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EXHIBIT 8(E)
SUBCUSTODIAN AGREEMENT
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Agreement made as of this 21st day of March, 1984, among SECURITY
PACIFIC NATIONAL BANK, a corporation organized and existing under the laws of
the United States, having Its principal office and place of business at 000
Xxxxx Xxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx (hereinafter called the
"Subcustodian"), THE BANK OF NEW YORK, a New York corporation authorized to do a
banking business, having its principal office and place of business at 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (hereinafter called the "Custodian"), and
PACIFIC HORIZON FUNDS, INC., a corporation organized and existing under the laws
of the State of Maryland, having its principal office and place of business at
0000 Xxxxxxxx Xxxx. (Xxxxx 000), Xxx Xxxxxxx, Xxxxxxxxxx 00000 (hereinafter
called the "Fund").
W I T N E S S E T H:
that for and in consideration of the mutual promises hereinafter set forth the
Fund, the Custodian and the Subcustodian agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
1. "Authorized Person" shall be deemed to include the Treasurer, the
Controller or any other person, whether or not any such person is an Officer or
employee of the Fund, duly authorized by the Board of Directors of the Fund to
give Oral Instructions and Written Instructions on behalf of the Fund and listed
in the Certificate annexed hereto as Appendix A or such other Certificate as may
be received by the Subcustodian from time to time.
2. "Book-Entry System" shall mean the Federal Reserve/Treasury
book-entry system for United States and federal agency securities, its
successor or successors and its nominee or nominees.
3. "Call Option" shall mean an exchange traded option entitling
the holder, upon timely exercise and payment of the
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exercise price, as specified therein, to purchase from the writer thereof the
specified underlying Securities (excluding Financial Futures Contracts and Stock
Index Futures Contracts).
4. "Certificate" shall mean any notice, instruction, or other
instrument in writing, authorized or required by this Agreement to be given to
the Subcustodian which is actually received by the Subcustodian and signed on
behalf of the Fund by any two Officers of the Fund.
5. "Covered Call Option" shall mean an exchange traded option entitling
the holder, upon timely exercise and payment of the exercise price, as specified
therein, to purchase from the writer thereof the specified underlying Securities
(excluding Financial Futures Contracts and Stock Index Futures Contracts) which
are owned by the writer thereof and subject to appropriate restrictions.
6. "Clearing Member" shall mean a registered broker-dealer which
is a clearing member under the rules of O.C.C. and a member of a national
securities exchange qualified to act as a custodian for an Investment company,
or any broker-dealer reasonably believed by the Subcustodian to be such a
clearing member.
7. "Depository" shall mean The Depository Trust Company ("DTC"), a
clearing agency registered with the Securities and Exchange Commission, its
successor or successors and its nominee or nominees, provided the Subcustodian
has received a certified copy of a resolution of the Fund's Board of Directors
specifically approving deposits in DTC. The term "Depository" shall further mean
and include any other person authorized to act as a depository under the
Investment Company Act of 1940, its successor or successors and its nominee or
nominees, specifically identified in a certified copy of a resolution of the
Fund's Board of Directors specifically approving deposits therein by the
Subcustodian.
8. "Financial Futures Contract" shall mean the firm commitment
to buy or sell fixed income securities including U.S. Treasury Bills, U.S.
Treasury Notes, U.S. Treasury Bonds, Government National Mortgage Association
modified pass-through mortgage-backed securities and commercial paper, during a
specified month at an agreed up price.
9. "Futures Contract" shall mean a Financial Futures Contract
and/or a Stock Index Futures Contract.
10. "Margin Account" shall mean a segregated account in the name of a
broker, dealer, or futures commission merchant or in the name of the Fund for
the benefit of a broker, dealer, or futures commission merchant, as the case may
be, separate and distinct from the custody account, in which certain Securities
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and/or money of the Fund shall be deposited and withdrawn from time to time in
connection with the purchase or sale by the Fund of Futures Contracts.
Securities held in the Book-Entry System or the Depository shall be deemed to
have been deposited in, or withdrawn from, a Margin Account upon the
Subcustodian's effecting an appropriate entry in its books and records.
11. "Money Market Security" shall be deemed to include, without
limitation, certain Reverse Repurchase Agreements, debt obligations issued or
guaranteed as to interest and principal by the government of the United States
or agencies or instrumentalities thereof, any tax, bond or revenue anticipation
note issued by any state or municipal government or public authority, commercial
paper, certificates of deposit and bankers' acceptances, repurchase and reverse
repurchase agreements with respect to the same and bank time deposits, where the
purchase and sale of such securities normally requires settlement in federal
funds on the same day as such purchase or sale.
12. "O.C.C." shall mean the Options Clearing Corporation, a clearing
agency registered under Section 17A of the Securities Exchange Act of 1931, its
successor or successors and its nominee or nominees, provided the Subcustodian
has received a certified copy of a resolution of the Fund's Board of Directors
with respect to Clearing Member confirmations described in the last sentence of
paragraph 1 of Article III hereof.
13. "Officers" shall be deemed to include the President, any Vice
President, the Secretary, the Treasurer, the Controller, any Assistant
Secretary, any Assistant Treasurer or any other person or persons, whether or
not any such other person is an officer of the Fund, duly authorized by the
Board of Directors of the Fund to execute any Certificate, instruction, notice
or other instrument on behalf of the Fund and listed in the Certificate annexed
hereto as Appendix B or such other Certificate as may be received by the
Subcustodian from time to time.
14. "Option" shall mean a Call Option, Covered Call Option
and/or a Put Option.
15. "Put Option" shall mean an exchange traded option entitling the
holder, upon timely exercise and tender of the specified underlying Securities
(excluding Financial Futures Contracts and Stock Index Futures Contracts), to
sell such securities to the writer thereof for the exercise price.
16. "Oral Instructions" shall mean verbal instructions actually
received by the Subcustodian from an Authorized Person or from a person
reasonably believed by the Subcustodian to be an Authorized Person.
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17. "Reverse Repurchase Agreement" shall mean an agreement
pursuant to which the Fund sells Securities and agrees to repurchase such
Securities at a described or specified date and price.
18. "Security" shall be deemed to include, without limitation,
Money Market Securities, Call Options, Covered Call Options, Put Options,
Stock Index Futures Contracts, Financial Futures Contracts, Reverse Repurchase
Agreements, common stocks and other securities having characteristics similar to
common stocks, preferred stocks., debt obligations issued by state or municipal
governments and by public authorities, (including, without limitation, general
obligation bonds, revenue bonds and industrial bonds and industrial development
bonds), bonds, debentures, notes, mortgages or other obligations, and any
certificates, receipts, warrants or other instruments representing rights to
receive, purchase, sell or subscribe for the same, or evidencing or representing
any other rights or interest therein, or any property or assets.
19. "Senior Security Account" shall mean an account maintained and
specifically allocated to a Series under the terms of this Agreement as a
segregated account, by recordation or otherwise, within the Custody Account in
which certain Securities and/or other assets of the Fund specifically allocated
to such Series shall be deposited and withdrawn from time to time in accordance
with Certificates received by the Subcustodian in connection with such
transactions as the Fund may from time to time determine.
20. "Series" shall mean the various portfolios of the Fund as
described from time to time in the Fund's current and effective prospectus.
21. "Shares" shall mean shares of capital stock of the Fund, each
of which is allocated to a particular Series.
22. "Stock Index Futures Contract" shall mean a bilateral
agreement pursuant to which the parties agree to take or make delivery of an
amount of cash equal to a specified dollar amount times the difference between
the value of a particular stock index at the close of the last business day of
the contract and the price at which the futures contract is originally struck.
23. "Written Instructions" shall mean written communications
actually received by the Subcustodian from an Authorized Person or from a
person reasonably believed by the Subcustodian to be an Authorized Person by
telex or any other such system whereby the receiver of such communications is
able to verify by codes or otherwise with a reasonable degree of certainty the
authenticity of the sender of such communication.
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ARTICLE II
APPOINTMENT OF SUBCUSTODIAN
1. The Fund and the Custodian hereby constitute and appoint the
Subcustodian as custodian of such Securities and money owned by the Fund as may
from time to time be received by the Subcustodian in connection with sales of
Shares, delivered to the Subcustodian by the Custodian, received by the
Subcustodian in connection with the purchase or sale of Securities by the Fund,
or received by the Subcustodian with respect to Securities of the Fund held
hereunder by the Subcustodian.
