CUSTODIAN AGREEMENT
AGREEMENT made as of this 2nd day of March, 1998 between Forward Funds,
Inc. (the "Fund") on behalf of each of the portfolios listed on Appendix B
hereto as the same may be amended from time to time (each a "Fund" and
collectively the "Funds"), and XXXXX BROTHERS XXXXXXXX & CO. (the "Custodian").
WITNESSETH
WHEREAS the Fund is organized as a Maryland Corporation with one or more
series of shares, and is an open-end management investment company registered
with the Securities and Exchange Commission;
WHEREAS, the Fund does not desire to have custody of any assets, including
securities of the Fund, and, under interpretations of the Securities and
Exchange Commission, will not be deemed to have custody if the procedures set
forth below are followed; and
WHEREAS each Fund represents an interest in a separate portfolio of cash,
securities and other assets (all references to a "Fund" or the "Funds" shall be
deemed to include each portfolio within the Fund as the context may make
appropriate); and
WHEREAS the Fund wishes to employ the Custodian and the Custodian has
agreed to provide custodial, banking and related services to the Fund in
accordance with the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the Fund and the Custodian agree as follows:
1. Appointment of Custodian. Upon the terms and conditions set forth in
this Agreement, the Fund hereby appoints the Custodian as a custodian, and the
Custodian hereby accepts such appointment. The Fund shall deliver or shall cause
to be delivered to the Custodian cash, securities and other property
("Property") owned by the Fund from time to time during the term of this
Agreement. The Custodian shall be under no obligation to request or to require
that any or all Property of the Fund be delivered to it, and the Custodian shall
have no responsibility with respect to any Property not delivered to it.
The Fund may in the future authorize the establishment of separate accounts
which hold Property of the Fund and with respect to which a certain investment
adviser or manager will be authorized to act and give instructions to the
Custodian (an "Investment Adviser"). The Fund shall notify the Custodian in
writing by a Proper Instruction of such authorization, whereupon the Custodian
may accept and act on Proper Instructions it reasonably believes to be sent by
such Investment Adviser.
2. Definitions.
In this Agreement, the following words shall, unless the context otherwise
requires, have the following meanings:
(i) "1940 Act" - the Investment Company Act of 1940 and the rules and
regulations thereunder.
(ii) "Advances" - shall have the meaning ascribed to it in Section 11 hereof.
(iii) "Agency Accounts" - shall have the meaning ascribed to it in Section 5
hereof.
(iv) "Agent" - shall have the meaning ascribed to it in Section 7 hereof.
(v) "BBH Accounts" - shall have the meaning ascribed to it in Section 5
hereof.
(vi) "Book-Entry Agent" - shall have the meaning ascribed to it in Section
4.1(b) hereof.
(vii) "Derivative Instruments and Commodities" - any form of risk transfer
contract in which a gain or loss is recognized from fluctuations in
market price levels or rates, indexes or benchmarks, and which includes
without limitation futures, forwards, options, swaps, forward rate and
forward exchange contracts, leverage- or commodity-related similar
contracts and any other risk transfer contract whether traded on or off
an exchange.
(viii) "Electronic Instructions" - shall have the meaning ascribed to it in
Section 8.3 hereof.
(ix) "Electronic Reports" - shall have the meaning ascribed to it in Section
8.3 hereof.
(x) "Force Majeure" - shall have the meaning ascribed to it in Section 10.4
hereof.
(xi) "Investments" - assets of the Fund, other than Property held by the
Custodian, a Subcustodian or a Securities Depository, but which the
Custodian may note on its records as being assets of the Fund including
without limitation Derivative Instruments and Commodities.
(xii) "Investment Adviser" - shall have the meaning ascribed to it in Section
1 hereof.
(xiii) "Liability" - shall have the meaning ascribed to it in Section 11
hereof.
(xiv) "Margin Account" - shall have the meaning ascribed to it in Section
4.2(d) hereof.
(xv) "Margin Agreement" - shall have the meaning ascribed to it in Section
4.2(d) hereof.
(xvi) "Omnibus Accounts" - accounts established in the name of the Custodian
on behalf of its customers in which assets on deposit with the Custodian
by one or several customers may be deposited. Omnibus Accounts may be
established for the purpose of holding cash or securities.
(xvii) "Proper Instructions" - any direction to take or not to take action in
respect of Property (including cash) or Investments which the Custodian
reasonably believes to be sent by an authorized person and to be
genuine. Proper Instructions may be sent via the media set forth in
Section 6 hereof or as otherwise agreed between the Custodian and the
Fund.
(xviii) "Property" - shall have the meaning ascribed to it in Section 1 hereof.
(xix) "Securities Accounts" - shall have the meaning ascribed to it in Section
4 hereof.
(xx) "Securities Depository" - a generally recognized book-entry system or a
clearing agency which acts as a securities depository in any country in
which securities are maintained under this Agreement and with which the
Custodian or a Subcustodian may maintain securities or other Property
owned by or held on behalf of the Fund, pursuant to the provisions
hereof, including Euroclear and Cedel.
(xxi) "Segregated Accounts" - shall have the meaning ascribed to it in Section
4.2(d) hereof.
(xxii) "Subcustodian" - shall mean any subcustodian appointed pursuant to
Section 7 of this Agreement.
(xxiii) "Voluntary Corporate Actions" - corporate actions (as further described
in Section 4) in respect of portfolio securities of the Fund which
require an investment decision.
3. Representations, Warranties and Covenants of the Fund. The Fund represents
and warrants that the execution, delivery and performance by the Fund of this
Agreement are within the Fund's corporate, trust or other constitutive powers,
have been duly authorized by all necessary corporate, trust or other appropriate
action under its constitutive documents, and do not contravene or constitute a
default under any provision of applicable law or regulation or of the
constitutive documents of the Fund or of any agreement, judgment, injunction,
order, decree or other instrument binding upon the Fund. The Fund agrees to
inform the Custodian reasonably promptly if any statement set forth in this
Section 3 or elsewhere made by the Fund in this Agreement ceases to be true and
correct. The Fund shall safeguard and shall solely be responsible for the
safekeeping of any testkeys, identification codes, other security devices or
statements of account with which the Custodian provides it. If and when
applicable, the Fund shall execute a license agreement or sublicense agreement
governing its use of any electronic instruction system proprietary to the
Custodian or an affiliate of the Custodian or proprietary to a third party which
has licensed such system to the Custodian or an affiliate of the Custodian.
