MASTER CUSTODIAN AGREEMENT
This Agreement is made as of March 9, 2001 by and among each investment
company identified on Appendix A hereto (each such investment company and each
investment company made subject to this Agreement in accordance with Section
18.5 below, shall hereinafter be referred to as (the "Fund"), and STATE STREET
BANK and TRUST Company, a Massachusetts trust company (the "Custodian"),
WITNESSETH:
WHEREAS, each Fund may or may not be authorized to issue shares of
beneficial interest in separate series ("Shares"), with each such series
representing interests in a separate portfolio of securities and other assets;
WHEREAS, each Fund so authorized intends that this Agreement be applicable
to each of its series set forth on Appendix A hereto (such series together with
all other series subsequently established by the Fund and made subject to this
Agreement in accordance with Section 18.6 below, shall hereinafter be referred
to as the "Portfolio(s)").
WHEREAS, each Fund not so authorized intends that this Agreement be
applicable to it and all references hereinafter to one or more "Portfolio(s)"
shall be deemed to refer to such Fund(s); and
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
SECTION 1. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT
Each Fund hereby employs the Custodian as a custodian of assets of the
Portfolios, including securities which the Fund, on behalf of the applicable
Portfolio, desires to be held in places within the United States ("domestic
securities") and securities it desires to be held outside the United States
("foreign securities"). The Custodian shall not be responsible for any property
of a Portfolio which is not received by it or which is delivered out in
accordance with Proper Instructions including, without limitation, Portfolio
property (i) held by brokers, private bankers or other entities on behalf of the
Portfolio (each a "Local Agent"), (ii) held by Special Sub-Custodians (as such
term is defined in Section 5 hereof), (iii) held by entities which have advanced
monies to or on behalf of the Portfolio and which have received Portfolio
property as security for such advance(s) (each a "Pledgee"), or (iv) delivered
or otherwise removed from the custody of the Custodian pursuant to Special
Instructions (as such term is defined in Section 7 hereof). With respect to
uncertificated shares (the "Underlying Shares") of registered "investment
companies" (as defined in Section 3(a)(1) of the Investment Company Act of 1940,
as amended (the "1940 Act")), whether in the same "group of investment
companies" (as defined in Section 12(d)(1)(G)(ii) of the 0000 Xxx) or otherwise,
including pursuant to Section 12(d)(1)(F) of the 1940 Act (hereinafter sometimes
referred to as the "Underlying Portfolios") the holding of confirmation
statements that identify the shares as being recorded in the Custodian's name on
behalf of the Portfolios will be deemed custody for purposes hereof.
Upon receipt of Proper Instructions, the Custodian shall on behalf of the
applicable Portfolio(s) from time to time employ one or more sub-custodians
located in the United States, but only in accordance with an applicable vote by
the Board of Trustees or the Board of Directors of the Fund (as appropriate, and
in each case, the "Board") on behalf of the applicable Portfolio(s), and
provided that the Custodian shall have no more or less responsibility or
liability to any Fund on account of any actions or omissions of any
sub-custodian so employed than any such sub-custodian has to the Custodian. The
Custodian may employ as sub-custodian for each Fund's foreign securities on
behalf of the applicable Portfolio(s) the foreign banking institutions and
foreign securities depositories designated in Schedules A and B hereto, but only
in accordance with the applicable provisions of Sections 3 and 4 hereof.
SECTION 2. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE PORTFOLIOS TO
BE HELD IN THE UNITED STATES
SECTION 2.1 HOLDING SECURITIES. The Custodian shall hold and physically
segregate for the account of each Portfolio all non-cash property, to be held by
it in the United States, including all domestic securities owned by such
Portfolio other than (a) securities which are maintained pursuant to Section 2.8
in a clearing agency which acts as a securities depository or in a book-entry
system authorized by the U.S. Department of the Treasury (each, a "U.S.
Securities System") and (b) Underlying Shares owned by each Fund which are
maintained pursuant to Section 2.10 hereof in an account with State Street Bank
and Trust Company or such other entity which may from time to time act as a
transfer agent for the Underlying Portfolios and with respect to which the
Custodian is provided with Proper Instructions (the "Underlying Transfer
Agent").
SECTION 2.2 DELIVERY OF SECURITIES. The Custodian shall release and deliver
domestic securities owned by a Portfolio held by the Custodian, in a U.S.
Securities System account of the Custodian or in an account at the Underlying
Transfer Agent, only upon receipt of Proper Instructions on behalf of the
applicable Portfolio, which may be continuing instructions when deemed
appropriate by the parties, and only in the following cases:
1) Upon sale of such securities for the account of the Portfolio and
receipt of payment therefor;
2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Portfolio;
3) In the case of a sale effected through a U.S. Securities System, in
accordance with the provisions of Section 2.8 hereof;
4) To the depository agent in connection with tender or other similar
offers for securities of the Portfolio;
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5) To the issuer thereof or its agent when such securities are called,
redeemed, retired or otherwise become payable; provided that, in any
such case, the cash or other consideration is to be delivered to the
Custodian;
6) To the issuer thereof, or its agent, for transfer into the name of the
Portfolio or into the name of any nominee or nominees of the Custodian
or into the name or nominee name of any agent appointed pursuant to
Section 2.7 or into the name or nominee name of any sub-custodian
appointed pursuant to Section 1; or for exchange for a different
number of bonds, certificates or other evidence representing the same
aggregate face amount or number of units; provided that, in any such
case, the new securities are to be delivered to the Custodian;
7) Upon the sale of such securities for the account of the Portfolio, to
the broker or its clearing agent, against a receipt, for examination
in accordance with "street delivery" custom; provided that in any such
case, the Custodian shall have no responsibility or liability for any
loss arising from the delivery of such securities prior to receiving
payment for such securities except as may arise from the Custodian's
own negligence or willful misconduct;
8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the
securities of the issuer of such securities, or pursuant to provisions
for conversion contained in such securities, or pursuant to any
deposit agreement; provided that, in any such case, the new securities
and cash, if any, are to be delivered to the Custodian;
9) In the case of warrants, rights or similar securities, the surrender
thereof in the exercise of such warrants, rights or similar securities
or the surrender of interim receipts or temporary securities for
definitive securities; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the Custodian;
10) For delivery in connection with any loans of securities made by the
Portfolio (a) against receipt of collateral as agreed from time to
time by the Fund on behalf of the Portfolio, except that in connection
with any loans for which collateral is to be credited to the
Custodian's account in the book-entry system authorized by the U.S.
Department of the Treasury, the Custodian will not be held liable or
responsible for the delivery of securities owned by the Portfolio
prior to the receipt of such collateral or (b) to the lending agent,
or the lending agent's custodian, in accordance with written Proper
Instructions (which may not provide for the receipt by the Custodian
of collateral therefor) agreed upon from time to time by the Custodian
and the Fund;
11) For delivery as security in connection with any borrowing by a Fund on
behalf of a Portfolio requiring a pledge of assets by the Fund on
behalf of such Portfolio;
3.
12) For delivery in accordance with the provisions of any agreement among
the Fund on behalf of the Portfolio, the Custodian and a broker-dealer
registered under the Securities Exchange Act of 1934 (the "Exchange
Act") and a member of The National Association of Securities Dealers,
Inc. (the "NASD"), relating to compliance with the rules of The
Options Clearing Corporation and of any registered national securities
exchange, or of any similar organization or organizations, regarding
escrow or other arrangements in connection with transactions by the
Fund on behalf of a Portfolio;
13) For delivery in accordance with the provisions of any agreement among
a Fund on behalf of the Portfolio, the Custodian, and a futures
commission merchant registered under the Commodity Exchange Act,
relating to compliance with the rules of the Commodity Futures Trading
Commission (the "CFTC") and/or any contract market, or any similar
organization or organizations, regarding account deposits in
connection with transactions by the Fund on behalf of a Portfolio;
14) Upon the sale or other delivery of such investments (including,
without limitation, to a Special Sub-Custodian), and prior to receipt
of payment therefor, as set forth in written Proper Instructions (such
delivery in advance of payment, along with payment in advance of
delivery made in accordance with Section 2.6(7), as applicable, shall
each be referred to herein as a "Free Trade"), provided that such
Proper Instructions shall set forth (a) the securities of the
Portfolio to be delivered and (b) the person or persons to whom
delivery of such securities shall be made;
15) Upon receipt of instructions from the Fund's transfer agent (the
"Transfer Agent") for delivery to such Transfer Agent or to the
holders of Shares in connection with distributions in kind, as may be
described from time to time in the currently effective prospectus and
statement of additional information of the Fund related to the
Portfolio (the "Prospectus"), in satisfaction of requests by holders
of Shares for repurchase or redemption;
16) In the case of a sale processed through the Underlying Transfer Agent
or Underlying Shares, in accordance with Section 2.10 hereof; and
17) For any other purpose, but only upon receipt of Proper Instructions
from the Fund on behalf of the applicable Portfolio specifying (a) the
securities of the Portfolio to be delivered and (b) the person or
persons to whom delivery of such securities shall be made.