2. The Subcustodian hereby accepts appointment as such
custodian and agrees to perform the duties thereof as hereinafter
set forth.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
1. Except as otherwise provided in paragraph 7 of this Article,
the Fund will deliver or cause to be delivered to the Subcustodian all
Securities and all moneys owned by it, other than moneys or Securities held by
the Custodian any sub-custodian or co-custodian appointed in accordance with
this Agreement, at any time during the period of this Agreement, and shall
specify with respect to Securities and money delivered to the Subcustodian the
Series to which the same are specifically allocated. The Subcustodian shall
segregate, keep and maintain the assets of the Series separate and apart. The
Subcustodian will not be responsible for any Securities and moneys not actually
received by it. The Subcustodian will be entitled to reverse any credits made on
the Fund's behalf where such credits have been previously made and moneys are
not finally collected. The Fund shall deliver to the Subcustodian a certified
resolution of the Board of Directors of the Fund approving, authorizing and
instructing the Subcustodian on a continuous and on-going basis to deposit in
the Book-Entry System all Securities eligible for deposit therein, regardless of
the Series to which the same are specifically allocated, and to utilize the
Book-Entry System to the extent possible in connection with its performance
hereunder, including, without limitation, in connection with settlements of
purchases and sales of Securities, loans of Securities, and deliveries and
returns of Securities collateral, regardless of the Series to which the same are
specifically allocated. Prior to a deposit of Securities specifically allocated
to a Series in the Depository the Fund shall deliver to the Subcustodian a
certified resolution of the Board of Directors of
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the Fund approving, authorizing and instructing the Subcustodian on a continuous
and on-going basis until instructed to the contrary by a Certificate actually
received by the Subcustodian to deposit in the Depository all Securities
specifically allocated to such Series and eligible for deposit therein and to
utilize the Depository to the extent possible with respect to such Securities in
connection with its performance hereunder, including, without limitation, in
connection with settlements of purchases and sales of Securities, loans of
Securities, and deliveries and returns of Securities collateral. Securities and
moneys specifically allocated to a Series deposited in either the Book-Entry
System or the Depository will be represented in accounts which include only
assets held by the Subcustodian for customers, including, but not limited to,
accounts in which the Subcustodian acts in a fiduciary or representative
capacity and shall be specifically allocated on the Subcustodian's books to the
separate account for such Series. Prior to the Subcustodian's accepting,
utilizing, and acting with respect to Clearing Member confirmations for Options
and transactions in Options for a Series as provided in this Agreement, the
Subcustodian shall have received from the Fund a certified resolution of the
Board of Directors of the Fund approving, authorizing and instructing the
Subcustodian on a continuous and on-going basis, until instructed to the
contrary by a Certificate actually received by the Subcustodian, to accept,
utilize and act in accordance with such confirmations as provided in this
Agreement with respect to such Series.
2. The Subcustodian shall establish and maintain separate
accounts, in the name of each Series, and shall credit to the separate
account for each Series all moneys received by it for the account of the Fund
with respect to such Series. Money credited to a separate account for a Series
shall be disbursed by the Subcustodian only:
(a) In payment for Securities purchased for such
Series, as provided in Article IV hereof;
(b) In payment for Options purchased for such Series,
as provided in Article V hereof;
(c) In connection with Futures Contracts for such
Series, as provided in Article VI hereof;
(d) For deposit in a Margin Account with respect to
such Series, as provided in Article VI hereof;
(e) In connection with terminations of Reverse
Repurchase Agreements by such Series, as provided in Article VII
hereof;
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(f) In payment of dividends or distributions with
respect to Shares of such Series, as provided In Article VIII
hereof;
(g) In payment of original issue or other taxes with
respect to Shares of such Series, as provided in Article IX
hereof;
(h) In payment for Shares of such Series redeemed by
it, as provided in Article IX hereof;
(i) Pursuant to Certificates setting forth the name and
address of the person to whom the payment is to be made, the Series account from
which payment is to be made, and the purpose for which payment is to be made; or
(j) In payment of the fees and in reimbursement of the
expenses and liabilities of the Subcustodian attributable to such
Series, as provided in Article XII hereof.
3. Promptly after the close of business on each day the Subcustodian
shall furnish the Fund and the Custodian with confirmations and a summary, on a
per Series basis, of all transfers to or from the account of the Fund hereunder
during said day. Where Securities are transferred to the account of the Fund
hereunder for a Series, the Subcustodian shall also by book entry or otherwise
identify as belonging to such Series a quantity of Securities in a fungible bulk
of Securities registered in the name of the Subcustodian (or its nominee) or
shown on the Subcustodian's account on the books of the Book-Entry System or the
Depository or O.C.C. At least monthly and from time to time, the Subcustodian
shall furnish the Fund with a detailed statement on a per Series basis of the
Securities and moneys held by the Subcustodian for the Fund.
4. Except as otherwise provided in paragraph 7 of this Article, all
Securities held by the Subcustodian hereunder, which are issued or issuable only
in bearer form, except such Securities as are held in the Book-Entry System,
shall be held by the Subcustodian in that form; all other Securities held
hereunder may be registered in the name of the Fund, in the name of any duly
appointed registered nominee of the Subcustodian as the Subcustodian may from
time to time determine, or in the name of the Book-Entry System or the
Depository or their successor or successors, or their nominee or nominees. The
Fund agrees to furnish to the Subcustodian appropriate instruments to enable the
Subcustodian to hold or deliver in proper form for transfer, or to register in
the name of its registered nominee or in the name of the Book-Entry System or
the Depository any Securities which it may hold hereunder and which may from
time to time be registered in the name of the Fund. The Subcustodian shall hold
all such Securities which are specifically allocated to a Series
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not held in the Book-Entry System or in the Depository in a separate account in
the name of such Series physically segregated at all times from those of any
other person or persons.
5. Unless otherwise instructed to the contrary by a Certificate,
the Subcustodian by itself, or through the use of the Book-Entry System or the
Depository with respect to Securities held hereunder and therein deposited,
shall with respect to all Securities held by the Subcustodian hereunder:
(a) Collect all income due or payable;
(b) Present for payment and collect the amount payable
upon all Securities which may mature or be called redeemed, or retired, or
otherwise become payable;
(c) Surrender Securities in temporary form for
definitive Securities;
(d) Execute, as Subcustodian, any necessary declarations or
certificates of ownership under the Federal Income Tax Laws or the laws or
regulations of any other taxing authority now or hereafter in effect; and
(e) Hold directly, or through the Book-Entry System or the
Depository with respect to Securities therein deposited, for the account of a
Series all rights and similar securities issued with respect to any Securities
held by the Subcustodian for such Series hereunder.
6. Upon receipt of a Certificate and not otherwise, the
Subcustodian, directly or through the use of the Book-Entry System or the
Depository shall:
(a) Execute and deliver to such persons as may be designated
in such Certificate proxies, consents, authorizations, and any other instruments
whereby the authority of the Fund as owner of any Securities held by the
Subcustodian hereunder for the Series specified in such Certificate may be
exercised;
(b) Deliver any Securities held by the Subcustodian hereunder
for the Series specified in such Certificate in exchange for other Securities or
cash issued or paid in connection with the liquidation, reorganization,
refinancing, merger, consolidation or recapitalization of any corporation, or
the exercise of any conversion privilege and receive and hold hereunder
specifically allocated to such Series any cash or other Securities received in
exchange;
(c) Deliver any Securities held by the Subcustodian
hereunder for the Series specified in such Certificate to any protective
committee, reorganization committee or other person in
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connection with the reorganization, refinancing, merger, consolidation,
recapitalization or sale of assets of any corporation, and receive and hold
hereunder specifically allocated to such Series such certificates of deposit,
interim receipts or other instruments or documents as may be issued to it to
evidence such delivery; and
(d) Make such transfers or exchanges of the assets of the
Series specified in such Certificate and take such other steps as shall be
stated in such Certificate to be for the purpose of effectuating any duly
authorized plan of liquidation, reorganization, merger, consolidation or
recapitalization of the Fund.
