EXHIBIT (g)(1)
FORM OF
CUSTODIAN AGREEMENT
THIS AGREEMENT, dated as of June 28, 1999, between Mackenzie Solutions,
an open-end management investment company organized under the laws of the
Commonwealth of Massachusetts and registered with the Commission under the 1940
Act (the Fund), and XXXXX BROTHERS XXXXXXXX & CO., a limited partnership formed
under the laws of the State of New York (BBH&Co. or the Custodian),
W I T N E S S E T H:
WHEREAS, the Fund wishes to employ BBH&Co. to act as custodian for the Fund
and to provide related services, all as provided herein, and BBH&Co. is willing
to accept such employment, subject to the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the Fund and BBH&Co. hereby agree, as follows:
1. Appointment of Custodian. The Fund hereby appoints BBH&Co. as the Fund's
custodian, and BBH&Co. hereby accepts such appointment. All Investments of the
Fund delivered to the Custodian or its agents or Subcustodians shall be dealt
with as provided in this Agreement. With respect to uncertificated shares of the
series of the Ivy Fund, the holding of confirmation statements that identify the
shares as being recorded in the Custodian's name on behalf of the Fund will be
deemed custody for the purposes hereof. The duties of the Custodian with respect
to the Fund's Investments shall be only as set forth expressly in this
Agreement, which duties are generally comprised of safekeeping and various
administrative duties that will be performed in accordance with Instructions and
as reasonably required to effect Instructions.
2. Representations, Warranties and Covenants of the Fund. The Fund hereby
represents, warrants and covenants each of the following:
2.1. This Agreement has been, and at the time of delivery of each Instruction
such Instruction will have been, duly authorized, executed and delivered by the
Fund. This Agreement does not violate any Applicable Law or conflict with or
constitute a default under the Fund's prospectus or other organic document,
agreement, judgment, order or decree to which the Fund is a party or by which it
or its Investments is bound.
2.2. By providing an Instruction with respect to the first acquisition of an
Investment in a jurisdiction other than the United States of America, the Fund
shall be deemed to have confirmed to the Custodian that the Fund has (a)
assessed and accepted all material Country or Sovereign Risks (as defined in
Section 9.1) and accepted responsibility for their occurrence, (b) made all
determinations required to be made by the Fund under the 1940 Act, and (iii)
appropriately and adequately disclosed to its shareholders, other investors and
all persons who have rights in or to such Investments, all material investment
risks, including those relating to the custody and settlement infrastructure or
the servicing of securities in such jurisdiction.
2.3. The Fund shall safeguard and shall solely be responsible for the
safekeeping of any testkeys, identification codes, passwords, other security
devices or statements of account with which the Custodian provides it. In
furtherance and not limitation of the foregoing, in the event the Fund utilizes
any on-line service offered by the Custodian, each of the Fund and the Custodian
shall be fully responsible for the security of its connecting terminal, access
thereto and the proper and authorized use thereof and the initiation and
application of continuing effective safeguards in respect thereof. Additionally,
if the Fund uses any on-line or similar communications service made available by
the Custodian, the Fund shall be solely responsible for ensuring the security of
its access to the service and for the use of the service, and shall only attempt
to access the service and the Custodian's computer systems as directed by the
Custodian. If the Custodian provides any computer software to the Fund relating
to the services described in this Agreement, the Fund will only use the software
for the purposes for which the Custodian provided the software to the Fund, and
will abide by the license agreement accompanying the software and any other
security policies which the Custodian provides to the Fund.
3. Representation and Warranty of BBH&Co. BBH&Co. hereby represents and warrants
that this Agreement has been duly authorized, executed and delivered by BBH&Co.
and does not and will not violate any Applicable Law or conflict with or
constitute a default under BBH&Co.'s limited partnership agreement or any
agreement, instrument, judgment, order or decree to which BBH&Co. is a party or
by which it is bound.
4. Instructions. Unless otherwise explicitly indicated herein, the Custodian
shall perform its duties pursuant to Instructions. As used herein, the term
Instruction shall mean a directive initiated by the Fund, acting directly or
through its board of trustees, officers or other Authorized Persons, which
directive shall conform to the requirements of this Section 4.
4.1. Authorized Persons. For purposes hereof, an Authorized Person shall be a
person or entity authorized to give Instructions for or on behalf of the Fund by
written notices to the Custodian or otherwise in accordance with procedures
delivered to and acknowledged by the Custodian, including without limitation the
Fund's Investment Adviser or Foreign Custody Manager. The Custodian may treat
any Authorized Person as having full authority of the Fund to issue Instructions
hereunder unless the notice of authorization contains explicit limitations as to
said authority. The Custodian shall be entitled to rely upon the authority of
Authorized Persons until it receives appropriate written notice from the Fund to
the contrary.
4.2. Form of Instruction. Each Instruction shall be transmitted by such secured
or authenticated electro-mechanical means as the Custodian shall make available
to the Fund from time to time unless the Fund shall elect to transmit such
Instruction in accordance with Subsections 4.2.1 through 4.2.3 of this Section.
4.2.1. Fund Designated Secured-Transmission Method. Instructions may be
transmitted through a secured or tested electro-mechanical means identified by
the Fund or by an Authorized Person entitled to give Instructions and
acknowledged and accepted by the Custodian; it being understood that such
acknowledgment shall authorize the Custodian to receive and process such means
of delivery but shall not represent a judgment by the Custodian as to the
reasonableness or security of the method determined by the Authorized Person.
4.2.2. Written Instructions. Instructions may be transmitted in a writing that
bears the manual signature of an Authorized Person.
4.2.3. Other Forms of Instruction. Instructions may also be transmitted by
another means determined by the Fund or Authorized Persons and acknowledged and
accepted by the Custodian (subject to the same limits as to acknowledgements as
is contained in Subsection 4.2.1, above) including Instructions given orally or
by SWIFT, telex or telefax (whether tested or untested).
When an Instruction is given by means established under Subsections
4.2.1 through 4.2.3, it shall be the responsibility of the Custodian to use
reasonable care to adhere to any security or other procedures established in
writing between the Custodian and the Authorized Person with respect to such
means of Instruction, but such Authorized Person shall be solely responsible for
determining that the particular means chosen is reasonable under the
circumstances. Telephonic or other oral instructions given by facsimile
transmission may be given by any Authorized Person and will be considered proper
Instructions if the Custodian reasonably believes them to have been given by an
Authorized Person. Oral Instructions communicated as described in the preceding
sentence will be confirmed by tested telex or in writing in the manner set forth
above but the lack of such confirmation shall in no way affect any action taken
by the Custodian in reliance upon such oral Instruction communicated as
described above. With respect to telefax instructions, the parties agree and
acknowledge that receipt of legible instructions cannot be assured, that the
Custodian cannot verify that authorized signatures on telefax instructions are
original or properly affixed, and that the Custodian shall not be liable for
losses or expenses incurred through actions taken in reliance on inaccurately
stated, or unauthorized telefax instructions. The provisions of Section 4A of
the Uniform Commercial Code shall apply to Funds Transfers performed in
accordance with Instructions. In the event that a Funds Transfer Services
Agreement is executed between the Fund or an Authorized Person and the
Custodian, such an agreement shall comprise a designation of form of a means of
delivering Instructions for purposes of this Section 4.2.
4.3. Completeness and Contents of Instructions. The Authorized Person shall be
responsible for assuring the adequacy and accuracy of Instructions.