The Fund hereby represents and warrants that it has disclosed appropriately
and adequately, or will appropriately and adequately disclose, all material
investments risks, including without limitation those relating to the custody,
settlement or servicing of foreign securities in the markets in which the Fund
invests or intends to invests, to the shareholders or other investors in the
Fund or to other persons who have property or contractual rights to or interests
in the assets of the Fund which are the subject of this Custodian Agreement.
4. Securities Account. The Fund hereby authorizes the Custodian to open and
maintain, with itself or with Subcustodians, securities accounts (the
"Securities Account") and authorizes the Custodian to deposit or record, as the
case may be, in such Securities Account the Fund's Property delivered to and
accepted by the Custodian, or such other Investments as the Fund requests the
Custodian to record by notation only. The Custodian shall keep safely all
Property delivered to it. In the event of a loss of a security for which the
Custodian would be liable under the provisions of this Agreement, the Custodian
shall be responsible for either replacing the security or for reimbursing the
Fund the value of the security as of the date the loss is first discovered by
the Fund or the Custodian. The Securities Account shall be maintained in the
manner and on the terms set forth below. (All references in this Section to the
Custodian shall include a Subcustodian, Securities Depository or any agent of
the Custodian.)
4.1 Manner of Holding or Recording Securities and Other Investments.
(a) Securities Represented by Physical Certificate. Securities
represented by share certificates or other instruments may be held in
registered or bearer form (i) in the Custodian's vault, (ii) in the vault
of a Subcustodian or other agent of the Custodian, (iii) in an account
maintained by the Custodian or a Subcustodian at a Securities Depository,
or (iv) in accordance with customary market practice in the Custodian's
discretion (x) in the country in which settlement is to occur or (y) for
the particular security in respect of which settlement is instructed.
Securities held at a Subcustodian will be held subject to the terms of
the Subcustodian Agreement in effect between the Custodian and the
Subcustodian and may be held in Omnibus Accounts.
Securities held in a Securities Depository will be held 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. Such securities shall be held (i) in an account which
contains only assets of the Custodian held as custodian or otherwise on
behalf of others if such account is maintained by the Custodian with a
Securities Depository (unless market practice or Securities Depository
rules and regulations require the Custodian also to hold its own assets in
such account), or (ii) in an account which contains only assets of the
Subcustodian or other agent held as custodian or otherwise on behalf of
others if such account is maintained by the Subcustodian or other agent
with a Securities Depository (unless market practice or Securities
Depository rules and regulations require a Subcustodian also to hold its
own assets in such account).
Registered securities of the Fund may be registered in the name of the
Custodian, the Fund or a nominee of either of them and may be held in any
manner set forth above, with or without any indication of fiduciary
capacity, provided that securities are held in an account of the Custodian
or a Subcustodian containing only assets of the Fund or only assets held by
the Custodian or a Subcustodian as custodian for its customers or are
otherwise held on behalf of others.
(b) Securities Represented by Book Entry. Securities represented by
book-entry on the books of the issuer, a registrar, a clearing agency or
other agent of the issuer (a "Book-Entry Agent") may be so held in an
account of the Custodian or a Subcustodian or other Agent maintained with
such Book-Entry Agent provided such account contains only assets of the
Fund or only assets held as custodian for customers or are otherwise held
on behalf of others.
(c) Other Investments. At the specific request of the Fund, the
Custodian may note on its records Investments owned by the Fund that are
not represented by physical securities or by book-entry, including without
limitation Derivative Instruments and Commodities. The Fund acknowledges
that such notation is for recordkeeping purposes only, that the Custodian
may not be able to exercise control over such Investments and that such
Investments may represent contractual rights of the Fund which the
Custodian cannot enforce. The Fund shall be responsible for requesting that
any statements applicable to such Investments, including brokerage
statements, be sent to the Custodian.
4.2 Powers and Duties of the Custodian with Respect to the Securities
Account. The Custodian shall have the following powers and duties with respect
to the Securities Account:
(a) Purchases. Upon receipt of Proper Instructions, insofar as funds
are available or as funds are otherwise provided by the Custodian at its
discretion pursuant to Section 11 hereof for the purpose, to pay for and
receive securities purchased for the account of the Fund, payment being
made (i) upon receipt of the securities by the Custodian, by a clearing
corporation of a securities exchange of which the Custodian or a
Subcustodian is a member, or by a Securities Depository, or (ii) otherwise
in accordance with (A) governmental regulations, (B) rules of Securities
Depositories or other U.S. or foreign clearing agencies, (C) generally
accepted trade practice in the applicable local market, (D) the terms of
the instrument representing the security, or (E) the terms of Proper
Instructions.
(b) Sales. Upon receipt of Proper Instructions, to make delivery of
securities which have been sold for the account of the Fund (i) against
payment therefor in cash, by check or by bank wire transfer; (ii) by credit
to the account of the Custodian or Subcustodian with a clearing corporation
of a securities exchange of which the Custodian or a Subcustodian is a
member; (iii) by credit to the account of the Custodian or Subcustodian
with a Securities Depository; or (iv) otherwise in accordance with (A)
governmental regulations, (B) rules of Securities Depositories or other
U.S. or foreign clearing agencies, (C) generally accepted trade practice in
the applicable local market, (D) the terms of the instrument representing
the security, or (E) the terms of Proper Instructions.
(c) Other Transfers. To deliver Property of the Fund to a
Subcustodian, another custodian or another third party as necessary to
effect transactions authorized by Proper Instructions, and upon receipt of
Proper Instructions, to make such other disposition of Property of the Fund
in a manner other than or for purposes other than as enumerated elsewhere
in this Agreement, provided that the instructions relating to such
disposition shall state the amount of Property to be delivered and the name
of the person or persons to whom delivery is to be made.
