FORM OF
CUSTODIAN AGREEMENT
THIS AGREEMENT, dated as of ______, 1999, between Mackenzie Solutions,
an open-end management investment company organized under the laws of the
Commonwealth of Massachusetts and registered with the Commission under the 1940
Act (the Fund), and XXXXX BROTHERS XXXXXXXX & CO., a limited partnership formed
under the laws of the State of New York (BBH&Co. or the Custodian),
W I T N E S S E T H:
WHEREAS, the Fund wishes to employ BBH&Co. to act as custodian for the Fund
and to provide related services, all as provided herein, and BBH&Co. is willing
to accept such employment, subject to the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the Fund and BBH&Co. hereby agree, as follows:
1. Appointment of Custodian. The Fund hereby appoints BBH&Co. as the Fund's
custodian, and BBH&Co. hereby accepts such appointment. All Investments of the
Fund delivered to the Custodian or its agents or Subcustodians shall be dealt
with as provided in this Agreement. With respect to uncertificated shares of the
series of the Ivy Fund, the holding of confirmation statements that identify the
shares as being recorded in the Custodian's name on behalf of the Fund will be
deemed custody for the purposes hereof. The duties of the Custodian with respect
to the Fund's Investments shall be only as set forth expressly in this
Agreement, which duties are generally comprised of safekeeping and various
administrative duties that will be performed in accordance with Instructions and
as reasonably required to effect Instructions.
2. Representations, Warranties and Covenants of the Fund. The Fund hereby
represents, warrants and covenants each of the following:
2.1 This Agreement has been, and at the time of delivery of
each Instruction such Instruction will have been, duly authorized,
executed and delivered by the Fund. This Agreement does not violate any
Applicable Law or conflict with or constitute a default under the
Fund's prospectus or other organic document, agreement, judgment, order
or decree to which the Fund is a party or by which it or its
Investments is bound.
2.2 By providing an Instruction with respect to the first
acquisition of an Investment in a jurisdiction other than the United
States of America, the Fund shall be deemed to have confirmed to the
Custodian that the Fund has (a) assessed and accepted all material
Country or Sovereign Risks (as defined in Section 9.1) and accepted
responsibility for their occurrence, (b) made all determinations
required to be made by the Fund under the 1940 Act, and (iii)
appropriately and adequately disclosed to its shareholders, other
investors and all persons who have rights in or to such Investments,
all material investment risks, including those relating to the custody
and settlement infrastructure or the servicing of securities in such
jurisdiction.
2.3 The Fund shall safeguard and shall solely be responsible
for the safekeeping of any testkeys, identification codes, passwords,
other security devices or statements of account with which the
Custodian provides it. In furtherance and not limitation of the
foregoing, in the event the Fund utilizes any on-line service offered
by the Custodian, each of the Fund and the Custodian shall be fully
responsible for the security of its connecting terminal, access thereto
and the proper and authorized use thereof and the initiation and
application of continuing effective safeguards in respect thereof.
Additionally, if the Fund uses any on-line or similar communications
service made available by the Custodian, the Fund shall be solely
responsible for ensuring the security of its access to the service and
for the use of the service, and shall only attempt to access the
service and the Custodian's computer systems as directed by the
Custodian. If the Custodian provides any computer software to the Fund
relating to the services described in this Agreement, the Fund will
only use the software for the purposes for which the Custodian provided
the software to the Fund, and will abide by the license agreement
accompanying the software and any other security policies which the
Custodian provides to the Fund.
3. Representation and Warranty of BBH&Co. BBH&Co. hereby represents and warrants
that this Agreement has been duly authorized, executed and delivered by BBH&Co.
and does not and will not violate any Applicable Law or conflict with or
constitute a default under BBH&Co.'s limited partnership agreement or any
agreement, instrument, judgment, order or decree to which BBH&Co. is a party or
by which it is bound.
4. Instructions. Unless otherwise explicitly indicated herein, the Custodian
shall perform its duties pursuant to Instructions. As used herein, the term
Instruction shall mean a directive initiated by the Fund, acting directly or
through its board of trustees, officers or other Authorized Persons, which
directive shall conform to the requirements of this Section 4.
4.1 Authorized Persons. For purposes hereof, an Authorized Person
shall be a person or entity authorized to give Instructions for or on
behalf of the Fund by written notices to the Custodian or otherwise in
accordance with procedures delivered to and acknowledged by the Custodian,
including without limitation the Fund's Investment Adviser or Foreign
Custody Manager. The Custodian may treat any Authorized Person as having
full authority of the Fund to issue Instructions hereunder unless the
notice of authorization contains explicit limitations as to said authority.
The Custodian shall be entitled to rely upon the authority of Authorized
Persons until it receives appropriate written notice from the Fund to the
contrary. 4.2 Form of Instruction. Each Instruction shall be transmitted by
such secured or authenticated electro-mechanical means as the Custodian
shall make available to the Fund from time to time unless the Fund shall
elect to transmit such Instruction in accordance with Subsections 4.2.1
through 4.2.3 of this Section.
4.2.1 Fund Designated Secured-Transmission Method. Instructions may be
transmitted through a secured or tested electro-mechanical means identified
by the Fund or by an Authorized Person entitled to give Instructions and
acknowledged and accepted by the Custodian; it being understood that such
acknowledgment shall authorize the Custodian to receive and process such
means of delivery but shall not represent a judgment by the Custodian as to
the reasonableness or security of the method determined by the Authorized
Person.
4.2.2 Written Instructions. Instructions may be transmitted in a
writing that bears the manual signature of an Authorized Person.
4.2.3 Other Forms of Instruction. Instructions may also be
transmitted by another means determined by the Fund or Authorized
Persons and acknowledged and accepted by the Custodian (subject to the
same limits as to acknowledgements as is contained in Subsection
4.2.1, above) including Instructions given orally or by SWIFT, telex
or telefax (whether tested or untested).
When an Instruction is given by means established under Subsections 4.2.1
through 4.2.3, it shall be the responsibility of the Custodian to use reasonable
care to adhere to any security or other procedures established in writing
between the Custodian and the Authorized Person with respect to such means of
Instruction, but such Authorized Person shall be solely responsible for
determining that the particular means chosen is reasonable under the
circumstances. Telephonic or other oral instructions given by facsimile
transmission may be given by any Authorized Person and will be considered proper
Instructions if the Custodian reasonably believes them to have been given by an
Authorized Person. Oral Instructions communicated as described in the preceding
sentence will be confirmed by tested telex or in writing in the manner set forth
above but the lack of such confirmation shall in no way affect any action taken
by the Custodian in reliance upon such oral Instruction communicated as
described above. With respect to telefax instructions, the parties agree and
acknowledge that receipt of legible instructions cannot be assured, that the
Custodian cannot verify that authorized signatures on telefax instructions are
original or properly affixed, and that the Custodian shall not be liable for
losses or expenses incurred through actions taken in reliance on inaccurately
stated, or unauthorized telefax instructions. The provisions of Section 4A of
the Uniform Commercial Code shall apply to Funds Transfers performed in
accordance with Instructions. In the event that a Funds Transfer Services
Agreement is executed between the Fund or an Authorized Person and the
Custodian, such an agreement shall comprise a designation of form of a means of
delivering Instructions for purposes of this Section 4.2.
4.3 Completeness and Contents of Instructions. The Authorized Person
shall be responsible for assuring the adequacy and accuracy of Instructions.