SECTION 2.3 REGISTRATION OF SECURITIES. Domestic securities held by the
Custodian (other than bearer securities) shall be registered in the name of the
Portfolio or in the name of any nominee of a Fund on behalf of the Portfolio or
of any nominee of the Custodian which nominee shall be assigned exclusively to
the Portfolio, unless the Fund has authorized in writing the appointment of a
nominee to be used in common with other registered investment companies having
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the same investment advisor as the Portfolio, or in the name or nominee name of
any agent appointed pursuant to Section 2.7 or in the name or nominee name of
any sub-custodian appointed pursuant to Section 1. All securities accepted by
the Custodian on behalf of the Portfolio under the terms of this Agreement shall
be in "street name" or other good delivery form. If, however, a Fund directs the
Custodian to maintain securities in "street name", the Custodian shall utilize
its best efforts only to timely collect income due the Fund on such securities
and to notify the Fund on a best efforts basis only of relevant corporate
actions including, without limitation, pendency of calls, maturities, tender or
exchange offers.
SECTION 2.4 BANK ACCOUNTS. The Custodian shall open and maintain a separate
bank account or accounts in the United States in the name of each Portfolio of
each Fund, subject only to draft or order by the Custodian acting pursuant to
the terms of this Agreement, and shall hold in such account or accounts, subject
to the provisions hereof, all cash received by it from or for the account of the
Portfolio, other than cash maintained by the Portfolio in a bank account
established and used in accordance with Rule 17f-3 under the 1940 Act. Funds
held by the Custodian for a Portfolio may be deposited by it to its credit as
Custodian in the banking department of the Custodian or in such other banks or
trust companies as it may in its discretion deem necessary or desirable;
provided, however, that every such bank or trust company shall be qualified to
act as a custodian under the 1940 Act and that each such bank or trust company
and the funds to be deposited with each such bank or trust company shall on
behalf of each applicable Portfolio be approved by vote of a majority of the
Board. Such funds shall be deposited by the Custodian in its capacity as
Custodian and shall be withdrawable by the Custodian only in that capacity.
SECTION 2.5 COLLECTION OF INCOME. Except with respect to Portfolio property
released and delivered pursuant to Section 2.2(14) or purchased pursuant to
Section 2.6(7), and subject to the provisions of Section 2.3, the Custodian
shall collect on a timely basis all income and other payments with respect to
registered domestic securities held hereunder to which each Portfolio shall be
entitled either by law or pursuant to custom in the securities business, and
shall collect on a timely basis all income and other payments with respect to
bearer domestic securities if, on the date of payment by the issuer, such
securities are held by the Custodian or its agent thereof and shall credit such
income, as collected, to such Portfolio's custodian account. Without limiting
the generality of the foregoing, the Custodian shall detach and present for
payment all coupons and other income items requiring presentation as and when
they become due and shall collect interest when due on securities held
hereunder. Income due each Portfolio on securities loaned pursuant to the
provisions of Section 2.2 (10) shall be the responsibility of the applicable
Fund. The Custodian will have no duty or responsibility in connection therewith,
other than to provide the Fund with such information or data as may be necessary
to assist the Fund in arranging for the timely delivery to the Custodian of the
income to which the Portfolio is properly entitled.
SECTION 2.6 PAYMENT OF FUND MONIES. Upon receipt of Proper Instructions on
behalf of the applicable Portfolio, which may be continuing instructions when
deemed appropriate by the parties, the Custodian shall pay out monies of a
Portfolio in the following cases only:
5.
1) Upon the purchase of domestic securities, options, futures contracts
or options on futures contracts for the account of the Portfolio but
only (a) against the delivery of such securities or evidence of title
to such options, futures contracts or options on futures contracts to
the Custodian (or any bank, banking firm or trust company doing
business in the United States or abroad which is qualified under the
1940 Act to act as a custodian and has been designated by the
Custodian as its agent for this purpose) registered in the name of the
Portfolio or in the name of a nominee of the Custodian referred to in
Section 2.3 hereof or in proper form for transfer; (b) in the case of
a purchase effected through a U.S. Securities System, in accordance
with the conditions set forth in Section 2.8 hereof; (c) in the case
of a purchase of Underlying Shares, in accordance with the conditions
set forth in Section 2.10 hereof; (d) in the case of repurchase
agreements entered into between the applicable Fund on behalf of a
Portfolio and the Custodian, or another bank, or a broker-dealer which
is a member of NASD, (i) against delivery of the securities either in
certificate form or through an entry crediting the Custodian's account
at the Federal Reserve Bank with such securities or (ii) against
delivery of the receipt evidencing purchase by the Portfolio of
securities owned by the Custodian along with written evidence of the
agreement by the Custodian to repurchase such securities from the
Portfolio; or (e) for transfer to a time deposit account of the Fund
in any bank, whether domestic or foreign; such transfer may be
effected prior to receipt of a confirmation from a broker and/or the
applicable bank pursuant to Proper Instructions from the Fund as
defined herein;
2) In connection with conversion, exchange or surrender of securities
owned by the Portfolio as set forth in Section 2.2 hereof;
3) For the redemption or repurchase of Shares issued as set forth in
Section 6 hereof;
4) For the payment of any expense or liability incurred by the Portfolio,
including but not limited to the following payments for the account of
the Portfolio: interest, taxes, management, accounting, transfer agent
and legal fees, and operating expenses of the Fund whether or not such
expenses are to be in whole or part capitalized or treated as deferred
expenses;
5) For the payment of any dividends on Shares declared pursuant to the
Fund's articles of incorporation or organization and by-laws or
agreement or declaration trust, as applicable, and Prospectus
(collectively, "Governing Documents");
6) For payment of the amount of dividends received in respect of
securities sold short;
7) Upon the purchase of domestic investments and prior to receipt of such
investments, as set forth in written Proper Instructions (such payment
in advance of delivery, along with delivery in advance of payment made
in accordance with Section 2.2(14), as applicable, shall each be
referred to herein as a "Free Trade"), provided that such
6.
Proper Instructions shall also set forth (a) the amount of such
payment and (b) the person(s) to whom such payment is made; and
8) For any other purpose, but only upon receipt of Proper Instructions
from the Fund on behalf of the Portfolio specifying (a) the amount of
such payment and (b) the person or persons to whom such payment is to
be made.
SECTION 2.7 APPOINTMENT OF AGENTS. The Custodian may at any time or times
in its discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the 1940 Act to act as a custodian, as
its agent to carry out such of the provisions of this Section 2 as the Custodian
may from time to time direct; provided, however, that the appointment of any
agent shall not relieve the Custodian of its responsibilities or liabilities
hereunder. The Underlying Transfer Agent shall not be deemed an agent or
subcustodian of the Custodian for purposes of this Section 2.7 or any other
provision of this Agreement.
SECTION 2.8 DEPOSIT OF FUND ASSETS IN U.S. SECURITIES SYSTEMS. The
Custodian may deposit and/or maintain securities owned by a Portfolio in a U.S.
Securities System subject to the following provisions:
1) The Custodian may keep securities of the Portfolio in a U.S.
Securities System provided that such securities are represented in an
account of the Custodian in the U.S. Securities System (the "U.S.
Securities System Account") which account shall not include any assets
of the Custodian other than assets held as a fiduciary, custodian or
otherwise for customers;
2) The records of the Custodian with respect to securities of the
Portfolio which are maintained in a U.S. Securities System shall
identify by book-entry those securities belonging to the Portfolio;
3) The Custodian shall pay for securities purchased for the account of
the Portfolio upon (a) receipt of advice from the U.S. Securities
System that such securities have been transferred to the U.S.
Securities System Account and (b) the making of an entry on the
records of the Custodian to reflect such payment and transfer for the
account of the Portfolio. The Custodian shall transfer securities sold
for the account of the Portfolio upon (i) receipt of advice from the
U.S. Securities System that payment for such securities has been
transferred to the U.S. Securities System Account and (ii) the making
of an entry on the records of the Custodian to reflect such transfer
and payment for the account of the Portfolio. Copies of all advices
from the U.S. Securities System of transfers of securities for the
account of the Portfolio shall identify the Portfolio, be maintained
for the Portfolio by the Custodian and be provided to the Fund at its
request. Upon request, the Custodian shall furnish the Fund
confirmation of each transfer to or from the account of the Portfolio
in the form of a written advice or notice and shall furnish to the
Fund copies of daily
7.
transaction sheets reflecting each day's transactions in the U.S.
Securities System for the account of the Portfolio;
4) The Custodian shall provide the Fund with any report obtained by the
Custodian on the U.S. Securities System's accounting system, internal
accounting control and procedures for safeguarding securities
deposited in the U.S. Securities System; and
5) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Fund for the benefit of the Portfolio
for any loss or damage to the Portfolio resulting from use of the U.S.
Securities System by reason of any negligence, misfeasance or
misconduct of the Custodian or any of its agents or of any of its or
their employees or from failure of the Custodian or any such agent to
enforce effectively such rights as it may have against the U.S.