(d) Futures; Options; Segregated Accounts. Upon the receipt of Proper
Instructions and the execution of any agreements relating to margin in
respect of a Derivative Instrument or Commodity ("Margin Agreements"), to
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 in accordance with the terms
of such Margin Agreements and any Proper Instructions ("Segregated
Accounts").
Upon receipt of Proper Instructions or upon receipt of instructions
given pursuant to any Margin Agreement, or pursuant to the terms of such
Agreement, the Custodian shall (i) receive and retain, to the extent the
same are provided to the Custodian, confirmations or other documents
evidencing the purchase or sale of such Derivative Instruments or
Commodities by the Fund; (ii) deposit and maintain, pursuant to a Margin
Agreement, in a segregated account, either physically or by book-entry in a
Securities Depository, for the benefit of any futures commission merchant
("Margin Account"), or pay pursuant to Proper Instructions to such broker,
dealer or futures commission merchant, such securities, cash or other
assets as are designated by the Fund 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 Derivative Instrument
or Commodity, in accordance with the provisions of any Margin Agreement
relating thereto; and (iii) otherwise pay, release and/or transfer
securities, cash or other assets into or out of such Margin Accounts only
in accordance with the provisions of any such Margin Agreement. The
Custodian shall not be responsible for the sufficiency of assets held in
any segregated account established in compliance with applicable margin
maintenance requirements or for the performance of the other terms of any
agreement relating to a Derivative Instrument or Commodity.
Notwithstanding anything in this Agreement to the contrary, the Fund
agrees that the Custodian's responsibility for any Derivative Instruments
and Commodities shall be limited to the exercise of reasonable care with
respect to any confirmations or other documents evidencing the purchase or
sale of such Derivative Instrument by the Fund which the Custodian
receives.
(e) Stock Lending. Upon receipt of Proper Instructions, to deliver
securities of the Fund, in connection with loans of securities by the Fund,
to the borrower thereof prior to receipt of the collateral, if any, for
such borrowing.
(f) Non-Discretionary Details. Without the necessity of express
authorization from the Fund, (1) to attend to all nondiscretionary details
in connection with the sale, exchange, substitution, purchase, transfer or
other dealings with securities, cash or other Property of the Fund held by
the Custodian except as otherwise directed from time to time by the
Directors or Trustees of the Fund, and (2) to make payments to itself or
others for minor expenses of handling securities or other similar items
relating to the Custodian's duties under this Agreement, provided that all
such payments shall be accounted for to the Fund.
4.3 Corporate Actions. Unless the Custodian receives timely Proper
Instructions to the contrary, the Custodian will perform or will cause the
Subcustodian to perform the following:
(i) exchange securities held by it for the account of the Fund for
other securities in connection with any reorganization, recapitalization,
split-up of shares, change of par value, conversion or other event relating
to the securities or the issuer of such securities, and shall deposit any
such securities in accordance with the terms of any reorganization or
protective plan;
(ii) surrender securities in temporary form for definitive securities;
surrender securities for transfer into the name of the Custodian, the Fund
or a nominee of either of them, as permitted by Section 4.1(a); and
surrender securities for a different number of certificates or instruments
representing the same number of shares or same principal amount of
indebtedness;
(iii) deliver warrants, puts, calls, rights or similar securities to
the issuer or trustee thereof, or to the agent of such issuer or trustee,
for the purpose of exercise or sale, and deposit securities upon
invitations for tenders thereof;
(iv) take all necessary action to comply with the terms of all
mandatory or compulsory exchanges, calls, tenders, redemptions, or similar
rights of security ownership, and promptly notify the Fund of such action,
and collect all stock dividends, rights and other items of like nature;
(v) collect amounts due and payable to the Fund with respect to
portfolio securities of the Fund, and promptly credit to the account of the
Fund all income and other payments relating to portfolio securities and
other assets held by the Custodian hereunder upon Custodian's receipt of
such income or payments or as otherwise agreed in writing by the Custodian
and the Fund, provided that the Custodian shall not be responsible for the
collection of amounts due and payable with respect to portfolio securities
that are in default;
(vi) endorse and deliver any instruments required to effect collection
of any amount due and payable to the Fund with respect to securities;
execute ownership and other certificates and affidavits on the Fund's
behalf for all federal, state and foreign tax purposes in connection with
receipt of income, capital gains or other payments with respect to
portfolio securities and other assets of the Fund, or in connection with
the purchase, sale or transfer of such securities or other assets; and file
any certificates or other affidavits for the refund or reclaim of foreign
taxes paid;
(vii) deliver to the Fund all forms of proxies, all notices of
meetings, and any other notices or announcements affecting or relating to
securities owned by the Fund that are received by the Custodian, any
Subcustodian, or any nominee of either of them, and, upon receipt of Proper
Instructions, the Custodian shall execute and deliver, or cause such
Subcustodian or nominee to execute and deliver, such proxies or other
authorizations as may be required. Except as directed pursuant to Proper
Instructions, neither the Custodian nor any Subcustodian or nominee shall
vote upon any such securities, or execute any proxy to vote thereon, or
give any consent or take any other action with respect thereto.
In fulfilling the duties set forth above, the Custodian shall be
responsible for sending to the Fund all information pertaining to the relevant
terms of a corporate action which it in fact receives, provided that the
Custodian shall not be responsible for incorrect information it receives, or
information it has not received but should have received, from industry-accepted
third-party securities information vendors.
Notwithstanding any provision of this Agreement to the contrary, with
respect to portfolio securities registered in so-called street name, the
Custodian shall use reasonable efforts to collect cash or share entitlements due
and payable to the Fund but shall not be responsible for its inability to
collect such cash or share entitlements.
The Custodian shall only be responsible for acting on the Proper
Instructions of the Fund in respect of any Voluntary Corporate Action which
requires an investment decision by the Investment Adviser provided the Custodian
has received a Proper Instruction which requesting such action a reasonable time
prior to expiration of the time within which action in respect of such Voluntary
Corporate Action may be taken, in order to ensure that Custodian has sufficient
time to take such action. The deadline for the acceptance of such instruction
may be set forth by the Custodian in its communication of the terms of such
action to the Fund and shall take into consideration delays which occur due to
(i) the involvement of a Subcustodian, Securities Depository or other
intermediary; (ii) differences in time zones; or (iii) other factors particular
to a given market, exchange or issuer.
