
debit each Fund's account with the Custodian in connection therewith as follows:
(i) Upon receipt of Authorized Instructions, the Custodian
shall effect the purchase of a Security by charging the account of
the appropriate Fund on the settlement date. The Custodian shall
have no liability of any kind to any person, including the Trust, if
the Custodian effects payment on behalf of the appropriate Fund as
provided for herein or in Authorized Instructions, and the seller or
selling broker fails to deliver the Securities purchased.
(ii) Upon receipt of Authorized Instructions, the Custodian
shall effect the sale of a Security by delivering a certificate or
other indicia of ownership, and shall credit the account of the
appropriate Fund with the proceeds of such sale on the settlement
date. The Custodian shall have no liability of any kind to any
person, including the Trust, if the Custodian delivers such a
certificate(s) or other indicia of ownership as provided for herein
or in Authorized Instructions, and the purchaser or purchasing
broker fails to effect payment to the appropriate Fund within a
reasonable time period, as determined by the Custodian in its sole
discretion. In such event, the Custodian shall be entitled to
reimbursement, with interest, of the amount so credited to the
account of the appropriate Fund in connection with such sale.
(iii) The Trust is responsible for ensuring that the Custodian
receives timely and accurate Authorized Instructions to enable the
Custodian to effect settlement of any purchase or sale. If the
Custodian does not receive such instructions within the required
time period, the Custodian shall have no liability of any kind to
any person, including the Trust, for failing to effect settlement on
the settlement date. However, the Custodian shall use its best
reasonable efforts to effect settlement as soon as possible after
receipt of Authorized Instructions.
(iv) The Custodian shall credit the account of the appropriate
Fund with interest income payable on interest bearing Securities on
payable date. Interest income on cash balances will be credited
monthly to the account of the appropriate Fund as follows: (1) on
the first Business Day (on which the Custodian is open for business)
following the end of each month; or (2) in the case of a Nassau
sweep, on the seventh Business Day following the end of the each
month; or (3) in the case of a sweep to a repurchase contract, on a
next business day basis; or (4) in the case of a GNMA II, on a
payable date plus one basis. Dividends and other amounts payable
with respect to Securities shall be credited to the account of the
appropriate Fund on the dividend payable date. The Custodian shall
not be required to commence suit or collection proceedings or resort
to any extraordinary means to collect such income and other amounts
payable with respect to Securities owned by the Funds. The
collection of income due each Fund on Securities loaned pursuant to
the provisions of Subparagraph 4(b)(x) shall be the responsibility
of the Funds. The Custodian will have no duty or responsibility in
connection therewith, other than to provide each Fund with such
information or data as may be necessary to assist each Fund in
arranging for the timely delivery to the Custodian of the income to
which each Fund is entitled. The Custodian shall have no liability
to any person, including the Trust, if the Custodian credits the
account of a Fund with such income or other amounts payable with
respect to Securities owned by the Fund (other than Securities
loaned by the Fund pursuant to Subparagraph 4(b)(x) hereof) and the
Custodian subsequently is unable to collect such income or other
amounts from the payors thereof within a reasonable time period, as
determined by the Custodian in its sole discretion. In such event,
the Custodian shall be entitled to reimbursement, with interest, of
the amount so credited to the account of the appropriate Fund.