7. Notwithstanding any provision elsewhere contained herein, the
Subcustodian shall not be required to obtain possession of any Futures Contract
or of any Option prior to its receipt of a Certificate stating with respect to
the type of Security specified therein that certificates for such Securities are
available. The Fund shall promptly deliver to the Subcustodian such a
Certificate with respect to each type of Futures Contract or Option for which
certificates are available no later than the date, if any, on which Certificates
become available. Prior to its receipt of such a Certificate, the Subcustodian
shall in connection with purchases and sales of Future Contracts, make payment
of amounts specified in Certificates received by the Custodian in connection
with such purchases and sales upon its receiving from a broker, dealer, or
futures commission merchant a statement or confirmation reasonably believed by
the Subcustodian to be in the form customarily used by brokers, dealers, or
future commission merchants with respect to such Futures Contracts confirming
that such Futures Contract is held by such broker, dealer or futures commission
merchant, in book-entry form or otherwise, in the name of the Subcustodian (or
any nominee of the Subcustodian) as custodian for the Fund. Prior to its receipt
of such a Certificate the Subcustodian shall accept, utilize, and act with
respect to Clearing Member confirmations, reasonably believed by the
Subcustodian to be in the form customarily used by Clearing Members, for Options
and transactions in Options for a Series as provided in this Agreement, provided
the Subcustodian has, received a certified resolution of the Board of Directors
of the Fund with respect to Clearing Member confirmations described in paragraph
1 of this Article which specifies such Series, and such resolution has not been
withdrawn by a Certificate. After the delivery to the Subcustodian of a
Certificate stating certificates are available for a specified type of Futures
Contract or Option, the provisions of this Agreement instructing the
Subcustodian to act upon receipt of a broker, dealer, or futures commission
merchant statement or confirmation shall cease to be of any further force and
effect with respect to transactions in the kind of Futures Contract or Options
specified
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in any such Certificate, except to the extent, if any, that such Certificate
otherwise provides.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
1. Promptly after each purchase of Securities by the Fund to be held by
the Subcustodian hereunder, other than a purchase of an Option or Futures
Contract, the Fund shall deliver to the Subcustodian and to the Custodian (I)
with respect to each purchase of Securities which are not Money Market
Securities, a Certificate, and (II) with respect to each purchase of Money
Market Securities, a Certificate, Oral Instructions or Written Instructions,
specifying with respect to each such purchase: (a) the Series to which the
purchased securities are to be specifically allocated, (b) the name of the
issuer and the title of the Securities, (c) the number of shares or the
principal amount purchased and accrued interest, if any, (d) the date of
purchase and settlement, (e) the purchase price per unit, (f) the total amount
payable upon such purchase, and (g) the name of the person from whom or the
broker through whom the purchase was made. The Subcustodian shall upon receipt
of Securities purchased by or for the Fund pay out of the moneys held for the
account of the Series to which such Securities are to be specifically allocated
the total amount payable to the person from whom or the broker through whom the
purchase was made, provided that the same conforms to the total amount payable
as set forth in such Certificate, Oral Instructions or Written Instructions.
2. Promptly after each sale by the Fund of Securities held by the
Subcustodian hereunder other than a sale of any Option, Futures Contract, or any
Reverse Repurchase Agreement, the Fund shall deliver to the Subcustodian and to
the Custodian (i) with respect to each sale of Securities which are not Money
Market Securities, a Certificate, and (ii) with respect to each sale of Money
Market Securities, a Certificate, Oral Instructions or Written Instructions,
specifying with respect to each such sale: (a) the Series to which such
Securities were specifically allocated, (b) the name of the issuer and the title
of the Security, (c) the number of shares or principal amount sold, and accrued
interest, if any, (d) the date of sale, (e) the sale price per unit, (f) the
total amount payable to the Fund upon such sale, and (g) the name of the broker
through whom or the person to whom the sale was made. The Subcustodian shall
deliver the Securities upon receipt of the total amount payable to the Fund upon
such sale, provided that the same conforms to the total amount payable as set
forth in such Certificate, Oral Instructions or Written Instructions.
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ARTICLE V
OPTIONS
1. Promptly after the purchase of any Option by the Fund, the Fund
shall deliver to the Subcustodian and to the Custodian a Certificate specifying
with respect to each Option purchased: (a) the Series to which the purchased
Option is to be specifically allocated; (b) the type of Option (put or call) (c)
the name of the issuer and the title and number of shares subject to such
Option; (d) the expiration date; (e) the exercise price; (f) the date of
purchase and settlement; (g) the premium to be paid by the Fund; and (h) the
name of the broker through whom such Option was purchased. The Subcustodian
shall pay, upon receipt of a Clearing Member's confirmation confirming the
purchase of the Option held by such Clearing Member for the account of the
Subcustodian (or any duly appointed and registered nominee of the Subcustodian)
as Subcustodian for the Fund, out of moneys held for the account of the Series
to which such Option is to be specifically allocated the premium payable to the
Clearing Member through whom the purchase was made, provided that the same
conforms to the total premium payable as set forth in such Certificate.
2. Promptly after the sale of any Option purchased by the Fund pursuant
to paragraph 1 hereof, the Fund shall deliver to the Subcustodian and to the
Custodian a Certificate specifying with respect to each such sale: (a) the
Series to which such Option was specifically allocated; (b) the type of Option
(put or call); (c) the name of the issuer and the title and number of shares
subject to such Option; (d) the date of sale; (e) the sale price; (f) the date
of settlement; (g) the total amount payable to the Fund upon such sale; and (h)
the name of the Clearing Member through whom the sale was made. The Subcustodian
shall consent to the delivery of the Option sold by the Clearing Member which
previously supplied the confirmation described in preceding paragraph 1 of this
Article with respect to such Option against payment to the Subcustodian of the
total amount payable to the Fund, provided that the same conforms to the total
amount payable as set forth in such Certificate.
3. Promptly after the exercise by the Fund of any Call Option purchased
by the Fund pursuant to paragraph 1 hereof, the Fund shall deliver to the
Subcustodian and to the Custodian a Certificate specifying with respect to such
Call Option: (a) the Series to which such Call Option was specifically
allocated; (b) the name of the issuer and the title and number of shares subject
to the Call Option; (c) the expiration date; (d) the date of exercise and
settlement; (e) the exercise price per share; (f) the total amount to be paid
the Fund upon such exercise; and (g) the name of the Clearing Member through
whom such Call Option was
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exercised. The Subcustodian shall, upon receipt of the Securities underlying the
Call Option which was exercised, (i) pay out of the moneys held for the account
of the Series to which such Call Option was specifically allocated the total
amount payable to the Clearing Member through whom the Call Option was
exercised, provided that the same conforms to the total amount payable as set
forth in such Certificate, and (ii) delete the exercised Call Option from the
statements delivered to the Fund pursuant to paragraph 3 of Article III herein.
4. Promptly after the exercise by the Fund of any Put Option purchased
by the Fund pursuant to paragraph 1 hereof, the Fund shall deliver to the
Subcustodian and to the Custodian a Certificate specifying with respect to such
Put Options: (a) the Series to which such Put Option was specifically allocated;
(b) the name of the issuer and the title and number of shares subject to the Put
Option; (c) the expiration date; (d) the date of exercise and settlement; (e)
the exercise price per share; (f) the total amount to be paid to the Fund upon
such exercise; and (g) the name of the Clearing Member through whom such Put
Option was exercised. The Subcustodian shall, upon receipt of the amount payable
upon the exercise of the Put Option (i) deliver or cause the Depository to
deliver, out of the account of the Series to which such Put Option was
allocated, the Securities which were subject to such Put Option, provided the
same conforms to the amount payable to the Fund as set forth in such
Certificate, and (ii) delete the exercised Put Option from the statements
delivered to the Fund pursuant to paragraph 3 of Article III herein.