Particularly, upon any acquisition or disposition or other dealing in the Fund's
Investments and upon any delivery and transfer of any Investment or moneys, the
person initiating such Instruction shall give the Custodian an Instruction with
appropriate detail, including, without limitation:
4.3.1 The transaction date and the date and location of
settlement;
4.3.2 The specification of the type of transaction;
4.3.4 A description of the Investments or moneys in question,
including, as appropriate, quantity, price per unit, amount of money
to be received or delivered and currency information. Where an
Instruction is communicated by electronic means, or otherwise where an
Instruction contains an identifying number such as a CUSIP, SEDOL or
ISIN number, the Custodian shall be entitled to rely on such number as
controlling notwithstanding any inconsistency contained in such
Instruction, particularly with respect to Investment description;
4.3.5 The name of the broker or similar entity concerned with
execution of the transaction.
If the Custodian shall determine that an Instruction is either unclear or
incomplete, the Custodian shall give prompt notice of such determination to the
Fund, and the Fund shall thereupon amend or otherwise reform such Instruction.
In such event, the Custodian shall have no obligation to take any action in
response to the Instruction initially delivered until the redelivery of an
amended or reformed Instruction.
4.4 Timeliness of Instructions. In giving an Instruction, the Fund
shall take into consideration delays which may occur due to the involvement
of a Subcustodian or agent, differences in time zones, and other factors
particular to a given market, exchange or issuer. When the Custodian has
established specific timing requirements or deadlines with respect to
particular classes of Instruction, or when an Instruction is received by
the Custodian at such a time that it could not reasonably be expected to
have acted on such instruction due to time zone differences or other
factors beyond its reasonable control, the execution of any Instruction
received by the Custodian after such deadline or at such time (including
any modification or revocation of a previous Instruction) shall be at the
risk of the Fund.
5. Safekeeping of Fund Assets. The Custodian shall hold Investments delivered to
it or Subcustodians for the Fund in accordance with the provisions of this
Section. The Custodian shall not be responsible for (a) the safekeeping of
Investments not delivered or that are not caused to be issued to it or its
Subcustodians, except that the holding of confirmation statements from Xxx
Xxxxxxxxx Service Corp. in accordance with Section 5.1.1 hereof that identify
uncertificated shares of the series of Ivy Fund as being recorded in the
Custodian's name on behalf of the Fund will be deemed custody for the purposes
hereof; or, (b) pre-existing faults or defects in Investments that are delivered
to the Custodian, or its Subcustodians. The Custodian is hereby authorized to
hold with itself or a Subcustodian, and to record in one or more accounts, all
Investments delivered to and accepted by the Custodian, any Subcustodian or
their respective agents pursuant to an Instruction or in consequence of any
corporate action. The Custodian shall hold Investments for the account of the
Fund and shall segregate Investments from assets belonging to the Custodian and
shall cause its Subcustodians to segregate Investments from assets belonging to
the Subcustodian in an account held for the Fund or in an account maintained by
the Subcustodian generally for non-proprietary assets of the Custodian. The Fund
shall receive periodic reports with respect to the safekeeping of the Fund's
assets, including, but not limited to, notification of any transfer to or from
the Fund's account or an account maintained by the Subcustodian generally for
the non-proprietary assets of the Custodian. 5.1 Use of Securities Depositories.
The Custodian may deposit and maintain Investments in any Securities Depository,
either directly or through one or more Subcustodians appointed by the Custodian.
Investments held in a Securities Depository shall be held (a) subject to the
agreement, rules, statement of terms and conditions or other document or
conditions effective between the Securities Depository and the Custodian or the
Subcustodian, as the case may be, and (b) in an account for the Fund or in bulk
segregation in an account maintained for the non-proprietary assets of the
entity holding such Investments in the Depository. The Fund shall receive
periodic reports with respect to the safekeeping of the Fund's assets including,
but not limited to, notification of any transfer to or from the Fund's account
or an account maintained in bulk segregation for the non-proprietary assets of
the entity holding such Investments in the Depository. If market practice or the
rules and regulations of the Securities Depository prevent the Custodian, the
Subcustodian or any agent of either from holding its client assets in such a
separate account, the Custodian, the Subcustodian or other agent shall, as
appropriate, segregate such Investments for benefit of the Fund or for benefit
of clients of the Custodian generally on its own books. 5.1.1 Deposit of Fund
Assets with Xxx Xxxxxxxxx Service Corp.
The Custodian may keep securities of the Fund with Xxx
Xxxxxxxxx Service Corp. provided that such securities are maintained in an
account on the books and records of Xxx Xxxxxxxxx Service Corp. in the name of
the Custodian, on behalf of the Fund, and provided further that such account
shall be maintained separately from the account of any other customer of Xxx
Xxxxxxxxx Service Corp.
The Custodian shall (i) pay for securities purchased for the
account of the Fund upon receipt of advice from Xxx Xxxxxxxxx Service Corp. that
such securities have been transferred to the account of the Custodian, on behalf
of the Fund, on the books and records of Xxx Xxxxxxxxx Service Corp., and (ii)
shall credit the account of the Custodian, on behalf of the Fund, for the
redemption of shares upon receipt of an advice from Xxx Xxxxxxxxx Service Corp.
that securities have been redeemed. Copies of all advices from Xxx Xxxxxxxxx
Service Corp. of purchases and sales 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.
5.2 Certificated Assets. Investments which are certificated may be
held in registered or bearer form: (a) in the Custodian's vault; (b) in the
vault of a Subcustodian or agent of the Custodian or a Subcustodian; or (c)
in an account maintained by the Custodian, Subcustodian or agent at a
Securities Depository; all in accordance with customary market practice in
the jurisdiction in which such certificated Investments are held.
5.3 Registered Assets. Investments which are registered may be
registered in the name of the Custodian, a Subcustodian, or in the name of
the Fund or a nominee for any of the foregoing, and may be held in any
manner set forth in paragraph 5.2 above with or without any identification
of fiduciary capacity in such registration. 5.4 Book Entry Assets.
Investments which are represented by book-entry may be so held in an
account maintained by the Book-Entry Agent on behalf of the Custodian, a
Subcustodian or another agent of the Custodian, or a Securities Depository.
5.5 Replacement of Lost Investments. In the event of a loss of Investments
for which the Custodian is responsible under the terms of this Agreement,
the Custodian shall replace such Investment, or in the event that such
replacement cannot be effected, the Custodian shall pay to the Fund the
fair market value of such Investment based on the last available price as
of the close of business in the relevant market on the date that a claim
was first made to the Custodian with respect to such loss, or, if less,
such other amount as shall be agreed by the parties as the date for
settlement.
6. Administrative Duties of the Custodian. The Custodian shall perform the
following administrative duties with respect to Investments of the Fund.
6.1 Purchase of Investments. Pursuant to Instruction, Investments
purchased for the account of the Fund shall be paid for (a) against
delivery thereof to the Custodian or a Subcustodian, as the case may be,
either directly or through a Clearing Corporation or a Securities
Depository (in accordance with the rules of such Securities Depository or
such Clearing Corporation), or (b) otherwise in accordance with an
Instruction, Section 5.1.1 herein, Applicable Law, generally accepted trade
practices, or the terms of the instrument representing such Investment.