(f) Payment of Funds Monies. Upon receipt of Authorized Instructions the
Custodian shall pay out monies of the appropriate Fund in the following cases
or as otherwise directed in Authorized Instructions:
(i) upon the purchase of Securities, futures contracts or
options on futures contracts for the account of a Fund but only,
except as otherwise provided herein, (A) against the delivery of
such securities, or evidence of title to futures contracts or
options on futures contracts, to the Custodian or a Subcustodian
registered pursuant to Subparagraph 4(c) 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
Subparagraph 4(g) hereof; or (C) in the case of repurchase
agreements entered into between a Fund and the Custodian, another
bank or a broker-dealer (1) against delivery of the Securities
either in certificated form to the Custodian or a Subcustodian or
through an entry crediting the Custodian's account at the
appropriate Federal Reserve Bank with such Securities or (2) against
delivery of the confirmation evidencing purchase by the Fund of
Securities owned by the Custodian or such broker-dealer or other
bank along with written evidence of the agreement by the Custodian
or such broker-dealer or other bank to repurchase such Securities
from the Fund;
(ii) in connection with conversion, exchange or surrender of
Securities owned by a Fund as set forth in Subparagraph 4(b) hereof;
(iii) for the redemption or repurchase of Shares issued by the
Funds;
(iv) for the payment of any expense or liability incurred by a
Fund, including but not limited to the following payments for the
account of a Fund: custodian fees, interest, taxes, management,
accounting, transfer agent and legal fees and operating expenses of
each Fund whether or not such expenses are to be in whole or part
capitalized or treated as deferred expenses; and
(v) for the payment of any dividends or distributions declared
by the Board of Trustees with respect to the Shares of a Fund.
(g) Deposit of securities in Securities systems. The Custodian may deposit
and/or maintain Securities owned by the Funds 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:
(i) the Custodian may hold Securities of the Funds in the
Depository Trust Company or the Federal Reserve's book entry system
or, upon receipt of Authorized Instructions, in another Securities
System provided that such securities are held in an account of the
Custodian in the Securities System ("Securities System Account")
which shall not include any assets of the Custodian other than
assets held as a fiduciary, custodian or otherwise for customers;
(ii) the records of the Custodian with respect to Securities
of the Funds which are maintained in a Securities System shall
identify by book-entry those Securities belonging to each separate
Fund;
(iii) subject to the appropriate rules of the Securities
System, the Custodian shall pay for Securities purchased for the
account of a Fund upon (A) receipt of advice from the Securities
System that such securities have been transferred to the Securities
System Account, and (B) the making of an entry on the records of the
Custodian to reflect such payment and transfer for the account of
the appropriate Fund. Subject to the appropriate rules of the
Securities Systems, the Custodian shall transfer Securities sold for
the account of a Fund upon (1) receipt of advice from the Securities
System that payment for such securities has been transferred to the
Securities System Account, and (2) the making of an entry on the
records of the Custodian to reflect such transfer and payment for
the account of the appropriate Fund. Copies of all advices from the
Securities System of transfers of Securities for the accounts of
each Fund shall be maintained separately for each of the Funds by
the Custodian and be provided to the appropriate Fund at its
request. Upon request, the Custodian shall furnish each Fund
confirmation of each transfer to or from the account of the Fund in
the form of a written advice or notice; and
(iv) upon request, the Custodian shall provide each Fund with
any report obtained by the Custodian on the Securities System's
accounting system, internal accounting control and procedures for
safeguarding domestic securities deposited in the Securities System.
(h) Segregated Account. The Custodian shall, upon receipt of Authorized
Instructions, establish and maintain segregated accounts for and on behalf of
each Fund into which accounts may be transferred the Fund's Cash and/or
Securities, including Securities maintained in accounts by the Custodian
pursuant to Section 4(g) hereof, (A) subject to a proper and acceptable
agreement among the Trust, the Custodian and a broker-dealer or futures
commission merchant, relating to compliance with the rules of registered
clearing corporations and of any 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 Funds, (B) for purposes of segregating cash
or securities in connection with options purchased, sold or written by a Fund or
commodity futures contracts or options thereon purchased or sold by a Fund and
(C) for other proper corporate purposes, but only, in the case of this clause
(C), upon receipt of, in addition to Authorized Instructions, a certified copy
of a resolution of the Board of Trustees or of the Executive Committee 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.
(i) Ownership Certificates for Tax purposes. The Custodian shall execute
ownership and other certificates and affidavits for all federal and state tax
purposes in connection with receipt of income or other payments with respect to
domestic securities of each Fund held by it and in connection with transfers of
such securities.