5. Whenever the Fund writes a Covered Call Option with respect to
Securities held by the Subcustodian hereunder, the Fund shall promptly deliver
to the Subcustodian and to the Custodian a Certificate specifying with respect
to such Covered Call Option: (a) the Series for which such Covered Call Option
is written; (b) the name of the issuer and the title and number of shares for
which the Covered Call Option was written and which underlie the same; (c) the
expiration date; (d) the exercise price; (e) the premium to be received by the
Fund; (f) the date such Covered Call Option was written; and (g) the name of the
Clearing Member through whom the premium is to be received. The Subcustodian
shall deliver or cause to be delivered, in exchange for receipt of the premium
specified in the Certificate with respect to such Covered Call Option, such
receipts as are required in accordance with the customs prevailing among brokers
in Covered Call Options, and shall impose, or direct the Depository to impose,
upon the underlying Securities specified in the Certificate such restrictions as
may be required by such receipts. Notwithstanding the foregoing, the
Subcustodian has the right, upon prior written notification to the Fund, at any
time to refuse to issue any receipts for Securities, in the
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possession of the Subcustodian and not deposited with the Depository,
underlying a Covered Call Option.
6. Whenever a Covered Call Option written by the Fund and described in
the preceding paragraph of this Article is exercised, the Fund shall promptly
deliver to the Subcustodian and to the Custodian a Certificate Instructing the
Subcustodian to deliver, or to direct the Depository to deliver, the Securities
subject to such Covered Call Option and specifying: (a) the Series for which
such Covered Call Option was written; (b) the name of the issuer and the title
and number of shares subject to the Covered Call Option; (c) the Clearing Member
to whom the underlying Securities are to be delivered; and (d) the total amount
payable to the Fund upon such delivery. Upon the return and/or cancellation of
any receipts delivered pursuant to paragraph 3 of this Article, the Subcustodian
shall deliver, or cause the Depository to deliver, the underlying Securities as
specified in the Certificate for the amount to be received as set forth in such
Certificate.
7. Whenever the Fund purchases any Option identical to a previously
written Covered Call Option described in paragraph 5 of this Article in a
transaction expressly designated as a "Closing Purchase Transaction" in order to
liquidate its position as a writer of a Option, the Fund shall promptly deliver
to the Subcustodian and to the Custodian a Certificate specifying with respect
to the Option being purchased: (a) the Series for which such purchase is being
made; (b) that the transaction is a Closing Purchase Transaction; (c) the name
of the issuer and the title and number of shares subject to the Covered Call
Option; (d) the exercise price; (e) the premium to be paid by the Fund; (f) the
expiration date; (g) the date of such purchase; and (h) the name of the Clearing
Member to whom the premium is to be paid. Upon the Subcustodian's payment of the
premium and the return and/or cancellation of any receipt issued pursuant to
paragraph 5 of this Article with respect to the Covered Call Option being
liquidated through the Closing Purchase Transaction, the Subcustodian shall (A)
remove, or direct the Depository to remove, the previously imposed restrictions
on the Securities underlying the Covered Call Option, and (B) and delete such
Option from statements delivered to the Fund by the Subcustodian pursuant to
paragraph 3 of Article III herein.
8. Upon the expiration of any Option purchased by the Fund pursuant to
paragraph 1 of this Article or any Covered Call Option written by the Fund and
described in paragraph 5 of this Article, the Subcustodian shall (a) delete such
Option from the statements delivered to the Fund and to the Custodian pursuant
to paragraph 3 of Article III herein and, if such expired Option was a Covered
Call Option written by the Fund, (b) free, or instruct the Depository to free,
the Securities underlying such Covered
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Call Option from the restrictions imposed by receipts issued in connection
therewith.
ARTICLE VI
FUTURES CONTRACTS
1. Whenever the Fund shall enter into a Futures Contract to be held by
the Subcustodian hereunder, the Fund shall deliver to the Subcustodian and to
the Custodian a Certificate specifying with respect to such Futures Contract,
(or with respect to any number of identical Futures Contract(s)): (a) the Series
for which the contract is being entered; (b) the category of Futures Contract
(the name of the underlying stock index or financial instrument); (c) the number
of identical Futures Contracts entered into; (d) the delivery or settlement date
of the Futures Contract(s); (e) the date the Futures Contract(s) was (were)
entered into; (f) whether the Fund is buying (going long) or selling (going
short) on such Futures Contract(s); (g) the amount of cash and/or the amount and
kind of Securities, if any, to be deposited by the Subcustodian in a Margin
Account with respect to such Futures Contract and the name in which Margin
Account has been, or is to be, established; (h) the amount of cash and/or the
amount and kind of securities, if any, to be deposited in the Senior Security
Account for such Series; (i) the name of the broker, dealer, or futures
commission merchant through whom the Futures Contract was entered into; and (j)
the amount of fee or commission, if any, to be paid to the broker, dealer, or
futures commission merchant. The Subcustodian shall upon receipt of such
broker's, dealer's, or futures commission merchant statement confirming the
purchase (creation of a long position) or sale (creation of a short position) of
a Futures Contract(s) which is (are) held by such broker, dealer, or futures
commission merchant in the name of the Custodian (or of a duly appointed and
registered nominee of the Subcustodian) as custodian for the Fund, make payment
of the fee or commission, if any, specified in the Certificate and deposit in
such Margin Account and/or in the Senior Security Account for such Series the
amount of cash and/or the amount and kind of securities specified in said
Certificate.
2. The Fund shall, from time to time, make such additional deposits to,
or withdrawals from, a Margin Account and/or the Senior Security Account as
specified in a Certificate received by the Subcustodian. Such Certificate shall
specify the Series for which such deposit or withdrawal is to be made, and the
amount of cash and/or the amount and kind of Securities specifically allocated
to such Series to be deposited in, or withdrawn from, a specified Margin Account
for such Series or in the Senior Security Account for such Series. In the event
that the Fund fails to specify in a Certificate the Series, the name of the
issuer, the title and the number of shares or the principal
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amount of any particular Securities to be deposited by the Subcustodian in a
Margin Account or in a Senior Securities Account, the Subcustodian shall not be
under any obligation to make any such deposit and shall so notify the Fund.
3. The Subcustodian shall make deliveries or payments from a Margin
Account to the broker, dealer, or futures commission merchant in whose name, or
for whose benefit, the account was established only upon the receipt of either
(a) a Certificate specifying the broker, dealer, or futures commission merchant
to whom such payment or delivery is to be made, the amount of money and/or the
amount and kind of securities to be paid or delivered, and the date on which
such payment or delivery is to be made, or (b) a certification signed by an
officer or director of such broker, dealer, or futures commission merchant
stating that all conditions precedent to its right under its agreement with the
Fund to direct disposition of the assets held therein have been satisfied and
specifying the amount of money and/or the amount and kind of Securities to be
paid or delivered to such broker, dealer, or futures commission merchant and the
date of such payment. After receipt of such a Certificate or such a
certification, as the case may be, the Subcustodian shall make the payments
and/or deliveries to the broker, dealer, or futures commission merchant therein
specified.
4. Whenever a Futures Contract held by the Subcustodian hereunder is
retained by the Fund until delivery or settlement is made on such Futures
Contract, the Fund shall deliver to the Subcustodian and to the Custodian a
Certificate specifying: (a) the Futures Contract and the Series to which the
same relates; (b) with respect to a Stock Index Futures Contract, the total cash
settlement amount to be paid or received, and with respect to a Financial
Futures Contract, the Securities and/or amount of cash to be delivered or
received; (c) the broker, dealer, or futures commission merchant to or from whom
payment or delivery is to be made or received; and (d) the amount of cash and/or
Securities to be withdrawn from the related Margin Account and/or the Senior
Security Account. Upon the receipt of a broker's, dealer's, or futures
commission merchant's statement or confirmation reasonably believed by the
Subcustodian to be in the form customarily used by brokers, dealers, or futures
commission merchants confirming that the Futures Contract is being settled and
that the Funds position in such Futures Contract is thereby terminated, the
Subcustodian shall make the payment or delivery specified in the Certificate,
and delete such Futures Contract from the statements delivered to the Fund and
to the Custodian pursuant to paragraph 3 of Article III herein.
5. Whenever the Fund shall enter into a Futures Contract to
offset a Futures Contract held by the Subcustodian hereunder, the Fund shall
deliver to the Subcustodian and to the Custodian a Certificate specifying:
(a) the items of information required in
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a Certificate described in paragraph 1 of this Article, and (b) the Futures
Contract being offset. The Subcustodian shall, upon receipt of a broker's,
dealer's, or futures commission merchant's statement or confirmation reasonably
believed by the Subcustodian to be in the form customarily used by brokers,
dealers, or futures commission merchants confirming the offsetting transaction,
make payment of the fee or commission, if any, specified in the Certificate and
delete the Futures Contract being offset from the statements delivered to the
Fund and to the Custodian pursuant to paragraph 3 of Article III herein.