Securities System; at the election of the Fund, it shall be entitled
to be subrogated to the rights of the Custodian with respect to any
claim against the U.S. Securities System or any other person which the
Custodian may have as a consequence of any such loss or damage if and
to the extent that the Portfolio has not been made whole for any such
loss or damage.
SECTION 2.9 SEGREGATED ACCOUNT. The Custodian shall upon receipt of Proper
Instructions on behalf of each applicable Portfolio, establish and maintain a
segregated account or accounts for and on behalf of each such Portfolio, into
which account or accounts may be transferred cash and/or securities, including
securities maintained in an account by the Custodian pursuant to Section 2.8
hereof, (a) in accordance with the provisions of any agreement among the Fund on
behalf of the Portfolio, the Custodian and a broker-dealer registered under the
Exchange Act and a member of the NASD (or any futures commission merchant
registered under the Commodity Exchange Act), relating to compliance with the
rules of The Options Clearing Corporation and of any registered national
securities exchange (or the CFTC or any registered contract market), or of any
similar organization or organizations, regarding escrow or other arrangements in
connection with transactions by the Portfolio, (b) for purposes of segregating
cash or government securities in connection with options purchased, sold or
written by the Portfolio or commodity futures contracts or options thereon
purchased or sold by the Portfolio, (c) for the purposes of compliance by the
Portfolio with the procedures required by Investment Company Act Release No.
10666, or any subsequent release of the U.S. Securities and Exchange Commission
(the "SEC"), or interpretative opinion of the staff of the SEC, relating to the
maintenance of segregated accounts by registered investment companies, and (d)
for any other purpose in accordance with Proper Instructions.
SECTION 2.10 DEPOSIT OF FUND ASSETS WITH THE UNDERLYING TRANSFER AGENT.
Underlying Shares shall be deposited and/or maintained in an account or accounts
maintained with the Underlying Transfer Agent. The Underlying Transfer Agent
shall be deemed to be acting as if it is a "securities depository" for purposes
of Rule 17f-4 under the 1940 Act. Each Fund hereby directs the Custodian to
deposit and/or maintain such securities with the Underlying Transfer Agent,
subject to the following provisions:
8.
1) The Custodian shall keep Underlying Shares owned by a Portfolio with
the Underlying Transfer Agent provided that such securities are
maintained in an account or accounts on the books and records of the
Underlying Transfer Agent in the name of the Custodian as custodian
for the Portfolio.
2) The records of the Custodian with respect to Underlying Shares which
are maintained with the Underlying Transfer Agent shall identify by
book-entry those Underlying Shares belonging to each Portfolio;
3) The Custodian shall pay for Underlying Shares purchased for the
account of a Portfolio upon (a) receipt of advice from the Portfolio's
investment adviser that such Underlying Shares have been purchased and
will be transferred to the account of the Custodian, on behalf of the
Portfolio, on the books and records of the Underlying Transfer Agent
and (b) the making of an entry on the records of the Custodian to
reflect such payment and transfer for the account of the Portfolio.
The Custodian shall receive confirmation from the Underlying Transfer
Agent of the purchase of such securities and the transfer of such
securities to the Custodian's account with the Underlying Transfer
Agent only after such payment is made. The Custodian shall transfer
Underlying Shares redeemed for the account of a Portfolio (i) upon
receipt of an advice from the Portfolio's investment adviser that such
securities have been redeemed and that payment for such securities
will be transferred to the Custodian and (ii) the making of an entry
on the records of the Custodian to reflect such transfer and payment
for the account of the Portfolio. The Custodian will receive
confirmation from the Underlying Transfer Agent of the redemption of
such securities and payment therefor only after such securities are
redeemed. Copies of all advices from the Portfolio's investment
adviser of purchases and sales of Underlying Shares for the account of
the Portfolio shall identify the Portfolio, be maintained for the
Portfolio by the Custodian, and be provided to the Portfolio's
investment adviser at its request; and
4) The Custodian shall be not be liable to any Fund or any Portfolio for
any loss or damage to the Fund or any Portfolio resulting from
maintenance of Underlying Shares with Underlying Transfer Agent except
for losses resulting directly from the negligence, misfeasance or
misconduct of the Custodian or any of its agents or of any of its or
their employees.
SECTION 2.11 OWNERSHIP CERTIFICATES FOR TAX PURPOSES. The Custodian shall
execute ownership and other certificates and affidavits for all federal and
state tax purposes in connection with receipt of income or other payments with
respect to domestic securities of each Portfolio held by it and in connection
with transfers of securities.
SECTION 2.12 PROXIES. Except with respect to Portfolio property released
and delivered pursuant to Section 2.2(14), or purchased pursuant to Section
2.6(7), the Custodian shall, with respect to the domestic securities held
hereunder, cause to be promptly executed by the registered
9.
holder of such securities, if the securities are registered otherwise than in
the name of the Portfolio or a nominee of the Portfolio, all proxies, without
indication of the manner in which such proxies are to be voted, and shall
promptly deliver to the Fund such proxies, all proxy soliciting materials and
all notices relating to such securities.
SECTION 2.13 COMMUNICATIONS RELATING TO PORTFOLIO SECURITIES. Except with
respect to Portfolio property released and delivered pursuant to Section
2.2(14), or purchased pursuant to Section 2.6(7), and subject to the provisions
of Section 2.3, the Custodian shall transmit promptly to the applicable Fund for
each Portfolio all written information (including, without limitation, pendency
of calls and maturities of domestic securities and expirations of rights in
connection therewith and notices of exercise of call and put options written by
the Fund on behalf of the Portfolio and the maturity of futures contracts
purchased or sold by the Fund on behalf of the Portfolio) received by the
Custodian from issuers of the securities being held for the Portfolio. With
respect to tender or exchange offers, the Custodian shall transmit promptly to
the applicable Fund all written information received by the Custodian from
issuers of the securities whose tender or exchange is sought and from the party
(or its agents) making the tender or exchange offer. If a Fund desires to take
action with respect to any tender offer, exchange offer or any other similar
transaction, the Fund shall notify the Custodian at least three business days
prior to the date on which the Custodian is to take such action.
SECTION 3. PROVISIONS RELATING TO RULES 17F-5 AND 17F-7
SECTION 3.1. DEFINITIONS. As used throughout this Agreement, the
capitalized terms set forth below shall have the indicated meanings:
"Country Risk" means all factors reasonably related to the systemic risk of
holding Foreign Assets in a particular country including, but not limited to,
such country's political environment, economic and financial infrastructure
(including any Eligible Securities Depository operating in the country),
prevailing or developing custody and settlement practices, and laws and
regulations applicable to the safekeeping and recovery of Foreign Assets held in
custody in that country.
"Eligible Foreign Custodian" has the meaning set forth in section (a)(1) of Rule
17f-5, including a majority-owned or indirect subsidiary of a U.S. Bank (as
defined in Rule 17f-5), a bank holding company meeting the requirements of an
Eligible Foreign Custodian (as set forth in Rule 17f-5 or by other appropriate
action of the SEC, or a foreign branch of a Bank (as defined in Section 2(a)(5)
of the 0000 Xxx) meeting the requirements of a custodian under Section 17(f) of
the 1940 Act; the term does not include any Eligible Securities Depository.
"Eligible Securities Depository" has the meaning set forth in section (b)(1) of
Rule 17f-7.
"Foreign Assets" means any of the Portfolios' investments (including foreign
currencies) for which the primary market is outside the United States and such
cash and cash equivalents as are reasonably necessary to effect the Portfolios'
transactions in such investments.
10.
"Foreign Custody Manager" has the meaning set forth in section (a)(3) of Rule
17f-5.
"Rule 17f-5" means Rule 17f-5 promulgated under the 1940 Act.
"Rule 17f-7" means Rule 17f-7 promulgated under the 1940 Act.
SECTION 3.2. THE CUSTODIAN AS FOREIGN CUSTODY MANAGER.
3.2.1 DELEGATION TO THE CUSTODIAN AS FOREIGN CUSTODY MANAGER. Each
Fund, by resolution adopted by its Board, hereby delegates to the Custodian,
subject to Section (b) of Rule 17f-5, the responsibilities set forth in this
Section 3.2 with respect to Foreign Assets of the Portfolios held outside the
United States, and the Custodian hereby accepts such delegation as Foreign
Custody Manager with respect to the Portfolios.
3.2.2 COUNTRIES COVERED. The Foreign Custody Manager shall be
responsible for performing the delegated responsibilities defined below only
with respect to the countries and custody arrangements for each such country
listed on Schedule A to this Agreement, which list of countries may be amended
from time to time by any Fund with the agreement of the Foreign Custody Manager.
The Foreign Custody Manager shall list on Schedule A the Eligible Foreign
Custodians selected by the Foreign Custody Manager to maintain the assets of the
Portfolios, which list of Eligible Foreign Custodians may be amended from time
to time in the sole discretion of the Foreign Custody Manager. The Foreign
Custody Manager will provide amended versions of Schedule A in accordance with
Section 3.2.5 hereof.