(j) Proxies. The Custodian shall, with respect to the Securities held
hereunder, promptly deliver to the Trust all proxies, all proxy soliciting
materials and all notices relating to such Securities. If the Securities are
registered otherwise than in the name of the Trust or a nominee of the Trust,
the Custodian shall use its best reasonable efforts, consistent with applicable
law, to cause all proxies to be promptly executed by the registered holder of
such Securities in accordance with Authorized Instructions.
(k) Communications Relating to Fund Portfolio securities, The Custodian
shall transmit promptly to the Trust all written information (including, without
limitation, pendency of calls and maturities of Securities and expirations of
rights in connection therewith and notices of exercise of put and call options
written by the Funds and the maturity of futures contracts purchased or sold by
the Funds) received by the Custodian from issuers of Securities being held for
the Funds. With respect to tender or exchange offers, the Custodian shall
transmit promptly to the Trust all written information received by the Custodian
from issuers of the Securities whose tender or exchange is sought and from the
party (or its agents) making the tender or exchange offer. If the Trust, on
behalf of any Fund, desires to take action with respect to any tender offer,
exchange offer or any other similar transaction, the Trust shall notify the
Custodian at least three Business Days prior to the date of which the Custodian
is to take such action.
(l) Fungibility. Except as provide in Sections 4(a) and 4(h), the
Securities may be commingled with other securities no matter by whom owned and
may be held as part of a fungible mass. The Trust shall have no right to any
specific certificates but will instead be entitled, subject to applicable laws
and regulations and to the terms of this Agreement, to transfer deliver or
repossess from the Custodian an amount of Securities of any issue that is
equivalent to the amount of such Securities credited to its Securities Account.
(m) Liens of Securities Depositories. The Custodian will authorize or
permit the holding of Securities by a Securities Depository only as long as (i)
the Securities are not subject to any right, charge, security, interest, lien or
claim of any kind in favor of such Securities Depository or its creditors,
including a receiver or trustee in bankruptcy, except for a claim of payment for
the safe custody or administration of the Securities and (ii) beneficial
ownership of the Securities is freely transferable without the payment of money
or value other than for safe custody or administration.
5. CASH ACCOUNT.
The Trust hereby establishes with the Custodian separate demand deposit
accounts (each a "Cash Account") for each Fund to be used in connection with
transactions relating to the Funds' Securities. Monies deposited by the
Custodian to each Cash Account shall be withdrawable by the Custodian acting
pursuant to the terms of this Agreement. The collected balance from time to time
in a Fund's Cash Account shall constitute "Cash". Any credit made to a Fund's
Cash Account shall be provisional and may be reversed if such payment is not
actually collected.
6. INSTRUCTIONS BY THE TRUST.
(a) Generally. As used in this Agreement, the term "Authorized
Instructions" means instructions of the Trust received by the Custodian via
telephone or in Writing which the Custodian believes in good faith to have been
given by Authorized Persons or which are transmitted with proper testing or
authentication pursuant to terms and conditions which the Custodian may specify.
Any Authorized Instructions delivered to the Custodian by telephone shall
promptly thereafter be confirmed in Writing by an Authorized Person, but the
Trust will hold the Custodian harmless for its failure to send such confirmation
in writing, the failure of such confirmation to conform to the telephone
instructions received or the Custodian's failure to produce such confirmation at
any subsequent time. Unless otherwise expressly provided, all Authorized
Instructions shall continue in full force and effect until cancelled or
superseded. If the Custodian requires test arrangements, authentication methods
or other security devices to be used with respect to Authorized Instructions,
any Authorized Instructions given by the Trust thereafter shall be given and
processed in accordance with such terms and conditions for the use of such
arrangements, methods or devices as the Custodian may put into effect and modify
from time to time. The Trust shall safeguard any testkeys, identification codes
or other security devices which the Custodian shall make available to it. The
Custodian may electronically record any Authorized Instructions given by
telephone, and any other telephone discussions, with respect to its activities
hereunder.
