EXHIBIT (G)(4)
AMENDMENT TO CUSTODIAN CONTRACT
This Amendment to the Custodian Contract is made as of January 17, 2002, by
and between Each of the Parties Indicated on Appendix A (the "Funds") and State
Street Bank and Trust Company (the "Custodian"). This Amendment shall only apply
to the Funds listed on Schedule 1 (each, a "Fund"), as amended from time to
time, attached to this Amendment. Capitalized terms used in this Amendment
without definition shall have the respective meanings given to such terms in the
Custodian Contract referred to below.
WHEREAS, Each of the Parties Indicated on Appendix A and the Custodian have
entered into a Custodian Contract (the "Contract"); and
WHEREAS, each Fund listed on Schedule 1 attached hereto and the Custodian
desire to amend certain provisions of the Contract to provide for the custody
and handling of interests in Loans (as defined below).
NOW THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements hereinafter contained, the parties hereby agree as follows:
I. New Section 20 is hereby added to the Contract, as of the effective date of
this Amendment, as set forth below.
SECTION 20. SPECIAL PROVISIONS REGARDING INTERESTS IN LOANS.
The following provisions shall apply with respect to investments, property
or assets in the nature of loans, or interests or participations in loans,
including without limitation interests in syndicated bank loans and bank loan
participations (collectively, "Loans").
SECTION 20.1 SAFEKEEPING. Instruments, certificates, agreements and/or
other documents which the Custodian may receive in respect of Loans, if any
(collectively "Financing Documents"), from time to time, shall be held by the
Custodian at its offices in Boston, Massachusetts.
SECTION 20.2 DUTIES OF THE CUSTODIAN.
1) The Custodian shall accept such Financing Documents, if any,
in respect of Loans as may be delivered to it from time to
time by a Fund. The Custodian shall be under no obligation to
examine the contents or determine the sufficiency of any such
Financing Documents or to provide any certification with
respect thereto, whether received by the Custodian as original
documents, photocopies, by facsimile or otherwise. Without
limiting the foregoing, the Custodian is under no duty to
examine any such Financing Documents to determine whether
necessary steps have been
taken or requirements met in respect of the assignment
or transfer of the related Loan or applicable interest or
participation therein. The Custodian shall be entitled to
assume the genuineness, sufficiency and completeness of any
Financing Documents received, and the genuineness and due
authority of any signature appearing thereon.
2) Notwithstanding any term of this Contract to the contrary,
with respect to any Loans, (i) the Custodian shall be under no
obligation to determine, and shall have no liability for, the
sufficiency of, or to require delivery of, any instrument,
document or agreement constituting, evidencing or representing
such Loan, other than to receive such Financing Documents, if
any, as may be delivered or caused to be delivered to it by
the Fund (or its investment manager or investment adviser (the
"Adviser") on its behalf), (ii) without limiting the
generality of the foregoing, delivery of any such Loan
(including without limitation, for purposes of Section 2.7
above) may be made to the Custodian by, and may be represented
solely by, delivery to the Custodian of a facsimile or
photocopy of an assignment agreement (an "Assignment
Agreement") or a confirmation or certification from the Fund
(or the Adviser) to the effect that it has acquired such Loan
and/or has received or will receive , and will deliver to the
Custodian, appropriate Financing Documents constituting,
evidencing or representing such Loan (such confirmation or
certification, together with any Assignment Agreement,
collectively, an "Assignment Agreement or Confirmation"), in
any case without delivery of any promissory note,
participation certificate or similar instrument (collectively,
an "Instrument"), (iii) if an original Instrument shall be or
shall become available with respect to any such Loan, it shall
be the sole responsibility of the Fund (or the Adviser acting
on its behalf) to make or cause delivery thereof to the
Custodian, and the Custodian shall be under no obligation at
any time or times to determine whether any such original
Instrument has been issued or made available with respect to
such Loan, and shall not be under any obligation to compel
compliance by the Fund to make or cause delivery of such
Instrument to the Custodian, and (iv) any reference to
Financing Documents appearing in Section 20.3(a) shall be
deemed to include, without limitation, any such Instrument
and/or Assignment Agreement or Confirmation.
