EXHIBIT 8
Custody Agreement
THIS AGREEMENT is effective October 4, 1994 and is between The Chase
Manhattan Bank, N.A. (the "Bank") and Convertible Holdings, Inc. (the
"Customer").
1. CUSTOMER ACCOUNTS
The Bank agrees to establish and maintain the following accounts
("Accounts"):
(a) A custody account in the name of the Customer ("Custody Account")
for any and all stocks, shares, bonds, debentures, notes, mortgages or other
obligations for the payment of money, bullion, coin and any certificates,
receipts, warrants or other instruments representing rights to receive,
purchase or subscribe for the same or evidencing or representing any other
rights or interests therein and other similar property whether certificated
or uncertificated as may be received by the Bank or its Subcustodian (as
defined in Section 3) for the account of the Customer ("Securities"); and
(b) A deposit account in the name of the Customer ("Deposit Account")
for any and all cash in any currency received by the Bank or its Subcustodian
for the account of the Customer, which cash shall not be subject to
withdrawal by draft or check.
The Customer warrants its authority to: 1) deposit the cash and
Securities ("Assets") received in the Accounts and 2) give instructions (as
defined in Section 11) concerning the Accounts. The Bank may deliver
securities of the same class in place of those deposited in the Custody
Account.
Upon written agreement between the Bank and the Customer, additional
Accounts may be established and separately accounted for as additional
Accounts under the terms of this Agreement.
2. MAINTENANCE OF SECURITIES AND CASH AT BANK AND SUBCUSTODIAN LOCATIONS
Unless instructions specifically require another location acceptable to
the Bank:
(a) Securities will be held in the country or other jurisdiction in
which the principal trading market for such Securities is located, where such
Securities are to be presented for payment or where such Securities are
acquired; and
(b) cash will be credited to an account in a country or other
jurisdiction in which such cash may be legally deposited or is the legal
currency for the payment of public or private debts.
Cash may held pursuant to instructions in either interest or non-
interest bearing accounts as may be available for the particular currency.
To the extent instructions are issued and the Bank can comply with such
instructions, the Bank is authorized to maintain cash balances on deposit for
the Customer with itself or one of its affiliates at such reasonable rates of
interest as may from time to time to be paid on such accounts, or in non-
interest bearing accounts as the Customer may direct, if acceptable to the
Bank.
If the Customer wishes to have any of its Assets held in the custody of
an institution other than the established Subcustodians or their securities
depositories, such arrangement must be authorized by a written agreement,
signed by the Bank and the Customer.
3. SUBCUSTODIANS AND SECURITIES DEPOSITORIES
The Bank may act under the Agreement through the subcustodians listed in
Schedule A of this Agreement with which the Bank has entered into
subcustodial agreements ("Subcustodians"). The Customer authorizes the Bank
to hold Assets in the Accounts in accounts which the Bank has established
with one or more of its branches or Subcustodians. The Bank and
Subcustodians are authorized to hold any of the Securities in their account
with any securities depository in which they participate.
The Bank reserves the right to add new, replace or remove Subcustodians.
The Customer will be given reasonable notice by the Bank of any amendment to
Schedule A. Upon request by the Customer, the Bank will identify the name,
address and principal place of business of any Subcustodian of the Customer's
Assets and the name and address of the governmental agency or other
regulatory authority that supervises or regulates such Subcustodian.
4. USE OF SUBCUSTODIAN
(a) The Bank will identify Assets on its books as belonging to the
Customer.
(b) A Subcustodian will hold Assets together with assets belonging to
other customers of the Bank in accounts identified on such Subcustodian's
books as special custody accounts for the exclusive benefit of customers of
the Bank.
(c) Any Assets in the Accounts held by a Subcustodian will be subject
only to the instructions of the Bank or its agent. Any Securities held in a
securities depository for the account of a Subcustodian will be subject only
to the instructions of such Subcustodian.
(d) Any agreement the Bank enters into with a Subcustodian for holding
its customer's assets shall provide that such assets will not be subject to
any right, charge, security interest, lien or claim or any kind or favor of
such Subcustodian except for safe custody or administration, and that the
beneficial ownership of such assets will be freely transferable without the
payment of money or value other than for safe custody or administration. The
foregoing shall not apply to the extent of any special agreement or
arrangement made by the Customer with any particular Subcustodian.