(b) Limitations. The Custodian will not be required to follow any
instruction that would violate any applicable law, decree, regulation or order
of any government or governmental body (including any court or tribunal) or that
would be contrary to any provision of this Agreement. Notwithstanding anything
in Section 4 to contrary with respect to the delivery of Securities by the
Custodian, the Custodian will transfer, exchange, or deliver Securities only to
the extent that sufficient Securities are actually in the Securities System
Accounts and available for delivery.
7. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY.
Except as otherwise provided in this Agreement, the Custodian may in its
discretion, without express authority from the Trust and until the Custodian
receives Authorized Instructions to the contrary:
(a) make payments to itself or others for minor expenses of handling
Securities or other similar items relating to its duties under this
Agreement, provided that all such payments shall be accounted for to the
Trust and made from the assets of the appropriate Fund on whose behalf the
expenses were incurred;
(b) endorse for collection, in the name of the appropriate Fund,
checks, drafts and other negotiable instruments; and
(c) 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 each Fund except as
otherwise provided in Proper Instructions.
(d) promptly after receipt thereof, forward to the Trust those
communications relating to any Securities which call for voting or the
exercise of rights or other specific action (including materials relating
to legal proceedings intended to be transmitted to holders of such
Securities);
(e) to the extent permitted by applicable law and practice, require
the Custodian's nominees to execute and deliver to the Trust proxies
relating to Securities registered in the name of such nominees but without
indicating the manner in which such proxies are to be voted and to deliver
proxies relating to bearer Securities in accordance with Authorized
Instructions and applicable law and practice;
(f) present for payment maturing Securities and those called for
redemption;
(g) execute in the name of the Trust such ownership and other
certificates as may be required to obtain payment or exercise any rights
in respect of any Securities;
(h) accept and open all mail directed to the Trust in care of the
Custodian;
(i) disclose the Trust's name, address and Securities position (A)
to the issuers of Securities when requested to do so by them or (B) as
required by law or the rules of any stock exchange or regulatory or
self-regulatory organization; and
(j) dispose of fractional interests received by the Custodian or a
Subcustodian as a result of stock dividends by selling any fractional
interest received.
With respect to any corporate actions not listed above, nor otherwise addressed
in this Agreement, the Custodian shall (in the absence of Authorized
Instructions from the Trust within an prescribed deadline) take such action as
it considers appropriate in the circumstances; provided that the Custodian shall
not be liable for the consequences of any such action. If the Custodian holds
Securities as part of a fungible mass with securities of its other clients as
permitted in subparagraph 4(1), the Custodian will select the securities to
participate in partial redemptions, partial payments or other actions affecting
less than all securities of the relevant class in such non-discriminatory manner
as it customarily uses to make such selection. If any Securities held by a
Securities Depository become subject to such a partial redemption, partial
payment or other action, the Trust agrees that any manner used by such
Securities Depository to select the securities to participate in such partial
redemption, partial payment or other action will be acceptable.
8. REPORTING/RECORDS.
(a) Generally. The Custodian shall cooperate with and supply necessary
information in its possession (to the extent permissible under applicable law)
to the entity or entities appointed by the Board of Trustees to keep the books
of account of each Fund and/or compute the net asset value per Share of the
outstanding Shares of each Fund.
(b) Statements. The Custodian shall mail or cause to be mailed to each
Fund monthly statements of the Fund's Securities System Account and Cash
Account. Such statements shall list all of the Fund's Securities and specify the
amount of Cash held on deposit. The Trust agrees that each such statement shall
be binding on the Trust and each Fund ninety (90) days after it has been mailed
by first class airmail, postage prepaid, to the Fund, unless the Trust has
theretofore notified the Custodian in Writing of any inaccuracy in such
statement.