Upon the receipt by the Foreign Custody Manager of Proper Instructions to open
an account or to place or maintain Foreign Assets in a country listed on
Schedule A, and the fulfillment by each Fund, on behalf of the applicable
Portfolio(s), of the applicable account opening requirements for such country,
the Foreign Custody Manager shall be deemed to have been delegated by such
Fund's Board on behalf of such Portfolio(s) responsibility as Foreign Custody
Manager with respect to that country and to have accepted such delegation.
Execution of this Agreement by each Fund shall be deemed to be a Proper
Instruction to open an account, or to place or maintain Foreign Assets, in each
country listed on Schedule A. Following the receipt of Proper Instructions
directing the Foreign Custody Manager to close the account of a Portfolio with
the Eligible Foreign Custodian selected by the Foreign Custody Manager in a
designated country, the delegation by the Board on behalf of such Portfolio to
the Custodian as Foreign Custody Manager for that country shall be deemed to
have been withdrawn and the Custodian shall immediately cease to be the Foreign
Custody Manager with respect to such Portfolio with respect to that country.
The Foreign Custody Manager may withdraw its acceptance of delegated
responsibilities with respect to a designated country upon written notice to the
Fund. Thirty days (or such longer period to which the parties agree in writing)
after receipt of any such notice by the Fund, the Custodian shall have no
further responsibility in its capacity as Foreign Custody Manager to the Fund
with respect to the country as to which the Custodian's acceptance of delegation
is withdrawn.
11.
3.2.3 SCOPE OF DELEGATED RESPONSIBILITIES:
(a) SELECTION OF ELIGIBLE FOREIGN CUSTODIANS. Subject to the provisions of
this Section 3.2, the Foreign Custody Manager may place and maintain the Foreign
Assets in the care of the Eligible Foreign Custodian selected by the Foreign
Custody Manager in each country listed on Schedule A, as amended from time to
time. In performing its delegated responsibilities as Foreign Custody Manager to
place or maintain Foreign Assets with an Eligible Foreign Custodian, the Foreign
Custody Manager shall determine that the Foreign Assets will be subject to
reasonable care, based on the standards applicable to custodians in the country
in which the Foreign Assets will be held by that Eligible Foreign Custodian,
after considering all factors relevant to the safekeeping of such assets,
including, without limitation the factors specified in Rule 17f-5(c)(1).
(b) CONTRACTS WITH ELIGIBLE FOREIGN CUSTODIANS. The Foreign Custody Manager
shall determine that the contract governing the foreign custody arrangements
with each Eligible Foreign Custodian selected by the Foreign Custody Manager
will satisfy the requirements of Rule 17f-5(c)(2).
(c) MONITORING. In each case in which the Foreign Custody Manager maintains
Foreign Assets with an Eligible Foreign Custodian selected by the Foreign
Custody Manager, the Foreign Custody Manager shall establish a system to monitor
(i) the appropriateness of maintaining the Foreign Assets with such Eligible
Foreign Custodian and (ii) the contract governing the custody arrangements
established by the Foreign Custody Manager with the Eligible Foreign Custodian.
In the event the Foreign Custody Manager determines that the custody
arrangements with an Eligible Foreign Custodian it has selected are no longer
appropriate, the Foreign Custody Manager shall notify the Board in accordance
with Section 3.2.5 hereunder.
3.2.4 GUIDELINES FOR THE EXERCISE OF DELEGATED AUTHORITY. For purposes
of this Section 3.2, the Board shall be deemed to have considered and determined
to accept such Country Risk as is incurred by placing and maintaining the
Foreign Assets in each country for which the Custodian is serving as Foreign
Custody Manager of the Portfolios.
3.2.5 REPORTING REQUIREMENTS. The Foreign Custody Manager shall report
the withdrawal of the Foreign Assets from an Eligible Foreign Custodian and the
placement of such Foreign Assets with another Eligible Foreign Custodian by
providing to the Board an amended Schedule A at the end of the calendar quarter
in which an amendment to such Schedule has occurred. The Foreign Custody Manager
shall make written reports notifying the Board of any other material change in
the foreign custody arrangements of the Portfolios described in this Section 3.2
after the occurrence of the material change.
12.
3.2.6 STANDARD OF CARE AS FOREIGN CUSTODY MANAGER OF A PORTFOLIO. In
performing the responsibilities delegated to it, the Foreign Custody Manager
agrees to exercise reasonable care, prudence and diligence such as a person
having responsibility for the safekeeping of assets of management investment
companies registered under the 1940 Act would exercise.
3.2.7 REPRESENTATIONS WITH RESPECT TO RULE 17F-5. The Foreign Custody
Manager represents to each Fund that it is a U.S. Bank as defined in section
(a)(7) of Rule 17f-5. Each Fund represents to the Custodian that its Board has
determined that it is reasonable for such Board to rely on the Custodian to
perform the responsibilities delegated pursuant to this Agreement to the
Custodian as the Foreign Custody Manager of the Portfolios.
3.2.8 EFFECTIVE DATE AND TERMINATION OF THE CUSTODIAN AS FOREIGN
CUSTODY MANAGER. Each Board's delegation to the Custodian as Foreign Custody
Manager of the Portfolios shall be effective as of the date hereof and shall
remain in effect until terminated at any time, without penalty, by written
notice from the terminating party to the non-terminating party. Termination will
become effective thirty (30) days after receipt by the non-terminating party of
such notice. The provisions of Section 3.2.2 hereof shall govern the delegation
to and termination of the Custodian as Foreign Custody Manager of the Portfolios
with respect to designated countries.
SECTION 3.3 ELIGIBLE SECURITIES DEPOSITORIES.
3.3.1 ANALYSIS AND MONITORING. The Custodian shall (a) provide the
Fund (or its duly-authorized investment manager or investment advisor) with an
analysis of the custody risks associated with maintaining assets with the
Eligible Securities Depositories set forth on Schedule B hereto in accordance
with section (a)(1)(i)(A) of Rule 17f-7, and (b) monitor such risks on a
continuing basis, and promptly notify the Fund (or its duly-authorized
investment manager or investment advisor) of any material change in such risks,
in accordance with section (a)(1)(i)(B) of Rule 17f-7.
3.3.2 STANDARD OF CARE. The Custodian agrees to exercise reasonable
care, prudence and diligence in performing the duties set forth in Section
3.3.1.
SECTION 4. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE PORTFOLIOS TO
BE HELD OUTSIDE THE UNITED STATES
SECTION 4.1 DEFINITIONS. As used throughout this Agreement, the capitalized
terms set forth below shall have the indicated meanings:
"Foreign Securities System" means an Eligible Securities Depository listed on
Schedule B hereto.
"Foreign Sub-Custodian" means a foreign banking institution serving as an
Eligible Foreign Custodian.
13.
SECTION 4.2. HOLDING SECURITIES. The Custodian shall identify on its books
as belonging to the Portfolios the foreign securities held by each Foreign
Sub-Custodian or Foreign Securities System. The Custodian may hold foreign
securities for all of its customers, including the Portfolios, with any Foreign
Sub-Custodian in an account that is identified as belonging to the Custodian for
the benefit of its customers, provided however, that (i) the records of the
Custodian with respect to foreign securities of the Portfolios which are
maintained in such account shall identify those securities as belonging to the
Portfolios and (ii), to the extent permitted and customary in the market in
which the account is maintained, the Custodian shall require that securities so
held by the Foreign Sub-Custodian be held separately from any assets of such
Foreign Sub-Custodian or of other customers of such Foreign Sub-Custodian.
SECTION 4.3. FOREIGN SECURITIES SYSTEMS. Foreign securities shall be
maintained in a Foreign Securities System in a designated country through
arrangements implemented by the Custodian or a Foreign Sub-Custodian, as
applicable, in such country.
SECTION 4.4. TRANSACTIONS IN FOREIGN CUSTODY ACCOUNT.
4.4.1. DELIVERY OF FOREIGN ASSETS. The Custodian or a Foreign
Sub-Custodian shall release and deliver foreign securities of the Portfolios
held by the Custodian or such Foreign Sub-Custodian, or in a Foreign Securities
System account, only upon receipt of Proper Instructions, which may be
continuing instructions when deemed appropriate by the parties, and only in the
following cases:
(i) Upon the sale of such foreign securities for the Portfolio in
accordance with commercially reasonable market practice in the country
where such foreign securities are held or traded, including, without
limitation: (A) delivery against expectation of receiving later
payment; or (B) in the case of a sale effected through a Foreign
Securities System, in accordance with the rules governing the
operation of the Foreign Securities System;
(ii) In connection with any repurchase agreement related to foreign
securities;
(iii) To the depository agent in connection with tender or other similar
offers for foreign securities of the Portfolios;
(iv) To the issuer thereof or its agent when such foreign securities are
called, redeemed, retired or otherwise become payable;
(v) To the issuer thereof, or its agent, for transfer into the name of the
Custodian (or the name of the respective Foreign Sub-Custodian or of
any nominee of the Custodian or such Foreign Sub-Custodian) or for
exchange for a different number of bonds, certificates or other
evidence representing the same aggregate face amount or number of
units;
14.