6. The Subcustodian shall accept cash and/or Securities tendered or
delivered by a broker, dealer, or futures commission merchant in connection with
any Futures Contract held by the Subcustodian hereunder when instructed to
accept such cash and/or Securities in a Certificate. Such Certificate shall
specify the Series to which such cash and/or Securities relate arid instruct the
Subcustodian where to deposit such cash and/or Securities.
7. Promptly after the close of business on each business day the
Subcustodian shall furnish the Fund and the Custodian with a statement with
respect to each Margin Account in which money or Securities are held specifying:
(a) the name of the Margin Account; (b) the amount and kind of Securities held
therein; and (c) the amount of money held therein. The Subcustodian shall make
available upon request to any broker, dealer, or futures commission merchant
specified in the name of a Margin Account a copy of the statement furnished the
Fund with respect to such Margin Account.
ARTICLE VII
REVERSE REPURCHASE AGREEMENTS
1. Promptly after the Fund enters a Reverse Repurchase Agreement with
respect to Securities and money held by the Subcustodian hereunder, the Fund
shall deliver to the Subcustodian and to the Custodian a Certificate or in the
event such Reverse Repurchase Agreement is a Money Market Security, a
Certificate or Oral Instructions specifying: (a) the Series for which the
Reverse Repurchase Agreement is entered; (b) the total amount payable to the
Fund in connection with such Reverse Repurchase Agreement and specifically
allocated to such Series; (c) the broker or dealer through or with whom the
Reverse Repurchase Agreement is entered; (d) the amount and kind of securities
specifically allocated to such Series to be delivered by the Fund to such broker
or dealer; (e) the date of such Reverse Repurchase Agreement; and (f) the amount
of cash and/or the amount and kind of Securities, if any, specifically allocated
to such Series to be deposited In a Senior Security Account for such Series in
connection with such Reverse Repurchase Agreement.
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The Subcustodian shall, upon receipt of the total amount payable to the Fund
specified in the Certificate or Oral Instructions, make the delivery to the
broker or dealer, and the deposits, if any, to the Senior Security Account,
specified in the Certificate.
2. The Subcustodian shall from time to time make such deposits to or
withdrawals from the Senior Securities Account with respect to a Reverse
Repurchase Agreement described in preceding paragraph 1 of this Article VII as
may be specified in a Certificate received by the Subcustodian. Such Certificate
shall specify the Series for which the deposit or withdrawal is to be made and
the amount of cash and/or Securities specifically allocated to such Series to be
deposited in, or withdrawn from, the Senior Security Account for such Series.
3. Upon the termination of a Reverse Repurchase Agreement described in
preceding paragraph 1 of this Article, the Fund shall promptly deliver a
Certificate or in the event such Reverse Repurchase Agreement is a Money Market
Security, a Certificate or Oral Instruction to the Subcustodian and to the
Custodian specifying: (a) the Reverse Repurchase Agreement being terminated and
the Series for which the same was entered; (b) the total amount payable by the
Fund in connection with such termination; (c) the amount and kind of Securities
to be received by the Fund and specifically allocated to such Series in
connection with such termination; (d) the date of termination; (e) the name of
the broker or dealer with or through whom the Reverse Repurchase Agreement is to
be terminated; and (f) the amount of cash and/or the amount and kind of
Securities to be withdrawn from the Senior Securities Account for such Series.
The Subcustodian shall, upon receipt of the amount and kind of Securities to be
received by the Fund specified in the Certificate, or Oral Instructions, make
the payment to the broker or dealer, and the withdrawals, if any, from the
Senior Security Account, specified in the Certificate.
ARTICLE VIII
PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
1. In the event the Subcustodian is to pay the amount of any dividend
or distribution to the Dividend Agent or any subdividend agent or co-dividend
agent, the Fund shall furnish to the Subcustodian a copy of the resolution of
the Board of Directors, certified by the Secretary or any Assistant Secretary,
either (i) setting forth with respect to the Series specified therein the date
of the declaration of a dividend or distribution, the date of payment thereof,
the record date as of which shareholders entitled to payment shall be
determined, the amount payable per Share of such Series to the shareholders of
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record as of that date and the total amount payable to the Dividend Agent and
any sub-dividend agent or co-dividend agent of the Fund on the payment date, or
(ii) authorizing with respect to the Series specified therein the declaration of
dividends and distributions on a daily basis and authorizing the Subcustodian to
rely on Oral Instructions, Written Instructions or a Certificate setting forth
the date of the declaration of such dividend or distribution, the date of
payment thereof, the record date as of which shareholders entitled to payment
shall be determined, the amount payable per Share of such Series to the
shareholders of record as of that date and the total amount payable to the
Dividend Agent on the payment date.
2. Upon the payment date specified in such resolution, Oral
Instructions, Written Instructions or Certificate, as the case may be, the
Subcustodian shall pay out of the moneys held for the account of each Series
the total amount payable to the Dividend Agent, and any sub-dividend agent or
co-dividend agent of the Fund with respect to such Series.
ARTICLE IX
SALE AND REDEMPTION OF SHARES
1. Whenever the Fund determines that the proceeds of any
sale of Shares are to be held by the Subcustodian, it shall
deliver to the Subcustodian a Certificate duly specifying:
(a) The Series, number of Shares sold, trade date, and
price; and
(b) The amount of money to be received by the Subcustodian for
the sale of such Shares and specifically allocated to the separate account in
the name of the Fund for such Series.
2. Upon receipt of such money from the Transfer Agent, the Subcustodian
shall credit such money to the separate account in the name of the Fund for the
Series for which such money was received.
3. Upon issuance of any Shares of any Series described in the foregoing
provisions of this Article, the Subcustodian shall pay, out of the money held
for the account of the Fund, all original issue or other taxes required to be
paid by the Fund in connection with such issuance upon the receipt of a
Certificate specifying the amount to be paid.
4. Except as provided hereinafter, whenever the Fund desires the
Subcustodian to make payment out of the money held by the Subcustodian
hereunder in connection with a redemption of any
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shares of any Series, it shall furnish to the Subcustodian a Certificate
specifying:
(a) The number and Series of Shares redeemed; and
(b) The amount to be paid for such Shares.
5. Upon receipt from the Transfer Agent of an advice setting forth the
Series and number of Shares received by the Transfer Agent for redemption and
that such shares are in good form for redemption, the Subcustodian shall make
payment to the Transfer Agent out of the moneys held in the separate account in
the name of the Series the total amount specified in the Certificate issued
pursuant to the foregoing paragraph 4 of this Article.
6. Notwithstanding the above provisions regarding the redemption of any
Shares, whenever any Shares are redeemed pursuant to any check redemption
privilege which may from time to time be offered by the Fund, the Subcustodian,
unless otherwise instructed by a Certificate, shall, upon receipt of an advice
from the Fund or its agent setting forth that the redemption is in good form for
redemption in accordance with the check redemption procedure, honor the check
presented as part of such check redemption privilege out of the money held in
the separate account in the name of the Series of the Shares being redeemed.
ARTICLE X
OVERDRAFTS OR INDEBTEDNESS
1. If the Subcustodian should In its sole discretion advance funds on
behalf of any Series which results in an overdraft because the moneys held by
the Subcustodian in the separate account for such Series shall be insufficient
to pay the total amount payable upon a purchase of Securities to be specifically
allocated to such Series, as set forth in a Certificate or Oral Instructions
issued pursuant to Articles V, VI, or VII or which results in an overdraft in
the separate account of such Series for some other reason, or if the Fund is for
any other reason indebted to the Subcustodian with respect to a Series (except a
borrowing for investment or for temporary or emergency purposes using Securities
as collateral pursuant to a separate agreement and subject to the provisions of
paragraph 2 of this Article X), such overdraft or indebtedness shall be deemed
to be an interest free loan made by the Subcustodian to the Fund for such Series
payable on demand. Any such overdraft or indebtedness shall be reduced by an
amount equal to the total or of all amounts due the Fund with respect to such
Series which have not been collected by the Subcustodian on behalf of the Fund
when due because of the failure of the Subcustodian to make
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timely demand or presentment for payment. In addition, the Fund hereby agrees
that the Subcustodian shall have a continuing lien and security interest in and
to any property specifically allocated to such Series at any time held by it for
the benefit of such Series or in which the Fund may have an interest which is
then in the Subcustodian's possession or control or in possession or control of
any third party acting in the Subcustodian's behalf. The Fund authorizes the
Subcustodian, in its sole discretion, at any time to charge any such overdraft
or indebtedness together with interest due thereon against any balance of
account standing to such Series' credit on the Subcustodian's books.