6.2 Sale of Investments. Pursuant to Instruction, Investments sold for
the account of the Fund shall be delivered (a) against payment therefor in
cash, by check or by bank wire transfer, (b) by credit to the account of
the Custodian or the applicable Subcustodian, as the case may be, with a
Clearing Corporation or a Securities Depository (in accordance with the
rules of such Securities Depository or such Clearing Corporation), or (c)
otherwise in accordance with an Instruction, Section 5.1.1 herein,
Applicable Law, generally accepted trade practices, or the terms of the
instrument representing such Investment. 6.3 Delivery in Connection with
Borrowings of the Fund or other Collateral and Margin Requirements.
Pursuant to Instruction, the Custodian may deliver Investments or cash of
the Fund in connection with borrowings and other collateral and margin
requirements.
6.4 Futures and Options. If, pursuant to an Instruction, the Custodian
shall become a party to an agreement with the Fund and a futures commission
merchant regarding margin (Tri-Party Agreement), the Custodian shall (a)
receive and retain, to the extent the same are provided to the Custodian,
confirmations or other documents evidencing the purchase or sale by the
Fund of exchange-traded futures contracts and commodity options, (b) when
required by such Tri-Party Agreement, deposit and maintain in an account
opened pursuant to such Agreement (Margin Account), segregated either
physically or by book-entry in a Securities Depository for the benefit of
any futures commission merchant, such Investments as the Fund shall have
designated as initial, maintenance or variation "margin" deposits or other
collateral intended to secure the Fund's performance of its obligations
under the terms of any exchange-traded futures contracts and commodity
options; and (c) thereafter pay, release or transfer Investments into or
out of the margin account in accordance with the provisions of the such
Agreement. Alternatively, the Custodian may deliver Investments, in
accordance with an Instruction, to a futures commission merchant for
purposes of margin requirements in accordance with Rule 17f-6. The
Custodian shall in no event be responsible for the acts and omissions of
any futures commission merchant to whom Investments are delivered pursuant
to this Section; for the sufficiency of Investments held in any Margin
Account; or, for the performance of any terms of any exchange-traded
futures contracts and commodity options. 6.4.1 Segregated Account. The
Custodian shall upon receipt of Instructions establish and maintain on its
books a segregated account or accounts for and on behalf of the Fund, into
which account or accounts may be transferred cash and/or securities of the
Fund, including securities maintained by the Custodian pursuant to Section
5.1 hereof, said account to be (i) maintained in accordance with the
provisions of any agreement among the Fund, the Custodian and a
broker-dealer registered under the Securities Exchange Act of 1934 and a
member of the National Association of Securities Dealers Inc., (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 any
similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Fund, (ii) for purposes
of segregating cash or securities in connection with options thereon
purchased, sold or written by the Fund, or commodity futures contracts or
options thereon purchased or sold by the Fund or in connection with
borrowings by the Fund (iii) for the purpose of compliance 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) as mutually agreed from time to time between the Fund
and the Custodian.
6.5 Contractual Obligations and Similar Investments. From time to
time, the Fund's Investments may include Investments that are not ownership
interests as may be represented by certificate (whether registered or
bearer), by entry in a Securities Depository or by book entry agent,
registrar or similar agent for recording ownership interests in the
relevant Investment. If the Fund shall at any time acquire such
Investments, including without limitation uncertificated shares of the
series of Ivy Fund as described in Section 5.1.1, deposit obligations, loan
participations, repurchase agreements and derivative arrangements, the
Custodian shall (a) receive and retain, to the extent the same are provided
to the Custodian, confirmations or other documents evidencing the
arrangement; and (b) perform on the Fund's account in accordance with the
terms of the applicable arrangement, but only to the extent directed to do
so by Instruction. The Custodian shall have no responsibility for
agreements running to the Fund as to which it is not a party, other than to
retain, to the extent the same are provided to the Custodian, documents or
copies of documents evidencing the arrangement and, in accordance with
Instruction, to include such arrangements in reports made to the Fund. 6.6
Exchange of Securities. Unless otherwise directed by Instruction, the
Custodian shall: (a) exchange securities held for the account of the Fund
for other securities in connection with any reorganization,
recapitalization, conversion, split-up, change of par value of shares or
similar event, and (b) deposit any such securities in accordance with the
terms of any reorganization or protective plan. 6.7 Surrender of
Securities. Unless otherwise directed by Instruction, the Custodian may
surrender securities: (a) in temporary form for definitive securities; (b)
for transfer into the name of an entity allowable under Section 5.3; and
(c) for a different number of certificates or instruments representing the
same number of shares or the same principal amount of indebtedness. 6.8
Rights, Warrants, Etc. Pursuant to Instruction, the Custodian shall (a)
deliver warrants, puts, calls, rights or similar securities to the issuer
or trustee thereof, or to any agent of such issuer or trustee, for purposes
of exercising such rights or selling such securities, and (b) deposit
securities in response to any invitation for the tender thereof. 6.9
Mandatory Corporate Actions. Unless otherwise directed by Instruction, the
Custodian shall: (a) comply with the terms of all mandatory or compulsory
exchanges, calls, tenders, redemptions or similar rights of securities
ownership affecting securities held on the Fund's account and promptly
notify the Fund of such action, and (b) collect all stock dividends, rights
and other items of like nature with respect to such securities. 6.10 Income
Collection. Unless otherwise directed by Instruction, the Custodian shall
collect any amount due and payable to the Fund with respect to Investments
and promptly credit the amount collected to a Principal or Agency Account;
provided, however, that the Custodian shall not be responsible for: (a) the
collection of amounts due and payable with respect to Investments that are
in default, or (b) the collection of cash or share entitlements with
respect to Investments that are not registered in the name of the Custodian
or its Subcustodians. The Custodian is hereby authorized to endorse and
deliver any instrument required to be so endorsed and delivered to effect
collection of any amount due and payable to the Fund with respect to
Investments. 6.11 Ownership Certificates and Disclosure of the Fund's
Interest. The Custodian is hereby authorized to execute on behalf of the
Fund ownership certificates, affidavits or other disclosure required under
Applicable Law or established market practice in connection with the
receipt of income, capital gains or other payments by the Fund with respect
to Investments, or in connection with the sale, purchase or ownership of
Investments. 6.12 Proxy Materials. The Custodian shall deliver, or cause to
be delivered, to the Fund proxy forms, notices of meeting, and any other
notices or announcements materially affecting or relating to Investments
received by the Custodian or any nominee. With respect to tender or
exchange offers, rights offerings or similar corporate actions ("Offers"),
the Custodian shall transmit promptly to the Fund all written information
received by the Custodian from issuers of the securities involved and from
the party (or its agents) making the Offer. If the Fund desires to take
action with respect to any Offer, the Fund shall notify the Custodian prior
to the last day on which the Custodian is able to take timely action
pursuant to the terms of such Offer. 6.13. Taxes. The Custodian shall,
where applicable, assist the Fund in the reclamation of taxes withheld on
dividends and interest payments received by the Fund. In the performance of
its duties with respect to tax withholding and reclamation, the Custodian
shall be entitled to rely on the advice of counsel and upon information and
advice regarding the Fund's tax status that is received from or on behalf
of the Fund without duty of separate inquiry. 6.14 Other Dealings. The
Custodian shall otherwise act as directed by Instruction, including without
limitation effecting the free payments of moneys or the free delivery of
securities, provided that such Instruction shall indicate the purpose of
such payment or delivery and that the Custodian shall record the party to
whom such payment or delivery is made.
The Custodian shall attend to all nondiscretionary details in
connection with the sale or purchase or other administration of Investments,
except as otherwise directed by an Instruction, and may make payments to itself
or others for minor expenses of administering Investments under this Agreement;
provided that the Fund shall have the right to request an accounting with
respect to such expenses.