5. DEPOSIT ACCOUNT TRANSACTIONS
(a) The Bank or its Subcustodians will make payments from the Deposit
Account upon receipt of instructions which include information required by
the Bank.
(b) In the event that any payment to be made under this Section 5
exceeds the funds available in the Deposit Account, the Bank, in its
discretion, may advance the Customer such excess amount which shall be deemed
a on payable on demand, bearing interest at the rate customarily charged by
the Bank on similar loans.
(c) If the Bank credits the Deposit Account on a payable date, or at
any time prior to actual collection and reconciliation to the Deposit
Account, with interest, dividends, redemptions or any other amount due, the
Customer will promptly return any such amount upon oral or written
notification; (i) that such amount has not been received in the ordinary
course of business or (ii) that such amount was incorrectly credited. If the
Customer does not promptly return any amount upon such notification, the Bank
shall be entitled, upon oral or written notification to the Customer, to
reverse such credit by debiting the Deposit Account for the amount previously
credited. The Bank or its Subcustodian shall have no duty or obligation to
institute legal proceedings, file a claim or a proof of claim in any
insolvency proceeding or take any other action with respect to the collection
of such amount, but may act for the Customer upon instructions after
consultation with the Customer.
6. CUSTODY ACCOUNT TRANSACTIONS
(a) Securities will be transferred, exchanged or delivered by the Bank
or its Subcustodian upon receipt by the Bank of instructions which include
all information required by the Bank. Settlement and payment for Securities
received for, and delivery of Securities out of, the Custody Account may be
made in accordance with the customary or established securities trading or
securities processing practices and procedures in the jurisdiction or market
in which the transaction occurs,including, without limitation, delivery of
Securities to a purchaser, dealer or their agents against a receipt with the
expectation of receiving later payment and free delivery. Delivery of
Securities out of the Custody Account may also be made in any manner
specifically required by instructions acceptable to the Bank.
(b) The Bank, in its discretion, may credit or debit the Accounts on a
contractual settlement date with cash or Securities with respect to any sale,
exchange or purchase of Securities. Otherwise, such transactions will be
credited or debited to the Accounts on the date cash or Securities are
actually received by the Bank and reconciled to the Accounts.
(i) The Bank may reverse credits or debits made to the Accounts in
its discretion if the related transaction fails to settle within a
reasonable period, determined by the Bank in its discretion, after
the contractual settlement date for the related transaction.
(ii) If any Securities delivered pursuant to this Section 6 are
returned by the recipient thereof, the Bank may reverse the credits
and debits of the particular transaction at any time.
7. ACTIONS OF THE BANK
The Bank shall follow instructions received regarding Assets held in the
Accounts. However, until it receives instructions to the contrary, the Bank
will perform the following functions.
(a) Present for payment any Securities which are called, redeemed or
retired or otherwise become payable and all coupons and other income items
which call for payment upon presentation, to the extent that the Bank or
Subcustodian is actually aware of such opportunities.
(b) Execute in the name of the Customer such ownership and other
certificates as may be required to obtain payments in respect of Securities.
(c) Exchange interim receipt or temporary Securities for definitive
Securities.
(d) Appoint brokers and agents for any transaction involving the
Securities, including, without limitation, affiliates of the Bank or any
Subcustodian.
(e) Issue statements to the Customer, at times mutually agreed upon,
identifying the Assets in the Accounts.
The Bank will send the Customer an advice or notification of any
transfers of Assets to or from the Accounts. Such statements, advice or
notifications shall indicate the identity of the entity having custody of the
Assets. Unless the Customer send the Bank a written exception or objection
to any Bank statement within sixty days of receipt, the Customer shall be
deemed to have approved such statement. In such event, or where the Customer
has otherwise approved any such statement, the Bank shall, to the extent
permitted by law, be released, relieved and discharged with respect to all
matters set forth in such statement or reasonably implied therefrom as though
it had been settled by the decree of a court of competent jurisdiction in an
action where the Customer and all persons having or claiming an interest in
the Customer or the Customer's Accounts were parties.