Particularly, upon any acquisition or disposition or other dealing in the Fund's
Investments and upon any delivery and transfer of any Investment or moneys, the
person initiating such Instruction shall give the Custodian an Instruction with
appropriate detail, including, without limitation:
4.3.1. The transaction date and the date and location of settlement;
4.3.2. The specification of the type of transaction;
4.3.3. A description of the Investments or moneys in question, including, as
appropriate, quantity, price per unit, amount of money to be received or
delivered and currency information. Where an Instruction is communicated by
electronic means, or otherwise where an Instruction contains an identifying
number such as a CUSIP, SEDOL or ISIN number, the Custodian shall be entitled to
rely on such number as controlling notwithstanding any inconsistency contained
in such Instruction, particularly with respect to Investment description;
4.3.4. The name of the broker or similar entity concerned with execution of the
transaction.
If the Custodian shall determine that an Instruction is either unclear
or incomplete, the Custodian shall give prompt notice of such determination to
the Fund, and the Fund shall thereupon amend or otherwise reform such
Instruction. In such event, the Custodian shall have no obligation to take any
action in response to the Instruction initially delivered until the redelivery
of an amended or reformed Instruction.
4.4. Timeliness of Instructions. In giving an Instruction, the Fund shall take
into consideration delays which may occur due to the involvement of a
Subcustodian or agent, differences in time zones, and other factors particular
to a given market, exchange or issuer. When the Custodian has established
specific timing requirements or deadlines with respect to particular classes of
Instruction, or when an Instruction is received by the Custodian at such a time
that it could not reasonably be expected to have acted on such instruction due
to time zone differences or other factors beyond its reasonable control, the
execution of any Instruction received by the Custodian after such deadline or at
such time (including any modification or revocation of a previous Instruction)
shall be at the risk of the Fund.
5. Safekeeping of Fund Assets. The Custodian shall hold Investments delivered to
it or Subcustodians for the Fund in accordance with the provisions of this
Section. The Custodian shall not be responsible for (a) the safekeeping of
Investments not delivered or that are not caused to be issued to it or its
Subcustodians, except that the holding of confirmation statements from Xxx
Xxxxxxxxx Service Corp. in accordance with Section 5.1.1 hereof that identify
uncertificated shares of the series of Ivy Fund as being recorded in the
Custodian's name on behalf of the Fund will be deemed custody for the purposes
hereof; or, (b) pre-existing faults or defects in Investments that are delivered
to the Custodian, or its Subcustodians. The Custodian is hereby authorized to
hold with itself or a Subcustodian, and to record in one or more accounts, all
Investments delivered to and accepted by the Custodian, any Subcustodian or
their respective agents pursuant to an Instruction or in consequence of any
corporate action. The Custodian shall hold Investments for the account of the
Fund and shall segregate Investments from assets belonging to the Custodian and
shall cause its Subcustodians to segregate Investments from assets belonging to
the Subcustodian in an account held for the Fund or in an account maintained by
the Subcustodian generally for non-proprietary assets of the Custodian. The Fund
shall receive periodic reports with respect to the safekeeping of the Fund's
assets, including, but not limited to, notification of any transfer to or from
the Fund's account or an account maintained by the Subcustodian generally for
the non-proprietary assets of the Custodian.
5.1. Use of Securities Depositories. The Custodian may deposit and maintain
Investments in any Securities Depository, either directly or through one or more
Subcustodians appointed by the Custodian. Investments held in a Securities
Depository shall be held (a) subject to the agreement, rules, statement of terms
and conditions or other document or conditions effective between the Securities
Depository and the Custodian or the Subcustodian, as the case may be, and (b) in
an account for the Fund or in bulk segregation in an account maintained for the
non-proprietary assets of the entity holding such Investments in the Depository.
The Fund shall receive periodic reports with respect to the safekeeping of the
Fund's assets including, but not limited to, notification of any transfer to or
from the Fund's account or an account maintained in bulk segregation for the
non-proprietary assets of the entity holding such Investments in the Depository.
If market practice or the rules and regulations of the Securities Depository
prevent the Custodian, the Subcustodian or any agent of either from holding its
client assets in such a separate account, the Custodian, the Subcustodian or
other agent shall, as appropriate, segregate such Investments for benefit of the
Fund or for benefit of clients of the Custodian generally on its own books.
5.1.1. Deposit of Fund Assets with Xxx Xxxxxxxxx Service Corp.
The Custodian may keep securities of the Fund with Xxx Xxxxxxxxx
Service Corp. provided that such securities are maintained in an account on the
books and records of Xxx Xxxxxxxxx Service Corp. in the name of the Custodian,
on behalf of the Fund, and provided further that such account shall be
maintained separately from the account of any other customer of Xxx Xxxxxxxxx
Service Corp.
The Custodian shall (i) pay for securities purchased for the account of
the Fund upon receipt of advice from Xxx Xxxxxxxxx Service Corp. that such
securities have been transferred to the account of the Custodian, on behalf of
the Fund, on the books and records of Xxx Xxxxxxxxx Service Corp., and (ii)
shall credit the account of the Custodian, on behalf of the Fund, for the
redemption of shares upon receipt of an advice from Xxx Xxxxxxxxx Service Corp.
that securities have been redeemed. Copies of all advices from Xxx Xxxxxxxxx
Service Corp. of purchases and sales of securities for the account of the Fund
shall identify the Fund, be maintained for the Fund by the Custodian and be
provided to the Fund at its request.
5.2. Certificated Assets. Investments which are certificated may be held in
registered or bearer form: (a) in the Custodian's vault; (b) in the vault of a
Subcustodian or agent of the Custodian or a Subcustodian; or (c) in an account
maintained by the Custodian, Subcustodian or agent at a Securities Depository;
all in accordance with customary market practice in the jurisdiction in which
such certificated Investments are held.
5.3. Registered Assets. Investments which are registered may be registered in
the name of the Custodian, a Subcustodian, or in the name of the Fund or a
nominee for any of the foregoing, and may be held in any manner set forth in
paragraph 5.2 above with or without any identification of fiduciary capacity in
such registration.
5.4. Book Entry Assets. Investments which are represented by book-entry may be
so held in an account maintained by the Book-Entry Agent on behalf of the
Custodian, a Subcustodian or another agent of the Custodian, or a Securities
Depository.
5.5. Replacement of Lost Investments. In the event of a loss of Investments for
which the Custodian is responsible under the terms of this Agreement, the
Custodian shall replace such Investment, or in the event that such replacement
cannot be effected, the Custodian shall pay to the Fund the fair market value of
such Investment based on the last available price as of the close of business in
the relevant market on the date that a claim was first made to the Custodian
with respect to such loss, or, if less, such other amount as shall be agreed by
the parties as the date for settlement.
6. Administrative Duties of the Custodian. The Custodian shall perform the
following administrative duties with respect to Investments of the Fund.
6.1. Purchase of Investments. Pursuant to Instruction, Investments purchased for
the account of the Fund shall be paid for (a) against delivery thereof to the
Custodian or a Subcustodian, as the case may be, either directly or through a
Clearing Corporation or a Securities Depository (in accordance with the rules of
such Securities Depository or such Clearing Corporation), or (b) otherwise in
accordance with an Instruction, Section 5.1.1 herein, Applicable Law, generally
accepted trade practices, or the terms of the instrument representing such
Investment.