In fulfilling the duties set forth in Sections 6.6 through 6.10 above,
the Custodian shall provide to the Fund all material information pertaining to a
corporate action which the Custodian actually receives; provided that the
Custodian shall not be responsible for the completeness or accuracy of such
information. Any advance credit of cash or shares expected to be received as a
result of any corporate action shall be subject to actual collection and may,
when the Custodian deems collection unlikely, be reversed by the Custodian,
after it has provided notification of the same to the Fund.
The Custodian, subject to the general liability provisions contained in
Section 9, may at any time or times in its discretion appoint (and may at any
time remove) agents (other than Subcustodians) to carry out some or all of the
administrative provisions of this Agreement (Agents), provided, however, that
the appointment of such agent shall not relieve the Custodian of its
responsibilities under this Agreement. 7. Cash Accounts, Deposits and Money
Movements. Subject to the terms and conditions set forth in this Section 7, the
Fund hereby authorizes the Custodian to open and maintain, with itself or with
Subcustodians, cash accounts in United States Dollars, in such other currencies
as are the currencies of the countries in which the Fund maintains Investments
or in such other currencies as the Fund shall from time to time request by
Instruction.
7.1 Types of Cash Accounts. Cash accounts opened on the books of the
Custodian (Principal Accounts) shall be opened in the name of the Fund. Such
accounts collectively shall be a deposit obligation of the Custodian and shall
be subject to the terms of this Section 7 and the general liability provisions
contained in Section 9. Cash accounts opened on the books of a Subcustodian may
be opened in the name of the Fund or the Custodian or in the name of the
Custodian for its customers generally (Agency Accounts). Such deposits shall be
obligations of the Subcustodian and shall be treated as an Investment of the
Fund. Accordingly, the Custodian shall be responsible for exercising reasonable
care in the administration of such accounts but shall not be liable for their
repayment in the event such Subcustodian, by reason of its bankruptcy,
insolvency or otherwise, fails to make repayment, unless the Fund experiences a
loss due to such bankruptcy or insolvency and the Custodian negligently failed
to take appropriate action in light of facts it knew or in the exercise of
reasonable care should have known regarding the Suscustodian's bankruptcy or
insolvency.
7.2 Payments and Credits with Respect to the Cash Accounts. The
Custodian shall make payments from or deposits to any of said accounts in the
course of carrying out its administrative duties, including but not limited to
income collection with respect to the Fund's Investments, and otherwise in
accordance with Instructions. The Custodian and its Subcustodians shall be
required to credit amounts to the cash accounts only when moneys are actually
received in cleared funds in accordance with banking practice in the country and
currency of deposit. Any credit made to any Principal or Agency Account before
actual receipt of cleared funds shall be provisional and may be reversed by the
Custodian, upon written notice to the Fund, in the event such payment is not
actually collected. Unless otherwise specifically agreed in writing by the
Custodian or any Subcustodian, all deposits shall be payable only at the branch
of the Custodian or Subcustodian where the deposit is made or carried.
7.3 Currency and Related Risks. The Fund bears the risks of holding or
transacting in any currency. The Custodian shall not be liable for any loss or
damage arising from the applicability of any law or regulation now or hereafter
in effect, or from the occurrence of any event, which may delay or affect the
transferability, convertibility or availability of any currency in the country
(a) in which such Principal or Agency Accounts are maintained or (b) in which
such currency is issued, and in no event shall the Custodian be obligated to
make payment of a deposit denominated in a currency during the period during
which its transferability, convertibility or availability has been affected by
any such law, regulation or event. Without limiting the generality of the
foregoing, neither the Custodian nor any Subcustodian shall be required to repay
any deposit made at a foreign branch of either the Custodian or Subcustodian if
such branch cannot repay the deposit due to a cause for which the Custodian
would not be responsible in accordance with the terms of Section 9 of this
Agreement unless the Custodian or such Subcustodian expressly agrees in writing
to repay the deposit under such circumstances. All currency transactions in any
account opened pursuant to this Agreement are subject to exchange control
regulations of the United States and of the country where such currency is the
lawful currency or where the account is maintained. Any taxes, costs, charges or
fees imposed on the convertibility of a currency held by the Fund shall be for
the account of the Fund.
7.4 Foreign Exchange Transactions. The Custodian shall, subject to the
terms of this Section, settle foreign exchange transactions (including
contracts, futures, options and options on futures) on behalf and for the
account of the Fund with such currency brokers or banking institutions,
including Subcustodians, as the Fund may direct pursuant to Instructions. The
Custodian may act as principal in any foreign exchange transaction with the Fund
in accordance with Section 7.4.2 of this Agreement. The obligations of the
Custodian in respect of all foreign exchange transactions (whether or not the
Custodian shall act as principal in such transaction) shall be contingent on the
free, unencumbered transferability of the currency transacted on the actual
settlement date of the transaction.
7.4.1 Third Party Foreign Exchange Transactions. The Custodian
shall process foreign exchange transactions (including without
limitation contracts, futures, options, and options on futures) where
any third party acts as principal counterparty to the Fund on the same
basis it performs duties as agent for the Fund with respect to any
other of the Fund's Investments. Accordingly, the Custodian shall only
be responsible for delivering or receiving currency on behalf of the
Fund in respect of such contracts pursuant to Instructions. Foreign
exchange transactions, other than those executed with the Custodian as
principal, but including those executed with Subcutsodians, shall be
deemed to be Investments of the Fund and the responsibility of the
Custodian therefor shall be the same as and no greater than the
Custodian's responsibility in respect of other Investments of the
Fund. The Custodian (a) shall transmit cash and Instructions to and
from the currency broker or banking institution with which a foreign
exchange contract or option has been executed pursuant hereto, (b) may
make free outgoing payments of cash in the form of Dollars or foreign
currency without receiving confirmation of a foreign exchange contract
or option or confirmation that the countervalue currency completing
the foreign exchange contract has been delivered or received or that
the option has been delivered or received, and (c) shall hold all
confirmations, certificates and other documents and agreements
received by the Custodian and evidencing or relating to such foreign
exchange transactions in safekeeping. The Fund accepts full
responsibility for its use of third-party foreign exchange dealers and
for execution of said foreign exchange contracts and options and
understands that the Fund shall be responsible for any and all costs
and interest charges which may be incurred by the Fund or the
Custodian as a result of the failure or delay of third parties to
deliver foreign exchange.
7.4.2 Foreign Exchange with the Custodian as Principal. The
Custodian may undertake foreign exchange transactions with the Fund as
principal as the Custodian and the Fund may agree from time to time.
In such event, the foreign exchange transaction will be performed in
accordance with the particular agreement of the parties, or in the
event a principal foreign exchange transaction is initiated by
Instruction in the absence of specific agreement, such transaction
will be performed in accordance with the usual commercial terms of the
Custodian. The responsibility of the Custodian with respect to foreign
exchange transactions executed with the Custodian as principal shall
be that of a U.S. bank with respect to similar foreign exchange
transactions.