2. The Fund will cause to be delivered to the Subcustodian by any bank
(including, if the borrowing is pursuant to a separate agreement, the
Subcustodian) from which it borrows money for investment or for temporary or
emergency purposes using Securities held by the Subcustodian hereunder as
collateral for such borrowings, a notice or undertaking in the form currently
employed by any such bank setting forth the amount which such bank will loan to
the Fund against delivery of a stated amount of collateral. The Fund shall
promptly deliver to the Subcustodian a Certificate specifying with respect to
each such borrowing: (a) the Series to which such Borrowing relates (b) the name
of the bank, (c) the amount and terms of the borrowing, which may be set forth
by incorporating by reference an attached promissory note, duly endorsed by the
Fund, or other loan agreement, (d) the time and date, if known, on which the
loan is to be entered into, (e) the date on which the loan becomes due and
payable, (f) the total amount payable to the Fund on the borrowing date, (g) the
market value of Securities specifically allocated to such to be delivered as
collateral for such loan, including the name of the issuer, the title and the
number of shares or the principal amount of any particular Securities, and (h) a
statement specifying whether such loan is for investment purposes or for
temporary or emergency purposes and that such loan is in conformance with the
Investment Company Act of 1940 and the Fund's prospectus. The Subcustodian shall
deliver on the borrowing date specified in a Certificate the specified
collateral and the executed promissory note, if any, against delivery by the
lending bank of the total amount of the loan payable, provided that the same
conforms to the total amount payable as set forth in the Certificate. The
Subcustodian may, at the option of the lending bank, keep such collateral in its
possession, but such collateral shall be subject to all rights therein given the
lending bank by virtue of any promissory note or loan agreement. The
Subcustodian shall deliver such Securities as additional collateral as may be
specified in a Certificate to collateralize further any transaction described in
this paragraph. The Fund shall cause all Securities released from collateral
status to be returned directly to the Subcustodian, and the Subcustodian shall
receive from time to
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time such return of collateral as may be tendered to it. In the event that the
Fund fails to specify in a Certificate the Series, the name of the issuer, the
title and number of shares or the principal amount of any particular Securities
to be delivered as collateral by the Subcustodian, the Subcustodian shall not be
under any obligation to deliver any Securities.
ARTICLE XI
LOAN OF PORTFOLIO SECURITIES OF THE FUND
1. If the Fund is permitted by the terms of its Articles of
Incorporation and as disclosed in its most recent and currently effective
prospectus to lend its portfolio Securities specifically allocated to a Series,
within 24 hours after each loan of portfolio Securities held by the Subcustodian
hereunder the Fund shall deliver or cause to be delivered to the Subcustodian a
Certificate specifying with respect to each such loan: (a) the name of the
issuer and the title of the Securities, (b) the number of shares or the
principal amount loaned, (c) the date of loan and delivery, (d) the total amount
to be delivered to the Subcustodian against the loan of the Securities,
including the amount of cash collateral and the premium, if any, separately
identified, (e) the name of the broker, dealer, or financial institution to
which the loan was made, and (f) the Series to which the loaned Securities are
specifically allocated. The Subcustodian shall deliver the Securities thus
designated to the broker, dealer or financial institution to which the loan was
made upon receipt of the total amount designated as to be delivered against the
loan of Securities. The Subcustodian may accept payment in connection with a
delivery otherwise than through the Book-Entry System or Depository only in the
form of a certified or bank cashier's check payable to the order of the Fund or
the Subcustodian drawn on New York Clearing House funds and may deliver
Securities in accordance with the customs prevailing among dealers in
securities.
2. Promptly after each termination of the loan of Securities by the
Fund, the Fund shall deliver or cause to be delivered to the Subcustodian a
Certificate specifying with respect to each such loan termination and return of
securities: (a) the name of the issuer and the title of the Securities to be
returned, (b) the number of shares or the principal amount to be returned, (c)
the date of termination, (d) the total amount to be delivered by the
Subcustodian (including the cash collateral for such Securities minus any
offsetting credits as described in said Certificate), (e) the name of the
broker, dealer, or financial institution from which the Securities will be
returned, and (f) the name of the Series to which the loaned Securities are
specifically allocated. The Subcustodian shall receive all
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Securities returned from the broker, dealer, or financial institution to which
such Securities were loaned and upon receipt thereof shall pay, out of the
moneys held for the account of the Fund, the total amount payable upon such
return of Securities as set forth in the Certificate.
ARTICLE XII
CONCERNING THE CUSTODIAN AND THE SUBCUSTODIAN
1. Except as hereinafter provided, neither the Subcustodian, the
Custodian, nor their respective nominees shall be liable for any loss or damage,
including counsel fees, resulting from its action or omission to act or
otherwise, except for any loss or damage arising out of their own respective
negligence or willful misconduct. The Subcustodian and the Custodian may, with
respect to questions of law, apply for and obtain the advice and opinion of
counsel to the Fund, at the expense of the Fund, or of its own respective
counsel, at its own expense, and shall be fully protected with respect to
anything done or omitted by it in good faith in conformity with such advice or
opinion. The Subcustodian shall be liable to the Fund for any loss or damage
resulting from the use of the Book-Entry System or any Depository arising by
reason of any negligence, misfeasance or willful misconduct on the part of the
Subcustodian or any of its employees or agents.
The Fund agrees (a) that the Custodian shall not be liable to the Fund
for any loss or damage to the Fund, including counsel fees, resulting from the
Subcustodian's action or omission to act or otherwise, whether or not a
custodian, and (b) that the Custodian shall have no duty or obligation to
supervise the Subcustodian.
2. Without limiting the generality of the foregoing, the Subcustodian
shall be under no obligation to inquire into, and shall not be liable for:
(a) The validity of the issue of any Securities
purchased, or any Covered Call Option written, by or for the Fund, the legality
of the purchase thereof, or the propriety of the amount paid therefor;
(b) The legality of the issue or sale of any Shares,
or the sufficiency of the amount to be received therefor;
(c) The legality of the redemption of any Shares, or
the propriety of the amount to be paid therefor;
(d) The legality of the declaration or payment of any
dividend by the Fund;
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(e) The legality of any borrowing by the Fund using
Securities as collateral;
(f) The legality of any loan of portfolio Securities pursuant
to Article XI of this Agreement, nor shall the Subcustodian be under any duty or
obligation to see to it that any cash collateral delivered to it by a broker,
dealer, or financial institution or held by it at any time as a result of such
loan of portfolio Securities of the Fund is adequate collateral for the Fund
against any loss it might sustain as a result of such loan. The Subcustodian
specifically, but not by way of limitation, shall not be under any duty or
obligation periodically to check or notify the Fund that the amount of such cash
collateral held by it for the Fund is sufficient collateral for the Fund, but
such duty or obligation shall be the sole responsibility of the Fund. In
addition, the Subcustodian shall be under no duty or obligation to see that any
broker, dealer or financial institution to which portfolio Securities of the
Fund are lent pursuant to Article XI of this Agreement makes payment to it of
any dividends or interest which are payable to or for the account of the Fund
during the period of such loan or at the termination of such loan, provided,
however, that the Subcustodian shall promptly notify the Fund in the event that
such dividends or interest are not paid and received when due; or
(g) The sufficiency or value of any amounts of money and/or
Securities held in any Margin Account or Senior Security Account in connection
with transactions by the Fund.
3. The Subcustodian shall not be liable for, or considered to be the
Subcustodian of, any money, whether or not represented by any check, draft, or
other instrument for the payment of money, received by it on behalf of the Fund
until the Subcustodian actually receives and collects such money directly or by
the final crediting of the account representing the Fund's interest at the
Book-Entry System or the Depository.
4. The Subcustodian shall not be under any duty or obligation to take
action to effect collection of any amount due to the Fund from the Transfer
Agent of the Fund nor to take any action to effect payment or distribution by
the Transfer Agent of the Fund of any amount paid by the Subcustodian to the
Transfer Agent of the Fund in accordance with this Agreement.