Any advance credit of cash or shares by the Custodian or a Subcustodian
expected to be received as a result of any corporate event shall be subject to
actual collection and may, when the Custodian deems such collection unlikely, be
reversed by the Custodian upon written notice to the Fund. As used herein, an
"advance credit of cash or shares" shall mean any credit of cash or shares to
any account maintained hereunder prior to actual receipt and collection of such
cash or shares in anticipation of a distribution expected to be received in the
future.
5. Cash Accounts.
5.1 Opening and Maintaining Cash Accounts. Subject to the terms and
conditions set forth in this Section 5, the Fund hereby authorizes the Custodian
to open and maintain, with itself or with Subcustodians, cash accounts in United
States Dollars and in such other currencies as the Fund shall from time to time
request or as are in the Custodian's discretion required in order for the
Custodian to carry out the terms of this Agreement. The Custodian shall make
payments from or deposits to any of said accounts upon its receipt of Proper
Instructions from the Fund providing sufficient details to effect such
transaction.
Cash accounts opened on the books of the Custodian ("BBH Accounts") shall
be opened in the name of the Fund. Subject always to the provisions of Section
10 hereof, the Custodian shall be liable for repayment of any and all deposits
carried on its books as principal, whether denominated in United States Dollars
or in other currencies.
Cash accounts opened on the books of Subcustodians appointed pursuant to
Section 7 hereof 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 treated as portfolio securities, and accordingly the Custodian
shall be responsible for the exercise of reasonable care in respect of the
administration of such Agency Accounts but shall not be liable for their
repayment in the event the Subcustodian fails to make repayment (including in
the event of the Subcustodian's bankruptcy or insolvency). Both BBH Accounts and
Agency Accounts shall have the benefit of the provisions of Section 10 of this
Agreement.
The Fund bears all risks of holding or transacting in any currency. Any
credit made to any Agency or BBH Account shall be provisional and may be
reversed by the Custodian in the event such payment is not actually collected.
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 (i) in which such
BBH or Agency Accounts are maintained or (ii) 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 (i) an act of war, insurrection or civil strife; or (ii) an
action by a foreign government or instrumentality, whether de jure or de facto,
in the country in which the branch is located preventing such repayment, 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.
5.2 Foreign Exchange Transactions. The Custodian shall, pursuant to Proper
Instructions, 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 Proper Instructions. The
Custodian shall be responsible for the transmission of cash and instructions to
and from the currency broker or banking institution with which the contract or
option is made and the safekeeping of all certificates and other documents and
agreements evidencing or relating to such foreign exchange transactions as the
Custodian may receive. In connection with such transactions, the Custodian is
authorized to make free outgoing payments of cash in the form of U. S. 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. 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.
Foreign exchange transactions (including without limitation contracts,
futures, options, and options on futures), other than those executed with the
Custodian as principal, but including those executed with Subcustodians, shall
be deemed to be portfolio securities of the Fund and accordingly the Custodian
shall only be responsible for delivering or receiving currency on behalf of the
Fund in respect of such contracts pursuant to Proper Instructions subject to the
fourth paragraph of this Section 5. The Custodian shall not be responsible for
the failure of any counterparty in such agency transaction to perform its
obligations thereunder.
Alternatively, such transactions may be undertaken by the Custodian as
principal, if instructed by the Fund and accepted by the Custodian, which
instructions may be in the form of a standing instruction.
The obligations of the Custodian in respect of all foreign exchange
transactions shall be contingent on the free, unencumbered transferability of
the currency transacted on the actual settlement date of the transaction.
5.3 Delays. In the event a delay is caused by the negligence or willful
misconduct of the Custodian in carrying out a Proper Instruction to transfer
cash in connection with any transaction referred to in Section 5.1 or 5.2 above,
the Custodian shall be liable to the Fund for interest to be calculated at the
rate customarily paid 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. 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.
6. Proper Instructions. Proper Instructions shall include, in the following
order of the preferred method of giving such instructions, authenticated
electromechanical communications including direct electronic transmissions,
authenticated SWIFT and tested telex, including Electronic Instructions as
described in Section 8.3,; a written request signed by two or more authorized
persons as set forth below; telefax transmissions; and oral instructions,
including telephone. Proper Instructions may also include such other methods of
communicating Proper Instructions as the parties hereto may from time to time
agree. Each of the first four methods of communicating Proper Instructions is
described and defined below and may from time to time be described and defined
in written operating memoranda between the Custodian and the Fund. The Custodian
is hereby authorized to act on instructions sent via any of the foregoing
methods from any director, employee or officer of the Fund or from the
Investment Adviser or other agent of the Fund as the Fund shall from time to
time instruct.
Authenticated electro-mechanical communications shall include
communications effected directly between electromechanical or electronic devices
or systems, including authenticated SWIFT and tested telex transmissions, and
other forms of communications involving or between such electro-mechanical or
electronic devices or systems as the parties may from time to time agree upon in
writing. In the event media other than tested telex transmissions are agreed
upon, the Custodian may in its discretion require that the Fund, its Investment
Adviser or other agent and the Custodian enter into certain operating memoranda
which shall set forth the media through which such Proper Instructions shall be
transmitted and the data which must be included in such Proper Instructions in
order for such instructions to be complete. Once such operating memoranda shall
have been instituted, the Fund, its Investment Adviser or other Agent shall be
responsible for sending instructions which meet the requirements set forth in
such operating memoranda and the Custodian shall only be responsible for acting
on instructions which meet such requirements. The Custodian shall not be liable
for damages of any kind, including direct or consequential losses resulting from
technological or equipment failures or communications system failures of any
kind in respect of instructions sent or attempted to be sent via
electromechanical communications.
A written request signed by two or more authorized persons shall include a
written request, direction, instruction or certification signed or initialed on
behalf of the Fund by two or more persons as the Directors or Trustees of the
Fund shall have from time to time authorized, or by such other written procedure
as the Custodian and the Fund shall from time to time agree in writing. Those
persons authorized to give Proper Instructions may be identified by the
Directors or Trustees by name, title or position (including any of its
directors, employees or agents or any investment manager or adviser or person or
entity with similar responsibilities which is authorized to give Proper
Instructions on behalf of the Fund to the Custodian) and will include at least
one officer empowered by the Directors or Trustees to name other individuals or
entities who are authorized to give Proper Instructions on behalf of the Fund.