3) If payments with respect to a Loan ("Loan Payment") are not
received by the Custodian on the date on which they are due,
as reflected in the Payment Schedule (as such term is defined
in Section 20.3 below) of the Loan ("Payment Date"), or in the
case of interest payments, not received either on a scheduled
interest payable date, as reported to the Custodian by the
Fund (or the Adviser, on its behalf) for the Loan (the
"Interest Payable Date"), or in the amount of their accrued
interest payable, the Custodian shall promptly, but in no
event later than one business day after the Payment Date or
the Interest Payable Date, give telephonic notice to the party
obligated under the Financing Documents to make such Loan
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Payment (the "Obligor") of its failure to make timely payment,
and (2) if such payment is not received within three business
days of its due date, shall notify the Fund (or the Adviser on
its behalf) of such Obligor's failure to make the Loan
Payment. The Custodian shall have no responsibility with
respect to the collection of Loan Payments which are past due,
other than the duty to notify the Obligor and the Fund (or the
Adviser on its behalf) as provided herein.
4) The Custodian shall have no responsibilities or duties
whatsoever under this Contract, with respect to Loans or the
Financing Documents, except for such responsibilities as are
expressly set forth herein. Without limiting the generality of
the foregoing, the Custodian shall have no obligation to
preserve any rights against prior parties or to exercise any
right or perform any obligation in connection with the Loans
or any Financing Documents (including, without limitation, no
obligation to take any action in respect of or upon receipt of
any consent solicitation, notice of default or similar notice
received from any bank agent or Obligor, except that the
Custodian shall undertake reasonable efforts to forward any
such notice to the Fund or the Adviser). In case any question
arises as to its duties hereunder, the Custodian may request
instructions from the Fund and shall be entitled at all times
to refrain from taking any action unless it has received
Proper Instructions from the Fund or the Adviser and the
Custodian shall in all events have no liability, risk or cost
for any action taken, with respect to a Loan, pursuant to and
in compliance with the Proper Instructions of such parties.
5) The Custodian shall be only responsible and accountable for
Loan Payments actually received by it and identified as for
the account of the Fund; any and all credits and payments
credited to the Fund, with respect to Loans, shall be
conditional upon clearance and actual receipt by the Custodian
of final payment thereon.
6) The Custodian shall promptly, upon the Fund's request, release
to the Fund's Adviser or to any party as the Fund or the
Adviser may specify, any Financing Documents being held on
behalf of the Fund. Without limiting the foregoing, the
Custodian shall not be deemed to have or be charged with
knowledge of the sale of any Loan, unless and except to the
extent it shall have received written notice and instruction
from the Fund (or the Adviser on its behalf) with respect
thereto, and except to the extent it shall have received the
sale proceeds thereof.
7) In no event shall the Custodian be under any obligation or
liability to make any advance of its own funds in respect of
any Loan.
SECTION 20.3 RESPONSIBILITY OF THE FUND. With respect to each Loan held
by the Custodian hereunder in accordance with the provisions hereof, the Fund
shall (a) cause the Financing Documents evidencing such Loan to be delivered
to the Custodian;
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(b) include with such Financing Documents an amortization schedule of
payments (the "Payment Schedule") identifying the amount and due dates of
scheduled principal payments, the Interest Payable Date(s) and related
payment amount information, and such other information with respect to the
related Loan and Financing Documents as the Custodian reasonably may require
in order to perform its services hereunder (collectively, "Loan
Information"), in such form and format as the Custodian reasonably may
require; (c) take, or cause the Adviser to take, all actions necessary to
acquire good title to such Loan (or the participation therein, as the case
may be), as and to the extent intended to be acquired; and (d) cause the
Custodian to be named as its nominee for payment purposes under the Financing
Documents or otherwise provide for the direct payment of the Payments to the
Custodian. The Custodian shall be entitled to rely upon the Loan Information
provided to it by the Fund (or the Adviser on its behalf) without any
obligation on the part of the Custodian independently to verify, investigate,
recalculate, update or otherwise confirm the accuracy or completeness
thereof; and the Custodian shall have no liability for any delay or failure
on the part of the Fund in providing necessary Loan Information to the
Custodian, or for any inaccuracy therein or incompleteness thereof. With
respect to each such Loan, the Custodian shall be entitled to rely on any
information and notices it may receive from time to time from the related
bank agent, Obligor or similar party with respect to the related Loan, and
shall be entitled to update its records on the basis of such information or
notices received, without any obligation on its part independently to verify,
investigate or recalculate such information.