7.5 Delays. If no event of Force Majeure shall have occurred and
be continuing and in the event that a delay shall have been caused by
the negligence or willful misconduct of the Custodian in carrying out
an Instruction to credit or transfer cash, the Custodian shall be
liable to the Fund: (a) with respect to Principal Accounts, for
interest to be calculated at the rate customarily paid on such deposit
and currency by the Custodian on overnight deposits at the time the
delay occurs for the period from the day when the transfer should have
been effected until the day it is in fact effected; and, (b) with
respect to Agency Accounts, for interest to be calculated at the rate
customarily paid on such deposit and currency by the Subcustodian on
overnight deposits at the time the delay occurs for the period from
the day when the transfer should have been effected until the day it
is in fact effected. The Custodian shall not be liable for delays in
carrying out such Instructions to transfer cash which are not due to
the Custodian's own negligence or willful misconduct, or that of a
Subcustodian or Agent utilized by the Custodian.. 7.6 Advances. If,
for any reason in the conduct of its safekeeping duties pursuant to
Section 5 hereof or its administration of the Fund's assets pursuant
to Section 6 hereof, the Custodian or any Subcustodian advances monies
to facilitate settlement or otherwise for benefit of the Fund (whether
or not any Principal or Agency Account shall be overdrawn either
during or at the end of any Business Day), the Fund hereby does:
7.6.1 acknowledge that the Fund shall have no right or title to
any Investments purchased with such Advance save a right to receive
such Investments upon: (a) the debit of the Principal or Agency
Account; or, (b) if such debit would produce an overdraft in such
account, other reimbursement of the associated Advance;
7.6.2 grant to the Custodian a security interest in certain
specified Investments; and,
7.6.3 agree that the Custodian may secure the resulting Advance
by perfecting a security interest in such specified Investments under
Applicable Law.
Neither the Custodian nor any Subcustodian shall be obligated to advance monies
to the Fund, and in the event that such Advance occurs, any transaction giving
rise to an Advance shall be for the account and risk of the Fund and shall not
be deemed to be a transaction undertaken by the Custodian for its own account
and risk. If such Advance shall have been made by a Subcustodian or any other
person, the Custodian may assign the security interest and any other rights
granted to the Custodian hereunder to such Subcustodian or other person. If the
Fund shall fail to repay when due the principal balance of an Advance and
accrued and unpaid interest thereon, the Custodian or its assignee, as the case
may be, shall be entitled to utilize the available cash balance in any Agency or
Principal Account and to dispose of the specified Investments to the extent
necessary to recover payment of all principal of, and interest on, such Advance
in full. The Custodian may assign any rights it has hereunder to a Subcustodian
or third party. Any security interest in Investments taken hereunder shall be
treated as financial assets credited to securities accounts under Articles 8 and
9 of the Uniform Commercial Code (1997). Accordingly, the Custodian shall have
the rights and benefits of a secured creditor that is a securities intermediary
under such Articles 8 and 9.
7.7 Integrated Account. For purposes hereof, deposits maintained in
all Principal Accounts (whether or not denominated in Dollars) shall
collectively constitute a single and indivisible current account with
respect to the Fund's obligations to the Custodian, or its assignee, and
balances in such Principal Accounts shall be available for satisfaction of
the Fund's obligations under this Section 7. The Custodian shall further
have a right of offset against the balances in any Agency Account
maintained hereunder to the extent that the aggregate of all Principal
Accounts is overdrawn.
8. Subcustodians and Securities Depositories. Subject to the provisions
hereinafter set forth in this Section 8, the Fund hereby authorizes the
Custodian to utilize Securities Depositories to act on behalf of the Fund and to
appoint from time to time and to utilize Subcustodians. With respect to
securities and funds held by a Subcustodian, either directly or indirectly
(including by a Securities Depository or Clearing Corporation), notwithstanding
any provisions of this Agreement to the contrary, payment for securities
purchased and delivery of securities sold may be made prior to receipt of
securities or payment, respectively, and securities or payment may be received
in a form, in accordance with (a) governmental regulations, (b) rules of
Securities Depositories and clearing agencies, (c) generally accepted trade
practice in the applicable local market, (d) the terms and characteristics of
the particular Investment, or (e) the terms of Instructions.
8.1 Domestic Subcustodians and Securities Depositories. The Custodian
may deposit and/or maintain, either directly or through one or more agents
appointed by the Custodian, Investments of the Fund in any Securities
Depository in the United States, including The Depository Trust Company,
provided such Depository meets applicable requirements of the Federal
Reserve Bank or of the Securities and Exchange Commission. The Custodian
may, at any time and from time to time, appoint any bank as defined in
Section 2(a)(5) of the 1940 Act meeting the requirements of a custodian
under Section 17(f) of the 1940 Act and the rules and regulations
thereunder, to act on behalf of the Fund as a Subcustodian for purposes of
holding Investments of the Fund in the United States. 8.2 Foreign
Subcustodians and Securities Depositories. The Custodian may deposit and/or
maintain non-U.S. Investments of the Fund in any non-U.S. Securities
Depository provided such Securities Depository meets the requirements of an
"eligible foreign custodian" under Rule 17f-5 promulgated under the 1940
Act, or any successor rule or regulation ("Rule 17f-5") or which by order
of the Securities and Exchange Commission is exempted therefrom.
Additionally, the Custodian may, at any time and from time to time, appoint
(a) any bank, trust company or other entity meeting the requirements of an
Eligible Foreign Custodian under Rule 17f-5 or which by order of the
Securities and Exchange Commission is exempted therefrom, or (b) any bank
as defined in Section 2(a)(5) of the 1940 Act meeting the requirements of a
custodian under Section 17(f) of the 1940 Act and the rules and regulations
thereunder, to act on behalf of the Fund as a Subcustodian for purposes of
holding Investments of the Fund outside the United States. Such appointment
of foreign Subcustodians shall be subject to approval of the Fund in
accordance with Subsections 8.2.1 and 8.2.2.
8.2.1 Board Approval of Foreign Subcustodians. Unless and
except to the extent that review of certain matters concerning the
appointment of Subcustodians shall have been delegated to the Custodian
pursuant to Subsection 8.2.2, the Custodian shall, prior to the
appointment of any Subcustodian for purposes of holding Investments of
the Fund outside the United States, obtain written confirmation of the
approval of the Board of Trustees of the Fund with respect to (a) the
identity of a Subcustodian, (b) the country or countries in which, and
the Securities Depositories, if any, through which, any proposed
Subcustodian is authorized to hold Investments of the Fund, and (c) the
Subcustodian agreement which shall govern such appointment. Each such
duly approved country, Subcustodian and Securities Depository shall be
listed on Appendix A attached hereto as the same may from time to time
be amended.
8.2.2 Delegation of Board Review of Subcustodians. From time
to time, the Custodian may offer to perform, and the Fund may accept
that the Custodian perform, certain reviews of Subcustodians and of
Subcustodian Contracts as delegate of the Fund's Board. In such event,
the Custodian's duties and obligations with respect to this delegated
review will be performed in accordance with the terms of [SCHEDULE ***
of this Agreement/the separate delegation agreement between the Fund
and the Custodian].
8.3 Responsibility for Subcustodians. With respect to securities and
funds held by a Subcustodian, either directly or indirectly (including by a
Foreign Depository, Securities System or foreign clearing agency),
including demand deposit and interest bearing deposits, currencies or other
deposits and foreign exchange contracts as referred to herein, the
Custodian shall be liable to the Fund if and only to the extent that such
Subcustodian is liable to the Custodian and the Custodian recovers under
the applicable subcustodian agreement. The Custodian shall nevertheless be
liable to the Fund for its own negligence in transmitting to any such
Subcustodian any Instructions received by it from the Fund and for its own
negligence in connection with the delivery of any Investments or moneys
held by it to any such Subcustodian.