5. The Subcustodian shall not be under any duty or obligation to take
action to effect collection of any amount, if the Securities upon which such
amount is payable are in default, or if payment is refused after due demand or
presentation, unless and until (i) it shall be directed to take such action by a
Certificate and (ii) it shall be assured to its satisfaction of reimbursement of
its costs and expenses in connection with any such action.
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6. The Subcustodian may appoint one or more banking institutions as
Depository or Depositories, as Sub-Subcustodian or Sub-custodians, or as
Co-Custodian or Co-Custodians including, but not limited to, banking
institutions located in foreign countries, of Securities and moneys at any time
owned by the Fund, upon such terms and conditions as may be approved in a
Certificate or contained in an agreement executed by the Subcustodian, the Fund
and the appointed institution.
7. The Subcustodian shall not be under any duty or obligation to
ascertain whether any Securities at any time delivered to or held by it for the
account of the Fund and specifically allocated to a Series are such as properly
may be held by the Fund and allocated to such Series under the provisions of its
Articles of Incorporation and its then current prospectus.
8. The Subcustodian shall be entitled to receive and the Fund agrees to
pay to the Subcustodian such reimbursements of the Subcustodian's direct and
indirect costs and expenses incurred in rendering services hereunder at such
times, and in accordance with such terms and conditions, as the Fund and the
Subcustodian may agree upon from time to time. The Agreement between the
Subcustodian and the Fund may provide that the Subcustodian may charge the
amount of such reimbursements with respect to a Series against any moneys
specifically allocated to such Series, and may further provide for the method of
such allocation.
9. The Subcustodian shall be entitled to rely upon any Certificate,
notice or other instrument in writing received by the Subcustodian and
reasonably believed by the Subcustodian to be a Certificate. The Subcustodian
shall be entitled to rely upon any Oral Instructions and any Written
Instructions actually received by the Subcustodian pursuant to Articles IV, VII
or VIII hereof. The Fund agrees to forward to the Subcustodian a Certificate or
facsimile thereof confirming such Oral Instructions or Written Instructions in
such manner so that such Certificate or facsimile thereof is received by the
Subcustodian, whether by hand delivery, telecopier or other similar device, or
otherwise, by the close of business of the same day that such Oral Instructions
or Written Instructions are given to the Subcustodian. The Fund agrees that the
fact that such confirming instructions are not received by the Subcustodian
shall in no way affect the validity of the transactions or enforceability of the
transactions hereby authorized by the Fund. The Fund agrees that the
Subcustodian shall incur no liability to the Fund in acting upon Oral
Instructions or Written Instructions given to the Subcustodian hereunder
concerning such transactions provided such instructions reasonably appear to
have been received from an Authorized Person.
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10. The Subcustodian shall be entitled to rely upon any instrument or
notice in writing received by the Subcustodian and reasonably believed by the
Subcustodian to be a certification described in paragraph 3 of Article VI
herein. Without limiting the generality of the foregoing, the Subcustodian shall
be under no duty to acquire into, and shall not be liable for, the accuracy of
any statements or representations contained in any such instrument or other
notice including, without limitation, any specification of any amount to be paid
to a broker, dealer, or futures commission merchant.
11. The Subcustodian shall treat confidentially and as proprietary
information of the Fund records and other information relative to the Fund and
prior, present or potential shareholders, and, except after prior notification
to, and approval in writing by, the Fund, which approval shall not be
unreasonably withheld, will not use such records and information for any purpose
other than performance of its responsibilities and duties hereunder.
Notwithstanding the foregoing, the Subcustodian shall have the right to disclose
such records and other information to any Federal or State authority with whom
the Fund or its shares of capital stock are registered, and the Subcustodian
shall further have the right to exhibit any such records and information to any
person whenever it receives an opinion from its counsel that there is a
reasonable likelihood that the Subcustodian will be held liable for the failure
to exhibit such records or information to such person, provided, however, that
in connection with any such disclosure the Subcustodian shall promptly notify
the Fund that such disclosure has been made or is to be made.
12. The books and records pertaining to the Fund which are in the
possession of the Subcustodian shall be the property of the Fund. Such books and
records shall be prepared and maintained as required by the Investment Company
Act of 1940, as amended, and other applicable securities laws and rules and
regulations. The Fund, or the Fund's authorized representatives, shall have
access to such books and records during the Subcustodian's normal business
hours. Upon the reasonable request of the Fund, copies of any such books and
records shall be provided by the Subcustodian to the Fund or the Fund's
authorized representative, and the Fund shall reimburse the Subcustodian its
expenses of providing such copies.
13. The Subcustodian shall provide the Fund with any report obtained by
the Subcustodian on the system of internal accounting control of the Book-Entry
System, the Depository, or O.C.C., and with such reports on its own systems of
internal accounting control as the Fund may reasonably request from time to
time.
14. The Fund agrees to fully indemnify and save harmless (a) the
Subcustodian from any and all liability, loss or damage
-25-
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whatsoever which may arise in connection with this Agreement, except for any
liability, loss, or damage arising out of its own bad faith, negligence, or
willful misconduct, and (b) the Custodian from any and all liability, loss or
damage whatsoever which may arise in connection with this Agreement, except for
any liability, loss or damage arising out of its own bad faith, negligence or
willful misconduct.
15. The Subcustodian agrees that, except to the extent indicated in
paragraph 8 of this Article, (a) it shall look solely to the Fund for payment of
all amounts to which the Subcustodian may from time to time be entitled
hereunder, including, without limitation, amounts to which it is entitled
pursuant to preceding paragraph 14 of this Article and (b) that the Custodian
shall not be liable to the Subcustodian for any liability, loss or damage
whatsoever resulting from or related to, this Agreement or the Subcustodian's
action or omission to act hereunder or otherwise.
16. Subject to the foregoing provisions of this Agreement, the
Subcustodian may deliver and receive Securities, and receipts with respect to
such Securities, and arrange for payments to be made and received by the
Subcustodian in accordance with the customs prevailing from time to time among
brokers or dealers in such Securities.
17. Neither the Subcustodian nor the Custodian shall have any duties or
responsibilities whatsoever except such duties and responsibilities as are
specifically set forth in this Agreement, and no covenant or obligation shall be
implied in this Agreement against the Subcustodian or the Custodian.
ARTICLE XIII
TERMINATION
Any one of the parties hereto may terminate this Agreement by giving to
the other two parties a notice in writing specifying the date of such
termination, which shall be not less than ninety (90) days after the date of
giving of such notice. In the event such notice is given by the Fund, it shall
be accompanied by a copy of a resolution of the Board of Directors of the Fund,
certified by the Secretary or any Assistant Secretary, electing to terminate
this Agreement. Upon the date set forth in any notice of termination, the
Subcustodian shall deliver to the Custodian all Securities and money held
hereunder by the Subcustodian.
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ARTICLE XIV
MISCELLANEOUS
1. Annexed hereto as Appendix A is a Certificate signed by two of the
present Officers of the Fund under its corporate seal, setting forth the names
and the signatures of the present Authorized Persons. The Fund agrees to furnish
to the Subcustodian a new Certificate in similar form in the event that any such
present Authorized Person ceases to be an Authorized Person or in the event that
other or additional Authorized Persons are elected or appointed. Until such new
Certificate shall be received, the Subcustodian shall be fully protected in
acting under the provisions of this Agreement upon Oral Instructions or
signatures of the present Authorized Persons as set forth in the last delivered
Certificate.
2. Annexed hereto as Appendix B is a Certificate signed by two of the
present Officers of the Fund under its corporate seal, setting forth the names
and the signatures of the present Officers of the Fund. The Fund agrees to
furnish to the Subcustodian a new Certificate in similar form in the event any
such present Officer ceases to be an Officer of the Fund, or in the event that
other or additional Officers are elected or appointed. Until such new
Certificate shall be received, the Subcustodian shall be fully protected in
acting under the provisions of this Agreement upon the signatures of the
Officers as set forth in the last delivered Certificate.
3. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to any party, shall be sufficiently given if
addressed to such party and mailed or delivered to it at its offices at the
address for such party first above written or at such other place as such party
may from time to time designate in writing.