All collections of funds or other property paid or distributed in
respect of Securities in the Custody Account shall be made the risk of the
Customer. The Bank shall have no liability for any loss occasioned by delay
in the actual receipt of notice by the Bank or by its Subcustodians of any
payment, redemption or other transaction regarding Securities in the Custody
Account in respect of which the Bank has agreed to take any action under this
Agreement.
8. CORPORATE ACTIONS; PROXIES
Whenever the Bank receives information concerning the Securities which
requires discretionary action by the beneficial owner of the Securities
(other than a proxy), such a subscription rights, bonus issues, stock
repurchase plans and right offerings, or legal notices or other material
intended to be transmitted to securities holders ("Corporate Actions"), the
Bank will give the Customer notice of such Corporate Actions to the extent
that the Bank's central corporate actions department has actual knowledge of
a Corporate Action in time to notify its customers.
When a rights entitlement or a fractional interest resulting from a
rights issue, stock dividend, stock split or similar Corporate Action is
received which bears an expiration date, the Bank will endeavor to obtain
instructions from the Customer or its Authorized Person, as defined in
Section 10, but if instruction are not received in time for the Bank to take
timely action, or actual notice of such Corporate Action was received too
late to seek instructions, the Bank is authorized to sell such rights
entitlement or fractional interest and to credit the Deposit Account with the
proceeds or take any other action it deems, in good faith, to be appropriate
in which case it shall be held harmless for any such action.
The Bank will deliver proxies to the Customer or its designated agent
pursuant to special arrangements which may have been agreed to in writing.
Such proxies shall be executed in the appropriate nominee name relating to
Securities in the Custody Account registered in the name of such nominee but
without indicating the manner in which such proxies are to be voted; and
where bearer Securities are involved, proxies will be delivered in accordance
with instructions.
9. NOMINEES
Securities which are ordinarily held in registered form may be
registered in a nominee name of the Bank, Subcustodian or securities
depository, as the case may be. The Bank may, without notice to the
Customer, cause any such Securities to cease to be registered in the name of
any such nominee and to be registered in the name of the Customer. In the
event that any Securities registered in a nominee name are called for partial
redemption by the issuer, the Bank may allot the called portion to the
respective beneficial holders of such class of security in any manner the
Bank deems to be fair and equitable. The Customer agrees to hold the Bank,
Subcustodians, and their respective nominees harmless from any liability
arising directly or indirectly from their status as a mere record holder of
Securities in the Custody Account.
10. AUTHORIZED PERSONS
As used in this Agreement, the term "Authorized Person" means employees
or agents including investment managers as have been designated by written
notice from the Customer or its designated agent to act on behalf of the
Customer under this Agreement. Such persons shall continue to be Authorized
Persons until such time as the Bank receives instructions from the Customer
or its designated agent that any such employee or agent is no longer an
Authorized Person.
11. INSTRUCTIONS
The term "Instructions" means instructions of any Authorized Person
received by the Bank, via telephone, telex, TWX, Facsimile transmission, bank
wire or other teleprocess or electronic instruction or trade information
system acceptable to the Bank which the Bank believes in good faith to have
been given by Authorized Persons or which are transmitted with proper testing
or authentication pursuant to terms and conditions which the Bank may
specify. Unless otherwise expressly provided, all instructions shall
continue in full force and effect until cancelled or superseded.
Any Instructions delivered to the Bank by telephone shall promptly
thereafter be confirmed in writing by an Authorized Person (which
confirmation may bear the facsimile signature of such Person, but the
Customer will hold the Bank harmless for the failure of an Authorized Person
to such confirmation in writing, the failure of such confirmation to conform
to the telephone instructions received or the Bank's failure to produce such
confirmation at any subsequent time. Either Party may electronically record
any instructions given by telephone, and any other telephone discussions with
respect to the Custody Account. The Customer shall be responsible for
safeguarding any test keys, identification codes or other security devices
which the Bank shall make available to the Customer or its Authorized
Persons.
12. STANDARD OF CARE; LIABILITIES
(a) The Bank shall be responsible for the performance of only such
duties as are set forth in this Agreement or expressly contained in
instructions which are consistent with the provisions of this Agreement.