(vi) To brokers, clearing banks or other clearing agents for examination or
trade execution in accordance with market custom; provided that in any
such case, the Foreign Sub-Custodian shall have no responsibility or
liability for any loss arising from the delivery of such foreign
securities prior to receiving payment for such foreign securities
except as may arise from the Foreign Sub-Custodian's own negligence or
willful misconduct;
(vii) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the
securities of the issuer of such securities, or pursuant to provisions
for conversion contained in such securities, or pursuant to any
deposit agreement;
(viii) In the case of warrants, rights or similar foreign securities, the
surrender thereof in the exercise of such warrants, rights or similar
securities or the surrender of interim receipts or temporary
securities for definitive securities;
(ix) For delivery as security in connection with any borrowing by a Fund on
behalf of a Portfolio requiring a pledge of assets by the Fund on
behalf of such Portfolio;
(x) In connection with trading in options and futures contracts, including
delivery as original margin and variation margin;
(xi) Upon the sale or other delivery of such foreign securities (including,
without limitation, to a Special Sub-Custodian) as a Free Trade,
provided that applicable Proper Instructions shall set forth (A) the
foreign securities to be delivered and (B) the person or persons to
whom delivery shall be made;
(xii) In connection with the lending of foreign securities; and
(xiii) For any other purpose, but only upon receipt of Proper Instructions
specifying (A) the foreign securities to be delivered and (B) the
person or persons to whom delivery of such securities shall be made.
4.4.2. PAYMENT OF PORTFOLIO MONIES. Upon receipt of Proper
Instructions, which may be continuing instructions when deemed appropriate by
the parties, the Custodian shall pay out, or direct the respective Foreign
Sub-Custodian or the respective Foreign Securities System to pay out, monies of
a Portfolio in the following cases only:
(i) Upon the purchase of foreign securities for the Portfolio, unless
otherwise directed by Proper Instructions, by (A) delivering money to
the seller thereof or to a dealer therefor (or an agent for such
seller or dealer) against expectation of receiving later delivery of
such foreign securities; or (B) in the case of a purchase effected
through a Foreign Securities System, in accordance with the rule
governing the operation of such Foreign Securities System;
15.
(ii) In connection with the conversion, exchange or surrender of foreign
securities of the Portfolio;
(iii) For the payment of any expense or liability of the Portfolio,
including but not limited to the following payments: interest, taxes,
investment advisory fees, transfer agency fees, fees under this
Agreement, legal fees, accounting fees, and other operating expenses;
(iv) For the purchase or sale of foreign exchange or foreign exchange
contracts for the Portfolio, including transactions executed with or
through the Custodian or its Foreign Sub-Custodians;
(v) In connection with trading in options and futures contracts, including
delivery as original margin and variation margin;
(vi) Upon the purchase of foreign securities as a Free Trade, provided that
applicable Proper Instructions shall set forth (A) the amount of such
payment and (B) the person or persons to whom payment shall be made;
(vii) For payment of part or all of the dividends received in respect of
securities sold short;
(viii) In connection with the borrowing or lending of foreign securities;
and
(ix) For any other purpose, but only upon receipt of Proper Instructions
specifying (A) the amount of such payment and (B) the person or
persons to whom such payment is to be made.
4.4.3. MARKET CONDITIONS. Notwithstanding any provision of this
Agreement to the contrary, settlement and payment for Foreign Assets received
for the account of the Portfolios and delivery of Foreign Assets maintained for
the account of the Portfolios may be effected in accordance with the customary
established securities trading or processing practices and procedures in the
country or market in which the transaction occurs, including, without
limitation, delivering Foreign Assets to the purchaser thereof or to a dealer
therefor (or an agent for such purchaser or dealer) with the expectation of
receiving later payment for such Foreign Assets from such purchaser or dealer.
The Custodian shall provide to each Board the information with respect to
custody and settlement practices in countries in which the Custodian employs a
Foreign Sub-Custodian described on Schedule C hereto at the time or times set
forth on such Schedule. The Custodian may revise Schedule C from time to time,
provided that no such revision shall result in a Board being provided with
substantively less information than had been previously provided hereunder.
16.
SECTION 4.5. REGISTRATION OF FOREIGN SECURITIES. The foreign securities
maintained in the custody of a Foreign Sub-Custodian (other than bearer
securities) shall be registered in the name of the applicable Portfolio or in
the name of the Custodian or in the name of any Foreign Sub-Custodian or in the
name of any nominee of the foregoing, and the applicable Fund on behalf of such
Portfolio agrees to hold any such nominee harmless from any liability as a
holder of record of such foreign securities. The Custodian or a Foreign
Sub-Custodian shall not be obligated to accept securities on behalf of a
Portfolio under the terms of this Agreement unless the form of such securities
and the manner in which they are delivered are in accordance with reasonable
market practice.
SECTION 4.6 BANK ACCOUNTS. The Custodian shall identify on its books as
belonging to the applicable Fund cash (including cash denominated in foreign
currencies) deposited with the Custodian. Where the Custodian is unable to
maintain, or market practice does not facilitate the maintenance of, cash on the
books of the Custodian, a bank account or bank accounts shall be opened and
maintained outside the United States on behalf of a Portfolio with a Foreign
Sub-Custodian. All accounts referred to in this Section shall be subject only to
draft or order by the Custodian (or, if applicable, such Foreign Sub-Custodian)
acting pursuant to the terms of this Agreement to hold cash received by or from
or for the account of the Portfolio. Cash maintained on the books of the
Custodian (including its branches, subsidiaries and affiliates), regardless of
currency denomination, is maintained in bank accounts established under, and
subject to the laws of, The Commonwealth of Massachusetts.
SECTION 4.7. COLLECTION OF INCOME. The Custodian shall use reasonable
commercial efforts to collect all income and other payments with respect to the
Foreign Assets held hereunder to which the Portfolios shall be entitled and
shall credit such income, as collected, to the applicable Portfolio. In the
event that extraordinary measures are required to collect such income, the Fund
and the Custodian shall consult as to such measures and as to the compensation
and expenses of the Custodian relating to such measures.
SECTION 4.8 SHAREHOLDER RIGHTS. With respect to the foreign securities held
pursuant to this Section 4, the Custodian shall use reasonable commercial
efforts to facilitate the exercise of voting and other shareholder rights,
subject always to the laws, regulations and practical constraints that may exist
in the country where such securities are issued. Each Fund acknowledges that
local conditions, including lack of regulation, onerous procedural obligations,
lack of notice and other factors may have the effect of severely limiting the
ability of such Fund to exercise shareholder rights.
SECTION 4.9. COMMUNICATIONS RELATING TO FOREIGN SECURITIES. The Custodian
shall transmit promptly to the applicable Fund written information with respect
to materials received by the Custodian via the Foreign Sub-Custodians from
issuers of the foreign securities being held for the account of the Portfolios
(including, without limitation, pendency of calls and maturities of foreign
securities and expirations of rights in connection therewith). With respect to
tender or exchange offers, the Custodian shall transmit promptly to the
applicable Fund written information with respect to materials so received by the
Custodian from issuers of the foreign securities whose
17.
tender or exchange is sought or from the party (or its agents) making the tender
or exchange offer. The Custodian shall not be liable for any untimely exercise
of any tender, exchange or other right or power in connection with foreign
securities or other property of the Portfolios at any time held by it unless (i)
the Custodian or the respective Foreign Sub-Custodian is in actual possession of
such foreign securities or property and (ii) the Custodian receives Proper
Instructions with regard to the exercise of any such right or power, and both
(i) and (ii) occur at least three business days prior to the date on which the
Custodian is to take action to exercise such right or power.
SECTION 4.10. LIABILITY OF FOREIGN SUB-CUSTODIANS. Each agreement pursuant
to which the Custodian employs a Foreign Sub-Custodian shall, to the extent
possible, require the Foreign Sub-Custodian to exercise reasonable care in the
performance of its duties, and to indemnify, and hold harmless, the Custodian
from and against any loss, damage, cost, expense, liability or claim arising out
of or in connection with the Foreign Sub-Custodian's performance of such
obligations. At a Fund's election, the Portfolios shall be entitled to be
subrogated to the rights of the Custodian with respect to any claims against a
Foreign Sub-Custodian as a consequence of any such loss, damage, cost, expense,
liability or claim if and to the extent that the Portfolios have not been made
whole for any such loss, damage, cost, expense, liability or claim.
SECTION 4.11 TAX LAW. The Custodian shall have no responsibility or
liability for any obligations now or hereafter imposed on any Fund, the
Portfolios or the Custodian as custodian of the Portfolios by the tax law of the
United States or of any state or political subdivision thereof. It shall be the
responsibility of each Fund to notify the Custodian of the obligations imposed
on such Fund with respect to the Portfolios or the Custodian as custodian of the
Portfolios by the tax law of countries other than those mentioned in the above
sentence, including responsibility for withholding and other taxes, assessments
or other governmental charges, certifications and governmental reporting. The
sole responsibility of the Custodian with regard to such tax law shall be to use
reasonable efforts to assist the Fund with respect to any claim for exemption or
refund under the tax law of countries for which such Fund has provided such
information.