Telephonic or other oral instructions or instructions given by telefax
transmission may be given by any one of the persons referred to in the preceding
paragraph and will be considered Proper Instructions if the Custodian believes
them to have been given by a person authorized to give such instructions with
respect to the transaction involved.
With respect to telefax transmissions, the Fund and the Custodian hereby
acknowledge that receipt of legible instructions cannot be assured, and that the
Custodian cannot verify that authorized signatures on telefax instructions are
original or properly affixed. Accordingly, the Custodian shall not be
responsible for losses or expenses incurred through actions taken in reliance on
inaccurately stated, illegible or unauthorized telefax instructions.
Oral instructions will be confirmed by authenticated electro-mechanical
communications or written instructions 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 instructions. The Fund hereby authorizes
the Custodian to tape record any and all telephonic or other oral instructions
given to the Custodian by or on behalf of the Fund (including any of its
Directors, Trustees, employees or agents or any Investment Adviser or person or
entity with similar responsibilities which is authorized to give Proper
Instructions on behalf of the Fund to the Custodian).
Proper Instructions may relate to specific transactions or to types or
classes of transactions, and may be in the form of standing instructions
The Custodian shall not be responsible for its failure to act on any
instruction received from the Fund which the Custodian in good faith believes
does not meet the requirements set forth herein.
7. Authority to Appoint Subcustodian and Agents and to Utilize Securities
Depositories. Subject to the provisions hereinafter set forth in this Section 7,
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.
The Custodian may deposit and/or maintain Property 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. The
Custodian may deposit and/or maintain, either directly or through one or more
agents appointed by the Custodian, Property 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. Notwithstanding anything in
this Agreement to the contrary, any Property held in a Securities Depository,
whether or not the Custodian is a direct participant or member, will be held
subject to the rules, regulations, operating memoranda or other conditions of
participation in such Securities Depository.
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 Property of the Fund in the United States. Additionally, the Custodian
may, at any time and from time to time, appoint (i) 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 (ii) 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 Property of the Fund outside the United
States. Any bank, trust company or other entity appointed pursuant to the
foregoing provisions shall be a Subcustodian.
Prior to the appointment of any Subcustodian for purposes of holding
Property of the Fund outside the United States, the Custodian shall have
obtained written confirmation of the approval of the Board of Trustees or
Directors of the Fund with respect to; the country or countries in which, and
the Securities Depositories, if any, through which, a Subcustodian may hold
Property of the Fund. Each Subcustodian and the countries where and Securities
Depositories through which they may hold Property of the Customer shall be
listed on Appendix A attached hereto as the same may from time to time be
amended. The Custodian may, at any time in its discretion, remove any
Subcustodian but will promptly notify the Fund of any such action.
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 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.
With respect to securities and funds held by a Subcustodian, either
directly or indirectly (including by a Securities Depository or clearing
agency), 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 (i) governmental
regulations, (ii) rules of Securities Depositories and clearing agencies, (iii)
generally accepted trade practice in the applicable local market, (iv) the terms
of the instrument representing the security, or (v) the terms of Proper
Instructions.
In the event the Custodian receives a claim from a Subcustodian under the
indemnification provisions of any subcustodian agreement, the Custodian shall
promptly give written notice to the Fund of such claim. No more than thirty days
after written notice to the Fund of the Custodian's intention to make such
payment, the Fund will reimburse the Custodian the amount of such payment except
in respect of any negligence or misconduct of the Custodian.
The Custodian may at any time or times in its discretion appoint (and may
at any time remove) any other bank or trust company as its agent (an "Agent") to
carry out such of the provisions of this Agreement as the Custodian may from
time to time direct, provided, however, that the appointment of such Agent shall
not relieve the Custodian of any of its responsibilities under this Agreement.
8. Reporting Records. The Custodian shall have and perform the following duties
with respect to recordkeeping.
8.1 Records. The Custodian shall create, maintain and retain such records
relating to its activities and obligations under this Agreement as (i) will
enable the Custodian to comply with its obligations hereunder, (ii) may be
necessary to give a complete record of all Property held by it under this
Agreement, (iii) and as are customarily maintained by a professional custodian.
8.2 Access to Records. The books and records maintained by the Custodian
pursuant to this Section 8 shall at reasonable times during the Custodian's
regular business hours be open to inspections and audit by the auditors and by
employees and agents of the Fund provided that all such individuals shall
observe all security requirements of the Custodian applicable to its own
employees having access to similar records and such rules as may be reasonably
imposed by the Custodian. To the extent consistent with the laws of the
jurisdiction in which a Subcustodian operates as such, and with the rules of any
securities depository or clearing agency utilized by such Subcustodian, the
Custodian shall also seek to obtain from each Subcustodian an undertaking to
permit the persons specified in this section reasonable access to the records of
such Subcustodian relating to the Property or confirmation of the contents of
such records.
8.3 Electronic Records and Communications. The Custodian may make any of
its records available to the Fund or its Investment Adviser via electronic
reporting which may include without limitation on-line software systems
("Electronic Reports"). The Fund understands that such Electronic Reports may
include data provided to the Custodian by outside sources which may not have
been independently verified by the Custodian and is subject to change.
Accordingly, the Custodian shall not be liable for inaccuracies, errors or
incomplete information furnished by such sources.
The Custodian may also make available to the Fund or its Investment Adviser
certain software to be used to initiate payment and securities transfer
instructions, affirm brokerage transactions reported through the Institutional
Delivery System or initiate other transaction instructions for the Custodian's
processing ("Electronic Instructions").
The Fund agrees that it shall be responsible for protecting and maintaining
the confidentiality and security of any codes assigned in respect of the Fund's
or its Investment Adviser's access to such Electronic Reports or Electronic
Instructions and that any instructions received through such system using the
client code assigned to the Fund shall be deemed to have originated from or on
behalf of the Fund and to be Proper Instructions.