6.2. Sale of Investments. Pursuant to Instruction, Investments sold for the
account of the Fund shall be delivered (a) against payment therefor in cash, by
check or by bank wire transfer, (b) by credit to the account of the Custodian or
the applicable Subcustodian, as the case may be, with a Clearing Corporation or
a Securities Depository (in accordance with the rules of such Securities
Depository or such Clearing Corporation), or (c) otherwise in accordance with an
Instruction, Section 5.1.1 herein, Applicable Law, generally accepted trade
practices, or the terms of the instrument representing such Investment.
6.3. Delivery in Connection with Borrowings of the Fund or other Collateral and
Margin Requirements. Pursuant to Instruction, the Custodian may deliver
Investments or cash of the Fund in connection with borrowings and other
collateral and margin requirements.
6.4. Futures and Options. If, pursuant to an Instruction, the Custodian shall
become a party to an agreement with the Fund and a futures commission merchant
regarding margin (Tri-Party Agreement), the Custodian shall (a) receive and
retain, to the extent the same are provided to the Custodian, confirmations or
other documents evidencing the purchase or sale by the Fund of exchange-traded
futures contracts and commodity options, (b) when required by such Tri-Party
Agreement, deposit and maintain in an account opened pursuant to such Agreement
(Margin Account), segregated either physically or by book-entry in a Securities
Depository for the benefit of any futures commission merchant, such Investments
as the Fund shall have designated as initial, maintenance or variation "margin"
deposits or other collateral intended to secure the Fund's performance of its
obligations under the terms of any exchange-traded futures contracts and
commodity options; and (c) thereafter pay, release or transfer Investments into
or out of the margin account in accordance with the provisions of the such
Agreement. Alternatively, the Custodian may deliver Investments, in accordance
with an Instruction, to a futures commission merchant for purposes of margin
requirements in accordance with Rule 17f-6. The Custodian shall in no event be
responsible for the acts and omissions of any futures commission merchant to
whom Investments are delivered pursuant to this Section; for the sufficiency of
Investments held in any Margin Account; or, for the performance of any terms of
any exchange-traded futures contracts and commodity options.
6.4.1. Segregated Account. The Custodian shall upon receipt of Instructions
establish and maintain on its books a segregated account or accounts for and on
behalf of the Fund, into which account or accounts may be transferred cash
and/or securities of the Fund, including securities maintained by the Custodian
pursuant to Section 5.1 hereof, said account to be (i) maintained in accordance
with the provisions of any agreement among the Fund, the Custodian and a
broker-dealer registered under the Securities Exchange Act of 1934 and a member
of the National Association of Securities Dealers Inc., (or any futures
commission merchant registered under the Commodity Exchange Act) relating to
compliance with the rules of the Options Clearing Corporation and of any
registered national securities exchange (or the Commodity Futures Trading
Commission or any registered contract market), or any similar organization or
organizations, regarding escrow or other arrangements in connection with
transactions by the Fund, (ii) for purposes of segregating cash or securities in
connection with options thereon purchased, sold or written by the Fund, or
commodity futures contracts or options thereon purchased or sold by the Fund or
in connection with borrowings by the Fund (iii) for the purpose of compliance
with the procedures required by Investment Company Act Release No. 10666, or any
subsequent release or releases of the Securities and Exchange Commission
relating to the maintenance of segregated accounts by registered investment
companies, and (iv) as mutually agreed from time to time between the Fund and
the Custodian.
6.5. Contractual Obligations and Similar Investments. From time to time, the
Fund's Investments may include Investments that are not ownership interests as
may be represented by certificate (whether registered or bearer), by entry in a
Securities Depository or by book entry agent, registrar or similar agent for
recording ownership interests in the relevant Investment. If the Fund shall at
any time acquire such Investments, including without limitation uncertificated
shares of the series of Ivy Fund as described in Section 5.1.1, deposit
obligations, loan participations, repurchase agreements and derivative
arrangements, the Custodian shall (a) receive and retain, to the extent the same
are provided to the Custodian, confirmations or other documents evidencing the
arrangement; and (b) perform on the Fund's account in accordance with the terms
of the applicable arrangement, but only to the extent directed to do so by
Instruction. The Custodian shall have no responsibility for agreements running
to the Fund as to which it is not a party, other than to retain, to the extent
the same are provided to the Custodian, documents or copies of documents
evidencing the arrangement and, in accordance with Instruction, to include such
arrangements in reports made to the Fund.
6.6. Exchange of Securities. Unless otherwise directed by Instruction, the
Custodian shall: (a) exchange securities held for the account of the Fund for
other securities in connection with any reorganization, recapitalization,
conversion, split-up, change of par value of shares or similar event, and (b)
deposit any such securities in accordance with the terms of any reorganization
or protective plan.
6.7. Surrender of Securities. Unless otherwise directed by Instruction, the
Custodian may surrender securities: (a) in temporary form for definitive
securities; (b) for transfer into the name of an entity allowable under Section
5.3; and (c) for a different number of certificates or instruments representing
the same number of shares or the same principal amount of indebtedness.
6.8. Rights, Warrants, Etc. Pursuant to Instruction, the Custodian shall (a)
deliver warrants, puts, calls, rights or similar securities to the issuer or
trustee thereof, or to any agent of such issuer or trustee, for purposes of
exercising such rights or selling such securities, and (b) deposit securities in
response to any invitation for the tender thereof.
6.9. Mandatory Corporate Actions. Unless otherwise directed by Instruction, the
Custodian shall: (a) comply with the terms of all mandatory or compulsory
exchanges, calls, tenders, redemptions or similar rights of securities ownership
affecting securities held on the Fund's account and promptly notify the Fund of
such action, and (b) collect all stock dividends, rights and other items of like
nature with respect to such securities.
6.10. Income Collection. Unless otherwise directed by Instruction, the Custodian
shall collect any amount due and payable to the Fund with respect to Investments
and promptly credit the amount collected to a Principal or Agency Account;
provided, however, that the Custodian shall not be responsible for: (a) the
collection of amounts due and payable with respect to Investments that are in
default, or (b) the collection of cash or share entitlements with respect to
Investments that are not registered in the name of the Custodian or its
Subcustodians. The Custodian is hereby authorized to endorse and deliver any
instrument required to be so endorsed and delivered to effect collection of any
amount due and payable to the Fund with respect to Investments.
6.11. Ownership Certificates and Disclosure of the Fund's Interest. The
Custodian is hereby authorized to execute on behalf of the Fund ownership
certificates, affidavits or other disclosure required under Applicable Law or
established market practice in connection with the receipt of income, capital
gains or other payments by the Fund with respect to Investments, or in
connection with the sale, purchase or ownership of Investments.
6.12. Proxy Materials. The Custodian shall deliver, or cause to be delivered, to
the Fund proxy forms, notices of meeting, and any other notices or announcements
materially affecting or relating to Investments received by the Custodian or any
nominee.
With respect to tender or exchange offers, rights offerings or similar
corporate actions ("Offers"), the Custodian shall transmit promptly to the Fund
all written information received by the Custodian from issuers of the securities
involved and from the party (or its agents) making the Offer. If the Fund
desires to take action with respect to any Offer, the Fund shall notify the
Custodian prior to the last day on which the Custodian is able to take timely
action pursuant to the terms of such Offer.
6.13. Taxes. The Custodian shall, where applicable, assist the Fund in the
reclamation of taxes withheld on dividends and interest payments received by the
Fund. In the performance of its duties with respect to tax withholding and
reclamation, the Custodian shall be entitled to rely on the advice of counsel
and upon information and advice regarding the Fund's tax status that is received
from or on behalf of the Fund without duty of separate inquiry.
