FOREIGN CUSTODY MANAGER AGREEMENT
Exhibit (g)(2)
EXECUTION
FOREIGN CUSTODY MANAGER AGREEMENT
AGREEMENT made as of November 12, 2019 by and between Third Avenue Variable Series Trust (the “Trust”) on behalf of each series listed on Annex I attached hereto and The Bank of New York Mellon (“BNY”).
W I T N E S S E T H:
WHEREAS, the Trust desires to appoint BNY as a Foreign Custody Manager on the terms and conditions contained herein;
WHEREAS, BNY desires to serve as a Foreign Custody Manager and perform the duties set forth herein on the terms and conditions contained herein;
NOW THEREFORE, in consideration of the mutual promises hereinafter contained in this Agreement, the Trust and BNY hereby agree as follows:
ARTICLE
I.
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless the context otherwise requires, shall have the following meanings:
1. “Board” shall mean the board of trustees of the Trust.
2. “Eligible Foreign Custodian” shall have the meaning provided in the Rule.
3. “Monitoring System” shall mean a system established by BNY to fulfill the Responsibilities specified in clauses (d) and (e) of Section 1 of Article III of this Agreement.
4. “Responsibilities” shall mean the responsibilities delegated to BNY under the Rule as a Foreign Custody Manager with respect to each Specified Country and each Eligible Foreign Custodian selected by BNY, as such responsibilities are more fully described in Article III of this Agreement.
5. “Rule” shall mean Rule 17f-5 under the Investment Company Act of 1940, as amended on June 12, 2000.
6. “Specified Country” shall mean each country listed on Schedule I attached hereto and each country, other than the United States, constituting the primary market for a security with respect to which the Trust has given settlement instructions to The Bank of New York Mellon as custodian (the “Custodian”) under its Custody Agreement with the Trust.
ARTICLE
II.
BNY AS A FOREIGN CUSTODY MANAGER
1. The Trust on behalf of its Board hereby delegates to BNY with respect to each Specified Country the Responsibilities.
2. BNY accepts the Board’s delegation of Responsibilities with respect to each Specified Country and agrees in performing the Responsibilities as a Foreign Custody Manager to exercise reasonable care, prudence and diligence such as a person having responsibility for the safekeeping of the Trust’s assets would exercise.
3. BNY shall provide to the Board at such times as the Board deems reasonable and appropriate based on the circumstances of the Trust’s foreign custody arrangements written reports notifying the Board of the placement of assets of the Trust with a particular Eligible Foreign Custodian within a Specified Country and of any material change in the arrangements (including the contract governing such arrangements) with respect to assets of the Trust with any such Eligible Foreign Custodian.
ARTICLE
III.
RESPONSIBILITIES
1. Subject to the provisions of this Agreement, BNY shall with respect to each Specified Country select an Eligible Foreign Custodian. In connection therewith, BNY shall: (a) determine that assets of the Trust held by such Eligible Foreign Custodian will be subject to reasonable care, based on the standards applicable to custodians in the relevant market in which such Eligible Foreign Custodian operates, after considering all factors relevant to the safekeeping of such assets, including, without limitation, those contained in paragraph (c)(1) of the Rule; (b) determine that the Trust’s foreign custody arrangements with each Eligible Foreign Custodian are governed by a written contract with the Custodian which will provide reasonable care for the Trust’s assets based on the standards specified in paragraph (c)(1) of the Rule; (c) determine that each contract with an Eligible Foreign Custodian shall include the provisions specified in paragraph (c)(2)(i)(A) through (F) of the Rule or, alternatively, in lieu of any or all of such (c)(2)(i)(A) through (F) provisions, such other provisions as BNY determines will provide, in their entirety, the same or a greater level of care and protection for the assets of the Trust as such specified provisions; (d) monitor pursuant to the Monitoring System the appropriateness of maintaining the assets of the Trust with a particular Eligible Foreign Custodian pursuant to paragraph (c)(1) of the Rule and the performance of the contract governing such arrangement; and (e) advise the Trust whenever BNY determines under the Monitoring System that an arrangement (including, any material change in the contract governing such arrangement) described in preceding clause (d) no longer meets the requirements of the Rule.