The Custodian shall not be responsible for information added to, changed or
omitted by electronic programming malfunction, unauthorized access or other
failure of such systems unless such actions are the direct result of the
Custodian's negligence, bad faith or willful malfeasance.
8.4 Review of Records. The Fund agrees to examine all records howsoever
produced or transmitted promptly upon receipt thereof and to notify the
Custodian promptly of any discrepancy or error therein. Unless the Fund delivers
written notice of any such discrepancy or error to the Custodian within a
reasonable period of time after its receipt thereof, such records shall be
deemed true and accurate.
8.5 Reports. The Custodian shall furnish to the Fund from time to time, as
mutually agreed upon, a statement of all Property held by the Custodian or
Subcustodian on behalf of the Fund.
9. Responsibility of Custodian. In carrying out the provisions of this
Agreement, the Custodian shall be held to the exercise of reasonable care,
provided that the Custodian shall not thereby be required to take any action
which is in contravention of any law, rule or regulation or any order of any
court of competent jurisdiction. As used in this Agreement, "reasonable care"
shall mean the level of care which a professional custodian providing custody
services to institutional investors would provide in light of the circumstances
and events which reasonably influence its performance in the market where the
securities are held or the transaction is effected, including without limitation
local market practices relating to securities settlement and safekeeping, and
"negligence" shall mean the failure to exercise reasonable care as herein
defined. The Custodian shall, subject to the provisions set forth in Sections 9
and 10 hereof, be responsible to the Fund for any direct loss or damage (without
taking into account special circumstances) which the Fund incurs by reason of
the Custodian's negligence, bad faith or willful malfeasance.
With respect to securities and funds held by a Subcustodian, either
directly or indirectly (including by a Securities Depository or foreign clearing
agency), including demand 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.
With respect to the securities, cash and other Property of the Fund held by
a Securities Depository utilized by the Custodian or any Subcustodian or any
agent of the Custodian, the Custodian shall not be liable for the acts and
omissions of such Securities Depository unless and only to the extent that such
Securities Depository is liable to the Custodian and the Custodian recovers from
such Securities Depository, provided always that the Custodian shall be liable
to the Fund only for any direct loss or damage to the Fund resulting from use of
the Securities Depository if caused by the negligence, bad faith or willful
malfeasance of the Custodian.
The Fund agrees to indemnify and hold harmless the Custodian and its
nominees from all claims and liabilities (including counsel fees) incurred or
assessed against it or its nominees in connection with the performance of this
Agreement, except such as may arise from its or its nominees breach of the
relevant standard of conduct set forth herein. Without limiting the foregoing
indemnification obligation of the Fund, the Fund agrees to indemnify the
Custodian and any nominee in whose name portfolio securities or other property
of the Fund is registered against any liability the Custodian or such nominee
may incur by reason of taxes assessed to the Custodian or such nominee or other
costs, liability or expense incurred by the Custodian or such nominee resulting
directly or indirectly from the fact that portfolio securities or other property
of the Fund is registered in the name of the Custodian or such nominee.
10. Limitations to Custodian's Responsibility.
10.1 Liability in General. Except as otherwise provided in this Agreement,
the Custodian shall be responsible for loss or damage which the Fund may incur
by reason of the Custodian's negligence, bad faith or willful malfeasance,
provided always that such loss or damage shall be limited to direct damages
incurred by the Fund without taking into account special circumstances, and
provided further that the Custodian shall in no event be liable for indirect or
consequential damages or for loss of goodwill, even if the Custodian has been
advised of the likelihood of such loss or damage and regardless of the form of
action.
10.2 Liability of the Custodian with Respect to Proper Instructions;
Evidence of Authority; Etc. The Custodian shall not be liable for, and shall be
indemnified by the Fund for losses or damages incurred or assessed against the
Custodian as a result of, any action taken or omitted in reliance upon Proper
Instructions or upon any other written notice, request, direction, instruction,
certificate or other instrument believed by it to be genuine.
The Custodian shall be entitled, at the expense of the Fund, to receive and
act upon advice of (a) its own counsel or counsel which it selects, (b) counsel
for the Fund, or (c) such other counsel as the Fund and the Custodian may agree
upon, with respect to all matters. The Custodian shall be without liability for
any action taken or omitted pursuant to such advice.
10.3 Title to Securities, Fraudulent Securities. So long as and to the
extent that it is in the exercise of reasonable care, the Custodian shall not be
responsible for the title, validity or genuineness of any Property or evidence
of title thereto received by it or delivered by it pursuant to this Agreement.
10.4 Force Majeure. Notwithstanding any other provision contained herein,
the Custodian shall not be liable for any action taken, or for any failure to
take any action required to be taken hereunder, or otherwise for its failure to
fulfill its obligations hereunder (including without limitation the failure to
receive or deliver securities or the failure to receive or make any payment) in
the event and to the extent that the taking of such action or such failure
arises out of or is caused by civil commotion, act of God, accident, fire, water
damage, explosion, mechanical breakdown, computer or system failure or other
equipment failure, malfunction or failure caused by computer virus, failure or
malfunctioning of any communications medium for whatever reason, interruption
(whether partial or total) of power supplies or other utility service, strike or
other stoppage (whether partial or total) of labor, market conditions which
prevent the orderly execution of securities transactions or affect the value of
Property, any law, decree, regulation or order of any government or governmental
body, de facto or de jure (including any court or tribunal), rules or
regulations of any Securities Depository or clearing agency or any other cause
whatsoever (whether similar or dissimilar to the foregoing) beyond its control
or the control of its Subcustodian or other agent (collectively, "Force
Majeure").
10.5 Soverign Risk. Without limiting the generality of the foregoing
Section 10.4, the Custodian shall not be liable for any losses resulting from a
Sovereign Risk. As used herein, a Sovereign Risk shall mean any act of war,
terrorism, riot, insurrection or civil commotion; the imposition of exchange
control restrictions; confiscation, expropriation or nationalization of any
property including without limitation cash, cash equivalents, securities or the
assets of any issuer of securities by any governmental or quasi-governmental
authority (including without limitation those authorities which are judicial,
legislative, executive, military or religious in nature), whether de facto or de
jure; currency devaluation or revaluation; the imposition of taxes, levies or
other charges affecting the Fund's property, or any other political risk
(whether similar or dissimilar to the foregoing) incurred in respect of the
country in which the issuer of such securities is organized or in which such
securities are held or such payments are held or effected.