(c) Records. The Custodian shall create and maintain records relating to
its activities with respect to each separate Fund under this Agreement as such
records are required with respect to each Fund's activities under Section 31 of
the Investment Company Act and Rules 31a-1 and 31a-2 thereunder. All such
records shall be the property of the Trust 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 Trust and employees and agents
of the Securities and Exchange Commission. The Custodian shall, at the Trust's
request, supply the Trust with a tabulation of Securities owned by each Fund and
held by the Custodian and shall, when requested to do so by the Trust and for
such compensation as shall be agreed upon between the Trust and the Custodian,
include certificate numbers in such tabulations.
9. RESPONSIBILITIES.
(a) Custodian. The Custodian will use reasonable care in the performance
of its duties, exercise the same degree of care with respect to the Securities
as it would with respect to its own securities and property and indemnify the
Trust and hold the Trust harmless from any loss or liability (including, without
limitation, the reasonable fees and disbursements of counsel and other legal
advisers) incurred by the Trust by reason of the negligence (whether through
action or inaction) or willful misconduct of the Custodian. The Custodian's
responsibility with respect to any Securities held by any Securities Depository
is limited to the failure on the part of the Custodian to exercise reasonable
care in the selection or retention of such Securities Depository and the
custodian will hold the Trust harmless from and indemnify it against any loss
that occurs as a result of the failure of the Custodian to exercise such
reasonable care; it being understood that Securities Depositories included on
Appendix A or otherwise approved or selected by the Trust shall not be
considered to have been selected by the Custodian.
(b) Insurance. The Custodian will maintain insurance coverage with respect
to the Securities covering such risks and in such amounts as the Custodian
maintains with respect to securities which the Custodian holds for its own
account and for the account of other customers.
10. LIMITATIONS ON RESPONSIBILITIES.
(a) Generally. The Custodian shall be responsible for the performance of
only those duties as are set forth herein or contained in Authorized
Instructions that are not contrary to the provisions of this Agreement. In the
absence of a failure to exercise the standard of care required by Section 9
hereof, the Custodian shall not be liable to the Trust of any other person with
respect to any action taken or omitted to be taken by it in connection with
furnishing the services contemplated hereby. Under no circumstances will the
Custodian be liable to the Trust or any other person for consequential damages.
Without limiting the foregoing:
(i) all collections of funds or other property paid or distributed with
respect to any Securities shall be made at the risk of the Trust;
(ii) the Custodian shall not be liable for any loss occasioned by the
failure of the Custodian to notify the Trust of any payment of dividends
or interest or any redemption, rights offering or other distribution made
with respect to any Security or any corporate action taken or to be taken
with respect to any Security if the Custodian has not received notice of
such transaction directly from the issuer of such Security and if such
distribution or action was not included in the reports of a recognized
investment data service selected by the Custodian; and
(iii) the Custodian shall not be liable for any action taken in good faith
upon Authorized Instructions.
(b) Payment and Delivery Instructions. In some securities markets, securities
deliveries and payments therefor may not be or are not customarily made
simultaneously. Accordingly, the Trust agrees that, notwithstanding the Trust's
instruction to deliver Securities against payment or to pay for Securities
against delivery under Section 6, the Custodian or a Securities Depository may
make or accept payment of or delivery of Securities in such form and manner as
may be satisfactory to it and at such time and in such manner as shall be in
accordance with the customs prevailing in the relevant securities market or
among securities dealers. The Trust shall bear the risk that (i) the recipient
of Securities may fail to make payment, return such Securities or hold such
Securities or the proceeds of their sale in trust for the Trust, and (ii) that
the recipient of payment for Securities may fail to deliver the Securities (such
failure to include, without limitation, delivery of forged or stolen Securities)
or to return such payment, in each case whether such failure is total or partial
or merely a failure to perform on a timely basis. The Custodian shall not be
liable to the Trust for any loss resulting from any of the foregoing events.