6.14. Other Dealings. The Custodian shall otherwise act as directed by
Instruction, including without limitation effecting the free payments of moneys
or the free delivery of securities, provided that such Instruction shall
indicate the purpose of such payment or delivery and that the Custodian shall
record the party to whom such payment or delivery is made.
The Custodian shall attend to all nondiscretionary details in
connection with the sale or purchase or other administration of Investments,
except as otherwise directed by an Instruction, and may make payments to itself
or others for minor expenses of administering Investments under this Agreement;
provided that the Fund shall have the right to request an accounting with
respect to such expenses.
In fulfilling the duties set forth in Sections 6.6 through 6.10 above,
the Custodian shall provide to the Fund all material information pertaining to a
corporate action which the Custodian actually receives; provided that the
Custodian shall not be responsible for the completeness or accuracy of such
information. Any advance credit of cash or shares expected to be received as a
result of any corporate action shall be subject to actual collection and may,
when the Custodian deems collection unlikely, be reversed by the Custodian,
after it has provided notification of the same to the Fund.
The Custodian, subject to the general liability provisions contained in
Section 9, may at any time or times in its discretion appoint (and may at any
time remove) agents (other than Subcustodians) to carry out some or all of the
administrative provisions of this Agreement (Agents), provided, however, that
the appointment of such agent shall not relieve the Custodian of its
responsibilities under this Agreement.
7. Cash Accounts, Deposits and Money Movements. Subject to the terms and
conditions set forth in this Section 7, the Fund hereby authorizes the Custodian
to open and maintain, with itself or with Subcustodians, cash accounts in United
States Dollars, in such other currencies as are the currencies of the countries
in which the Fund maintains Investments or in such other currencies as the Fund
shall from time to time request by Instruction.
7.1. Types of Cash Accounts. Cash accounts opened on the books of the Custodian
(Principal Accounts) shall be opened in the name of the Fund. Such accounts
collectively shall be a deposit obligation of the Custodian and shall be subject
to the terms of this Section 7 and the general liability provisions contained in
Section 9. Cash accounts opened on the books of a Subcustodian may be opened in
the name of the Fund or the Custodian or in the name of the Custodian for its
customers generally (Agency Accounts). Such deposits shall be obligations of the
Subcustodian and shall be treated as an Investment of the Fund. Accordingly, the
Custodian shall be responsible for exercising reasonable care in the
administration of such accounts but shall not be liable for their repayment in
the event such Subcustodian, by reason of its bankruptcy, insolvency or
otherwise, fails to make repayment, unless the Fund experiences a loss due to
such bankruptcy or insolvency and the Custodian negligently failed to take
appropriate action in light of facts it knew or in the exercise of reasonable
care should have known regarding the Subcustodian's bankruptcy or insolvency.
7.2. Payments and Credits with Respect to the Cash Accounts. The Custodian shall
make payments from or deposits to any of said accounts in the course of carrying
out its administrative duties, including but not limited to income collection
with respect to the Fund's Investments, and otherwise in accordance with
Instructions. The Custodian and its Subcustodians shall be required to credit
amounts to the cash accounts only when moneys are actually received in cleared
funds in accordance with banking practice in the country and currency of
deposit. Any credit made to any Principal or Agency Account before actual
receipt of cleared funds shall be provisional and may be reversed by the
Custodian, upon written notice to the Fund, in the event such payment is not
actually collected. Unless otherwise specifically agreed in writing by the
Custodian or any Subcustodian, all deposits shall be payable only at the branch
of the Custodian or Subcustodian where the deposit is made or carried.
7.3. Currency and Related Risks. The Fund bears the risks of holding or
transacting in any currency. The Custodian shall not be liable for any loss or
damage arising from the applicability of any law or regulation now or hereafter
in effect, or from the occurrence of any event, which may delay or affect the
transferability, convertibility or availability of any currency in the country
(a) in which such Principal or Agency Accounts are maintained or (b) in which
such currency is issued, and in no event shall the Custodian be obligated to
make payment of a deposit denominated in a currency during the period during
which its transferability, convertibility or availability has been affected by
any such law, regulation or event. Without limiting the generality of the
foregoing, neither the Custodian nor any Subcustodian shall be required to repay
any deposit made at a foreign branch of either the Custodian or Subcustodian if
such branch cannot repay the deposit due to a cause for which the Custodian
would not be responsible in accordance with the terms of Section 9 of this
Agreement unless the Custodian or such Subcustodian expressly agrees in writing
to repay the deposit under such circumstances. All currency transactions in any
account opened pursuant to this Agreement are subject to exchange control
regulations of the United States and of the country where such currency is the
lawful currency or where the account is maintained. Any taxes, costs, charges or
fees imposed on the convertibility of a currency held by the Fund shall be for
the account of the Fund.
7.4. Foreign Exchange Transactions. The Custodian shall, subject to the terms of
this Section, settle foreign exchange transactions (including contracts,
futures, options and options on futures) on behalf and for the account of the
Fund with such currency brokers or banking institutions, including
Subcustodians, as the Fund may direct pursuant to Instructions. The Custodian
may act as principal in any foreign exchange transaction with the Fund in
accordance with Section 7.4.2 of this Agreement. The obligations of the
Custodian in respect of all foreign exchange transactions (whether or not the
Custodian shall act as principal in such transaction) shall be contingent on the
free, unencumbered transferability of the currency transacted on the actual
settlement date of the transaction.
7.4.1. Third Party Foreign Exchange Transactions. The Custodian shall process
foreign exchange transactions (including without limitation contracts, futures,
options, and options on futures) where any third party acts as principal
counterparty to the Fund on the same basis it performs duties as agent for the
Fund with respect to any other of the Fund's Investments. Accordingly, the
Custodian shall only be responsible for delivering or receiving currency on
behalf of the Fund in respect of such contracts pursuant to Instructions.
Foreign exchange transactions, other than those executed with the Custodian as
principal, but including those executed with Subcutsodians, shall be deemed to
be Investments of the Fund and the responsibility of the Custodian therefor
shall be the same as and no greater than the Custodian's responsibility in
respect of other Investments of the Fund. The Custodian (a) shall transmit cash
and Instructions to and from the currency broker or banking institution with
which a foreign exchange contract or option has been executed pursuant hereto,
(b) may make free outgoing payments of cash in the form of Dollars or foreign
currency without receiving confirmation of a foreign exchange contract or option
or confirmation that the countervalue currency completing the foreign exchange
contract has been delivered or received or that the option has been delivered or
received, and (c) shall hold all confirmations, certificates and other documents
and agreements received by the Custodian and evidencing or relating to such
foreign exchange transactions in safekeeping. The Fund accepts full
responsibility for its use of third-party foreign exchange dealers and for
execution of said foreign exchange contracts and options and understands that
the Fund shall be responsible for any and all costs and interest charges which
may be incurred by the Fund or the Custodian as a result of the failure or delay
of third parties to deliver foreign exchange.
7.4.2. Foreign Exchange with the Custodian as Principal. The Custodian may
undertake foreign exchange transactions with the Fund as principal as the
Custodian and the Fund may agree from time to time. In such event, the foreign
exchange transaction will be performed in accordance with the particular
agreement of the parties, or in the event a principal foreign exchange
transaction is initiated by Instruction in the absence of specific agreement,
such transaction will be performed in accordance with the usual commercial terms
of the Custodian. The responsibility of the Custodian with respect to foreign
exchange transactions executed with the Custodian as principal shall be that of
a U.S. bank with respect to similar foreign exchange transactions.