SECTION 4.12. LIABILITY OF CUSTODIAN. The Custodian shall be liable for the
acts or omissions of a Foreign Sub-Custodian to the same extent as set forth
with respect to sub-custodians generally in this Agreement and, regardless of
whether assets are maintained in the custody of a Foreign Sub-Custodian or a
Foreign Securities System, the Custodian shall not be liable for any loss,
damage, cost, expense, liability or claim resulting from nationalization,
expropriation, currency restrictions, or acts of war or terrorism, or any other
loss where the Sub-Custodian has otherwise acted with reasonable care.
SECTION 5. SPECIAL SUB-CUSTODIANS
Upon receipt of Special Instructions (as such term is defined in Section 7
hereof), the Custodian shall, on behalf of one or more Portfolios, appoint one
or more banks, trust companies or other entities designated in such Special
Instructions to act as a sub-custodian for purposes of: (a) effecting
third-party repurchase transactions with banks, brokers, dealers or other
entities through the use of a
18.
common custodian or sub-custodian; (b) establishing a joint trading account for
the applicable Portfolio(s) and other registered open-end management investment
companies for which Xxxxx & Steers Capital Management, Inc. serves as investment
adviser, through which such Portfolios and such other investment companies shall
collectively participate in certain repurchase transactions; and (c) effecting
any other transactions designated by a Fund in Special Instructions. Each such
designated sub-custodian is referred to herein as a "Special Sub-Custodian."
Each such duly-appointed Special Sub-Custodian shall be listed on Schedule D
hereto, as it may be amended from time to time by a Fund, with the
acknowledgment of the Custodian. In connection with the appointment of any
Special Sub-Custodian, and in accordance with Special Instructions, the
Custodian shall enter into a subcustodian agreement with the Fund and the
Special Sub-Custodian in form and substance approved by such Fund, provided that
such agreement shall in all events comply with the provisions of the 1940 Act
and the rules and regulations thereunder and the terms and provisions of this
Agreement.
SECTION 6. PAYMENTS FOR SALES OR REPURCHASES OR REDEMPTIONS OF SHARES
The Custodian shall receive from the distributor of the Shares or from the
Transfer Agent and deposit into the account of the appropriate Portfolio such
payments as are received for Shares thereof issued or sold from time to time by
the applicable Fund. The Custodian will provide timely notification to such Fund
on behalf of each such Portfolio and the Transfer Agent of any receipt by it of
payments for Shares of such Portfolio.
From such funds as may be available for the purpose, the Custodian shall, upon
receipt of instructions from the Transfer Agent, make funds available for
payment to holders of Shares who have delivered to the Transfer Agent a request
for redemption or repurchase of their Shares. In connection with the redemption
or repurchase of Shares, the Custodian is authorized upon receipt of
instructions from the Transfer Agent to wire funds to or through a commercial
bank designated by the redeeming shareholders. In connection with the redemption
or repurchase of Shares, the Custodian shall honor checks drawn on the Custodian
by a holder of Shares, which checks have been furnished by a Fund to the holder
of Shares, when presented to the Custodian in accordance with such procedures
and controls as are mutually agreed upon from time to time between such Fund and
the Custodian.
SECTION 7. PROPER INSTRUCTIONS AND SPECIAL INSTRUCTIONS
"Proper Instructions," as such term is used throughout this Agreement, means a
writing signed or initialed by one or more person or persons as the applicable
Board shall have from time to time authorized. Each such writing shall set forth
the specific transaction or type of transaction involved. Oral instructions will
be considered Proper Instructions if the Custodian reasonably believes them to
have been given by a person authorized to give such instructions with respect to
the transaction involved; each Fund shall cause all oral instructions to be
confirmed in writing. Proper Instructions may include communications effected
directly between electro-mechanical or electronic devices
19.
provided that the applicable Fund and the Custodian agree to security procedures
including, but not limited to, the security procedures selected by such Fund via
the form of Funds Transfer Addendum hereto. For purposes of this Section, Proper
Instructions shall include instructions received by the Custodian pursuant to
any three-party agreement which requires a segregated asset account in
accordance with Section 2.9 hereof.
"Special Instructions," as such term is used throughout this Agreement, means
Proper Instructions countersigned or confirmed in writing by the Treasurer or
any Assistant Treasurer of the applicable Fund or any other person designated in
writing by the Treasurer of such Fund, which countersignature or confirmation
shall be (a) included on the same instrument containing the Proper Instructions
or on a separate instrument clearly relating thereto and (b) delivered by hand,
by facsimile transmission, or in such other manner as the Fund and the Custodian
agree in writing.
Concurrently with the execution of this Agreement, and from time to time
thereafter, as appropriate, each Fund shall deliver to the Custodian, duly
certified by such Fund's Treasurer or Assistant Treasurer, a certificate setting
forth: (i) the names, titles, signatures and scope of authority of all persons
authorized to give Proper Instructions or any other notice, request, direction,
instruction, certificate or instrument on behalf of the Fund and (ii) the names,
titles and signatures of those persons authorized to give Special Instructions.
Such certificate may be accepted and relied upon by the Custodian as conclusive
evidence of the facts set forth therein and shall be considered to be in full
force and effect until receipt by the Custodian of a similar certificate to the
contrary.
SECTION 8. EVIDENCE OF AUTHORITY
The Custodian shall be protected in acting upon any instructions, notice,
request, consent, certificate or other instrument or paper believed by it to be
genuine and to have been properly executed by or on behalf of the applicable
Fund. The Custodian may receive and accept a copy of a resolution certified by
the Secretary or an Assistant Secretary of any Fund as conclusive evidence (a)
of the authority of any person to act in accordance with such resolution or (b)
of any determination or of any action by the applicable Board as described in
such resolution, and such resolution may be considered as in full force and
effect until receipt by the Custodian of written notice to the contrary.
SECTION 9. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY
The Custodian may in its discretion, without express authority from the
applicable Fund on behalf of each applicable Portfolio:
1) Make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this
Agreement; provided that all such payments shall be accounted for to
the Fund on behalf of the Portfolio;
2) Surrender securities in temporary form for securities in definitive
form;
20.
3) Endorse for collection, in the name of the Portfolio, checks, drafts
and other negotiable instruments; and
4) In general, attend to all non-discretionary details in connection with
the sale, exchange, substitution, purchase, transfer and other
dealings with the securities and property of the Portfolio except as
otherwise directed by the applicable Board.
SECTION 10. DUTIES OF CUSTODIAN WITH RESPECT TO THE BOOKS OF ACCOUNT AND
CALCULATION OF NET ASSET VALUE AND NET INCOME
The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the applicable Board to keep the books of
account of each Portfolio and/or compute the net asset value per Share of the
outstanding Shares or, if directed in writing to do so by a Fund on behalf of a
Portfolio, shall itself keep such books of account and/or compute such net asset
value per Share. If so directed, the Custodian shall also calculate daily the
net income of the Portfolio as described in the Prospectus and shall advise the
Fund and the Transfer Agent daily of the total amounts of such net income and,
if instructed in writing by an officer of the Fund to do so, shall advise the
Transfer Agent periodically of the division of such net income among its various
components. Each Fund acknowledges and agrees that, with respect to investments
maintained with the Underlying Transfer Agent, the Underlying Transfer Agent is
the sole source of information on the number of shares of a fund held by it on
behalf of a Portfolio and that the Custodian has the right to rely on holdings
information furnished by the Underlying Transfer Agent to the Custodian in
performing its duties under this Agreement, including without limitation, the
duties set forth in this Section 10 and in Section 11 hereof; provided, however,
that the Custodian shall be obligated to reconcile information as to purchases
and sales of Underlying Shares contained in trade instructions and confirmations
received by the Custodian and to report promptly any discrepancies to the
Underlying Transfer Agent. The calculations of the net asset value per Share and
the daily income of each Portfolio shall be made at the time or times described
from time to time in the Prospectus. Each Fund acknowledges that, in keeping the
books of account of the Portfolio and/or making the calculations described
herein with respect to Portfolio property released and delivered pursuant to
Section 2.2(14), or purchased pursuant to Section 2.6(7) hereof, the Custodian
is authorized and instructed to rely upon information provided to it by the
Fund, the Fund's counterparty(ies), or the agents of either of them.
SECTION 11. RECORDS
The Custodian shall with respect to each Portfolio create and maintain all
records relating to its activities and obligations under this Agreement in such
manner as will meet the obligations of each Fund under the 1940 Act, with
particular attention to section 31 thereof and Rules 31a-1 and 31a-2 thereunder.
All such records shall be the property of the Fund and shall at all times during
the regular business hours of the Custodian be open for inspection by duly
authorized officers,
21.
employees or agents of such Fund and employees and agents of the SEC. The
Custodian shall, at a Fund's request, supply the Fund with a tabulation of
securities owned by each Portfolio and held by the Custodian and shall, when
requested to do so by the Fund and for such compensation as shall be agreed upon
between the Fund and the Custodian, include certificate numbers in such
tabulations. Each Fund acknowledges that, in creating and maintaining the
records as set forth herein with respect to Portfolio property released and
delivered pursuant to Section 2.2(14), or purchased pursuant to Section 2.6(7)
hereof, the Custodian is authorized and instructed to rely upon information
provided to it by the Fund, the Fund's counterparty(ies), or the agents of
either of them.