In the event that any Subcustodian appointed pursuant to the provisions
of this Section 8.3 fails to perform any of its obligations under the terms and
conditions of the applicable subcustodian agreement, the Custodian shall use its
best efforts to cause such Subcustodian to perform such obligations. In the
event that the Custodian is unable to cause such Subcustodian to perform fully
its obligations thereunder, the Custodian shall forthwith upon the Fund's
request terminate such Subcustodian in accordance with the termination
provisions under the applicable subcustodian agreement and, if necessary or
desirable, appoint another Subcustodian in accordance with the provisions of
Section 8 herein. At the election of the Fund, it shall have the right to
enforce, to the extent permitted by the subcustodian agreement and applicable
law, the Custodian's rights against any such Subcustodian for loss or damage
caused the Fund by such Subcustodian.
The Custodian may at any time and from time to time make non-material,
administrative amendments to any subcustodian agreement without notice to the
Fund. The Custodian may at any time and from time to time, make material
amendments to any subcustodian agreement provided that the Custodian give notice
to the Fund of such amendments as soon as reasonably practicable after such
amendments.
The Custodian may, at any time in its discretion upon notification to
the Fund, terminate any Subcustodian of the Fund in accordance with the
termination provisions under the applicable subcustodian agreement, and at the
written request of the Fund, the Custodian will terminate any Subcustodian in
accordance with the termination provisions under the applicable subcustodian
agreement.
If necessary or desirable, the Custodian may appoint another
Subcustodian to replace a Subcustodian terminated pursuant to the foregoing
provisions of this Section 8.3, such appointment to be made upon approval of the
successor Subcustodian by the Fund's board of trustees in accordance with
Section 8.2.1, unless such duty shall have been delegated to the Custodian in
accordance with Section 8.2.2.
8.4 New Countries. The Fund shall be responsible for informing the
Custodian sufficiently in advance of a proposed Investment which is to be held
in a country in which no Subcustodian is authorized to act in order that the
Custodian shall, if it deems appropriate to do so, have sufficient time to
establish a subcustodial arrangement in accordance herewith. In the event,
however, the Custodian is unable to establish such arrangements prior to the
time such investment is to be acquired, the Custodian is authorized to designate
at its discretion a local safekeeping agent, and the use of such local
safekeeping agent shall be at the sole risk of the Fund, and, accordingly, the
Custodian shall be responsible to the Fund for the actions of such agent if and
only to the extent the Custodian shall have recovered from such agent for any
damages caused the Fund by such agent. At the request of the Fund, the Custodian
agrees to remove any securities held on behalf of the Fund by such agent, if
practical, to an approved Subcustodian.
9. Responsibility of the Custodian. In performing its duties and obligations
hereunder, the Custodian shall use reasonable care and diligence under the facts
and circumstances prevailing in the market where performance is effected.
Subject to the specific provisions of this Section, the Custodian shall be
liable for any direct damages incurred by the Fund in consequence of the
Custodian's negligence, bad faith or willful misconduct. It is agreed that the
Custodian shall have no duty to assess the risks inherent in the Fund's
Investments or to provide investment advice with respect to such Investments and
that the Fund as principal shall bear any risks attendant to particular
Investments such as failure of counterparty or issuer.
9.1 Limitations of Performance. The Custodian shall not be responsible
under this Agreement for any failure to perform its duties, and shall not
liable hereunder for any loss or damage in association with such failure to
perform, for or in consequence of the following causes:
9.1.1 Force Majeure. Force Majeure shall mean any circumstance
or event which is beyond the reasonable control of the Custodian, a
Subcustodian or any agent of the Custodian or a Subcustodian and which
adversely affects the performance by the Custodian of its obligations
hereunder, by the Subcustodian of its obligations under its Subcustody
Agreement or by any other agent of the Custodian or the Subcustodian,
including any event caused by, arising out of or involving (a) an act
of God, (b) accident, fire, water damage or explosion, (c) any
computer, system or other equipment failure or malfunction caused by
any computer virus or the malfunction or failure of any communications
medium, other than a computer failure attributable to the Custodian's
inability to process properly and calculate date-related information
and data from and after January 1, 2000 (the "Year 2000 Problem"), (d)
any interruption of the power supply or other utility service, (e) any
strike or other work stoppage, whether partial or total, (f) any delay
or disruption resulting from or reflecting the occurrence of any
Sovereign Risk, (g) any disruption of, or suspension of trading in, the
securities, commodities or foreign exchange markets, whether or not
resulting from or reflecting the occurrence of any Sovereign Risk, (h)
any encumbrance on the transferability of a currency or a currency
position on the actual settlement date of a foreign exchange
transaction, whether or not resulting from or reflecting the occurrence
of any Sovereign Risk, or (i) any other cause similarly beyond the
reasonable control of the Custodian.
9.1.2 Country Risk. Country Risk shall mean, with respect to
the acquisition, ownership, settlement or custody of Investments
in a jurisdiction, all risks relating to, or arising in
consequence of, systemic and markets factors affecting the
acquisition, payment for or ownership of Investments including
(a) the prevalence of crime and corruption, (b) the inaccuracy or
unreliability of business and financial information, (c) the
instability or volatility of banking and financial systems, or
the absence or inadequacy of an infrastructure to support such
systems, (d) custody and settlement infrastructure of the market
in which such Investments are transacted and held, (e) the acts,
omissions and operation of any Securities Depository, (f) the
risk of the bankruptcy or insolvency of banking agents,
counterparties to cash and securities transactions, registrars or
transfer agents, and (g) the existence of market conditions which
prevent the orderly execution or settlement of transactions or
which affect the value of assets.
9.1.3 Sovereign Risk. Sovereign Risk shall mean, in respect
of any jurisdiction, including the United States of America,
where Investments are acquired or held hereunder or under a
Subcustody Agreement, (a) any act of war, terrorism, riot,
insurrection or civil commotion, (b) the imposition of any
investment, repatriation or exchange control restrictions by any
Governmental Authority, (c) the confiscation, expropriation or
nationalization of any Investments by any Governmental Authority,
whether de facto or de jure, (iv) any devaluation or revaluation
of the currency, (d) the imposition of taxes, levies or other
charges affecting Investments, (vi) any change in the Applicable
Law, or (e) any other economic or political risk incurred or
experienced.
9.2. Limitations on Liability. The Custodian shall not be liable for
any loss, claim, damage or other liability arising from the following
causes:
9.2.1 Failure of Third Parties. Except as specifically
stated to the contrary in this Agreement, the failure of any
third party including: (a) any issuer of Investments or
book-entry or other agent of an issuer; (b) any counterparty with
respect to any Investment, including any issuer of
exchange-traded or other futures, option, derivative or
commodities contract; (c) failure of an Investment Adviser,
Foreign Custody Manager or other agent of the Fund; or (d)
failure of other third parties similarly beyond the control or
choice of the Custodian.
9.2.2 Information Sources. The Custodian may rely upon
information received from issuers of Investments or agents of
such issuers, information received from Subcustodians and from
other commercially reasonable sources such as commercial data
bases and the like, but shall not be responsible for specific
inaccuracies in such information, provided that the Custodian has
relied upon such information in good faith, or for the failure of
any commercially reasonable information provider.
9.2.3 Reliance on Instruction. Action by the Custodian or
the Subcustodian in accordance with an Instruction, even when
such action conflicts with, or is contrary to any provision of,
the Fund's declaration of trust or by-laws, Applicable Law, or
actions by the trustees or shareholders of the Fund.
9.2.4 Restricted Securities. The limitations inherent in the
rights, transferability or similar investment characteristics of
a given Investment of the Fund.