7.5. Delays. If no event of Force Majeure shall have occurred and be continuing
and in the event that a delay shall have been caused by the negligence or
willful misconduct of the Custodian in carrying out an Instruction to credit or
transfer cash, the Custodian shall be liable to the Fund: (a) with respect to
Principal Accounts, for interest to be calculated at the rate customarily paid
on such deposit and currency by the Custodian on overnight deposits at the time
the delay occurs for the period from the day when the transfer should have been
effected until the day it is in fact effected; and, (b) with respect to Agency
Accounts, for interest to be calculated at the rate customarily paid on such
deposit and currency by the Subcustodian on overnight deposits at the time the
delay occurs for the period from the day when the transfer should have been
effected until the day it is in fact effected. The Custodian shall not be liable
for delays in carrying out such Instructions to transfer cash which are not due
to the Custodian's own negligence or willful misconduct, or that of a
Subcustodian or Agent utilized by the Custodian..
7.6. Advances. If, for any reason in the conduct of its safekeeping duties
pursuant to Section 5 hereof or its administration of the Fund's assets pursuant
to Section 6 hereof, the Custodian or any Subcustodian advances monies to
facilitate settlement or otherwise for benefit of the Fund (whether or not any
Principal or Agency Account shall be overdrawn either during or at the end of
any Business Day), the Fund hereby does:
7.6.1. acknowledge that the Fund shall have no right or title to any Investments
purchased with such Advance save a right to receive such Investments upon: (a)
the debit of the Principal or Agency Account; or, (b) if such debit would
produce an overdraft in such account, other reimbursement of the associated
Advance;
7.6.2. grant to the Custodian a security interest in certain specified
Investments; and,
7.6.3. agree that the Custodian may secure the resulting Advance by perfecting a
security interest in such specified Investments under Applicable Law.
Neither the Custodian nor any Subcustodian shall be obligated to
advance monies to the Fund, and in the event that such Advance occurs, any
transaction giving rise to an Advance shall be for the account and risk of the
Fund and shall not be deemed to be a transaction undertaken by the Custodian for
its own account and risk. If such Advance shall have been made by a Subcustodian
or any other person, the Custodian may assign the security interest and any
other rights granted to the Custodian hereunder to such Subcustodian or other
person. If the Fund shall fail to repay when due the principal balance of an
Advance and accrued and unpaid interest thereon, the Custodian or its assignee,
as the case may be, shall be entitled to utilize the available cash balance in
any Agency or Principal Account and to dispose of the specified Investments to
the extent necessary to recover payment of all principal of, and interest on,
such Advance in full. The Custodian may assign any rights it has hereunder to a
Subcustodian or third party. Any security interest in Investments taken
hereunder shall be treated as financial assets credited to securities accounts
under Articles 8 and 9 of the Uniform Commercial Code (1997). Accordingly, the
Custodian shall have the rights and benefits of a secured creditor that is a
securities intermediary under such Articles 8 and 9.
7.7. Integrated Account. For purposes hereof, deposits maintained in all
Principal Accounts (whether or not denominated in Dollars) shall collectively
constitute a single and indivisible current account with respect to the Fund's
obligations to the Custodian, or its assignee, and balances in such Principal
Accounts shall be available for satisfaction of the Fund's obligations under
this Section 7. The Custodian shall further have a right of offset against the
balances in any Agency Account maintained hereunder to the extent that the
aggregate of all Principal Accounts is overdrawn.
8. Subcustodians and Securities Depositories. Subject to the provisions
hereinafter set forth in this Section 8, the Fund hereby authorizes the
Custodian to utilize Securities Depositories to act on behalf of the Fund and to
appoint from time to time and to utilize Subcustodians. With respect to
securities and funds held by a Subcustodian, either directly or indirectly
(including by a Securities Depository or Clearing Corporation), notwithstanding
any provisions of this Agreement to the contrary, payment for securities
purchased and delivery of securities sold may be made prior to receipt of
securities or payment, respectively, and securities or payment may be received
in a form, in accordance with (a) governmental regulations, (b) rules of
Securities Depositories and clearing agencies, (c) generally accepted trade
practice in the applicable local market, (d) the terms and characteristics of
the particular Investment, or (e) the terms of Instructions.
8.1. Domestic Subcustodians and Securities Depositories. The Custodian may
deposit and/or maintain, either directly or through one or more agents appointed
by the Custodian, Investments of the Fund in any Securities Depository in the
United States, including The Depository Trust Company, provided such Depository
meets applicable requirements of the Federal Reserve Bank or of the Securities
and Exchange Commission. The Custodian may, at any time and from time to time,
appoint any bank as defined in Section 2(a)(5) of the 1940 Act meeting the
requirements of a custodian under Section 17(f) of the 1940 Act and the rules
and regulations thereunder, to act on behalf of the Fund as a Subcustodian for
purposes of holding Investments of the Fund in the United States.
8.2. Foreign Subcustodians and Securities Depositories. The Custodian may
deposit and/or maintain non-U.S. Investments of the Fund in any non-U.S.
Securities Depository provided such Securities Depository meets the requirements
of an "eligible foreign custodian" under Rule 17f-5 promulgated under the 1940
Act, or any successor rule or regulation ("Rule 17f-5") or which by order of the
Securities and Exchange Commission is exempted therefrom. Additionally, the
Custodian may, at any time and from time to time, appoint (a) any bank, trust
company or other entity meeting the requirements of an Eligible Foreign
Custodian under Rule 17f-5 or which by order of the Securities and Exchange
Commission is exempted therefrom, or (b) any bank as defined in Section 2(a)(5)
of the 1940 Act meeting the requirements of a custodian under Section 17(f) of
the 1940 Act and the rules and regulations thereunder, to act on behalf of the
Fund as a Subcustodian for purposes of holding Investments of the Fund outside
the United States. Such appointment of foreign Subcustodians shall be subject to
approval of the Fund in accordance with Subsections 8.2.1 and 8.2.2.
8.2.1. Board Approval of Foreign Subcustodians. Unless and except to the extent
that review of certain matters concerning the appointment of Subcustodians shall
have been delegated to the Custodian pursuant to Subsection 8.2.2, the Custodian
shall, prior to the appointment of any Subcustodian for purposes of holding
Investments of the Fund outside the United States, obtain written confirmation
of the approval of the Board of Trustees of the Fund with respect to (a) the
identity of a Subcustodian, (b) the country or countries in which, and the
Securities Depositories, if any, through which, any proposed Subcustodian is
authorized to hold Investments of the Fund, and (c) the Subcustodian agreement
which shall govern such appointment. Each such duly approved country,
Subcustodian and Securities Depository shall be listed on Appendix A attached
hereto as the same may from time to time be amended.
8.2.2. Delegation of Board Review of Subcustodians. From time to time, the
Custodian may offer to perform, and the Fund may accept that the Custodian
perform, certain reviews of Subcustodians and of Subcustodian Contracts as
delegate of the Fund's Board. In such event, the Custodian's duties and
obligations with respect to this delegated review will be performed in
accordance with the terms of [SCHEDULE *** of this Agreement/the separate
delegation agreement between the Fund and the Custodian].
8.3. Responsibility for Subcustodians. With respect to securities and funds held
by a Subcustodian, either directly or indirectly (including by a Foreign
Depository, Securities System or foreign clearing agency), including demand
deposit and interest bearing deposits, currencies or other deposits and foreign
exchange contracts as referred to herein, the Custodian shall be liable to the
Fund if and only to the extent that such Subcustodian is liable to the Custodian
and the Custodian recovers under the applicable subcustodian agreement. The
Custodian shall nevertheless be liable to the Fund for its own negligence in
transmitting to any such Subcustodian any Instructions received by it from the
Fund and for its own negligence in connection with the delivery of any
Investments or moneys held by it to any such Subcustodian.