(i) The Bank will use reasonable care with respect to its obligations
under this Agreement and the safekeeping of Assets. The Bank shall
be liable to the Customer for any loss which shall occur as the
result of the failure of a Subcustodian to exercise reasonable care
with respect to the safekeeping of such Assets to the same extent
that the Bank would be liable to the Customer if the Bank were
holding such Assets in New York. In the vent of any loss to the
Customer by reason of the failure of the Bank or its Subcustodian
to utilize reasonable care, the Bank shall be liable to the
Customer only to the extent of the Customer's direct damages, to be
determined based on the market value of the property which is the
subject of the loss at the date of discovery of such loss and
without reference to any special conditions or circumstances.
(ii) The Bank will not be responsible for any act, omission, default or
for the solvency of any broker or agent which it or a Subcustodian
appoints unless such appointment was made negligently or in bad
faith.
(iii) The Bank will be indemnified by, and without liability to the
Customer for any action taken or omitted by the Bank whether
pursuant to Instructions or otherwise within the scope of this
Agreement if such act or omission was in good faith, without
negligence. In performing its obligations under this Agreement,
the Bank may rely on the genuineness of any document which it
believes in good faith to have been validly executed.
(iv) The Customer agrees to pay for and hold the Bank harmless from any
liability or loss resulting from the imposition or assessment of
any taxes or other governmental charges, and any related expenses
with respect to income from or Assets in the Accounts.
(v) The Bank shall be entitled to rely, and may act upon the advice of
counsel (who may be counsel for the Customer) on all matters, and
shall be without liability for any action reasonably taken or
omitted pursuant to such advice.
(vi) The bank need not maintain any insurance for the benefit of the
Customer.
(vii) Without limiting the foregoing, the Bank shall not be liable for
any loss which results from: 1) the general risk of investing, or
2) investing or holding Assets in a particular country including,
but not limited to, losses resulting from nationalization,
expropriation or other governmental actions; regulation of the
banking or securities industry; currency restrictions, devaluations
or fluctuations; and market conditions which prevent the orderly
execution of securities transactions or affect the value of Assets.
(viii) Neither party shall be liable to the other for any loss due to
forces beyond their control including, but not limited to strikes
or work stoppages, acts of war or terrorism, insurrection,
revolution, nuclear fusion, fission or radiation, or acts of God.
(b) Consistent with and without limiting the first paragraph of this
Section 12, it is specifically acknowledged that the Bank shall have not duty
or responsibility to:
(i) question instructions or make any suggestions to the Customer or an
Authorized Person regarding such Instructions;
(ii) supervise or make recommendations with respect to investments or
the retention of Securities;
(iii) advise the Customer or an Authorized Person regarding any default
in the payment of principal or income of any security other than as
provided in Section 5(c) of this Agreement;
(iv) evaluate or report to the Customer or an Authorized Person
regarding the financial condition of any broker, agent or other
party to which Securities are delivered or payments are made
pursuant to this Agreement; or
(v) review or reconcile trade confirmations received from brokers. The
Customer or its Authorized Persons issuing instructions shall bear
any responsibility to review such confirmations against
instructions issued to and statements issued by the Bank.
(c) The Customer authorizes the Bank to act under this Agreement
notwithstanding that the Bank or any of its divisions or affiliates may have
a material interest in a transaction, or circumstances are such that the Bank
may have a potential conflict of duty or interest including the fact that the
Bank or any of its affiliates may provide brokerage services to thereon
customers, act as financial advisor to the issuer of Securities, act as a
lender to the issuer of Securities, act as a lender to the issuer of
Securities, act in the same transaction as agent for more than one customer,
have a material interest in the issue of Securities, or earn profits from any
of the activities listed herein.
13. FEES AND EXPENSES
The Customer agrees to pay the Bank for its services under this
Agreement such amount as may be agreed upon in writing, together with the
Bank's reasonable out-of-pocket or incidental expenses, including, but not
limited to legal fees. The Bank shall have a lien on and is authorized to
charge any Accounts of the Customer for any amount owing to the Bank under
any provision of this Agreement.
14. MISCELLANEOUS
(a) Foreign Exchange Transactions. To facilitate the administration of
the Customer's trading and investment activity, the Bank is authorized to
enter into spot or forward foreign exchange contracts with the Customer or an
Authorized Person for the Customer and may also provide foreign exchange
through its subsidiaries, affiliates or Subcustodians, instructions,
including standing instructions, may be issued with respect to such contracts
but the Bank may establish rules or limitations concerning any foreign
exchange facility made available. In all cases where the Bank, its
subsidiaries, affiliates or Subcustodians enter into a foreign exchange
contract related to Accounts, the terms and conditions of the then current
foreign exchange contract of the Bank, its subsidiary, affiliate or
Subcustodian and, to the extent not inconsistent, this Agreement, shall apply
to such transaction.