2. For purposes of preceding Section 1 of this Article, BNY’s determination of appropriateness shall not include, nor be deemed to include, any evaluation of Country Risks associated with investment in a particular country. For purposes hereof, “Country Risks” shall mean systemic risks of holding assets in a particular country including but not limited to (a) an Eligible Foreign Custodian’s use of any depositories that act as or operate a system or a transnational system for the central handling of securities or any equivalent book-entries; (b) such country’s financial infrastructure; (c) such country’s prevailing custody and settlement practices; (d) nationalization, expropriation or other governmental actions; (e) regulation of the banking or securities industry; (f) currency controls, restrictions, devaluations or fluctuations; and (g) market conditions which affect the orderly execution of securities transactions or affect the value of securities.
- 2 -
ARTICLE
IV.
REPRESENTATIONS
1. The Trust hereby represents that: (a) this Agreement has been duly authorized, executed and delivered by the Trust, constitutes a valid and legally binding obligation of the Trust enforceable in accordance with its terms, and no statute, regulation, rule, order, judgment or contract binding on the Trust prohibits the Trust’s execution or performance of this Agreement; (b) this Agreement has been approved and ratified by the Board at a meeting duly called and at which a quorum was at all times present in-person or telephonically, and (c) the Board or an investment advisor to a series of the Trust has considered the Country Risks associated with investment in each Specified Country and will have considered such risks prior to any settlement instructions being given to the Custodian with respect to any other country.
2. BNY hereby represents that: (a) BNY is duly organized and existing under the laws of the State of New York, with full power to carry on its businesses as now conducted, and to enter into this Agreement and to perform its obligations hereunder; (b) this Agreement has been duly authorized, executed and delivered by BNY, constitutes a valid and legally binding obligation of BNY enforceable in accordance with its terms, and no statute, regulation, rule, order, judgment or contract binding on BNY prohibits BNY’s execution or performance of this Agreement; and (c) BNY has established the Monitoring System.
ARTICLE
V.
CONCERNING BNY
1. BNY shall not be liable for any costs, expenses, damages, liabilities or claims, including attorneys’ and accountants’ fees, sustained or incurred by, or asserted against, the Trust except to the extent the same arises out of the failure of BNY to exercise the care, prudence and diligence required by Section 2 of Article II hereof. In no event shall BNY be liable to the Trust, the Board, or any third party for special, indirect or consequential damages, or for lost profits or loss of business, arising in connection with this Agreement.
2. The Trust shall indemnify BNY and hold it harmless from and against any and all costs, expenses, damages, liabilities or claims, including attorneys’ and accountants’ fees, sustained or incurred by, or asserted against, BNY by reason or as a result of any action or inaction, or arising out of BNY’s performance hereunder, provided that the Trust shall not indemnify BNY to the extent any such costs, expenses, damages, liabilities or claims arises out of BNY’s failure to exercise the reasonable care, prudence and diligence required by Section 2 of Article II hereof.
3. For its services hereunder, the Trust agrees to pay to BNY such compensation and out-of-pocket expenses as shall be mutually agreed.
- 3 -
4. BNY shall have only such duties as are expressly set forth herein. In no event shall BNY be liable for any Country Risks associated with investments in a particular country.
ARTICLE
VI.
MISCELLANEOUS
1. This Agreement constitutes the entire agreement between the Trust and BNY as a foreign custody manager, and no provision in the Custody Agreement between the Trust and the Custodian shall affect the duties and obligations of BNY hereunder, nor shall any provision in this Agreement affect the duties or obligations of the Custodian under the Custody Agreement.
2. Any notice or other instrument in writing, authorized or required by this Agreement to be given to BNY, shall be sufficiently given if received by it at its offices at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such other place as BNY may from time to time designate in writing.
3. Any notice or other instrument in writing, authorized or required by this Agreement to be given to the Trust shall be sufficiently given if received by it at its offices at JW Fund Management LLC, 000 Xxxxxxxxxx Xx., Xxxxx X0-000, Xxxxxx Xxxx, XX 00000 or at such other place as the Trust may from time to time designate in writing.
4. In case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions shall not in any way be affected thereby. This Agreement may not be amended or modified in any manner except by a written agreement executed by both parties. This Agreement shall extend to and shall be binding upon the parties hereto, and their respective successors and assigns; provided however, that this Agreement shall not be assignable by either party without the written consent of the other.
5. This Agreement shall be construed in accordance with the substantive laws of the State of New York, without regard to conflicts of laws principles thereof. The Trust and BNY hereby consent to the jurisdiction of a state or federal court situated in New York City, New York in connection with any dispute arising hereunder. The Trust hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection which it may now or hereafter have to the laying of venue of any such proceeding brought in such a court and any claim that such proceeding brought in such a court has been brought in an inconvenient forum. The Trust and BNY each hereby irrevocably waives any and all rights to trial by jury in any legal proceeding arising out of or relating to this Agreement.