In the event that any Subcustodian appointed pursuant to the provisions
of this Section 8.3 fails to perform any of its obligations under the terms and
conditions of the applicable subcustodian agreement, the Custodian shall use its
best efforts to cause such Subcustodian to perform such obligations. In the
event that the Custodian is unable to cause such Subcustodian to perform fully
its obligations thereunder, the Custodian shall forthwith upon the Fund's
request terminate such Subcustodian in accordance with the termination
provisions under the applicable subcustodian agreement and, if necessary or
desirable, appoint another Subcustodian in accordance with the provisions of
Section 8 herein. At the election of the Fund, it shall have the right to
enforce, to the extent permitted by the subcustodian agreement and applicable
law, the Custodian's rights against any such Subcustodian for loss or damage
caused the Fund by such Subcustodian.
The Custodian may at any time and from time to time make non-material,
administrative amendments to any subcustodian agreement without notice to the
Fund. The Custodian may at any time and from time to time, make material
amendments to any subcustodian agreement provided that the Custodian give notice
to the Fund of such amendments as soon as reasonably practicable after such
amendments.
The Custodian may, at any time in its discretion upon notification to
the Fund, terminate any Subcustodian of the Fund in accordance with the
termination provisions under the applicable subcustodian agreement, and at the
written request of the Fund, the Custodian will terminate any Subcustodian in
accordance with the termination provisions under the applicable subcustodian
agreement.
If necessary or desirable, the Custodian may appoint another
Subcustodian to replace a Subcustodian terminated pursuant to the foregoing
provisions of this Section 8.3, such appointment to be made upon approval of the
successor Subcustodian by the Fund's board of trustees in accordance with
Section 8.2.1, unless such duty shall have been delegated to the Custodian in
accordance with Section 8.2.2.
8.4. New Countries. The Fund shall be responsible for informing the Custodian
sufficiently in advance of a proposed Investment which is to be held in a
country in which no Subcustodian is authorized to act in order that the
Custodian shall, if it deems appropriate to do so, have sufficient time to
establish a subcustodial arrangement in accordance herewith. In the event,
however, the Custodian is unable to establish such arrangements prior to the
time such investment is to be acquired, the Custodian is authorized to designate
at its discretion a local safekeeping agent, and the use of such local
safekeeping agent shall be at the sole risk of the Fund, and, accordingly, the
Custodian shall be responsible to the Fund for the actions of such agent if and
only to the extent the Custodian shall have recovered from such agent for any
damages caused the Fund by such agent. At the request of the Fund, the Custodian
agrees to remove any securities held on behalf of the Fund by such agent, if
practical, to an approved Subcustodian.
9. Responsibility of the Custodian. In performing its duties and obligations
hereunder, the Custodian shall use reasonable care and diligence under the facts
and circumstances prevailing in the market where performance is effected.
Subject to the specific provisions of this Section, the Custodian shall be
liable for any direct damages incurred by the Fund in consequence of the
Custodian's negligence, bad faith or willful misconduct. It is agreed that the
Custodian shall have no duty to assess the risks inherent in the Fund's
Investments or to provide investment advice with respect to such Investments and
that the Fund as principal shall bear any risks attendant to particular
Investments such as failure of counterparty or issuer.
9.1. Limitations of Performance. The Custodian shall not be responsible under
this Agreement for any failure to perform its duties, and shall not liable
hereunder for any loss or damage in association with such failure to perform,
for or in consequence of the following causes:
9.1.1. Force Majeure. Force Majeure shall mean any circumstance or event which
is beyond the reasonable control of the Custodian, a Subcustodian or any agent
of the Custodian or a Subcustodian and which adversely affects the performance
by the Custodian of its obligations hereunder, by the Subcustodian of its
obligations under its Subcustody Agreement or by any other agent of the
Custodian or the Subcustodian, including any event caused by, arising out of or
involving (a) an act of God, (b) accident, fire, water damage or explosion, (c)
any computer, system or other equipment failure or malfunction caused by any
computer virus or the malfunction or failure of any communications medium, other
than a computer failure attributable to the Custodian's inability to process
properly and calculate date-related information and data from and after January
1, 2000 (the "Year 2000 Problem"), (d) any interruption of the power supply or
other utility service, (e) any strike or other work stoppage, whether partial or
total, (f) any delay or disruption resulting from or reflecting the occurrence
of any Sovereign Risk, (g) any disruption of, or suspension of trading in, the
securities, commodities or foreign exchange markets, whether or not resulting
from or reflecting the occurrence of any Sovereign Risk, (h) any encumbrance on
the transferability of a currency or a currency position on the actual
settlement date of a foreign exchange transaction, whether or not resulting from
or reflecting the occurrence of any Sovereign Risk, or (i) any other cause
similarly beyond the reasonable control of the Custodian.
9.1.2. Country Risk. Country Risk shall mean, with respect to the acquisition,
ownership, settlement or custody of Investments in a jurisdiction, all risks
relating to, or arising in consequence of, systemic and markets factors
affecting the acquisition, payment for or ownership of Investments including (a)
the prevalence of crime and corruption, (b) the inaccuracy or unreliability of
business and financial information, (c) the instability or volatility of banking
and financial systems, or the absence or inadequacy of an infrastructure to
support such systems, (d) custody and settlement infrastructure of the market in
which such Investments are transacted and held, (e) the acts, omissions and
operation of any Securities Depository, (f) the risk of the bankruptcy or
insolvency of banking agents, counterparties to cash and securities
transactions, registrars or transfer agents, and (g) the existence of market
conditions which prevent the orderly execution or settlement of transactions or
which affect the value of assets.
9.1.3. Sovereign Risk. Sovereign Risk shall mean, in respect of any
jurisdiction, including the United States of America, where Investments are
acquired or held hereunder or under a Subcustody Agreement, (a) any act of war,
terrorism, riot, insurrection or civil commotion, (b) the imposition of any
investment, repatriation or exchange control restrictions by any Governmental
Authority, (c) the confiscation, expropriation or nationalization of any
Investments by any Governmental Authority, whether de facto or de jure, (iv) any
devaluation or revaluation of the currency, (d) the imposition of taxes, levies
or other charges affecting Investments, (vi) any change in the Applicable Law,
or (e) any other economic or political risk incurred or experienced.
9.2. Limitations on Liability. The Custodian shall not be liable for any loss,
claim, damage or other liability arising from the following causes:
9.2.1. Failure of Third Parties. Except as specifically stated to the contrary
in this Agreement, the failure of any third party including: (a) any issuer of
Investments or book-entry or other agent of an issuer; (b) any counterparty with
respect to any Investment, including any issuer of exchange-traded or other
futures, option, derivative or commodities contract; (c) failure of an
Investment Adviser, Foreign Custody Manager or other agent of the Fund; or (d)
failure of other third parties similarly beyond the control or choice of the
Custodian.
9.2.2. Information Sources. The Custodian may rely upon information received
from issuers of Investments or agents of such issuers, information received from
Subcustodians and from other commercially reasonable sources such as commercial
data bases and the like, but shall not be responsible for specific inaccuracies
in such information, provided that the Custodian has relied upon such
information in good faith, or for the failure of any commercially reasonable
information provider.