10.6 Currency Risks. The Fund bears all risks of holding or transacting in
any currency. Without limiting the generality of the foregoing, the Fund bears
all risks that rules or procedures imposed by Securities Depositories, exchange
controls, asset freezes or other laws or regulations shall prohibit or impose
burdens on or costs relating to the transfer by or for the account of the Fund
of securities, cash or currency held outside the United States or denominated in
a currency other than U. S. dollars or on the conversion of any currency so
held. The Custodian shall in no event be obligated to substitute another
currency (including U.S. dollars) for a currency whose transferability,
convertibility or availability has been affected by any such law, regulation,
rule or procedure.
10.7 Investment Risks not assumed by Custodian. The Custodian shall have
no liability in respect of any loss or damage suffered by the Fund, insofar as
such loss or damage arises from commercial or other investment risks inherent in
investing in capital markets or in holding securities in a particular
jurisdiction or country including without limitation: (i) political, legal,
economic, settlement and custody infrastructure, exchange rate and currency
risks; (ii) investment and repatriation restrictions; (iii) the Fund's or
Custodian's inability to protect and enforce any local legal rights including
rights of title and beneficial ownership; (iv) corruption and crime in the local
market; (v) unreliable information which emanates from the local market; (vi)
volatility of banking and financial systems and infrastructure; (vii) bankruptcy
and insolvency risks of any and all local banking agents, counterparties to cash
and securities transactions or registrars or transfer agents; (viii) risk of
issuer insolvency or default; and (ix) market conditions which prevent the
orderly execution of transactions or the value of assets.
10.8 Investment Limitations. In performing its duties generally, and more
particularly in connection with the purchase, sale and exchange of securities
made by or for the Fund, the Custodian may assume unless and until notified in
writing to the contrary that Proper Instructions received by it are not in
conflict with or in any way contrary to any provisions of the Fund's Declaration
of Trust or Certificate of Incorporation or By-Laws (or comparable documents) or
votes or proceedings of the shareholders or Trustees or Directors of the Fund.
The Custodian shall in no event be liable to the Fund and shall be indemnified
by the Fund for any violation which occurs in the course of carrying out
instructions given by the Fund or any Investment Adviser of any investment
limitations to which the Fund is subject or other limitations with respect to
the Fund's powers to make expenditures, encumber securities, borrow or take
similar actions affecting the Fund.
10.9 Foreign Ownership Limitations. The Fund shall be responsible for
monitoring foreign ownership limitations in any markets in which it invests.
10.10 Restricted Securities. The Custodian shall only be responsible for
notifying the Fund of any restrictions on the transfer of securities held in the
Securities Account of which the Custodian is in fact aware. In no event shall
the Custodian be responsible for the inability of a Fund to sell or transfer
restricted securities or for delays incurred in the sale or transfer of
restricted securities if such inability or delay is the result of the terms of
the security itself, actions of the issuer, its counsel or other representative
(including without limitation its registrar), or limitations due to laws,
regulations or other applicable rules. The Custodian shall only be responsible
for transmitting information to the Fund as to those corporate actions in
respect of restricted securities which it in fact receives.
10.11 Market Information. The Custodian may in its discretion make market
information available to the Fund. This service is for informational purposes
only and is not to be construed as a recommendation to buy or sell a particular
security, to invest or not to invest in a particular country, or to take any
action whatsoever. Although information reported therein is believed to be
accurate, the Custodian does not represent or warrant its accuracy or
completeness. The Fund accordingly acknowledges that the Custodian provides
market information on a best efforts basis and recognizes its responsibility to
consult with its own independent sources before making any investment or other
decisions.
11. Advances and Security for Advances. In the event that the Custodian is
directed by Proper Instructions to make any payment or transfer of funds from
any BBH or Agency Account on behalf of the Fund for which there would be, at the
close of business on the date of such payment or transfer, whether known at that
time or subsequently determined, insufficient funds held by the Custodian or any
Subcustodian, Securities Depository, or otherwise on behalf of the Fund, or if
the Custodian or any nominee thereof shall incur or be assessed any taxes,
charges, expenses, assessments, claims or liabilities in connection with the
performance of this Agreement (collectively a "Liability"), the Custodian may,
in its discretion without further Proper Instructions, provide or authorize an
advance ("Advance") for the account of the Fund in an amount sufficient to
satisfy such Liability or to allow the settlement or completion of the
transaction by reason of which such payment or transfer of funds is to be made.
Any Advance shall be payable on demand made by the Custodian, unless otherwise
agreed by the Fund and the Custodian, and shall accrue interest from the date of
the Advance to the date of payment by the Fund at a rate agreed upon from time
to time by the Custodian and the Fund or otherwise at the rate the Custodian
customarily charges on loans to customers. It is understood that any transaction
in respect of which the Custodian shall have made an Advance, including but not
limited to a foreign exchange contract or transaction in respect of which the
Custodian is not acting as a principal, is for the account of and at the risk of
the Fund, and not, by reason of such Advance, deemed to be a transaction
undertaken by the Custodian for its own account and risk. If the Custodian shall
make or authorize any Advance to the Fund or incur any Liability, then in such
event any property in the amount of such Advance or Liability at any time held
for the account of the Fund by the Custodian, a Subcustodian, a Securities
Depository or otherwise ("Collateral") shall be security for such Liability or
for such Advance and the interest thereon, and if the Fund shall fail to pay
such Advance or interest when due or shall fail to reimburse or indemnify the
Custodian promptly in respect of a Liability, the Custodian shall be entitled to
utilize available cash and to dispose of the Fund's property, including
securities and balances in any BBH or Agency Account, to the extent necessary
(which shall include the right to sell or assign securities or otherwise assign
its security interest to third parties) to obtain repayment, reimbursement or
indemnification.