(b) Certification of Residency, etc. The Customer certifies that it is
a resident of the United States and agrees to notify the Bank of any changes
in residency. The Bank may rely upon this certification or the certification
of such other facts as may be required to administer the Bank's obligations
under this Agreement. The Customer will indemnify the Bank against all
losses, liability, claims or demands arising directly or indirectly from any
such certifications.
(c) Access to Records. The Bank shall allow the Customer's independent
public accountants reasonable access to the records of the Bank relating to
the Assets as is required in connection with their examination of books and
records pertaining to the Customer's affairs. Subject to restrictions under
applicable law, the Bank shall also obtain an undertaking to permit the
Customer's affairs. Subject to restrictions under applicable law, the Bank
shall also obtain an undertaking to permit the Customer's independent public
accounts reasonable access to the records of any Subcustodian which has
physical possession of any assets as xxx be required in connection with the
examination of the Customer's books and records.
(d) Governing Law; Successors and Assigns. This Agreement shall be
governed by the laws of the State of New York and shall not be assignable by
either party, but shall bind the successors in interest of the Customer and
the Bank.
(e) Entire Agreement; Applicable Riders. Customer represents that the
Assets deposited in the Accounts are (check one):
employee benefit plan or other assets subject to the
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Employee Retirement Income Security Act of 1974, as amended
("ERISA");
X mutual fund assets subject to Securities and Exchange
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("SEC") rules and regulations;
neither of the above.
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This Agreement consists exclusively of this document together with
Schedule A, and the following rider(s) (check applicable riders):
ERISA
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X MUTUAL FUND
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SPECIAL TERMS AND CONDITIONS
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There are not other provisions of this Agreement and this Agreement
supersedes any other agreements, whether written or oral, between the
parties. Any amendment to this Agreement must be in writing, executed by
both parties.
(f) Severability. In the event that one or more provisions of this
Agreement are held invalid, illegal or unenforceable in any respect on the
basis of any particular circumstances or in any jurisdiction, the validity,
legality and enforceability of any such provision and the remaining
provisions, under other circumstances or in other jurisdictions will not in
any way be affected or impaired.
(g) Waiver. Except as otherwise provided in this Agreement, no failure
or delay on the part of either part in exercising any power or right under
this Agreement operates as a waiver, nor does any single or partial exercise
of any power or right preclude any other or further exercise thereof, or the
exercise of any other power or right. No waiver by a party of any provision
of this Agreement, or waiver of any breach or default, is effective unless in
writing and signed by the party against whom the waiver is to be enforced.
(h) Notices. All notices under this Agreement shall be effective when
actually received. Any notices or other communications which may be required
under this Agreement are to be sent to the parties at the following addresses
or such other addresses as may subsequently be given to the other party in
writing:
Bank: The Chase Manhattan Bank, N.A.
0 XxxxxXxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Global Securities Services
Customer: Xxxxxxx Xxxxx Asset Management
000 Xxxxxxxx Xxxx Xxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attn: Treasurer
(i) Termination. This Agreement may be terminated by the Customer or
the Bank by giving sixty days written notice to the other provided, that such
notice to the Bank shall specify the names of the persons to whom the Bank
shall deliver the Assets in the Accounts. If notice of termination is given
by the Bank, the Customer shall, within sixty days following receipt of the
notice, deliver to the Bank instructions specifying the names of the persons
to whom the Bank shall deliver the Assets. In either case the Bank will
deliver the Assets to the persons so specified, after deducting any amounts
which the Bank determines in good faith to be owed to it under Section 13.
If within sixty days following receipt of a notice of termination by the
Bank, the Bank does not receive instructions from the Customer specifying the
names of the persons to whom the Bank shall deliver the Assets, the Bank, at
its election, may deliver the Assets to a bank or trust company doing
business in the State of New York to be held and disposed of pursuant to the
provisions of this Agreement, or to Authorized Persons, or may continue to
hold the Assets until Instructions are provided to the Bank.