9.2.3. Reliance on Instruction. Action by the Custodian or the Subcustodian in
accordance with an Instruction, even when such action conflicts with, or is
contrary to any provision of, the Fund's declaration of trust or by-laws,
Applicable Law, or actions by the trustees or shareholders of the Fund.
9.2.4. Restricted Securities. The limitations inherent in the rights,
transferability or similar investment characteristics of a given Investment of
the Fund.
10. Indemnification. The Fund hereby indemnifies the Custodian and each
Subcustodian, and their respective agents, nominees and their partners,
employees, officers and directors, and agrees to hold each of them harmless from
and against all claims and liabilities, including counsel fees and taxes,
incurred or assessed against any of them in connection with the performance of
this Agreement and any Instruction, except such as may arise from the
Custodian's or Subcustodian's breach of the relevant standard of conduct set
forth herein. If a Subcustodian or any other person indemnified under the
preceding sentence, gives written notice of claim to the Custodian, the
Custodian shall promptly give written notice to the Fund. Not more than thirty
days following the date of such notice, unless the Custodian shall be liable
under Section 8 hereof in respect of such claim, the Fund will pay the amount of
such claim or reimburse the Custodian for any payment made by the Custodian in
respect thereof.
10.1. Limitation of Liability. The Fund is organized as a Massachusetts business
trust, and references in this Agreement to the Fund mean and refer to the
Trustees from time to time serving under its Declaration of Trust on file with
the Secretary of State of The Commonwealth of Massachusetts, as may be amended
from time to time, pursuant to which the Fund conducts its business. It is
expressly agreed that the obligations of the Fund hereunder shall not be binding
upon any of the Trustees, shareholders, nominees, officers, agents or employees
of the Fund, as provided in said Declaration of Trust. Moreover, if the Fund has
more than one series, no series other than the series on whose behalf a
specified transaction shall have been undertaken shall be responsible for the
obligations of the Fund, and persons engaging in transactions with the Fund
shall look only to the assets of that series to satisfy those obligations. The
execution and delivery of this Agreement has been authorized by the Trustees and
signed by an authorized officer of the Fund, acting as such, and neither such
authorization by such Trustees nor such execution by such officer shall be
deemed to have been made by any of them but shall bind only the trust property
of the Fund as provided in such Declaration of Trust.
11. Reports and Records. The Custodian shall:
11.1. create and maintain records relating to the performance of its obligations
under this Agreement;
11.2. make available to the Fund, its auditors, agents and employees, during
regular business hours of the Custodian, upon reasonable request and during
normal business hours of the Custodian, all records maintained by the Custodian
pursuant to paragraph (a) above, subject, however, to all reasonable security
requirements of the Custodian then applicable to the records of its custody
customers generally; and
11.3. make available to the Fund all Electronic Reports; it being understood
that the Custodian shall not be liable hereunder for the inaccuracy or
incompleteness thereof or for errors in any information included therein. All
such records will be the property of the Fund and in the event of termination of
this Agreement shall be delivered to the successor custodian.
11.4. Opinion of Fund's Independent Certified Public Accountants. The Custodian
shall take all reasonable action as the Fund may request to obtain from year to
year favorable opinions from the Fund's independent certified public accountants
with respect to the Custodians activities hereunder in connection with the
preparation of any periodic reports to or filings with the Securities and
Exchange Commission ("SEC") and with respect to any other requirements of the
SEC.
11.5. Reports of the Custodian's Independent Certified Public Accountants. At
the request of the Fund, the Custodian shall deliver to the Fund a written
report prepared by the Custodian's independent certified public accountants with
respect to the services provided by the Custodian under this Agreement,
including, without limitation, the Custodian's accounting system, internal
accounting controls and procedures for safeguarding cash, securities and other
assets, including cash, securities and other assets deposited and/or maintained
in a Securities Depository or with a Subcustodian. Such report shall be of
sufficient scope and in sufficient detail as may reasonably be required by the
Fund and as may be obtained by the Custodian.
The Fund shall examine all records, howsoever produced or transmitted,
promptly upon receipt thereof and notify the Custodian promptly of any
discrepancy or error therein. Unless the Fund delivers written notice of any
such discrepancy or error within a reasonable time after its receipt thereof,
such records shall be deemed to be true and accurate. It is understood that the
Custodian now obtains and will in the future obtain information on the value of
assets from outside sources which may be utilized in certain reports made
available to the Fund. The Custodian deems such sources to be reliable but it is
acknowledged and agreed that the Custodian does not verify nor represent nor
warrant as to the accuracy or completeness of such information and accordingly
shall be without liability in selecting and using such sources and furnishing
such information, unless the Custodian was negligent in the selection and use of
such sources or furnishing such information.
12. Miscellaneous.
12.1. Proxies, etc. The Fund will promptly execute and deliver, upon request,
such proxies, powers of attorney or other instruments as may be necessary or
desirable for the Custodian to provide, or to cause any Subcustodian to provide,
custody services.
12.2. Entire Agreement. Except as specifically provided herein, this Agreement
constitutes the entire agreement between the Fund and the Custodian with respect
to the subject matter hereof. Accordingly, this Agreement supersedes any custody
agreement or other oral or written agreements heretofore in effect between the
Fund and the Custodian with respect to the custody of the Fund's Investments.
12.3. Waiver and Amendment. No provision of this Agreement may be waived,
amended or modified, and no addendum to this Agreement shall be or become
effective, or be waived, amended or modified, except by an instrument in writing
executed by the party against which enforcement of such waiver, amendment or
modification is sought; provided, however, that an Instruction shall, whether or
not such Instruction shall constitute a waiver, amendment or modification for
purposes hereof, be deemed to have been accepted by the Custodian when it
commences actions pursuant thereto or in accordance therewith.
12.4. GOVERNING LAW AND JURISDICTION. This agreement shall be construed in
accordance with, and be governed by the laws of, the state of New York, without
giving effect to the conflicts of law of such state. The parties hereto
irrevocably consent to the exclusive jurisdiction of the courts of the state of
New York and the federal courts located in New York city in the borough of
Manhattan.
12.5. Notices. Notices and other writings contemplated by this Agreement, other
than Instructions, shall be delivered (a) by hand, (b) by first class registered
or certified mail, postage prepaid, return receipt requested, (c) by a
nationally recognized overnight courier or (d) by facsimile transmission,
provided that any notice or other writing sent by facsimile transmission shall
also be mailed, postage prepaid, to the party to whom such notice is addressed.
All such notices shall be addressed, as follows:
If to the Fund:
Mackenzie Solutions
C/O Ivy Management, Inc.
Via Xxxxxx Financial Plaza
000 Xxxxx Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, XX 00000
Attn: C. Xxxxxxx Xxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
If to the Custodian:
Xxxxx Brothers Xxxxxxxx & Co.
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Manager, Securities Department
Telephone:(000) 000-0000
Facsimile: (000) 000-0000,
or such other address as the Fund or the Custodian may have designated in
writing to the other.
12.6. Headings. Paragraph headings included herein are for convenience of
reference only and shall not modify, define, expand or limit any of the terms
or provisions hereof.
12.7. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original. This Agreement shall
become effective when one or more counterparts have been signed and delivered by
the Fund and the Custodian.
12.8. Confidentiality. The parties hereto agree that each shall treat
confidentially the terms and conditions of this Agreement and all information
provided by each party to the other regarding its business and operations. All
confidential information provided by a party hereto shall be used by any other
party hereto solely for the purpose of rendering or obtaining services pursuant
to this Agreement and, except as may be required in carrying out this Agreement,
shall not be disclosed to any third party without the prior consent of such
providing party. The foregoing shall not be applicable to any information that
is publicly available when provided or thereafter becomes publicly available
other than through a breach of this Agreement, or that is required to be
disclosed by or to any bank examiner of the Custodian or any Subcustodian, any
Regulatory Authority, any auditor of the parties hereto, or by judicial or
administrative process or otherwise by Applicable Law.