(c) Reversals. In certain circumstances, deliveries of securities may be
reversed. Accordingly, credits of securities to the Trust's Securities Account
are provisional and subject to reversal if, in accordance with relevant local
law and practice, the delivery of the security giving rise to the credit is
reversed.
(d) Force Majeure. Subject to the provision of Section 9 hereof regarding
the Custodian's general standard of care, neither party hereto shall be liable
for any action taken, or any failure to take any action required to be taken
hereunder or otherwise to fulfill its obligations hereunder (including without
limitation the failure to receive or deliver securities or the failure to
receive or make any payment) in the event and to the extent that the taking of
such action or such failure is beyond the control of and without negligence by
the party chargeable with the action or failure and arises out of or is caused
by war, insurrection, riot, civil commotion, act of God, accident, fire, water
damage, explosion, mechanical breakdown, computer or system failure or other
failure of equipment, or malfunctioning of any communications media for whatever
reason, interruption (whether partial or total) of power supplies or other
utility or service, strike or other stoppage (whether partial or total) of
labor, any law, decree, regulation or order of any government or governmental
body (including any court or tribunal), or any other cause (whether similar or
dissimilar to any of the foregoing) whatsoever beyond its reasonable control.
(e) Trust's Reporting Obligations. The Trust shall be solely responsible
for compliance with any notification or other requirement of any jurisdiction
relating to or affecting the Trust's beneficial ownership of the Securities, and
the Custodian assumes no liability for noncompliance with such requirements.
(f) NO Investment Advice. Neither the Custodian nor any Subcustodian or
Xxxxxx Affiliate is under any duty to provide the Trust with investment advice
or to supervise its investments.
(g) Fraudulent Securities. The Custodian shall have no liability for
losses incurred by the Trust or any other person as a result of the receipt or
acceptance of fraudulent, forged or invalid Securities (or Securities which are
otherwise not freely transferable or deliverable without encumbrance in any
relevant market).
11. USE OF XXXXXX AFFILIATES.
(a) Executing orders. The Custodian will, in its sole discretion and if
permitted by applicable law, accept orders from the Trust for the purchase of
sale of Securities and either execute such orders itself or by means of Xxxxxx
Affiliates or brokers or other financial organizations of its choice, subject to
the fees and commissions in effect from time to time. The Custodian will not be
responsible for an act or omission, or for the solvency, of any broker or other
financial organization so selected to effect any transaction for the account of
the Trust. When instructed to buy or sell Securities for which the Custodian or
a Xxxxxx Affiliate acts as dealer, the Custodian will buy or sell such
Securities from or to either itself, as principal, or such Xxxxxx Affiliate.
(b) Disclosure to Xxxxxx Affiliates. The Custodian may only disclose to
X.X. Xxxxxx Securities ("JPMS") details with respect to the Funds' Securities
and transactions hereunder and then only to the extent necessary to carry out
Fund and Trust transactions with JPMS.
(c) Sub-Contracting. The Trust hereby agrees that the Custodian may
arrange with any Xxxxxx Affiliate to act as a Subcustodian and/or perform on
behalf of the Custodian any act required to be performed by the Custodian
hereunder.
12. FEES. The Trust agrees to pay the Custodian as compensation for the services
provided hereunder a fee computed at rates determined by the Custodian from time
to time and communicated to the Trust in Writing in advance (as well as all
reasonable out-of-pocket assessments, charges and expenses not resulting from
custodian's breach of Section 9). The Custodian is authorized to charge the
appropriate Fund's Cash Account for such fees. Attached as Appendix B is the
current Schedule of Fees for the Funds' accounts.
13. PLEDGE; RIGHT OF SET-OFF. To the extent permitted by applicable law,
including without limitation the Investment Company Act, the Trust hereby (i)
pledges to the Custodian as security for the payment of the fees and other
amounts referred to in Section 12 as well as any other obligation or liability
of any kind which the Trust may have to the Custodian in connection with this
Agreement, all Cash from time to time in the Cash Account and all Securities
held by the Custodian or a Securities Depository and hereby grants to the
Custodian a lien and security interest in such Cash and Securities and (ii)
grants to the Custodian a lien and security interest in such Cash and Securities
and (ii) grants to the Custodian a right to set off its obligations to deliver
such Cash and Securities to the Trust against any obligation or liability of any
kind which the Trust may have to the Custodian.
14. INDEMNIFICATION BY THE TRUST.
(a) The Trust agrees to indemnify and hold harmless the Custodian and its
nominees (each an "Indemnitee") from all taxes, charges, expenses, assessments,
claims and liabilities (including legal fees and expenses) reasonably and
actually incurred by an Indemnitee in connection with the good-faith performance
of this Agreement, except such as may arise from any negligent action, negligent
failure to act, willful misconduct, or misfeasance and so long as (i) the
Indemnitee reasonably believed that the conduct associated with its demand for
indemnification hereunder was at least not opposed to the best interests of the
Trust and the Funds and (ii) the Indemnitee shall not have been adjudged to be
liable on the basis of improper personal benefit, in the performance of the
Indemnitee's duty to the Trust and the Funds. The Trust shall not be liable to
an Indemnitee hereunder for expenses incurred in defending, amounts paid in
settling, or otherwise disposing of a threatened or pending action indemnifiable
hereunder, with or without court approval, without approval by a majority vote
of a quorum of the Board of Trustees; provided, however, that if the Board of
Trustees does not approve payment of these expenses, the Trust will accept
tender of the defense from the Indemnitee. The Custodian shall be entitled to
rely, and may act, on advice of counsel (who may be counsel for the Trust and/or
the Funds) on all matters and shall be without liability for any action
reasonably taken or omitted pursuant to such advice.
(b) The Custodian agrees that any obligations of the Trust and any Fund
arising hereunder shall be limited to the assets of the appropriate Fund, and
that the Custodian shall not seek satisfaction of any such obligation from the
shareholders of any other Fund nor from any Trustee, officer, employee, or agent
of the Trust.
15. TERMINATION.
This Agreement may be terminated by the Custodian or the Trust following
receipt by the other party of 60 days' prior written notice thereof; provided,
that such termination may be immediate if the other party shall be in breach of
its obligations hereunder of shall become the subject of bankruptcy, insolvency,
reorganization, receivership or other similar proceedings. If notice of
termination is given by the Custodian, Authorized Persons shall, within 60 days
following receipt of such notice, specify in writing the names of the persons to
whom all Securities and Cash shall be delivered or paid. In such case, the
Custodian, subject to the satisfaction of amounts owed to it pursuant to Section
12 hereof, will deliver such Securities and Cash to the persons so specified. If
within 60 days following the receipt of a notice of termination by the
Custodian, the Custodian does not receive from the Trust the names of the
persons to whom such Securities and Cash shall be delivered, the Custodian, at
its election, may deliver such Securities and Cash to a bank or a trust company
doing business in the State of California. Securities or Cash so delivered shall
be held and disposed of pursuant to the provisions of this Agreement or
Authorized Instructions or may be continued to be held until the names of such
persons are delivered to the Custodian. If notice of termination is given by the
Trust, the Custodian, subject to the payment of all amounts owed to it pursuant
to Section 12 hereof, will deliver such Securities and Cash to the persons
specified in Authorized Instructions. The indemnity provisions of this Agreement
and the provisions limiting the liabilities of the Custodian shall survive the
termination of this Agreement.
16. NOTICES.
Except as otherwise specified herein, any notice or other communication to
the Custodian is to be addressed to it at: 00 Xxxx Xxxxxx, Xxx Xxxx, X.X.