6. The parties hereto agree that in performing hereunder, BNY is acting solely on behalf of the Trust and no contractual or service relationship shall be deemed to be established hereby between BNY and any other person by reason of this Agreement.
7. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but such counterparts shall, together, constitute only one instrument.
8. This Agreement shall terminate simultaneously with the termination of the Custody Agreement between the Trust and the Custodian, and may otherwise be terminated by either party giving to the other party a notice in writing specifying the date of such termination, which shall be not less than thirty (30) days after the date of such notice.
- 4 -
IN WITNESS WHEREOF, the Trust and BNY have caused this Agreement to be executed by their respective officers, thereunto duly authorized, as of the date first above written.
| THIRD AVENUE VARIABLE SERIES TRUST |
| By: | /s/ Xxxx Xxxxx | |
| Title: President | ||
| THE BANK OF NEW YORK MELLON |
| By: | /s/ Xxxxxxx XxXxxxx | |
| Title: Director | ||
- 5 -
ANNEX I
| Series Name | Tax Identification | |
| Third Avenue Value Portfolio | Tax ID: 00-0000000 |
SCHEDULE I
| Market Name | Subcustodian |
| Argentina | Citibank Argentina, Buenos Aires |
| Australia | Citigroup Pty Limited |
| Australia | The Hongkong and Shanghai Banking Corporation Limited Australia Branch |
| Austria | UniCredit Bank Austria AG |
| Bahrain | HSBC Bank Middle East Limited, Manama |
| Bangladesh | Hongkong and Shanghai Banking Corporation, Dhaka |
| Belgium | The Bank of New York Xxxxxx XX/NV |
| Benin | Société Générale Côte d'Ivoire, Abidjan |
| Bermuda | HSBC Bank Bermuda Limited, Xxxxxxxx |
| Botswana | Stanbic Bank Botswana Ltd |
| Brazil | Citibank N.A., Brazilian Branch |
| Bulgaria | Citibank Europe plc, Bulgarian Branch |
| Burkina Faso | Société Générale Côte d'Ivoire, Abidjan |
| Canada | CIBC Mellon Trust Company |
| Chile | Banco de Chile |
| Chile | Itaú CorpBanca S.A. |
| China - Shanghai B shares | HSBC Bank (China) Company Limited |
| China - Shanghai A shares | HSBC Bank (China) Company Limited |
| China - CIBM | HSBC Bank (China) Company Limited |
| Colombia | Cititrust S.A., Bogota |
| Costa Rica | Banco Nacional de Costa Rica |
| Croatia | Privredna Banka Zagreb d.d. |
| Cyprus | BNP Paribas Securities Services Athens |
| Czech Republic | Citibank Europe plc |
| Denmark (For T2S EUR and DKK settlement) | Skandinaviska Enskilda Xxxxxx XX, Copenhagen Branch |
| Egypt | HSBC Bank Egypt S.A.E. |
| Estonia | SEB Pank AS |
| Eswatini | Standard Bank Eswatini Ltd, Mbabane |
- 6 -
| Euromarkets - Euroclear | Euroclear Bank |
| Finland | Skandinaviska Enskilda Banken, Helsinki branch |
| France | The Bank of New York Xxxxxx XX/NV |
| France | BNP Paribas Securities Services, Paris |
| Germany | The Bank of New York Xxxxxx XX/NV, Asset Servicing, Niederlassung Frankfurt am Main |
| Ghana | Stanbic Bank of Ghana Limited |
| Greece | BNP Paribas Securities Services, Athens |
| Guinea Bissau | Société Générale Côte d'Ivoire, Abidjan |
| Hong Kong | Deutsche Bank AG, Hong Kong |
| Hong Kong | Hongkong and Shanghai Banking Corporation, Hong Kong |
| Hungary | Citibank Europe plc. Hungarian Branch Office |
| Iceland | Landsbankinn hf. |
| India | Deutsche Bank AG Mumbai |
| India | Hongkong and Shangai Banking Corporation, Mumbai |