SECTION 12. OPINION OF FUND'S INDEPENDENT ACCOUNTANT
The Custodian shall take all reasonable action, as a Fund with respect to a
Portfolio may from time to time request, to obtain from year to year favorable
opinions from the Fund's independent accountants with respect to its activities
hereunder in connection with the preparation of the Fund's Form N-1A or Form
N-2, as applicable, and Form N-SAR or other annual reports to the SEC and with
respect to any other requirements thereof.
SECTION 13. REPORTS TO FUND BY INDEPENDENT PUBLIC ACCOUNTANTS
The Custodian shall provide the applicable Fund, on behalf of each of the
Portfolios at such times as such Fund may reasonably require, with reports by
independent public accountants on the accounting system, internal accounting
control and procedures for safeguarding securities, futures contracts and
options on futures contracts, including securities deposited and/or maintained
in a U.S. Securities System or a Foreign Securities System, relating to the
services provided by the Custodian under this Agreement; such reports, shall be
of sufficient scope and in sufficient detail, as may reasonably be required by
the Fund to provide reasonable assurance that any material inadequacies would be
disclosed by such examination, and, if there are no such inadequacies, the
reports shall so state.
SECTION 14. COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to reasonable compensation for its services and
expenses as Custodian, as agreed upon from time to time between each Fund on
behalf of each applicable Portfolio and the Custodian.
SECTION 15. RESPONSIBILITY OF CUSTODIAN
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 and shall be held harmless in acting upon any
22.
notice, request, consent, certificate or other instrument reasonably believed by
it to be genuine and to be signed by the proper party or parties, including any
futures commission merchant acting pursuant to the terms of a three-party
futures or options agreement. The Custodian shall be held to the exercise of
reasonable care in carrying out the provisions of this Agreement, but shall be
kept indemnified by and shall be without liability to any Fund for any action
taken or omitted by it in good faith without negligence, including, without
limitation, acting in accordance with any Proper Instruction. It shall be
entitled to rely on and may act upon advice of counsel (who may be counsel for
the Fund) on all matters, and shall be without liability for any action
reasonably taken or omitted pursuant to such advice. The Custodian shall be
without liability to any Fund or Portfolio for any loss, liability, claim or
expense resulting from or caused by anything which is part of Country Risk (as
defined in Section 3 hereof), including without limitation nationalization,
expropriation, currency restrictions, or acts of war, revolution, riots or
terrorism.
Except as may arise from the Custodian's own negligence or willful misconduct or
the negligence or willful misconduct of a sub-custodian or agent, the Custodian
shall be without liability to any Fund for any loss, liability, claim or expense
resulting from or caused by; (i) events or circumstances beyond the reasonable
control of the Custodian or any sub-custodian or Securities System or any agent
or nominee of any of the foregoing, including, without limitation, the
interruption, suspension or restriction of trading on or the closure of any
securities market, power or other mechanical or technological failures or
interruptions, computer viruses or communications disruptions, work stoppages,
natural disasters, or other similar events or acts; (ii) errors by any Fund or
its duly authorized investment manager or investment advisor in their
instructions to the Custodian provided such instructions have been in accordance
with this Agreement; (iii) the insolvency of or acts or omissions by a
Securities System; (iv) any act or omission of a Special Sub-Custodian
including, without limitation, reliance on reports prepared by a Special
Sub-Custodian; (v) any delay or failure of any broker, agent or intermediary,
central bank or other commercially prevalent payment or clearing system to
deliver to the Custodian's sub-custodian or agent securities purchased or in the
remittance or payment made in connection with securities sold; (vi) any delay or
failure of any company, corporation, or other body in charge of registering or
transferring securities in the name of the Custodian, any Fund, the Custodian's
sub-custodians, nominees or agents or any consequential losses arising out of
such delay or failure to transfer such securities including non-receipt of
bonus, dividends and rights and other accretions or benefits; (vii) delays or
inability to perform its duties due to any disorder in market infrastructure
with respect to any particular security or Securities System; and (viii) any
provision of any present or future law or regulation or order of the United
States of America, or any state thereof, or any other country, or political
subdivision thereof or of any court of competent jurisdiction.
The Custodian shall be liable for the acts or omissions of a Foreign
Sub-Custodian (as such term is defined in Section 4 hereof) to the same extent
as set forth with respect to sub-custodians generally in this Agreement.
If a Fund on behalf of a Portfolio requires the Custodian to take any action
with respect to securities, which action involves the payment of money or which
action may, in the opinion of the Custodian, result in the Custodian or its
nominee assigned to the Fund or the Portfolio being liable for the
23.
payment of money or incurring liability of some other form, such Fund on behalf
of the Portfolio, as a prerequisite to requiring the Custodian to take such
action, shall provide indemnity to the Custodian in an amount and form
satisfactory to it.
If a Fund requires the Custodian, its affiliates, subsidiaries or agents, to
advance cash or securities for any purpose (including but not limited to
securities settlements, foreign exchange contracts and assumed settlement) or in
the event that the Custodian or its nominee shall incur or be assessed any
taxes, charges, expenses, assessments, claims or liabilities in connection with
the performance of this Agreement, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the applicable Portfolio shall
be security therefor and should the Fund fail to repay the Custodian promptly,
the Custodian shall be entitled to utilize available cash and to dispose of such
Portfolio's assets to the extent necessary to obtain reimbursement.
Except as may arise from the Custodian's own negligence or willful misconduct,
each Fund shall indemnify and hold the Custodian harmless from and against any
and all costs, expenses, losses, damages, charges, counsel fees, payments and
liabilities which may be asserted against the Custodian (a) acting in accordance
with any Proper Instruction or Special Instruction including, without
limitation, any Proper Instruction with respect to Free Trades including, but
not limited to, cost, expense, loss, damage, liability, tax, charge, assessment
or claim resulting from (i) the failure of the applicable Fund to receive income
with respect to purchased investments, (ii) the failure of the applicable to
recover amounts invested on maturity of purchased investments, (iii) the failure
of the Custodian to respond to or be aware of notices or other corporate
communications with respect to purchased investments, or (iv) the Custodian's
reliance upon information provided by the applicable Fund, such Fund's
counterparty(ies) or the agents of either of them with respect to Fund property
released, delivered or purchased pursuant to either of Section 2.2(14) or
Section 2.6(7) hereof; (b) for the acts or omissions of any Special
Sub-Custodian; or (c) for the acts or omissions of any Local Agent or Pledgee.
In no event shall the Custodian be liable for indirect, special or consequential
damages.
SECTION 16. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT
This Agreement shall become effective as of its execution, shall continue in
full force and effect until terminated as hereinafter provided, may be amended
at any time by mutual agreement of the parties hereto and may be 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 sixty (60) days
after the date of such delivery or mailing; provided, however, that no Fund
shall amend or terminate this Agreement in contravention of any applicable
federal or state regulations, or any provision of such Fund's Governing
Documents, and further provided, that any Fund on behalf of one or more of the
Portfolios may at any time by action of its Board (i) substitute another bank or
trust company for the Custodian by giving notice as described above to the
Custodian, or (ii) immediately terminate this Agreement in the event of the
appointment of a conservator or receiver for the Custodian by the
24.
Comptroller of the Currency or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.
Termination of this Agreement with respect to any one particular Fund or
Portfolio shall in no way affect the rights and duties under this Agreement with
respect to any other Fund or Portfolio.
Upon termination of the Agreement, the applicable Fund on behalf of each
applicable Portfolio shall pay to the Custodian such compensation as may be due
as of the date of such termination and shall likewise reimburse the Custodian
for its costs, expenses and disbursements.
SECTION 17. SUCCESSOR CUSTODIAN
If a successor custodian for one or more Portfolios shall be appointed by the
applicable Board, the Custodian shall, upon termination and receipt of Proper
Instructions, deliver to such successor custodian at the office of the
Custodian, duly endorsed and in the form for transfer, all securities of each
applicable Portfolio then held by it hereunder and shall transfer to an account
of the successor custodian all of the securities of each such Portfolio held in
a Securities System or at the Underlying Transfer Agent.
If no such successor custodian shall be appointed, the Custodian shall, in like
manner, upon receipt of Proper Instructions, deliver at the office of the
Custodian and transfer such securities, funds and other properties in accordance
with such resolution.
In the event that no Proper Instructions designating a successor custodian or
alternative arrangements shall have been delivered to the Custodian on or before
the date when such termination shall become effective, then the Custodian shall
have the right to deliver to a bank or trust company, which is a "bank" as
defined in the 1940 Act, doing business in Boston, Massachusetts or New York,
New York, of its own selection, having an aggregate capital, surplus, and
undivided profits, as shown by its last published report, of not less than
$25,000,000, all securities, funds and other properties held by the Custodian on
behalf of each applicable Portfolio and all instruments held by the Custodian
relative thereto and all other property held by it under this Agreement on
behalf of each applicable Portfolio, and to transfer to an account of such
successor custodian all of the securities of each such Portfolio held in any
Securities System or at the Underlying Transfer Agent. Thereafter, such bank or
trust company shall be the successor of the Custodian under this Agreement.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of any Fund to provide Proper Instructions as aforesaid, the Custodian
shall be entitled to fair compensation for its services during such period as
the Custodian retains possession of such securities, funds and other properties
and the provisions of this Agreement relating to the duties and obligations of
the Custodian shall remain in full force and effect.