10260-0060 or to such other address as may be specified by the Custodian to the
Trust in writing from time to time. Any notice or other communication to the
Trust is to be addressed to The Money Market Portfolio, c/o Franklin Resources,
Inc., Attn: Trust Manager, 000 Xxxxxxxx Xxxxxx Xxxxxxxxx, Xxx Xxxxx, XX
00000-0000 or to such other address as may be specified by the Trust to the
Custodian in Authorized Instructions from time to time. Unless otherwise
specified herein, notices shall be effective when received.
17. AMENDMENTS AND WAIVER.
Any provision of this Agreement (including the Appendix hereto) may be
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by the Trust and the custodian; provided, however, that (i) the Custodian
may from time to time delete the name of any Securities Depository from Appendix
A without notice to or consent by the Trust and (ii) the Custodian may from time
to time add the name of any securities depository or clearing system to Appendix
A if it notifies the Trust by first class mail of such addition and does not
receive in writing an objection to such addition within 30 days after the date
such notice is mailed.
18. SUCCESSORS AND ASSIGNS; GOVERNING THE LAW.
This Agreement shall bind the successors and assigns of the Custodian and
the Trust and shall be governed by and construed in accordance with the law of
the State of New York. Except as otherwise provided by the terms of this
Agreement, neither the Custodian nor the Trust may assign any of its rights or
obligations under this Agreement without the prior written consent of the other
party.
19. HEADINGS.
The section headings used herein are for information only and shall not
affect the interpretation of any provision of this Agreement.
20. INTEGRATION.
This Agreement constitutes the entire agreement between the parties hereto
and supersedes any and all prior agreements and understanding, oral or written,
relating to the subject matter hereof.
21. ATTORNEYS' FEES.
If any lawsuit or other action or proceeding relating to this Agreement is
brought by a party hereto against the other party hereto, the prevailing party
shall be entitled to recover reasonable attorneys' fees, costs and disbursements
(including allocated costs and disbursements of in-house counsel), in addition
to any other relief to which the prevailing party may be entitled.
22. FURTHER ASSURANCES.
Each party hereto shall furnish to the other party hereto such instruments
and other documents as such other party may reasonably request for the purpose
of carrying out or evidencing the transactions contemplated by this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
by their respective authorized representatives as of the day and year first
above written.
Xxxxxx Guaranty Trust Company The Money Market Portfolios
of New York
/s/ Xxxxx X. Xxxxxxxxx, Xx /s/ Xxxxxxx X. Xxxxxxx
By: Xxxxx X. Xxxxxxxxx, Xx BY: Xxxxxxx X. Xxxxxxx
Title: vice President Title: President
Appendix A
Depository*
The Depository Trust Co.
The Participants Trust Co.
* In addition to the central bank , if applicable
APPENDIX B
X.X. XXXXXX Fee Schedule:
1. Custody Transactions (per item) [1,2]
FRB $ 8.00
DTC 12.00
PTC 15.00
Physical 35.00
2. Issue Position (per issue/ year)
Depository $ 35.00
Physical 115.00
3. Amortizations (per item)
Depository $ 10.00
Physical 15.00
4. Custody Reporting/ Instructions (per fund)
XXXXXX/Securities $1,000.00
5. Cash Reporting/Instructions (per account)
XXXXXX Same Day $3,000.00
or
XXXXXX Next Day (1st fund) 2,760.00
& each additional fund 1,680.00
5. Wires (per item)
-Outgoing FED (straight through) $ 4.80
-Outgoing FED (repair) 13.25
-Outgoing FED (phoned into Mon. Transfer) 45.00
-Incoming FED/CHIPS (straight through) 5.90
-Incoming Phone 35.75
-Book Transfer 2.50
-Zero Balance Transfer 2.00
5. Funds Management Rates
Nassau Sweep Fed Funds - 50 BP
Sweep to Repo Fed Funds - 75 BP
6. Overnight Overdraft Rate Fed Funds + 95 BP
(based on credit quality; subject to change)