12.8.1. Request by Regulatory Authority. In the event that the Custodian
receives a request for information from any regulatory authority or governmental
body in relation to the Investments and/or cash held by the Custodian,
Subcustodians or Agents for the Fund, the Custodian shall notify the Fund of the
identity of the agency making such request and the information to be provided as
soon as reasonably practicable after receipt of such request. Unless otherwise
required by applicable law, the Custodian shall not release such information
until receipt of proper Instructions from the Fund.
12.9. Counsel. In fulfilling its duties hereunder, the Custodian shall be
entitled to receive and act upon the advice of (i) counsel regularly retained by
the Custodian in respect of such matters, (ii) counsel for the Fund or (iii)
such counsel as the Fund and the Custodian may agree upon, with respect to all
matters, and the Custodian shall be without liability for any action reasonably
taken or omitted pursuant to such advice.
12.10. Additional Portfolios. If the Fund shall issue shares of more than one
series during the term hereof, the Custodian agrees that all Investments of the
Fund will be segregated by series and all books and records, account values or
actions shall be maintained, held, made or taken, as the case may be, separately
for each series. Other than as encompassed by the preceding sentence, references
in this Agreement to "the Fund" are applicable either to the entire trust or to
a particular series, as the context may make reasonable and appropriate. If the
Fund has more than one series, Instructions shall designate the series to which
they apply.
13. Definitions. The following defined terms will have the respective meanings
set forth below.
13.1. Advance shall mean any extension of credit by or through the Custodian or
by or through any Subcustodian and shall include amounts paid to third parties
for account of the Fund or in discharge of any expense, tax or other item
payable by the Fund.
13.2. Agency Account shall mean any deposit account opened on the books of a
Subcustodian or other banking institution in accordance with Section 7.1.
13.3. Agent shall have the meaning set forth in the last paragraph of Section 6.
13.4. Applicable Law shall mean with respect to each jurisdiction, all (a) laws,
statutes, treaties, regulations, guidelines (or their equivalents); (b) orders,
interpretations, licenses and permits; and (c) judgments, decrees, injunctions,
writs, orders and similar actions by a court of competent jurisdiction;
compliance with which is required or customarily observed in such jurisdiction.
13.5. Authorized Person shall mean any person or entity authorized to give
Instructions on behalf of the Fund in accordance with Section 4.1.
13.6. Book-entry Agent shall mean an entity acting as agent for the issuer of
Investments for purposes of recording ownership or similar entitlement to
Investments, including without limitation a transfer agent or registrar.
13.7. Clearing Corporation shall mean any entity or system established for
purposes of providing securities settlement and movement and associated
functions for a given market.
13.8. Delegation Agreement shall mean any separate agreement entered into
between the Custodian and the Fund or its authorized representative with respect
to certain matters concerning the appointment and administration of
Subcustodians delegated to the Custodian pursuant to Rule 17f-5.
13.9. Foreign Custody Manager shall mean the Fund's foreign custody manager
appointed pursuant to Rule 17f-5 of the 1940 Act.
13.10. Funds Transfer Services Agreement shall mean any separate agreement
entered into between the Custodian and the Fund or its authorized representative
with respect to certain matters concerning the processing of payment orders from
Principal Accounts of the Fund.
13.11. Instruction(s) shall have the meaning assigned in Section 4.
13.12. Investment Adviser shall mean any person or entity who is an Authorized
Person to give Instructions with respect to the investment and reinvestment of
the Fund's Investments.
13.13. Investments shall mean any investment asset of the Fund, including
without limitation securities, bonds, notes, and debentures as well as
receivables, derivatives, contractual rights or entitlements and other
intangible assets.
13.14. Margin Account shall have the meaning set forth in Section 6.4 hereof.
13.15. Principal Account shall mean deposit accounts of the Fund carried on the
books of BBH&Co. as principal in accordance with Section 7.
13.16. Safekeeping Account shall mean an account established on the books of the
Custodian or any Subcustodian for purposes of segregating the interests of the
Fund (or clients of the Custodian or Subcustodian) from the assets of the
Custodian or any Subcustodian.
13.17. Securities Depository shall mean a central or book entry system or agency
established under Applicable Law for purposes of recording the ownership and/or
entitlement to investment securities for a given market. For the purposes of
this Agreement, Securities Depository shall also include Xxx Xxxxxxxxx Service
Corp.
13.18. Subcustodian shall mean each foreign bank appointed by the Custodian
pursuant to Section 8, but shall not include Securities Depositories.
13.19. Tri-Party Agreement shall have the meaning set forth in Section 6.4
hereof.
13.20. 1940 Act shall mean the Investment Company Act of 1940.
14. Compensation. The Fund agrees to pay to the Custodian (a) a fee in an amount
set forth in the fee letter between the Fund and the Custodian in effect on the
date hereof or as amended from time to time, and (b) all out-of-pocket expenses
incurred by the Custodian, including the fees and expenses of all Subcustodians,
and payable from time to time. Amounts payable by the Fund under and pursuant to
this Section 14 shall be payable by wire transfer to the Custodian at BBH&Co. in
New York, New York.
15. Termination. This Agreement may be terminated by either party in accordance
with the provisions of this Section. The provisions of this Agreement and any
other rights or obligations incurred or accrued by any party hereto prior to
termination of this Agreement shall survive any termination of this Agreement.
15.1. Notice and Effect. This Agreement may be terminated by either party by
written notice effective no sooner than seventy-five days following the date
that notice to such effect shall be delivered to other party at its address set
forth in paragraph 12.5 hereof.
15.2. Successor Custodian. In the event of the appointment of a successor
custodian, it is agreed that the Investments of the Fund held by the Custodian
or any Subcustodian shall be delivered to the successor custodian in accordance
with reasonable Instructions. The Custodian agrees to cooperate with the Fund in
the execution of documents and performance of other actions necessary or
desirable in order to facilitate the succession of the new custodian. If no
successor custodian shall be appointed, the Custodian shall in like manner
transfer the Fund's Investments in accordance with Instructions.
15.3. Delayed Succession. If no Instruction has been given as of the effective
date of termination, Custodian may at any time on or after such termination date
and upon ten days' written notice to the Fund either (a) deliver the Investments
of the Fund held hereunder to the Fund at the address designated for receipt of
notices hereunder; or (b) deliver any investments held hereunder to a bank or
trust company having a capitalization of $2M USD equivalent and operating under
the Applicable Law of the jurisdiction where such Investments are located, such
delivery to be at the risk of the Fund. In the event that Investments or moneys
of the Fund remain in the custody of the Custodian or its Subcustodians after
the date of termination owing to the failure of the Fund to issue Instructions
with respect to their disposition or owing to the fact that such disposition
could not be accomplished in accordance with such Instructions despite diligent
efforts of the Custodian, the Custodian shall be entitled to compensation for
its services with respect to such Investments and moneys during such period as
the Custodian or its Subcustodians retain possession of such items and the
provisions of this Agreement shall remain in full force and effect until
disposition in accordance with this Section is accomplished.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be duly executed as of the date first above written.
MACKENZIE SOLUTIONS
By:_______________________________
XXXXX BROTHERS XXXXXXXX & CO.
By: ________________________________