25.
SECTION 18. GENERAL
SECTION 18.1 MASSACHUSETTS LAW TO APPLY. This Agreement shall be construed
and the provisions thereof interpreted under and in accordance with laws of The
Commonwealth of Massachusetts.
SECTION 18.2 PRIOR AGREEMENTS. This Agreement supersedes and terminates, as
of the date hereof, all prior Agreements between each Fund on behalf of each of
the Portfolios and the Custodian relating to the custody of such Fund's assets.
SECTION 18.3 ASSIGNMENT. This Agreement may not be assigned by (a) any Fund
without the written consent of the Custodian or (b) by the Custodian without the
written consent of each applicable Fund.
SECTION 18.4 INTERPRETIVE AND ADDITIONAL PROVISIONS. In connection with the
operation of this Agreement, the Custodian and each Fund on behalf of each of
the Portfolios, may from time to time agree on such provisions interpretive of
or in addition to the provisions of this Agreement as may in their joint opinion
be consistent with the general tenor of this Agreement. Any such interpretive or
additional provisions shall be in a writing signed by all parties and shall be
annexed hereto, provided that no such interpretive or additional provisions
shall contravene any applicable federal or state regulations or any provision of
a Fund's Governing Documents. No interpretive or additional provisions made as
provided in the preceding sentence shall be deemed to be an amendment of this
Agreement.
SECTION 18.5 ADDITIONAL FUNDS. In the event that any investment company in
addition to those listed on Appendix A hereto desires to have the Custodian
render services as custodian under the terms hereof, it shall so notify the
Custodian in writing, and if the Custodian agrees in writing to provide such
services, such investment company shall become a Fund hereunder and be bound by
all terms and conditions and provisions hereof including, without limitation,
the representations and warranties set forth in Section 18.7 below.
SECTION 18.6 ADDITIONAL PORTFOLIOS. In the event that any Fund establishes
one or more series of Shares in addition to those set forth on Appendix A hereto
with respect to which it desires to have the Custodian render services as
custodian under the terms hereof, it shall so notify the Custodian in writing,
and if the Custodian agrees in writing to provide such services, such series of
Shares shall become a Portfolio hereunder.
SECTION 18.7 THE PARTIES. All references herein to the "Fund" are to each
of the investment companies listed on Appendix A hereto, and each investment
company made subject to this Agreement in accordance with Section 18.5 above,
individually, as if this Agreement were between such individual Fund and the
Custodian. In the case of a series corporation, trust or other entity, all
references herein to the "Portfolio" are to the individual series or portfolio
of such corporation, trust or other entity, or to such corporation, trust or
other entity on behalf of the individual series or portfolio, as appropriate.
Any reference in this Agreement to "the parties" shall
26.
mean the Custodian and such other individual Fund as to which the matter
pertains. Each Fund hereby represents and warrants that (a) it is duly
incorporated or organized and is validly existing in good standing in its
jurisdiction of incorporation or organization; (b) it has the requisite power
and authority under applicable law and its Governing Documents to enter into and
perform this Agreement; (c) all requisite proceedings have been taken to
authorize it to enter into and perform this Agreement; (d) this Agreement
constitutes its legal, valid, binding and enforceable agreement; and (e) its
entrance into this Agreement shall not cause a material breach or be in material
conflict with any other agreement or obligation of the Fund or any law or
regulation applicable to it.
SECTION 18.8 REMOTE ACCESS SERVICES ADDENDUM. The Custodian and each Fund
agree to be bound by the terms of the Remote Access Services Addendum hereto.
SECTION 18.9 NOTICES. Any notice, instruction or other instrument required
to be given hereunder may be delivered in person to the offices of the parties
as set forth herein during normal business hours or delivered prepaid registered
mail or by telex, cable or telecopy to the parties at the following addresses or
such other addresses as may be notified by any party from time to time.
To any Fund: c/o COHEN & STEERS CAPITAL MANAGEMENT, INC.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxxx, Senior Vice President
Telephone: 000-000-0000
Telecopy: 000-000-0000
To the Custodian: STATE STREET BANK AND TRUST COMPANY
0000 Xxxxxxxx Xxxxx, XXX0
Xxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxxxxx, Vice President
Telephone: 000-000-0000
Telecopy: 000-000-0000
Such notice, instruction or other instrument shall be deemed to have been served
in the case of a registered letter at the expiration of five business days after
posting, in the case of cable twenty-four hours after dispatch and, in the case
of telex, immediately on dispatch and if delivered outside normal business hours
it shall be deemed to have been received at the next time after delivery when
normal business hours commence and in the case of cable, telex or telecopy on
the business day after the receipt thereof. Evidence that the notice was
properly addressed, stamped and put into the post shall be conclusive evidence
of posting.
SECTION 18.10 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original, and all such
counterparts taken together shall constitute one and the same Agreement.
27.
SECTION 18.11 REPRODUCTION OF DOCUMENTS. This Agreement and all schedules,
addenda, exhibits, appendices, attachments and amendments hereto may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties hereto all/each agree that
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 18.12 SHAREHOLDER COMMUNICATIONS ELECTION. SEC Rule 14b-2 requires
banks which hold securities for the account of customers to respond to requests
by issuers of securities for the names, addresses and holdings of beneficial
owners of securities of that issuer held by the bank unless the beneficial owner
has expressly objected to disclosure of this information. In order to comply
with the rule, the Custodian needs each Fund to indicate whether it authorizes
the Custodian to provide such Fund's name, address, and share position to
requesting companies whose securities the Fund owns. If a Fund tells the
Custodian "no," the Custodian will not provide this information to requesting
companies. If a Fund tells the Custodian "yes" or does not check either "yes" or
"no" below, the Custodian is required by the rule to treat the Fund as
consenting to disclosure of this information for all securities owned by the
Fund or any funds or accounts established by the Fund. For a Fund's protection,
the Rule prohibits the requesting company from using the Fund's name and address
for any purpose other than corporate communications. Please indicate below
whether the Fund consents or objects by checking one of the alternatives below.
YES [_] The Custodian is authorized to release the Fund's name, address, and
share positions.
NO [X] The Custodian is not authorized to release the Fund's name, address,
and share positions.
28.
SIGNATURE PAGE
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the date first above-written.
FUND SIGNATURE ATTESTED TO BY: EACH OF THE ENTITIES SET FORTH ON
APPENDIX A HERETO
By: By:
------------------------------------- ----------------------------------
Name: Name:
----------------------------------- --------------------------------
Title:
Title: *[Secretary/Ass't Secretary] -------------------------------
SIGNATURE ATTESTED TO BY: STATE STREET BANK AND TRUST COMPANY
By: By:
------------------------------------- ----------------------------------
Xxxxxxxxx X. Poster Xxxxxx X. Xxxxx
Vice President Vice Chairman and Chief
Operating Officer
29.
APPENDIX A
TO
MASTER CUSTODIAN AGREEMENT
INVESTMENT COMPANIES AND PORTFOLIOS, IF ANY
XXXXX & STEERS EQUITY INCOME FUND, INC.
XXXXX & STEERS INSTITUTIONAL REALTY SHARES, INC.
XXXXX & STEERS REALTY INCOME FUND, INC.
XXXXX & STEERS REALTY SHARES, INC.
XXXXX & STEERS SPECIAL EQUITY FUND, INC.
XXXXX & STEERS TOTAL RETURN REALTY FUND, INC.
SCHEDULE D
TO
MASTER CUSTODIAN AGREEMENT
SPECIAL SUB-CUSTODIANS
None
Xxxxx & Steers Utility Fund, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
______________, 0000
Xxxxx Xxxxxx Bank and Trust Company
0 Xxxxxx xx Xxxxxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxxxx X. Poster, Vice President and Counsel
Re: Xxxxx & Steers Utility Fund, Inc. (the "Fund")
Ladies and Gentlemen:
Please be advised that the undersigned Fund has been incorporated and registered
as a management investment company under the Investment Company Act of 1940, as
amended.
In accordance with Section 18.5, the Additional Funds provision, of the Master
Custodian Agreement, dated as of March 9, 2001 by and between each management
investment company party thereto and State Street Bank and Trust Company, the
undersigned Fund hereby requests that your bank act as Custodian for the Fund
under the terms of the aforementioned contract. In connection with such request,
the undersigned Fund hereby confirms to you, as of the date hereof, its
representations and warranties set forth in Section 18.7 of the aforementioned
contract.
Sincerely,
Xxxxx & Steers Utility
Fund, Inc.
By:
----------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chairman, Duly Authorized
Agreed and Accepted:
STATE STREET BANK AND TRUST COMPANY
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Effective Date: , 2004
----------------