CONVERTIBLE HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Treasurer
-----------------------
Title
CHASE MANHATTAN BANK, N.A.
By: /s/ Xxxxxx X. Xxxxxx
----------------------
Vice President
----------------------
Title
STATE OF )
: ss.
COUNTY OF )
This _____ day of _________, 19 __, before me personally came
________________ to me known, who being by me duly sworn, did depose and say
that he/she resides in __________________________________; that he/she is
_________________________ of ___________________________________
("Customer"), the Customer which executed the foregoing Agreement; that
he/she knows the seal of the Customer; that the seal affixed to the Agreement
is such seal; that it was affixed by order of the Customer, and that he/she
signed his/her name thereto by like order.
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Sworn to before me this ___ day
of _______________, 19__.
---------------------------------------
Notary
STATE OF NEW YORK )
: ss.
COUNTY OF NEW YORK)
On this 4th day of October, 1994, before me personally came Xxxxxx
Xxxxxx, to me known, who being by me duly sworn, did depose and say that he
resides in Redbank, New Jersey, at 00 Xxxxxxxx Xxxxxx, that he is a Vice
President of THE CHASE MANHATTAN BANK, N.A. ("Bank"), the Bank which executed
the foregoing Agreement; that he knows the seal of the Bank; that the seal
affixed to the Agreement is such corporate seal; that it was so affixed by
order of the Board of Directors of the Bank, and that he signed his name
thereto by like order.
/s/ Xxxxxx X. Xxxxxx
--------------------------------------
Sworn to before me this 4th day
of October, 1994.
/s/ Xxxxxx Xx
--------------------------------
Notary
(Notary Stamp)
Mutual Fund Rider to Global Custody Agreement
Between The Chase Manhattan Bank, N.A. and
Convertible Holdings, Inc.,
effective October 4, 1994
Customer represents that the Assets being placed in the Bank's
custody are subject to the Investment Company Act of 1940 (the "Act"), as the
same may be amended from time to time.
Except to the extent that the Bank has specifically agreed to
comply with a condition of a rule, regulation or interpretation promulgated
by or under the authority of the SEC or the Exemptive Order applicable to
accounts of this nature issued to the Bank (Investment Company Act of 1940,
Release No. 12053, November 20, 1981), as amended, or unless the Bank has
otherwise specifically agreed, the Customer shall be solely responsible to
assure that the maintenance of Assets under this Agreement complies with such
rules, regulations, interpretations or exemptive order promulgated by or
under the authority of the Securities Exchange Commission.
The following modifications are made to the Agreement:
SECTION 3. SUBCUSTODIANS AND SECURITIES DEPOSITORIES.
Add the following language to the end of Section 3:
The terms Subcustodian and securities depositories as used in this
Agreement shall mean a branch of a qualified U.S. bank, an eligible foreign
custodian or an eligible foreign securities depository, which are further
defined as follows:
(a) "qualified U.S. Bank" shall mean a qualified U.S. Bank as defined
in Rule 17f-5 under the Act;
(b) "eligible foreign custodian" shall mean (i) a banking institution
or trust company incorporated or organized under the laws of a country other
than the United States that is regulated as such by that country's government
or an agency thereof and that has shareholders' equity in excess of $200
million in U.S. currency (or a foreign currency equivalent thereof), (ii) a
majority owned direct or indirect subsidiary of a qualified U.S. bank or bank
holding company that is incorporated or organized under the laws of a country
other than the United States and that has shareholders' equity in excess of
$100 million in U.S. currency (or a foreign currency equivalent thereof),
(iii) a banking institution or trust company incorporated or organized under
the laws of a country other than the United States or a majority owned direct
or indirect subsidiary of a qualified U.S. bank or bank holding company that
is incorporated or organized under the laws of a country other than the United
States which has such other qualifications as shall be specified instructions
and approved by the Bank or (iv) any other entity that shall have been so
qualified by exemptive order, rule or other appropriate action of the SEC; and
(c) "eligible foreign securities depository" shall mean a securities
depository or clearing agency, incorporated or organized under the laws of a
country other than the United States, which operates (i) the central system
for handling securities or equivalent book-entries in that country or (ii) a
transnational system for the central handling of securities or equivalent
book-entries.
The Customer represents that its Board of Directors has approved each of
the Subcustodians listed in Schedule A to this Agreement and the terms of the
subcustody agreements between the Bank and each Subcustodian, and further
represents that is Board has determined that the use of each Subcustodian and
the terms of each subcustody agreement are consistent with the best interests
of the Customer's fund(s) and its(their) shareholders. The Bank will supply
the Customer with any amendment to Schedule A for approval. The Customer has
supplied or will supply the Bank with certified copies of its Board of
Directors resolution(s) with respect to the foregoing prior to placing Assets
with any Subcustodian so approved.
SECTION 11. INSTRUCTIONS.
Add the following language to the end of Section 11:
Account transactions made pursuant to Section 5 and 6 of this Agreement
may be made only for the purposes listed below. Instructions must specify
the purpose for which any transaction is to be made and the Customer shall be
solely responsible to assure that instructions are in accord with any
limitations or restrictions applicable to the Customer by law or as may be
set forth in its prospectus.
(a) In connection with the purchase or sale of Securities at prices as
confirmed by instructions.
(b) When Securities are called, redeemed or retired, or otherwise
become payable.
(c) In exchange for or upon conversion into other securities alone or
other securities and cash pursuant to any plan or merger, consolidation,
reorganization, recapitalization or readjustment.
(d) Upon conversion of Securities pursuant to their terms into other
securities.
(e) Upon exercise of subscription, purchase or other similar rights
represented by Securities.
(f) For the payment of interest, taxes, management or supervisory fees,
distributions or operating expenses.
(g) In connection with any borrowings by the Customer requiring a
pledge of Securities, but only against receipt of amounts borrowed.
(h) In connection with any loans, but only against receipt of adequate
collateral as specified in Instructions which shall reflect any restrictions
applicable to the Customer.
(i) For the purpose of redeeming shares of the capital stock of the
Customer and the delivery to, or the crediting to the account of the Bank,
its Subcustodian or the Customer's transfer agent, such shares to be
purchased or redeemed.
(j) For the purpose of redeeming in kind shares of the Customer against
delivery of the shares to be redeemed to the Bank, its Subcustodian or the
Customer's transfer agent.
(k) For delivery in accordance with the provisions of any agreement
among the Customer, the Bank 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., 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
Customer.
(l) For release of Securities to designated brokers under covered call
options, provided, however, that such Securities shall be released only upon
payment to the Bank of monies for the premium due and a receipt for the
Securities which are to be held in escrow. Upon exercise of the option, or
at expiration, the Bank will receive the Securities previously deposited from
brokers. The Bank will act strictly in accordance with instructions in the
delivery of Securities to be held in escrow and will have no responsibility
or liability for any such Securities which are not returned promptly when due
other than to make proper request for such return.
(m) For spot or forward foreign exchange transactions to facilitate
security trading, receipt of income from Securities or related transactions.
(n) For other proper purposes as may be specified in instructions
issued by an officer of the Customer which shall include a statement of the
purpose for which the delivery or payment is to be made, the amount of the
payment or specific Securities to be delivered, the name of the person or
persons to whom delivery or payment is to be made, and a certification that
the purpose is a proper purpose under the instruments governing the Customer.
(o) Upon the termination of this Agreement as set forth in Section
14(i).
SECTION 12. STANDARD OF CARE; LIABILITIES.
Add the following subsection (d) to Section 12:
(d) The Bank hereby warrants to the Customer that in its opinion, after
due inquiry, the established procedures to be followed by each of its
branches, each branch of a qualified U.S. bank, each eligible foreign
custodian and each eligible foreign securities depository holding the
Customer's Securities pursuant to this Agreement afford protection for such
Securities at least equal to that afforded by the bank's established
procedures with respect to similar securities held by the Bank and its
securities depositories in New York.
SECTION 14. ACCESS TO RECORDS.
Add the following language to the end of Section 14(c):
Upon reasonable request from the Customer, the Bank shall furnish the
Customer such reports (or portions thereof) of the Bank's system of internal
accounting controls applicable to the Bank's duties under this Agreement.
The Bank shall endeavor to obtain and furnish the Customer with such similar
reports as it may reasonably request with respect to each Subcustodian and
Securities depository holding the Customer's assets.