| Indonesia | Deutsche Bank AG, Jakarta |
| Ireland | The Bank of New York Mellon |
| Israel | Bank Hapoalim B.M. |
| Italy | The Bank of New York Xxxxxx XX/NV |
| Ivory Coast | Société Générale Côte d'Ivoire, Abidjan |
| Japan | MUFG Bank, Ltd. |
| Japan | Mizuho Bank, Ltd |
| Jordan | Standard Chartered Bank, Jordan Branch |
| Kazakhstan | Citibank Kazakhstan JSC |
| Kenya | Stanbic Bank KenyaLimited |
| Kuwait | HSBC Bank Middle East, Kuwait |
| Latvia | AS SEB banka |
| Lithuania | SEB Bankas, Vinius |
| Luxembourg | Euroclear Bank |
| Malaysia | Deutsche Bank (Malaysia) Berhad |
| Malawi | Xxxxxxxx Xxxx XXX |
- 0 -
| Xxxx | Xxxxxxx Xxxxxxxx Côte d'Ivoire, Abidjan |
| Malta | The Bank of New York Xxxxxx XX/NV, Asset Servicing, Niederlassung Frankfurt am Main |
| Mauritius | Hongkong and Shangai Banking Corporation, Ebene |
| Mexico | Banco S3 Mexico S.A. |
| Mexico | Citibanamex |
| Morocco | Citibank Maghreb |
| Namibia | Standard Bank Namibia Ltd |
| Netherlands | The Bank of New York Xxxxxx XX/NV |
| New Zealand | The Hongkong and Shanghai Banking Corporation Limited, New Zealand Branch |
| Niger | Société Générale Côte d'Ivoire, Abidjan |
| Nigeria | Stanbic IBTC Bank PLC |
| Norway | Skandinaviska Enskilda Xxxxxx XX, Oslo Branch |
| Oman | HSBC Bank Oman S.A.O.C. |
| Pakistan | Deutsche Bank AG Karachi Branch |
| Panama | Citibank N.A., Panama Branch, Panama City |
| Peru | Citibank N.A., Sucursal de Lima |
| Philippines | Deutsche Bank AG, Manila |
| Poland | Bank Pekao SA |
| Portugal | Citibank Europe Plc |
| Qatar | HSBC Bank Middle East Limited, Doha |
| Romania | Citibank Europe plc. Romania Branch |
| Russia | AO CITIBANK MOSCOW |
| Russia | PJSC ROSBANK |
| Saudi Arabia | HSBC Saudi Arabia |
| Senegal | Société Générale Côte d'Ivoire, Abidjan |
| Serbia | UniCredit Bank Serbia JSC |
| Singapore | DBS Bank Ltd., Singapore |
| Singapore | Standard Chartered Bank (Singapore) Limited |
| Slovak | Citibank Europe plc, pobocka zahranicnej banky |
| Slovenia | UniCredit Xxxxx Xxxxxxxx x.x. |
- 0 -
| Xxxxx Xxxxxx | The Standard Bank of South Africa Limited |
| South Africa | Standard Chartered Bank, Johannesburg branch |
| South Korea | Hongkong and Xxxxxxx Xxxxxxx Xxxxxxxxxxx, Xxxxx |
| Xxxxx Xxxxx | Deutsche Bank AG, Seoul |
| Spain | Santander Securities Services S.A. |
| Spain | Banco Bilbao Vizcaya Argentaria, Madrid |
| Sri Lanka | Hongkong and Shangai Banking Corporation, Colombo |
| Sweden | Skandinaviska Enskilda Banken, Stockholm |
| Switzerland | UBS Switzerland AG |
| Switzerland | Credit Suisse Switzerland Ltd |
| Taiwan | HSBC Bank (Taiwan) Limited |
| Taiwan | Standard Chartered Bank (Taiwan) Ltd. |
| Tanzania | Stanbic Bank Tanzania Limited |
| Thailand | Hongkong and Shangai Banking Corporation, Bangkok |
| Togo | Société Générale Côte d'Ivoire, Abidjan |
| Tunisia | Union Internationale de Banques |
| Turkey | Deutsche Bank A.S., Istanbul |
| Uganda | Stanbic Bank Uganda Limited |
| Ukraine | JSC “Citibank” |
| United Arab Emirates | HSBC Bank Middle East Limited, Dubai |
| United Kingdom | The Bank of New York Mellon |
| United States | The Bank of New York Mellon, New York |
| Uruguay | Banco Itaù Uruguay S.A. |
| Vietnam | HSBC Bank (Vietnam) Ltd |
| Zambia | Stanbic Bank Zambia Ltd. |
| Zimbabwe | Stanbic Bank Zimbabwe Limited |
- 10 -