4. This Agreement may not be amended or modified in any manner except
by a written agreement executed by all the parties with the same formality as
this Agreement and approved by a resolution of the Board of Directors of the
Fund.
5. This Agreement shall extend to and shall be binding upon the parties
hereto, and their respective successors and assigns; provided, however, that
this Agreement shall not be assignable by any party without the written consent
of the other parties hereto and authorized or approved by a resolution of the
Board of Directors of the Fund.
6. This Agreement shall be construed in accordance with the laws of
the State of New York.
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28
7. This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original, but such counterparts shall,
together, constitute only one instrument.
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29
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective corporate Officers, thereunto duly authorized and
their respective corporate seals to be hereunto affixed, as of the day and year
first above written.
Attest: SECURITY PACIFIC NATIONAL BANK
/S/ Xxxxxx Xxxxxxxxxx By: /S/ Xxxxx X. Xxxxxxx
--------------------- ---------------------
Xxxxxx Xxxxxxxxxx Xxxxx X. Xxxxxxxx
Senior Vice President Senior Vice President
Attest:
/S/ Xxxxxx Xxxxxxxxxx By: /S/ Xxxxxx X. Xxxxxxxx
--------------------- ------------------------
Xxxxxx Xxxxxxxxxx Xxxxxx X. Xxxxxxxx
Senior Vice President First Vice President
THE BANK OF NEW YORK
By: /S/ Xxxxxxx X. Grunston
------------------------
Xxxxxxx X. Grunston
Vice President
Attest:
/S/ Xxxxxxxx Xxxxx
------------------
Xxxxxxxx Xxxxx
Assistant Vice President
PACIFIC HORIZON FUNDS, INC.
By: /S/ Xxxxxx X. Xxxxxxx
----------------------
Xxxxxx X. Xxxxxxx
President
Attest:
/S/ W. Xxxxx XxXxxxxx, III
--------------------------
W. Xxxxx XxXxxxxx III
Secretary
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APPENDIX A
I, Xxxxxx X. Xxxxxxx, President and I, W. Xxxxx XxXxxxxx, III,
Secretary of PACIFIC HORIZON FUNDS, INC., a Maryland Corporation (the "Fund"),
do hereby certify that:
Any two of the following individuals have been duly authorized
by the Board of Directors of the Fund in conformity with the Fund's Articles of
Incorporation and By-Laws to direct The Bank of New York to issue bank checks on
behalf of the Fund, and the signatures set forth opposite their respective names
are their true and correct signatures.
NAME SIGNATURE
---- ---------
Xxxxxx X. Xxxxxxx /S/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxx X. Xxxxxx /S/ Xxxx X. Xxxxxx
--------------------------
W. Xxxxx XxXxxxxx, III /S/ W. Xxxxx XxXxxxxx, III
--------------------------
Xxxxxx X. Xxxxxx /S/ Xxxxxx X. Xxxxxx
--------------------------
Xxxxxxx Xxxxx /S/ Xxxxxxx Xxxxx
--------------------------
Xxxx Xxxxx /S/ Xxxx Xxxxx
--------------------------
Xxxxxxx Xxxxxx /S/ Xxxxxxx Xxxxxx
--------------------------
Any two of the following individuals have been duly authorized
by the Board of Directors of the Fund in conformity with the Fund's Articles of
Incorporation and By-Laws to give Oral Instructions and Written Instructions and
Certificates on behalf of the Fund to direct The Bank of New York or Security
Pacific National Bank to receive or deliver portfolio securities on behalf and
for the benefit of the Fund, and the signatures set forth opposite their
respective names are their true and correct signatures.
31
NAME SIGNATURE
---- ---------
Xxxxx Xxxxxxxx /S/ Xxxxx Xxxxxxxx
--------------------------
Xxxxxxx Xxxxxx /S/ Xxxxxxx Xxxxxx
--------------------------
Xxxxx Xxxxxxx /S/ Xxxxx Xxxxxxx
--------------------------
Xxxx XxxXxxxxxx /S/ Xxxx Xxxxxxxxxx
--------------------------
Xxxx Xxxxx /S/ Xxxx Xxxxx
--------------------------
Xxxxxxx Xxxxxx /S/ Xxxxxxx Xxxxxx
--------------------------
Xxxxxx Xxxxxxxx /S/ Xxxxxx Xxxxxxxx
--------------------------
Xxxxxxx Xxxxx /S/ Xxxxxxx Xxxxx
--------------------------
Xxxx Xxxxxx /S/ Xxxx Xxxxxx
--------------------------
The following individuals have been duly authorized by the
Board of Directors of the Fund in conformity with the Fund's Articles of
Incorporation and By-Laws to be authorized signatories in respect of the Fund's
Blue Sky Account at The Bank of New York, provided that checks drawn on such
account may not exceed $500, and the signatures set forth opposite their
respective names are their true and correct signatures:
NAME SIGNATURE
---- ---------
Xxxxxx X. Xxxxxxx /S/ Xxxxxx X. Xxxxxxx
--------------------------
W. Xxxxx XxXxxxxx, III /S/ W. Xxxxx XxXxxxxx, III
--------------------------
Xxxx X. Xxxxxx /S/ Xxxx X. Xxxxxx
--------------------------
Xxxxxxxxx Xxxxxxx /S/ Xxxxxxxxx Xxxxxxx
--------------------------
Xxxx Xxxxxx /S/ Xxxx Xxxxxx
--------------------------
Xxxxxx Xxxxxxx /S/ Xxxxxx Xxxxxxx
/S/ Xxxxxx X. Xxxxxxx
---------------------
Xxxxxx X. Xxxxxxx
President
/S/ W. Xxxxx XxXxxxxx, III
--------------------------
W. Xxxxx XxXxxxxx, III
Secretary
00
XXXXXXXX X
I, Xxxxxx X. Xxxxxxx, President and I, W. Xxxxx XxXxxxxx, III,
Secretary of PACIFIC HORIZON FUNDS, INC., a Maryland corporation (the "Fund"),
do hereby certify that:
The following individuals are Officers of the Fund as defined
in Article I hereof, subject to the limitations as to their authority provided
in Appendix A hereto, and the signatures set forth opposite their respective
names are their true and correct signatures:
NAME POSITION SIGNATURE
---- -------- ---------
Xxxxxx X. Xxxxxxx President and /S/ Xxxxxx X. Xxxxxxx
Treasurer ----------------------------
Xxxx X. Xxxxxx Controller /S/ Xxxx X. Xxxxxx
----------------------------
W. Xxxxx XxXxxxxx, III Secretary /S/ W. Xxxxx XxXxxxxx, III
----------------------------
Xxxxxx X. Xxxxxx Assistant /S/ Xxxxxx X. Xxxxxx
Secretary ----------------------------
Xxxxx Xxxxxxxx /S/ Xxxxx Xxxxxxxx
----------------------------
Xxxxxxx Xxxxxx /S/ Xxxxxxx Xxxxxx
----------------------------
Xxxxx Xxxxxxx /S/ Xxxxx Xxxxxxx
----------------------------
Xxxx XxxXxxxxxx /S/ Xxxx Xxxxxxxxxx
----------------------------
Xxxx Xxxxx /S/ Xxxx Xxxxx
----------------------------
Xxxxxxx Xxxxxx /S/ Xxxxxxx Xxxxxx
----------------------------
Xxxxxx Xxxxxxxx /S/ Xxxxxx Xxxxxxxx
----------------------------
Xxxxxxx Xxxxx /S/ Xxxxxxx Xxxxx
----------------------------
Xxxx Xxxxxx /S/ Xxxx Xxxxxx
----------------------------
Xxxxxxx Xxxxx /S/ Xxxxxxx Xxxxx
----------------------------
33
NAME POSITION SIGNATURE
---- -------- ---------
Xxxxxxxxx Xxxxxxx /S/ Xxxxxxxxx Xxxxxxx
---------------------
Xxxx Xxxxxx /S/ Xxxx Xxxxxx
---------------------
Xxxxxx Xxxxxxx /S/ Xxxxxx Xxxxxxx
---------------------
/S/ Xxxxxx X. Xxxxxxx
--------------------------
Xxxxxx X. Xxxxxxx
President
/S/ W. Xxxxx XxXxxxxx, III
--------------------------
W. Xxxxx XxXxxxxx, III
Secretary
