AMENDMENT
TO
GLOBAL CUSTODY AGREEMENT
This Amendment, dated as of September 7, 2000, is entered into between The
Chase Manhattan Bank (successor to The Chase Manhattan Bank, N.A.) (the "Bank")
and The Galaxy Fund (the "Customer").
WHEREAS, the Bank and the Customer entered into a Global Custody Agreement
dated as of November 1, 1991, as subsequently amended (as so amended, the
"Agreement"); and
WHEREAS, the Customer, The Galaxy VIP Fund ("Galaxy VIP"), Galaxy Fund II
("Galaxy II"), Fleet Investment Advisors Inc. ("Fleet") and Columbia Management
Co. ("Columbia") have received an exemptive order (the "Order") from the
Securities and Exchange Commission permitting each existing and future portfolio
of the Customer, Galaxy VIP and Galaxy II for which Fleet and/or Columbia acts
as adviser or sub-adviser to deposit uninvested cash balances that remain at the
end of each trading day into one or more joint accounts established with the
Custodian and to invest the daily cash balances of the joint accounts in certain
short-term liquid assets; and
WHEREAS, the Bank and the Customer wish to amend the Agreement in order to
provide for the transactions permitted by the Order;
NOW THEREFORE, the parties hereto, intending to be legally bound, hereby
agree as follows:
1. Except as modified hereby, the Agreement is confirmed in all respects.
Capitalized terms used herein without definition shall have the meanings
ascribed to them in the Agreement.
2. In addition to the accounts which the Custodian has agreed to
establish and maintain pursuant to Section 1 of the Agreement, the Custodian
also agrees to establish and maintain one or more joint accounts (the "Joint
Accounts"). The Joint Accounts are intended to be used to hold (i) uninvested
cash balances that remain at the end of a trading day as may be received from
Deposit Accounts of the Customer's portfolios and/or the portfolios of Galaxy
VIP and Galaxy II, and (ii) any short-term liquid assets ("Short-Term
Investments") that may be purchased with the daily cash balances in the Joint
Accounts. Each Joint Account so established shall be titled "Fleet Joint Trading
Account" with an appropriate number designation.
3. (a) The Bank will transfer cash from the Deposit Account of a
portfolio of the Customer to one or more Joint Accounts upon receipt of
Instructions from the Customer or its designee, which Instructions shall include
all information required by the Bank.
(b) The Bank will make payments from a Joint Account which holds any cash
balances of a portfolio of the Customer upon receipt of Instructions from the
Customer or its designee, which Instructions shall include all information
required by the Bank for the allocation of any Short-Term Investments purchased
with such cash balances among the participating portfolios of the Customer,
Galaxy VIP and/or Galaxy II.
(c) In the event that any payment to be made under paragraph (b) of this
Section 3 exceeds the funds available in the Joint Account, the Bank, in its
discretion, may advance the participating portfolios of the Customer, Galaxy VIP
and/or Galaxy II such excess amount which shall be deemed a loan payable on
demand, bearing interest at the rate customarily charged by the Bank on similar
loans.
(d) Short-Term Investments in a Joint Account will be transferred,
exchanged or delivered by the Bank upon receipt by the Bank of Instructions,
which Instructions shall include all information required by the Bank.
Settlement and payment for Short-Term Investments received for, and delivery of
Short-Term Investments out of, a Joint Account may be made in accordance with
the customary or established securities trading or securities processing
practices and procedures in the jurisdiction or market in which the transaction
occurs, including, without limitation, delivery of Short-Term Investments to a
purchaser, dealer or their agents against a receipt with the expectation of
receiving later payment and free delivery. Delivery of Short-Term Investments
out of a Joint Account may also be made in any manner specifically required by
Instructions acceptable to the Bank.
(e) The Bank, in its discretion, may credit or debit a Joint Account on a
contractual settlement date with cash or Short-Term Investments with respect to
any sale, exchange or purchase of Short-Term Investments. Otherwise, such
transactions will be credited or debited to the Joint Account on the date cash
or Short-Term Investments are actually received by the Bank and reconciled to
the Joint Account.
(i) The Bank may reverse credits or debits made to a Joint Account in
its discretion if the related transaction fails to settle within
a reasonable period, determined by the Bank in its discretion,
after the contractual settlement date for the related
transaction.
(ii) If any Short-Term Investments delivered pursuant to this Section
3 are returned by the recipient thereof, the Bank may reverse the
credits and debits of the particular transaction at anytime.
(f) If the Bank credits a Joint Account on a payable date, or at any time
prior to the actual collection and reconciliation to the Joint Account, with
interest, dividends, redemptions or any other amount due, the participating
portfolios of the Customer will promptly return their share of any such amount
upon oral or written notification: (i) that such amount has not been received in
the ordinary course of business or (ii) that such amount was incorrectly
credited. If the participating portfolios of the Customer do not promptly return
their share of any amount upon such notification, the Bank shall be entitled,
upon oral or written
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notification to the Customer, to reverse such credit by debiting the Joint
Account for the amount previously credited. The Bank shall have no duty or
obligation to institute legal proceedings, file a claim or a proof of claim in
any insolvency proceeding or take any other action with respect to the
collection of such amount, but may act for the Customer upon Instructions after
consultation with the Customer.
4. The Bank shall maintain records, based upon the Instructions it
receives from the Customer, documenting for any given day the aggregate
investment in a Joint Account by each of the Customer's participating portfolios
and each participating portfolio's pro rata share of each Short-Term Investment
made through such Joint Agreement. The Bank shall maintain such records for at
least six (6) years.
5. The Bank shall have no obligation or duty to monitor or determine
whether a Joint Account is being operated in compliance with the Order.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment on the
day and year first above written.
THE CHASE MANHATTAN BANK
By: /s/ Xxxxx X. Xxxxxx, Xx.
-------------------------------------
Name: Xxxxx X. Xxxxxx, Xx.
Title: Vice President
THE GALAXY FUND
By: /s/ Xxxxxxx Xxxxxxxx
-------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
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