SECTION 20.4 INSTRUCTIONS; AUTHORITY TO ACT. The certificate of the
Secretary or an Assistant Secretary of the Trust, identifying certain
individuals to be officers of the Trust or employees of the Adviser of the Fund
authorized to sign any such instructions, may be received and accepted as
conclusive evidence of the incumbency and authority of such to act and may be
considered by the Custodian to be in full force and effect until it receives
written notice to the contrary from the Secretary or Assistant Secretary of the
Trust. Notwithstanding any other provision of this Contract, the Custodian shall
have no responsibility to ensure that any investment by the Trust or any Fund
with respect to Loans has been authorized.
SECTION 20.5 ATTACHMENT. In case any portion of the Loans or the Financing
Documents shall be attached or levied upon pursuant to an order of court, or the
delivery or disbursement thereof shall be stayed or enjoined by an order of
court, or any other order, judgment or decree shall be made or entered by any
court affecting the property of the Fund or any act of the Custodian relating
thereto, the Custodian is hereby expressly authorized in its sole discretion to
obey and comply with all orders, judgments or decrees so entered or issued,
without the necessity of inquire whether such court had jurisdiction, and, in
case the Custodian obeys or complied with any such order, judgment or decree, it
shall not be liable to anyone by reason of such compliance.
SECTION 20.6 PAYMENT OF FUND MONIES. Notwithstanding Section 2.7 and
Section 2.8 of the Custodian Contract, upon receipt of Proper Instructions
(as defined in the Custodian Contract), the Custodian shall deliver cash
and/or other assets of the Fund upon purchase of Loans to parties identified
in such Proper Instructions, which delivery
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may be made without contemporaneous receipt by the Custodian of cash or other
assets, including Financing Documents, in exchange therefor. Upon such
delivery of cash or other assets in accordance with such Proper Instructions,
the Custodian shall have no further responsibility or obligation to the Fund
as a custodian of the Fund with respect to the cash or assets so delivered.
In preparing reports of monies received by or paid out of the Fund or of
assets comprising the Fund, the Custodian shall be entitled to rely upon
information received from time to time regarding the Loans or Loan Payments
and shall not be responsible for the accuracy or completeness of such
information included in the Custodian's reports until such assets are
received by the Custodian.
II. Except as specifically superseded or modified hereby, the terms and
provisions of the Contract shall continue to apply with full force and
effect. In the event of any conflict between the terms of the Contract
prior to this Amendment and this Amendment, the terms of this Amendment
shall prevail.
IN WITNESS WHEREOF, each of the parties has caused this Amendment to be executed
in its name and behalf by its duly authorized representative as of the date
first above written.
WITNESSED BY: STATE STREET BANK and TRUST COMPANY
/s/ XXXX X. XXXX By: /s/ XXXXXX X. XXXXXX
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Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
WITNESSED BY: EACH OF THE INVESTMENT COMPANIES LISTED
ON SCHEDULE I ATTACHED
/s/ XXXXXXXX X. XXXXX By: /s/ XXXX X. XXXX
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Name: Xxxxxxxx X. Xxxxx Name: Xxxx X. Xxxx
Title: Secretary of certain Title: Vice President
of the Prudential
mutual funds.
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SCHEDULE 1
to
Amendment to Custodian Contract
Dated January 17, 2002
PRUDENTIAL HIGH YIELD FUND, INC.