10. Indemnification. The Fund hereby indemnifies the Custodian and each
Subcustodian, and their respective agents, nominees and their partners,
employees, officers and directors, and agrees to hold each of them harmless from
and against all claims and liabilities, including counsel fees and taxes,
incurred or assessed against any of them in connection with the performance of
this Agreement and any Instruction, except such as may arise from the
Custodian's or Subcustodian's breach of the relevant standard of conduct set
forth herein. If a Subcustodian or any other person indemnified under the
preceding sentence, gives written notice of claim to the Custodian, the
Custodian shall promptly give written notice to the Fund. Not more than thirty
days following the date of such notice, unless the Custodian shall be liable
under Section 8 hereof in respect of such claim, the Fund will pay the amount of
such claim or reimburse the Custodian for any payment made by the Custodian in
respect thereof.
10.1 Limitation of Liability. The Fund is organized as a Massachusetts
business trust, and references in this Agreement to the Fund mean and refer to
the Trustees from time to time serving under its Declaration of Trust on file
with the Secretary of State of The Commonwealth of Massachusetts, as may be
amended from time to time, pursuant to which the Fund conducts its business. It
is expressly agreed that the obligations of the Fund hereunder shall not be
binding upon any of the Trustees, shareholders, nominees, officers, agents or
employees of the Fund, as provided in said Declaration of Trust. Moreover, if
the Fund has more than one series, no series other than the series on whose
behalf a specified transaction shall have been undertaken shall be responsible
for the obligations of the Fund, and persons engaging in transactions with the
Fund shall look only to the assets of that series to satisfy those obligations.
The execution and delivery of this Agreement has been authorized by the Trustees
and signed by an authorized officer of the Fund, acting as such, and neither
such authorization by such Trustees nor such execution by such officer shall be
deemed to have been made by any of them but shall bind only the trust property
of the Fund as provided in such Declaration of Trust.
11. Reports and Records. The Custodian shall:
11.1 create and maintain records relating to the performance of its
obligations under this Agreement;
11.2 make available to the Fund, its auditors, agents and employees,
during regular business hours of the Custodian, upon reasonable request and
during normal business hours of the Custodian, all records maintained by
the Custodian pursuant to paragraph (a) above, subject, however, to all
reasonable security requirements of the Custodian then applicable to the
records of its custody customers generally; and
11.3 make available to the Fund all Electronic Reports; it being
understood that the Custodian shall not be liable hereunder for the
inaccuracy or incompleteness thereof or for errors in any information
included therein.
All such records will be the property of the Fund and in the event of
termination of this Agreement shall be delivered to the successor custodian.
11.4 Opinion of Fund's Independent Certified Public Accountants. The
Custodian shall take all reasonable action as the Fund may request to
obtain from year to year favorable opinions from the Fund's independent
certified public accountants with respect to the Custodians activities
hereunder in connection with the preparation of any periodic reports to or
filings with the Securities and Exchange Commission ("SEC") and with
respect to any other requirements of the SEC.
11.5 Reports of the Custodian's Independent Certified Public
Accountants. At the request of the Fund, the Custodian shall deliver to the
Fund a written report prepared by the Custodian's independent certified
public accountants with respect to the services provided by the Custodian
under this Agreement, including, without limitation, the Custodian's
accounting system, internal accounting controls and procedures for
safeguarding cash, securities and other assets, including cash, securities
and other assets deposited and/or maintained in a Securities Depository or
with a Subcustodian. Such report shall be of sufficient scope and in
sufficient detail as may reasonably be required by the Fund and as may be
obtained by the Custodian.
The Fund shall examine all records, howsoever produced or transmitted,
promptly upon receipt thereof and notify the Custodian promptly of any
discrepancy or error therein. Unless the Fund delivers written notice of any
such discrepancy or error within a reasonable time after its receipt thereof,
such records shall be deemed to be true and accurate. It is understood that the
Custodian now obtains and will in the future obtain information on the value of
assets from outside sources which may be utilized in certain reports made
available to the Fund. The Custodian deems such sources to be reliable but it is
acknowledged and agreed that the Custodian does not verify nor represent nor
warrant as to the accuracy or completeness of such information and accordingly
shall be without liability in selecting and using such sources and furnishing
such information, unless the Custodian was negligent in the selection and use of
such sources or furnishing such information.
12. Miscellaneous.
12.1 Proxies, etc. The Fund will promptly execute and deliver, upon
request, such proxies, powers of attorney or other instruments as may be
necessary or desirable for the Custodian to provide, or to cause any
Subcustodian to provide, custody services. 12.2 Entire Agreement. Except as
specifically provided herein, this Agreement constitutes the entire
agreement between the Fund and the Custodian with respect to the subject
matter hereof. Accordingly, this Agreement supersedes any custody agreement
or other oral or written agreements heretofore in effect between the Fund
and the Custodian with respect to the custody of the Fund's Investments.
12.3 Waiver and Amendment. No provision of this Agreement may be waived,
amended or modified, and no addendum to this Agreement shall be or become
effective, or be waived, amended or modified, except by an instrument in
writing executed by the party against which enforcement of such waiver,
amendment or modification is sought; provided, however, that an Instruction
shall, whether or not such Instruction shall constitute a waiver, amendment
or modification for purposes hereof, be deemed to have been accepted by the
Custodian when it commences actions pursuant thereto or in accordance
therewith. 12.4 GOVERNING LAW AND JURISDICTION. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH, AND BE GOVERNED BY THE LAWS OF, THE STATE OF
NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW OF SUCH STATE. THE
PARTIES HERETO IRREVOCABLY CONSENT TO THE EXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK AND THE FEDERAL COURTS LOCATED IN NEW YORK
CITY IN THE BOROUGH OF MANHATTAN. 12.5 Notices. Notices and other writings
contemplated by this Agreement, other than Instructions, shall be delivered
(a) by hand, (b) by first class registered or certified mail, postage
prepaid, return receipt requested, (c) by a nationally recognized overnight
courier or (d) by facsimile transmission, provided that any notice or other
writing sent by facsimile transmission shall also be mailed, postage
prepaid, to the party to whom such notice is addressed. All such notices
shall be addressed, as follows: If to the Fund: Mackenzie Solutions C/O Ivy
Management, Inc. Via Xxxxxx Financial Plaza 000 Xxxxx Xxxxxxx Xxxxxxx,
Xxxxx 000 Xxxx Xxxxx, XX 00000 Attn: C. Xxxxxxx Xxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
If to the Custodian:
Xxxxx Brothers Xxxxxxxx & Co.
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Manager, Securities Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000,
or such other address as the Fund or the Custodian may have designated in
writing to the other.
12.6 Headings. Paragraph headings included herein are for convenience
of reference only and shall not modify, define, expand or limit any of the
terms or provisions hereof.
12.7 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original. This Agreement
shall become effective when one or more counterparts have been signed and
delivered by the Fund and the Custodian.
12.8 Confidentiality. The parties hereto agree that each shall treat
confidentially the terms and conditions of this Agreement and all
information provided by each party to the other regarding its business and
operations. All confidential information provided by a party hereto shall
be used by any other party hereto solely for the purpose of rendering or
obtaining services pursuant to this Agreement and, except as may be
required in carrying out this Agreement, shall not be disclosed to any
third party without the prior consent of such providing party. The
foregoing shall not be applicable to any information that is publicly
available when provided or thereafter becomes publicly available other than
through a breach of this Agreement, or that is required to be disclosed by
or to any bank examiner of the Custodian or any Subcustodian, any
Regulatory Authority, any auditor of the parties hereto, or by judicial or
administrative process or otherwise by Applicable Law.
12.8.1 Request by Regulatory Authority. In the event that the
Custodian receives a request for information from any regulatory
authority or governmental body in relation to the Investments and/or
cash held by the Custodian, Subcustodians or Agents for the Fund, the
Custodian shall notify the Fund of the identity of the agency making
such request and the information to be provided as soon as reasonably
practicable after receipt of such request. Unless otherwise required
by applicable law, the Custodian shall not release such information
until receipt of proper Instructions from the Fund.
12.9 Counsel. In fulfilling its duties hereunder, the Custodian shall
be entitled to receive and act upon the advice of (i) counsel regularly
retained by the Custodian in respect of such matters, (ii) counsel for the
Fund or (iii) such counsel as the Fund and the Custodian may agree upon,
with respect to all matters, and the Custodian shall be without liability
for any action reasonably taken or omitted pursuant to such advice.
12.10 Additional Portfolios. If the Fund shall issue shares of more
than one series during the term hereof, the Custodian agrees that all
Investments of the Fund will be segregated by series and all books and
records, account values or actions shall be maintained, held, made or
taken, as the case may be, separately for each series. Other than as
encompassed by the preceding sentence, references in this Agreement to "the
Fund" are applicable either to the entire trust or to a particular series,
as the context may make reasonable and appropriate. If the Fund has more
than one series, Instructions shall designate the series to which they
apply.
13. Definitions. The following defined terms will have the respective meanings
set forth below.
13.1 Advance shall mean any extension of credit by or through the
Custodian or by or through any Subcustodian and shall include amounts paid
to third parties for account of the Fund or in discharge of any expense,
tax or other item payable by the Fund.
13.2 Agency Account shall mean any deposit account opened on the books
of a Subcustodian or other banking institution in accordance with Section
7.1.
13.3 Agent shall have the meaning set forth in the last paragraph of
Section 6.
13.4 Applicable Law shall mean with respect to each jurisdiction, all
(a) laws, statutes, treaties, regulations, guidelines (or their
equivalents); (b) orders, interpretations, licenses and permits; and (c)
judgments, decrees, injunctions, writs, orders and similar actions by a
court of competent jurisdiction; compliance with which is required or
customarily observed in such jurisdiction.
13.5 Authorized Person shall mean any person or entity authorized to
give Instructions on behalf of the Fund in accordance with Section 4.1.
13.6 Book-entry Agent shall mean an entity acting as agent for the
issuer of Investments for purposes of recording ownership or similar
entitlement to Investments, including without limitation a transfer agent
or registrar.
13.7 Clearing Corporation shall mean any entity or system established
for purposes of providing securities settlement and movement and associated
functions for a given market.
13.8 Delegation Agreement shall mean any separate agreement entered
into between the Custodian and the Fund or its authorized representative
with respect to certain matters concerning the appointment and
administration of Subcustodians delegated to the Custodian pursuant to Rule
17f-5.
13.9 Foreign Custody Manager shall mean the Fund's foreign custody
manager appointed pursuant to Rule 17f-5 of the 1940 Act.
13.10 Funds Transfer Services Agreement shall mean any separate
agreement entered into between the Custodian and the Fund or its authorized
representative with respect to certain matters concerning the processing of
payment orders from Principal Accounts of the Fund.
13.11 Instruction(s) shall have the meaning assigned in Section 4.
13.12 Investment Adviser shall mean any person or entity who is an
Authorized Person to give Instructions with respect to the investment and
reinvestment of the Fund's Investments.
13.13 Investments shall mean any investment asset of the Fund,
including without limitation securities, bonds, notes, and debentures as
well as receivables, derivatives, contractual rights or entitlements and
other intangible assets.
13.14 Margin Account shall have the meaning set forth in Section 6.4
hereof.
13.15 Principal Account shall mean deposit accounts of the Fund
carried on the books of BBH&Co. as principal in accordance with Section 7.
13.16 Safekeeping Account shall mean an account established on the
books of the Custodian or any Subcustodian for purposes of segregating the
interests of the Fund (or clients of the Custodian or Subcustodian) from
the assets of the Custodian or any Subcustodian.
13.17 Securities Depository shall mean a central or book entry system
or agency established under Applicable Law for purposes of recording the
ownership and/or entitlement to investment securities for a given market.
For the purposes of this Agreement, Securities Depository shall also
include Xxx Xxxxxxxxx Service Corp.
13.18 Subcustodian shall mean each foreign bank appointed by the
Custodian pursuant to Section 8, but shall not include Securities
Depositories.
13.19 Tri-Party Agreement shall have the meaning set forth in Section
6.4 hereof.
13.20 1940 Act shall mean the Investment Company Act of 1940.
14. Compensation. The Fund agrees to pay to the Custodian (a) a fee in an amount
set forth in the fee letter between the Fund and the Custodian in effect on the
date hereof or as amended from time to time, and (b) all out-of-pocket expenses
incurred by the Custodian, including the fees and expenses of all Subcustodians,
and payable from time to time. Amounts payable by the Fund under and pursuant to
this Section 14 shall be payable by wire transfer to the Custodian at BBH&Co. in
New York, New York.
15. Termination. This Agreement may be terminated by either party in accordance
with the provisions of this Section. The provisions of this Agreement and any
other rights or obligations incurred or accrued by any party hereto prior to
termination of this Agreement shall survive any termination of this Agreement.
15.1 Notice and Effect. This Agreement may be terminated by either
party by written notice effective no sooner than seventy-five days
following the date that notice to such effect shall be delivered to other
party at its address set forth in paragraph 12.5 hereof.
15.2 Successor Custodian. In the event of the appointment of a
successor custodian, it is agreed that the Investments of the Fund held by
the Custodian or any Subcustodian shall be delivered to the successor
custodian in accordance with reasonable Instructions. The Custodian agrees
to cooperate with the Fund in the execution of documents and performance of
other actions necessary or desirable in order to facilitate the succession
of the new custodian. If no successor custodian shall be appointed, the
Custodian shall in like manner transfer the Fund's Investments in
accordance with Instructions.
15.3 Delayed Succession. If no Instruction has been given as of the
effective date of termination, Custodian may at any time on or after such
termination date and upon ten days' written notice to the Fund either (a)
deliver the Investments of the Fund held hereunder to the Fund at the
address designated for receipt of notices hereunder; or (b) deliver any
investments held hereunder to a bank or trust company having a
capitalization of $2M USD equivalent and operating under the Applicable Law
of the jurisdiction where such Investments are located, such delivery to be
at the risk of the Fund. In the event that Investments or moneys of the
Fund remain in the custody of the Custodian or its Subcustodians after the
date of termination owing to the failure of the Fund to issue Instructions
with respect to their disposition or owing to the fact that such
disposition could not be accomplished in accordance with such Instructions
despite diligent efforts of the Custodian, the Custodian shall be entitled
to compensation for its services with respect to such Investments and
moneys during such period as the Custodian or its Subcustodians retain
possession of such items and the provisions of this Agreement shall remain
in full force and effect until disposition in accordance with this Section
is xxxxxxxxxxxx.XX WITNESS WHEREOF, each of the parties hereto has caused
this Agreement to be duly executed as of the date first above written.
Mackenzie Solutions
By:_______________________________
XXXXX BROTHERS XXXXXXXX & CO.
By: ________________________________