For purposes of this Section 11, all such Collateral shall be treated as
financial assets credited to securities accounts under revised Articles 8 and 9
of the Uniform Commercial Code (1994), whether such Articles have in fact been
adopted in the jurisdiction in which the securities are held or the Advance is
granted. Accordingly, with respect to any Collateral, the Custodian shall have
the rights and benefits of a secured creditor that is a securities intermediary
for the Fund under the Uniform Commercial Code as revised.
Deposits maintained in Agency Accounts and BBH Accounts (including all
accounts denominated in any currency) shall collectively constitute a single and
indivisible current account with respect to the Fund's obligations to the
Custodian or any Subcustodian hereunder. Accordingly, balances in all such
Agency and BBH Accounts shall at all times be available for satisfaction of the
Fund's obligations under this Agreement to the Custodian or any of its
Subcustodians or agents including without limitation any Advances incurred
pursuant to this Section.
12. Compensation. The Fund shall pay the Custodian a custody fee based on such
fee schedule as may from time to time be agreed upon in writing by the Custodian
and the Fund. Such fee, together with all out-of-pocket expenses for which the
Custodian is to be reimbursed, shall be billed to the Fund and be paid by cash
or wire transfer to the Custodian.
13. Termination. This Agreement shall continue in full force and effect until
terminated by either party by an instrument in writing delivered or mailed,
postage prepaid, to the other party, such termination to take effect not sooner
than ninety (90) days after the date of such delivery or mailing. In the event
of termination the Custodian shall be entitled to receive, prior to delivery of
the securities, cash and other Property held by it, payment of all accrued fees
and unreimbursed expenses and all Advances and Liabilities, upon receipt by the
Fund of a statement setting forth such fees, expenses, Advances and Liabilities.
In the event of the appointment of a successor custodian, it is agreed that
the cash, securities and other Property owned by the Fund and held by the
Custodian or any Subcustodian shall be delivered to the successor custodian, and
the Custodian agrees to cooperate with the Fund in execution of documents and
performance of other actions necessary or desirable in order to substitute the
successor custodian for the Custodian under this Agreement.
14. Miscellaneous. The following miscellaneous provisions shall govern the
relationship between the parties --
14.1 Execution of Documents, Etc. Upon request, the Fund shall execute and
deliver to the Custodian such proxies, powers of attorney or other instruments
as may be reasonable and necessary or desirable in connection with the
performance by the Custodian or any Subcustodian of their respective obligations
to the Fund under this Agreement or any applicable subcustodian agreement with
respect to the Fund.
14.2 Entire Agreement. This Agreement constitutes the entire understanding
and agreement of the Fund, on the one hand, and the Custodian, on the other,
with respect to the subject matter hereof and accordingly, supersedes as of the
effective date of this Agreement any custodian agreement or other oral or
written agreements heretofore in effect between the Fund and the Custodian with
respect to custody of the Fund's Property.
14.3 Waivers and Amendments. No provision of this Agreement may be waived,
amended or terminated except by a statement in writing signed by the party
against which enforcement of such waiver, amendment or termination is sought;
provided however any appendix or addendum to this Agreement may be added or
amended from time to time by the Fund's execution and delivery to the Custodian
of such additional or amended appendix or addendum, in which case the terms
thereof shall take effect immediately upon execution by the Custodian or
otherwise as set forth in this Agreement.
14.4 Interpretation. In connection with the operation of this Agreement,
the Custodian and the Fund may agree in writing from time to time on such
provisions interpretative of or in addition to the provisions of this Agreement
with respect to the Fund as may be consistent with the general tenor of this
Agreement. No interpretative or additional provisions made as provided in the
preceding sentence shall be deemed to be an amendment of this Agreement.
14.5 Captions. Headings contained in this Agreement, which are included as
convenient references only, shall have no bearing upon the interpretation of the
terms of the Agreement or the obligations of the parties hereto.
14.6 Governing Law. The provisions of this Agreement shall be construed in
accordance with and governed by the laws of the State of New York without giving
effect to principles of conflicts of law. 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.
14.7 Notices. Except in the case of Proper Instructions, notices and other
writings contemplated by this Agreement shall be delivered by hand or by
facsimile transmission (provided that in the case of delivery by facsimile
transmission, such notice or other writing shall also be mailed postage prepaid)
to the parties at the following addresses:
(a) If to the Fund:
Xxxxxx Xxxxxx
Xxxxxx Place Management Company, Inc.
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
(b) If to the Custodian:
Xxxxx Brothers Xxxxxxxx & Co.
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Manager, Securities Department
Telephone (000) 000-0000
Telefax: (000) 000-0000
or to such other address as the Fund or the Custodian may have designated in
writing to the other.
14.8 Assignment. This Agreement shall be binding on and shall inure to the
benefit of the Fund and the Custodian and their respective successors and
assigns, provided that neither the Custodian nor the Fund may assign this
Agreement or any of its rights or obligations hereunder without the prior
written consent of the other party.
14.9 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.
14.10 Confidentiality; Survival of Obligations. 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 or regulation.
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. The Custodian shall seek to obtain an
agreement from each Subcustodian that shall require each Subcustodian, to the
extent permitted by law, to treat all matters regarding the Fund, and this
Agreement with the same degree of confidentiality as the Custodian has agreed
hereunder.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed in its name and behalf on the day and year first above written.
FORWARD FUNDS, INC. XXXXX BROTHERS XXXXXXXX & CO.
On behalf of the portfolios
Listed on the attached Appendix B
By ________________________ By ___________________________
Name: Name:
Title: Title:
APPENDIX "B"
TO
THE CUSTODIAN AGREEMENT
BETWEEN
FORWARD FUNDS, INC. on behalf of the Funds listed on Appendix B
and
XXXXX BROTHERS XXXXXXXX & CO.
Dated as of ___________________1998
The following is a list of Funds for which the Custodian shall serve under a
Custodian Agreement dated as of ______________ to provide custodial services to
the Funds. (the "Agreement"):
The Global Fund
IN WITNESS WHEREOF, each of the parties hereto have caused this Appendix to be
executed in its name and on behalf of each such Fund.
Forward Funds, Inc.
On behalf of each Fund
listed above XXXXX BROTHERS XXXXXXXX & CO.
By:____________________ By:________________________________
Name: Name:
Title: itle:
