CUSTODY AGREEMENT
AGREEMENT,
dated as of ________________, 200__ between _U.S. One Trust____________, a
Delaware statutory trust, having its principal office and place of business at
0000 Xxxxxx Xxxxxxx Xxxx, Xxxx, XX 89521___ (the “Trust”), and The Bank of New
York Mellon, a New York corporation authorized to do a banking business having
its principal office and place of business at Xxx Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 (“Custodian”).
WITNESSETH:
That for
and in consideration of the mutual promises hereinafter set forth the Trust and
Custodian agree as follows:
ARTICLE
I
DEFINITIONS
Whenever
used in this Agreement, the following words shall have the meanings set forth
below:
1. “Authorized Person” shall be
any person, whether or not an officer or employee of the Trust, duly authorized
by the Trust’s board to execute any Certificate or to give any Oral Instruction
with respect to one or more Accounts, such persons to be designated in a
Certificate annexed hereto as Schedule I hereto or such other Certificate as may
be received by Custodian from time to time.
2. “Custodian Affiliate” shall
mean any office, branch or subsidiary of The Bank of New York Mellon
Corporation.
3. “Book-Entry System” shall mean
the Federal Reserve/Treasury book-entry system for receiving and delivering
securities, its successors and nominees.
4. “Business Day” shall mean any
day on which Custodian and relevant Depositories are open for
business.
5. “Certificate” shall mean any
notice, instruction, or other instrument in writing, authorized or required by
this Agreement to be given to Custodian, which is actually received by Custodian
by letter or facsimile transmission and signed on behalf of the Trust by an
Authorized Person or a person reasonably believed by Custodian to be an
Authorized Person.
6. “Composite Currency Unit”
shall mean the Euro or any other composite currency unit consisting of the
aggregate of specified amounts of specified currencies, as such unit may be
constituted from time to time.
7. “Depository” shall include (a)
the Book-Entry System, (b) the Depository Trust Company, (c) any other clearing
agency or securities depository registered with the Securities and Exchange
Commission identified to the Trust from time to time, and (d) the respective
successors and nominees of the foregoing.
8. “Foreign Depository” shall
mean (a) Euroclear, (b) Clearstream Banking, societe anonyme, (c) each Eligible
Securities Depository as defined in Rule 17f-7 under the Investment Company Act
of 1940, as amended, identified to the Trust from time to time, and (d) the respective
successors and nominees of the foregoing.
9.
“Instructions” shall mean
communications actually received by Custodian by S.W.I.F.T., tested
telex, letter, facsimile transmission, or other method or system specified by
Custodian as available for use in connection with the services
hereunder.
10. “Oral Instructions” shall mean
verbal instructions received by Custodian from an Authorized Person or from a
person reasonably believed by Custodian to be an Authorized Person.
11. “Series” shall mean the
various portfolios, if any, of the Trust listed on Schedule II hereto, and if
none are listed references to Series shall be references to the
Trust.
12. “Securities” shall include,
without limitation, any common stock and other equity securities, bonds,
debentures and other debt securities, notes, mortgages or other obligations, and
any instruments representing rights to receive, purchase, or subscribe for the
same, or representing any other rights or interests therein (whether represented
by a certificate or held in a Depository or by a Subcustodian).
13. “Subcustodian” shall mean a
bank (including any branch thereof) or other financial institution (other than a
Foreign Depository) located outside the U.S. which is utilized by Custodian in
connection with the purchase, sale or custody of Securities hereunder and
identified to the Trust from time to time, and their respective successors and
nominees.
14.
“Transfer Agent” shall
mean The Bank of New York, subject to a separate Transfer Agency and Service
Agreement entered into between the parties, or any successor transfer agent
identified to Custodian in a Certificate.
ARTICLE
II
APPOINTMENT
OF CUSTODIAN; ACCOUNTS;
REPRESENTATIONS,
WARRANTIES, AND COVENANTS
1.
(a) The Trust hereby appoints Custodian as custodian of all
Securities and cash at any time delivered to Custodian during the term of this
Agreement, and authorizes Custodian to hold Securities in registered form in its
name or the name of its nominees. Custodian hereby accepts such
appointment and agrees to establish and maintain one or more securities accounts
and cash accounts for each Series in which Custodian will hold Securities and
cash as provided herein. Custodian shall maintain books and records
segregating the assets of each Series from the assets of any other
Series. Such accounts (each, an “Account”; collectively, the
“Accounts”) shall be in the name of the Trust.
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(b) Custodian
may from time to time establish on its books and records such sub-accounts
within each Account as the Trust and Custodian may agree upon (each a “Special
Account”), and Custodian shall reflect therein such assets as the Trust may
specify in a Certificate or Instructions.
(c) Custodian
may from time to time establish pursuant to a written agreement with and for the
benefit of a broker, dealer, future commission merchant or other third party
identified in a Certificate or Instructions such accounts on such terms and
conditions as the Trust and Custodian shall agree, and Custodian shall transfer
to such account such Securities and money as the Trust may specify in a
Certificate or Instructions.
2. The
Trust hereby represents and warrants, which representations and warranties shall
be continuing and shall be deemed to be reaffirmed upon each delivery of a
Certificate or each giving of Oral Instructions or Instructions by the Trust,
that:
(b) It
is duly organized and existing under the laws of the jurisdiction of its
organization, with full power to carry on its business as now conducted, to
enter into this Agreement, and to perform its obligations
hereunder;
(c) This
Agreement has been duly authorized, executed and delivered by the Trust,
approved by a resolution of its board, constitutes a valid and legally binding
obligation of the Trust, enforceable in accordance with its terms, and there is
no statute, regulation, rule, order or judgment binding on it, and no provision
of its charter or by-laws, nor of any mortgage, indenture, credit agreement or
other contract binding on it or affecting its property, which would prohibit its
execution or performance of this Agreement;
(d) It
is conducting its business in substantial compliance with all applicable laws
and requirements, both state and federal, and has obtained all regulatory
licenses, approvals and consents necessary to carry on its business as now
conducted;
(e) It
will not use the services provided by Custodian hereunder in any manner that is,
or will result in, a violation of any law, rule or regulation applicable to the
Trust;
(f) Its
board or its foreign custody manager, as defined in Rule 17f-5 under the
Investment Company Act of 1940, as amended (the “‘40 Act”), has determined that
use of each Subcustodian (including any Replacement Custodian) which Custodian
is authorized to utilize in accordance with Section 1(a) of Article III hereof
satisfies the applicable requirements of the ‘40 Act and Rule 17f-5
thereunder;
(g) The
Trust or its investment adviser has determined that the custody arrangements of
each Foreign Depository provide reasonable safeguards against the custody risks
associated with maintaining assets with such Foreign Depository within the
meaning of Rule 17f-7 under the ‘40 Act;
(h) It
is fully informed of the protections and risks associated with various methods
of transmitting Instructions and Oral Instructions and delivering Certificates
to Custodian, shall, and shall cause each Authorized Person, to safeguard and
treat with extreme care any user and authorization codes, passwords and/or
authentication keys, understands that there may be more secure methods of
transmitting or delivering the same than the methods selected by it, agrees that
the security procedures (if any) to be followed in connection therewith provide
a commercially reasonable degree of protection in light of its particular needs
and circumstances, and acknowledges and agrees that Instructions need not be
reviewed by Custodian, may conclusively be presumed by Custodian to have been
given by person(s) duly authorized, and may be acted upon as
given;
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(i) It
shall manage its borrowings, including, without limitation, any advance or
overdraft (including any day-light overdraft) in the Accounts, so that the
aggregate of its total borrowings for each Series does not exceed the amount
such Series is permitted to borrow under the ‘40 Act;
(j) Its
transmission or giving of, and Custodian acting upon and in reliance on,
Certificates, Instructions, or Oral Instructions pursuant to this Agreement
shall at all times comply with the ‘40 Act;
(k) It
shall impose and maintain restrictions on the destinations to which cash may be
disbursed by Instructions to ensure that each disbursement is for a proper
purpose; and
(l) It
has the right to make the pledge and grant the security interest and security
entitlement to Custodian contained in Section 1 of Article V hereof, free of any
right of redemption or prior claim of any other person or entity, such pledge
and such grants shall have a first priority subject to no setoffs,
counterclaims, or other liens or grants prior to or on a parity therewith, and
it shall take such additional steps as Custodian may require to assure such
priority.
3. The
Trust hereby covenants that it shall from time to time complete and execute and
deliver to Custodian upon Custodian’s request a Form FR U-1 (or successor form)
whenever the Trust borrows from Custodian any money to be used for the purchase
or carrying of margin stock as defined in Federal Reserve Regulation
U.
ARTICLE
III
CUSTODY
AND RELATED SERVICES
1.
(a) Subject to the terms hereof, the Trust hereby authorizes Custodian to
hold any Securities received by it from time to time for the Trust’s
account. Custodian shall be entitled to utilize, subject to
subsection (c) of this Section 1, Depositories, Subcustodians, and, subject to
subsection (d) of this Section 1, Foreign Depositories, to the extent possible
in connection with its performance hereunder. Securities and cash
held in a Depository or Foreign Depository will be held subject to the rules,
terms and conditions of such entity. Securities and cash held through
Subcustodians shall be held subject to the terms and conditions of Custodian’s
agreements with such Subcustodians. Subcustodians may be authorized
to hold Securities in Foreign Depositories in which such Subcustodians
participate. Unless otherwise required by local law or practice or a
particular subcustodian agreement, Securities deposited with a Subcustodian, a
Depositary or a Foreign Depository will be held in a commingled account, in the
name of Custodian, holding only Securities held by Custodian as
custodian for its customers. Custodian shall identify on its books
and records the Securities and cash belonging to the Trust, whether held
directly or indirectly through Depositories, Foreign Depositories, or
Subcustodians. Custodian shall, directly or indirectly through
Subcustodians, Depositories, or Foreign Depositories, endeavor, to the extent
feasible, to hold Securities in the country or other jurisdiction in which the
principal trading market for such Securities is located, where such Securities
are to be presented for cancellation and/or payment and/or registration, or
where such Securities are acquired. Custodian at any time may cease
utilizing any Subcustodian and/or may replace a Subcustodian with a different
Subcustodian (the “Replacement Subcustodian”). In the event Custodian
selects a Replacement Subcustodian, Custodian shall not utilize such Replacement
Subcustodian until after the Trust’s board or foreign custody manager has
determined that utilization of such Replacement Subcustodian satisfies the
requirements of the ‘40 Act and Rule 17f-5 thereunder.
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(b) Unless
Custodian has received a Certificate or Instructions to the contrary, Custodian
shall hold Securities indirectly through a Subcustodian only if (i) the
Securities are not subject to any right, charge, security interest, lien or
claim of any kind in favor of such Subcustodian or its creditors or operators,
including a receiver or trustee in bankruptcy or similar authority, except for a
claim of payment for the safe custody or administration of Securities on behalf
of the Trust by such Subcustodian, and (ii) beneficial ownership of the
Securities is freely transferable without the payment of money or value other
than for safe custody or administration.
(c) With
respect to each Depository, Custodian (i) shall exercise due care in accordance
with reasonable commercial standards in discharging its duties as a securities
intermediary to obtain and thereafter maintain Securities or financial assets
deposited or held in such Depository, and (ii) will provide, promptly upon
request by the Trust, such reports as are available concerning the internal
accounting controls and financial strength of Custodian.
(d) With
respect to each Foreign Depository, Custodian shall exercise reasonable care,
prudence, and diligence (i) to provide the Trust with an analysis of the custody
risks associated with maintaining assets with the Foreign Depository, and (ii)
to monitor such custody risks on a continuing basis and promptly notify the
Trust of any material change in such risks. The Trust acknowledges
and agrees that such analysis and monitoring shall be made on the basis of, and
limited by, information gathered from Subcustodians or through publicly
available information otherwise obtained by Custodian, and shall not include any
evaluation of Country Risks. As used herein the term “Country Risks”
shall mean with respect to any Foreign Depository: (a) the financial
infrastructure of the country in which it is organized, (b) such country’s
prevailing custody and settlement practices, (c) nationalization, expropriation
or other governmental actions, (d) such country’s regulation of the banking or
securities industry, (e) currency controls, restrictions, devaluations or
fluctuations, and (f) market conditions which affect the order execution of
securities transactions or affect the value of securities.
2. Custodian
shall furnish the Trust with an advice of daily transactions (including a
confirmation of each transfer of Securities) and a monthly summary of all
transfers to or from the Accounts.
3. With
respect to all Securities held hereunder, Custodian shall, unless otherwise
instructed to the contrary:
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(a) Receive
all income and other payments and advise the Trust as promptly as practicable of
any such amounts due but not paid;
(b) Present
for payment and receive the amount paid upon all Securities which may mature and
advise the Trust as promptly as practicable of any such amounts due but not
paid;
(c) Forward
to the Trust copies of all information or documents that it may actually receive
from an issuer of Securities which, in the opinion of Custodian, are intended
for the beneficial owner of Securities;
(d) Execute,
as custodian, any certificates of ownership, affidavits, declarations or other
certificates under any tax laws now or hereafter in effect in connection with
the collection of bond and note coupons;
(e) Hold
directly or through a Depository, a Foreign Depository, or a Subcustodian all
rights and similar Securities issued with respect to any Securities credited to
an Account hereunder; and
(f) Endorse
for collection checks, drafts or other negotiable instruments.
4. (a) Custodian
shall notify the Trust of rights or discretionary actions with respect to
Securities held hereunder, and of the date or dates by when such rights must be
exercised or such action must be taken, provided that Custodian has actually
received, from the issuer or the relevant Depository (with respect to Securities
issued in the United States) or from the relevant Subcustodian, Foreign
Depository, or a nationally or internationally recognized bond or corporate
action service to which Custodian subscribes, timely notice of such rights or
discretionary corporate action or of the date or dates such rights must be
exercised or such action must be taken. Absent actual receipt of such
notice, Custodian shall have no liability for failing to so notify the
Trust.
(b) Whenever
Securities (including, but not limited to, warrants, options, tenders, options
to tender or non-mandatory puts or calls) confer discretionary rights on the
Trust or provide for discretionary action or alternative courses of action by
the Trust, the Trust shall be responsible for making any decisions relating
thereto and for directing Custodian to act. In order for Custodian to
act, it must receive the Trust’s Certificate or Instructions at Custodian’s
offices, addressed as Custodian may from time to time request, not later than
noon (New York time) at least two (2) Business Days prior to the last scheduled
date to act with respect to such Securities (or such earlier date or time as
Custodian may specify to the Trust). Absent Custodian’s timely
receipt of such Certificate or Instructions, Custodian shall not be liable for
failure to take any action relating to or to exercise any rights conferred by
such Securities.
5. All
voting rights with respect to Securities, however registered, shall be exercised
by the Trust or its designee. Custodian will make available to the
Trust proxy voting services upon the request of, and for the jurisdictions
selected by, the Trust in accordance with terms and conditions to be mutually
agreed upon by Custodian and the Trust.
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6. Custodian
shall promptly advise the Trust upon Custodian’s actual receipt of notification
of the partial redemption, partial payment or other action affecting less than
all Securities of the relevant class. If Custodian, any Subcustodian,
any Depository, or any Foreign Depository holds any Securities in which the
Trust has an interest as part of a fungible mass, Custodian, such Subcustodian,
Depository, or Foreign Depository may select the Securities to participate in
such partial redemption, partial payment or other action in any
non-discriminatory manner that it customarily uses to make such
selection.
7. Custodian
shall not under any circumstances accept bearer interest coupons which have been
stripped from United States federal, state or local government or agency
securities unless explicitly agreed to by Custodian in writing.
8. The
Trust shall be liable for all taxes, assessments, duties and other governmental
charges, including any interest or penalty with respect thereto (“Taxes”), with
respect to any cash or Securities held on behalf of the Trust or any transaction
related thereto. The Trust shall indemnify Custodian and each
Subcustodian for the amount of any Tax that Custodian, any such Subcustodian or
any other withholding agent is required under applicable laws (whether by
assessment or otherwise) to pay on behalf of, or in respect of income earned by
or payments or distributions made to or for the account of the Trust (including
any payment of Tax required by reason of an earlier failure to
withhold). Custodian shall, or shall instruct the applicable
Subcustodian or other withholding agent to, withhold the amount of any Tax which
is required to be withheld under applicable law upon collection of any dividend,
interest or other distribution made with respect to any Security and any
proceeds or income from the sale, loan or other transfer of any
Security. In the event that Custodian or any Subcustodian is required
under applicable law to pay any Tax on behalf of the Trust, Custodian is hereby
authorized to withdraw cash from any cash account in the amount required to pay
such Tax and to use such cash, or to remit such cash to the appropriate
Subcustodian or other withholding agent, for the timely payment of such Tax in
the manner required by applicable law. If the aggregate amount of
cash in all cash accounts is not sufficient to pay such Tax, Custodian shall
promptly notify the Trust of the additional amount of cash (in the appropriate
currency) required, and the Trust shall directly deposit such additional amount
in the appropriate cash account promptly after receipt of such notice, for use
by Custodian as specified herein. In the event that Custodian
reasonably believes that Trust is eligible, pursuant to applicable law or to the
provisions of any tax treaty, for a reduced rate of, or exemption from, any Tax
which is otherwise required to be withheld or paid on behalf of the Trust under
any applicable law, Custodian shall, or shall instruct the applicable
Subcustodian or withholding agent to, either withhold or pay such Tax at such
reduced rate or refrain from withholding or paying such Tax, as appropriate;
provided that
Custodian shall have received from the Trust all documentary evidence of
residence or other qualification for such reduced rate or exemption required to
be received under such applicable law or treaty. In the event that
Custodian reasonably believes that a reduced rate of, or exemption from, any Tax
is obtainable only by means of an application for refund, Custodian and the
applicable Subcustodian shall have no responsibility for the accuracy or
validity of any forms or documentation provided by the Trust to Custodian
hereunder. The Trust hereby agrees to indemnify and hold harmless
Custodian and each Subcustodian in respect of any liability arising from any
underwithholding or underpayment of any Tax which results from the inaccuracy or
invalidity of any such forms or other documentation, and such obligation to
indemnify shall be a continuing obligation of the Trust, its successors and
assigns notwithstanding the termination of this Agreement.
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9. (a) For
the purpose of settling Securities and foreign exchange transactions, the Trust
shall provide Custodian with sufficient immediately available funds for all
transactions by such time and date as conditions in the relevant market dictate.
As used herein, “sufficient immediately available funds” shall mean either (i)
sufficient cash denominated in U.S. dollars to purchase the necessary foreign
currency, or (ii) sufficient applicable foreign currency, to settle the
transaction. Custodian shall provide the Trust with immediately
available funds each day which result from the actual settlement of all sale
transactions, based upon advices received by Custodian from Subcustodians,
Depositories, and Foreign Depositories. Such funds shall be in U.S.
dollars or such other currency as the Trust may specify to
Custodian.
(b) Any
foreign exchange transaction effected by Custodian in connection with this
Agreement may be entered with Custodian or a Custodian Affiliate acting as
principal or otherwise through customary banking channels. The Trust
may issue a standing Certificate or Instructions with respect to foreign
exchange transactions, but Custodian may establish rules or limitations
concerning any foreign exchange facility made available to the
Trust. The Trust shall bear all risks of investing in Securities or
holding cash denominated in a foreign currency.
(c) To
the extent that Custodian has agreed to provide pricing or other information
services in connection with this Agreement, Custodian is authorized to utilize
any vendor (including brokers and dealers of Securities) reasonably believed by
Custodian to be reliable to provide such information. The Trust
understands that certain pricing information with respect to complex financial
instruments (e.g., derivatives)
may be based on calculated amounts rather than actual market transactions and
may not reflect actual market values, and that the variance between such
calculated amounts and actual market values may or may not be material. Where
vendors do not provide information for particular Securities or other property,
an Authorized Person may advise Custodian in a Certificate regarding the fair
market value of, or provide other information with respect to, such Securities
or property as determined by it in good faith. Custodian shall not be
liable for any loss, damage or expense incurred as a result of errors or
omissions with respect to any pricing or other information utilized by Custodian
hereunder.
10. Until
such time as Custodian receives a certificate to the contrary with respect to a
particular Security, Custodian may release the identity of the Trust to an
issuer which requests such information pursuant to the Shareholder
Communications Act of 1985 for the specific purpose of direct communications
between such issuer and shareholder.
ARTICLE
IV
PURCHASE
AND SALE OF SECURITIES;
CREDITS
TO ACCOUNT
1. Promptly
after each purchase or sale of Securities by the Trust, the Trust shall deliver
to Custodian a Certificate or Instructions, or with respect to a purchase or
sale of a Security generally required to be settled on the same day the purchase
or sale is made, Oral Instructions specifying all information Custodian may
reasonably request to settle such purchase or sale. Custodian shall
account for all purchases and sales of Securities on the actual settlement date
unless otherwise agreed by Custodian.
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2. The
Trust understands that when Custodian is instructed to deliver Securities
against payment, delivery of such Securities and receipt of payment therefor may
not be completed simultaneously. Notwithstanding any provision in
this Agreement to the contrary, settlements, payments and deliveries of
Securities may be effected by Custodian or any Subcustodian in accordance with
the customary or established securities trading or securities processing
practices and procedures in the jurisdiction in which the transaction occurs,
including, without limitation, delivery to a purchaser or dealer therefor (or
agent) against receipt with the expectation of receiving later payment for such
Securities. The Trust assumes full responsibility for all risks,
including, without limitation, credit risks, involved in connection with such
deliveries of Securities.
3. Custodian
may, as a matter of bookkeeping convenience or by separate agreement with the
Trust, credit the Account with the proceeds from the sale, redemption or other
disposition of Securities or interest, dividends or other distributions payable
on Securities prior to its actual receipt of final payment
therefor. All such credits shall be conditional until Custodian’s
actual receipt of final payment and may be reversed by Custodian to the extent
that final payment is not received. Payment with respect to a
transaction will not be “final” until Custodian shall have received immediately
available funds which under applicable local law, rule and/or practice are
irreversible and not subject to any security interest, levy or other
encumbrance, and which are specifically applicable to such
transaction.
ARTICLE
V
OVERDRAFTS
OR INDEBTEDNESS
1. If
Custodian should in its sole discretion advance funds on behalf of any Series
which results in an overdraft (including, without limitation, any day-light
overdraft) because the money held by Custodian in an Account for such Series
shall be insufficient to pay the total amount payable upon a purchase of
Securities specifically allocated to such Series, as set forth in a Certificate,
Instructions or Oral Instructions, or if an overdraft arises in the separate
account of a Series for some other reason, including, without limitation,
because of a reversal of a conditional credit or the purchase of any currency,
or if the Trust is for any other reason indebted to Custodian with respect to a
Series, including any indebtedness to The Bank of New York under the Trust’s
Cash Management and Related Services Agreement (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 Section 2 of
this Article), such overdraft or indebtedness shall be deemed to be a loan made
by Custodian to the Trust for such Series payable on demand and shall bear
interest from the date incurred at a rate per annum ordinarily charged by
Custodian to its institutional customers, as such rate may be adjusted from time
to time. In addition, the Trust hereby agrees that Custodian shall to the
maximum extent permitted by law have a continuing lien, security interest, and
security entitlement in and to any property, including, without limitation, any
investment property or any financial asset, of such Series at any time held by
Custodian for the benefit of such Series or in which such Series may have an
interest which is then in Custodian’s possession or control or in possession or
control of any third party acting in Custodian’s behalf. The Trust
authorizes Custodian, 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 Custodian’s books.
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2. If
the Trust borrows money from any bank (including Custodian if the borrowing is
pursuant to a separate agreement) for investment or for temporary or emergency
purposes using Securities held by Custodian hereunder as collateral for such
borrowings, the Trust shall deliver to Custodian 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 of the borrowing,
(d) the time and date, if known, on which the loan is to be entered into, (e)
the total amount payable to the Trust on the borrowing date, (f) the Securities
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 (g) 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 ‘40 Act and the Trust’s prospectus. Custodian
shall deliver on the borrowing date specified in a Certificate the specified
collateral against payment 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. Custodian 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. Custodian shall deliver such
Securities as additional collateral as may be specified in a Certificate to
collateralize further any transaction described in this Section. The
Trust shall cause all Securities released from collateral status to be returned
directly to Custodian, and Custodian shall receive from time to time such return
of collateral as may be tendered to it. In the event that the
Trust 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 Custodian, Custodian shall not be under any
obligation to deliver any Securities.
ARTICLE
VI
SALE
AND REDEMPTION OF SHARES
1. Whenever
the Trust shall sell any shares issued by the Trust (“Shares”) it shall deliver
to Custodian a Certificate or Instructions, or cause the Trust’s Transfer Agent
to provide instructions, specifying the amount of money, if any, and the
particular Securities and the amount of each Security to be received by
Custodian for the sale of such Shares and specifically allocated to an Account
for such Series. Upon receipt of such money, if any, and such Securities,
Custodian shall credit the same to an Account in the name of the Series for
which such money, if any, and such Securities are received.
2.
Whenever the Trust desires Custodian to make a payment, if any, and a delivery
of Securities out of the money and Securities held by Custodian hereunder in
connection with a redemption of any Shares, it shall furnish to Custodian a
Certificate or Instructions, or cause the Trust’s Transfer Agent to provide
instructions specifying the total amount of money, if any, to be paid, and the
particular Securities and amount of each Security to be delivered, for the
redemption of such Shares. Custodian shall make any such payment and such
delivery of Shares, as directed by a Certificate or Instructions or
instructions of the Trust’s transfer agent, out of the money and Securities held
in an Account of the appropriate Series.
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ARTICLE
VII
PAYMENT
OF DIVIDENDS OR DISTRIBUTIONS
1. Whenever
the Trust shall determine to pay a dividend or distribution on Shares it shall
furnish to Custodian Instructions or a Certificate setting forth with respect to
the Series specified therein the date of the declaration of such dividend or
distribution, the total amount payable, and the payment date.
2. Upon
the payment date specified in such Instructions or Certificate, Custodian shall
pay out of the money held for the account of such Series the total amount
payable to the dividend agent of the Trust specified therein.
ARTICLE
VIII
CONCERNING
CUSTODIAN
1.
(a) Except as otherwise expressly provided herein, Custodian shall not be
liable for any costs, expenses, damages, liabilities or claims, including
attorneys’ and accountants’ fees (collectively, “Losses”), incurred by or
asserted against the Trust, except those Losses arising out of Custodian’s own
negligence or willful misconduct. Custodian shall have no liability
whatsoever for the action or inaction of any Depositories or of any Foreign
Depositories, except in each case to the extent such action or inaction is a
direct result of the Custodian’s failure to fulfill its duties
hereunder. With respect to any Losses incurred by the Trust as a
result of the acts or any failures to act by any Subcustodian (other than a
Custodian Affiliate), Custodian shall take appropriate action to recover such
Losses from such Subcustodian; and Custodian’s sole responsibility and liability
to the Trust shall be limited to amounts so received from such Subcustodian
(exclusive of costs and expenses incurred by Custodian). In no event
shall Custodian be liable to the Trust or any third party for special, indirect
or consequential damages, or lost profits or loss of business, arising in
connection with this Agreement, nor shall Custodian or any Subcustodian be
liable: (i) for acting in
accordance with any Certificate or Oral Instructions actually
received by Custodian and reasonably believed by Custodian to be given by an
Authorized Person; (ii) for acting in
accordance with Instructions without reviewing the same; (iii) for conclusively
presuming that all Instructions are given only by person(s) duly authorized;
(iv) for
conclusively presuming that all disbursements of cash directed by the Trust,
whether by a Certificate, an Oral Instruction, or an Instruction, are in
accordance with Section 2(i) of Article II hereof; (v) for holding
property in any particular country, including, but not limited to, Losses
resulting from nationalization, expropriation or other governmental actions;
regulation of the banking or securities industry; exchange or currency controls
or restrictions, devaluations or fluctuations; availability of cash or
Securities or market conditions which prevent the transfer of property or
execution of Securities transactions or affect the value of property; (vi) for any Losses
due to forces beyond the control of Custodian, including without limitation
strikes, work stoppages, acts of war or terrorism, insurrection, revolution,
nuclear or natural catastrophes or acts of God, or interruptions, loss or
malfunctions of utilities, communications or computer (software and hardware)
services, provided that Custodian has established and is maintaining a disaster
recovery plan and back-up systems and that upon occurrence of any such event
Custodian shall use commercially reasonable best efforts to resume performance
as soon as practicable; (vii) for the
insolvency of any Subcustodian (other than a Custodian Affiliate), any
Depository, or, except to the extent such action or inaction is a direct result
of the Custodian’s failure to fulfill its duties hereunder, any Foreign
Depository; or (viii) for any Losses
arising from the applicability of any law or regulation now or hereafter in
effect, or from the occurrence of any event, including, without limitation,
implementation or adoption of any rules or procedures of a Foreign Depository,
which may affect, limit, prevent or impose costs or burdens on, the
transferability, convertibility, or availability of any currency or Composite
Currency Unit in any country or on the transfer of any Securities, and in no
event shall Custodian be obligated to substitute another currency for a currency
(including a currency that is a component of a Composite Currency Unit) whose
transferability, convertibility or availability has been affected, limited, or
prevented by such law, regulation or event, and to the extent that any such law,
regulation or event imposes a cost or charge upon Custodian in relation to the
transferability, convertibility, or availability of any cash currency or
Composite Currency Unit, such cost or charge shall be for the account of the
Trust, and Custodian may treat any account denominated in an affected currency
as a group of separate accounts denominated in the relevant component
currencies.
-11-
(b) Custodian
may enter into subcontracts, agreements and understandings with any Custodian
Affiliate, whenever and on such terms and conditions as it deems necessary or
appropriate to perform its services hereunder. No such subcontract,
agreement or understanding shall discharge Custodian from its obligations
hereunder.
(c) The
Trust agrees to indemnify Custodian and hold Custodian harmless from and against
any and all Losses sustained or incurred by or asserted against Custodian by
reason of or as a result of any action or inaction, or arising out of
Custodian’s performance hereunder, including reasonable fees and expenses of
counsel incurred by Custodian in a successful defense of claims by the Trust;
provided however, that the Trust shall not indemnify Custodian for those Losses
arising out of Custodian’s own negligence or willful misconduct. This
indemnity shall be a continuing obligation of the Trust, its successors and
assigns, notwithstanding the termination of this Agreement.
2. Without
limiting the generality of the foregoing, Custodian shall be under no obligation
to inquire into, and shall not be liable for:
(a) Any
Losses incurred by the Trust or any other person as a result of the receipt or
acceptance of fraudulent, forged or invalid Securities, or Securities which are
otherwise not freely transferable or deliverable without encumbrance in any
relevant market;
(b) The
validity of the issue of any Securities purchased, sold, or written by or for
the Trust, the legality of the purchase, sale or writing thereof, or the
propriety of the amount paid or received therefor;
(c) The
legality of the sale or redemption of any Shares, or the propriety of the amount
to be received or paid therefor;
-12-
(d) The
legality of the declaration or payment of any dividend or distribution by the
Trust;
(e) The
legality of any borrowing by the Trust;
(f) The
legality of any loan of portfolio Securities, nor shall Custodian be under any
duty or obligation to see to it that any cash or 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 is adequate security for the Trust against any
loss it might sustain as a result of such loan, which duty or obligation shall
be the sole responsibility of the Trust. In addition, Custodian shall
be under no duty or obligation to see that any broker, dealer or financial
institution to which portfolio Securities of the Trust are lent makes payment to
it of any dividends or interest which are payable to or for the account of the
Trust during the period of such loan or at the termination of such loan,
provided, however that Custodian shall promptly notify the Trust in the event
that such dividends or interest are not paid and received when due;
(g) The
sufficiency or value of any amounts of money and/or Securities held in any
Special Account in connection with transactions by the Trust; whether any
broker, dealer, futures commission merchant or clearing member makes payment to
the Trust of any variation margin payment or similar payment which the Trust may
be entitled to receive from such broker, dealer, futures commission merchant or
clearing member, or whether any payment received by Custodian from any broker,
dealer, futures commission merchant or clearing member is the amount the Trust
is entitled to receive, or to notify the Trust of Custodian’s receipt or
non-receipt of any such payment; or
(h) Whether
any Securities at any time delivered to, or held by it or by any Subcustodian,
for the account of the Trust and specifically allocated to a Series are such as
properly may be held by the Trust or such Series under the provisions of its
then current prospectus and statement of additional information, or to ascertain
whether any transactions by the Trust, whether or not involving Custodian, are
such transactions as may properly be engaged in by the Trust.
3. Custodian
may, with respect to questions of law specifically regarding an Account, obtain
the advice of counsel and shall be fully protected with respect to anything done
or omitted by it in good faith in conformity with such advice.
4. Custodian
shall be under no obligation to take action to collect any amount payable on
Securities in default, or if payment is refused after due demand and
presentment.
5. Custodian
shall have no duty or responsibility to inquire into, make recommendations,
supervise, or determine the suitability of any transactions affecting any
Account.
6. The
Trust shall pay to Custodian the fees and charges as may be specifically agreed
upon from time to time and such other fees and charges at Custodian’s standard
rates for such services as may be applicable. The Trust shall
reimburse Custodian for all costs associated with the conversion of the Trust’s
Securities hereunder and the transfer of Securities and records kept in
connection with this Agreement. The Trust shall also reimburse
Custodian for out-of-pocket expenses which are a normal incident of the services
provided hereunder.
-13-
7. Custodian
has the right to debit any cash account for any amount payable by the Trust in
connection with any and all obligations of the Trust to Custodian. In
addition to the rights of Custodian under applicable law and other agreements,
at any time when the Trust shall not have honored any of its obligations to
Custodian, Custodian shall have the right without notice to the Trust to retain
or set-off, against such obligations of the Trust, any Securities or cash
Custodian or a Custodian Affiliate may directly or indirectly hold for the
account of the Trust, and any obligations (whether matured or unmatured) that
Custodian or a Custodian Affiliate may have to the Trust in any currency or
Composite Currency Unit. Any such asset of, or obligation to, the
Trust may be transferred to Custodian and any Custodian Affiliate in order to
effect the above rights.
8. The
Trust agrees to forward to Custodian a Certificate or Instructions confirming
Oral Instructions by the close of business of the same day that such Oral
Instructions are given to Custodian. The Trust agrees that the fact
that such confirming Certificate or Instructions are not received or that a
contrary Certificate or contrary Instructions are received by Custodian shall in
no way affect the validity or enforceability of transactions authorized by such
Oral Instructions and effected by Custodian. If the Trust elects to
transmit Instructions through an on-line communications system offered by
Custodian, the Trust’s use thereof shall be subject to the Terms and Conditions
attached as Appendix I hereto. If Custodian receives Instructions
which appear on their face to have been transmitted by an Authorized Person via
(i) computer facsimile, email, the Internet or other insecure electronic method,
or (ii) secure electronic transmission containing applicable authorization
codes, passwords and/or authentication keys, the Trust understands and agrees
that Custodian cannot determine the identity of the actual sender of such
Instructions and that Custodian shall conclusively presume that such Written
Instructions have been sent by an Authorized Person, and the Trust shall be
responsible for ensuring that only Authorized Persons transmit such Instructions
to Custodian. If the Trust elects (with Custodian’s prior consent) to
transmit Instructions through an on-line communications service owned or
operated by a third party, the Trust agrees that Custodian shall not be
responsible or liable for the reliability or availability of any such
service.
9. The
books and records pertaining to the Trust which are in possession of Custodian
shall be the property of the Trust. Such books and records shall be
prepared and maintained as required by the ‘40 Act and the rules thereunder. The
Trust, or its authorized representatives, shall have access to such books and
records during Custodian’s normal business hours. Upon the reasonable
request of the Trust, copies of any such books and records shall be provided by
Custodian to the Trust or its authorized representative. Upon the
reasonable request of the Trust, Custodian shall provide in hard copy or on
computer disc any records included in any such delivery which are maintained by
Custodian on a computer disc, or are similarly maintained.
10. It
is understood that Custodian is authorized to supply any information regarding
the Accounts which is required by any law, regulation or rule now or hereafter
in effect. The Custodian shall provide the Trust with any report
obtained by the Custodian on the system of internal accounting control of a
Depository, and with such reports on its own system of internal accounting
control as the Trust may reasonably request from time to time.
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11. Custodian
shall have no 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 against Custodian in connection with
this Agreement.
ARTICLE
IX
CONCERNING
TRUST
1. The
Trust shall have no 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 against the Trust in connection with this
Agreement.
ARTICLE
X
TERMINATION
1. Either
of the parties hereto may terminate this Agreement by giving to the other party
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 Trust, it shall be accompanied by a copy of a
resolution of the board of the Trust, certified by the Secretary or any
Assistant Secretary, electing to terminate this Agreement and designating a
successor custodian or custodians, each of which shall be a bank or trust
company having not less than $2,000,000 aggregate capital, surplus and undivided
profits. In the event such notice is given by Custodian, the Trust shall,
on or before the termination date, deliver to Custodian a copy of a resolution
of the board of the Trust, certified by the Secretary or any Assistant
Secretary, designating a successor custodian or custodians. In the absence
of such designation by the Trust, Custodian may designate a successor custodian
which shall be a bank or trust company having not less than $2,000,000 aggregate
capital, surplus and undivided profits. Upon the date set forth in such
notice this Agreement shall terminate, and Custodian shall upon receipt of a
notice of acceptance by the successor custodian on that date deliver directly to
the successor custodian all Securities and money then owned by the Trust and
held by it as Custodian, after deducting all fees, expenses and other amounts
for the payment or reimbursement of which it shall then be
entitled.
2. If
a successor custodian is not designated by the Trust or Custodian in accordance
with the preceding Section, the Trust shall upon the date specified in the
notice of termination of this Agreement and upon the delivery by Custodian of
all Securities (other than Securities which cannot be delivered to the Trust)
and money then owned by the Trust be deemed to be its own custodian and
Custodian shall thereby be relieved of all duties and responsibilities pursuant
to this Agreement, other than the duty with respect to Securities which cannot
be delivered to the Trust to hold such Securities hereunder in accordance with
this Agreement.
-15-
ARTICLE
XI
MISCELLANEOUS
1. The
Trust agrees to furnish to Custodian a new Certificate of Authorized Persons in
the event of any change in the then present Authorized Persons. Until
such new Certificate is received, Custodian shall be fully protected in acting
upon Certificates or Oral Instructions of such present Authorized
Persons.
2. Any
notice or other instrument in writing, authorized or required by this Agreement
to be given to Custodian, shall be sufficiently given if addressed to Custodian
and received by it at its offices at Xxx Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
or at such other place as Custodian may from time to time designate in
writing.
3. Any
notice or other instrument in writing, authorized or required by this Agreement
to be given to the Trust shall be sufficiently given if addressed to the Trust
and received by it at its offices at 0000 Xxxxxx Xxxxxxx Xxxx, Xxxx, XX
89521_____________________, or at such other place as the Trust may from time to
time designate in writing.
4. Each
and every right granted to either party hereunder or under any other document
delivered hereunder or in connection herewith, or allowed it by law or equity,
shall be cumulative and may be exercised from time to time. No
failure on the part of either party to exercise, and no delay in exercising, any
right will operate as a waiver thereof, nor will any single or partial exercise
by either party of any right preclude any other or future exercise thereof or
the exercise of any other right.
5. In
case any provision in or obligation under this Agreement shall be invalid,
illegal or unenforceable in any exclusive jurisdiction, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
thereby. This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties, except that any
amendment to the Schedule I hereto need be signed only by the Trust and any
amendment to Appendix I hereto need be signed only by Custodian. 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 either party without the written consent of the
other.
6. This
Agreement shall be construed in accordance with the substantive laws of the
State of New York, without regard to conflicts of laws principles
thereof. The Trust and Custodian hereby consent to the jurisdiction
of a state or federal court situated in New York City, New York in connection
with any dispute arising hereunder. The Trust hereby irrevocably
waives, to the fullest extent permitted by applicable law, any objection which
it may now or hereafter have to the laying of venue of any such proceeding
brought in such a court and any claim that such proceeding brought in such a
court has been brought in an inconvenient forum. The Trust and
Custodian each hereby irrevocably waives any and all rights to trial by jury in
any legal proceeding arising out of or relating to this Agreement.
-16-
7. The Trust hereby
acknowledges that Custodian is subject to federal laws, including the Customer
Identification Program (CIP) requirements under the USA PATRIOT Act and its
implementing regulations, pursuant to which Custodian must obtain, verify and
record information that allows Custodian to identify the
Trust. Accordingly, prior to opening an Account hereunder Custodian
will ask the Trust to provide certain information including, but not limited to,
the Trust’s name, physical address, tax identification number and other
information that will help Custodian to identify and verify the Trust’s identity
such as organizational documents, certificate of good standing, license to do
business, or other pertinent identifying information. The Trust
agrees that Custodian cannot open an Account hereunder unless and until
Custodian verifies the Trust’s identity in accordance with its CIP.
8. It
is expressly acknowledged and agreed that the obligations of the Trust hereunder
shall not be binding upon any of the shareholders, trustees, officers,
employees, or agents of the Trust, personally, but shall bind only the trust
property of the Trust. Neither the authorization of this Agreement by
the Trustees of the Trust nor the execution and delivery of this Agreement by
the executing officer of the Trust shall be deemed to have been made by any of
them individually or to impose any liability on any of them personally, but
shall bind only the trust property of the Trust.
9. 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.
-17-
IN WITNESS WHEREOF, the Trust
and Custodian have caused this Agreement to be executed by their respective
officers, thereunto duly authorized, as of the day and year first above
written.
By:
Title:
Tax
Identification No:
THE BANK
OF NEW YORK MELLON
By:
Title:
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SCHEDULE
I
CERTIFICATE
OF AUTHORIZED PERSONS
(The
Trust - Oral and Written Instructions)
The
undersigned hereby certifies that he/she is the duly elected and acting
________________________ of * (the “Trust”), and further certifies that the
following officers or employees of the Trust have been duly authorized in
conformity with the Trust’s Declaration of Trust and By-Laws to deliver
Certificates and Oral Instructions to The Bank of New York (“Custodian”)
pursuant to the Custody Agreement between the Trust and Custodian dated
_______________, and that the signatures appearing opposite their names are true
and correct:
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Title
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Signature
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Name
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Title
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Signature
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Name
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Title
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Signature
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This
certificate supersedes any certificate of Authorized Persons you may currently
have on file.
[seal] By:
Title:
Date:
SCHEDULE
II
SERIES
One
Fund
APPENDIX
I
ELECTRONIC
SERVICES TERMS AND CONDITIONS
1. License; Use. (a)
This Appendix I shall govern the Trust’s use of electronic communications,
information delivery, portfolio management and banking services, that The Bank
of New York and its affiliates (“Custodian”) may provide to the Trust, such as
The Bank of New York Inform ™ and The Bank of New York CA$H-Register Plus®, and any
computer software, proprietary data and documentation provided by Custodian to
the Trust in connection therewith (collectively, the “Electronic Services”). In the
event of any conflict between the terms of this Appendix I and the main body of
this Agreement with respect to the Trust’s use of the Electronic Services, the
terms of this Appendix I shall control.
(b)
Custodian grants to the Trust a personal, nontransferable and nonexclusive
license to use the Electronic Services to which the Trust subscribes solely for
the purpose of transmitting instructions and information (“Written
Instructions”), obtaining reports, analyses and statements and other information
and data, making inquiries and otherwise communicating with Custodian in
connection with the Trust’s relationship with Custodian. The Trust
shall use the Electronic Services solely for its own internal and proper
business purposes and not in the operation of a service
bureau. Except as set forth herein, no license or right of any kind
is granted to with respect to the Electronic Services. The Trust
acknowledges that Custodian and its suppliers retain and have title and
exclusive proprietary rights to the Electronic Services, including any trade
secrets or other ideas, concepts, know-how, methodologies, and information
incorporated therein and the exclusive rights to any copyrights, trade dress,
look and feel, trademarks and patents (including registrations and applications
for registration of either), and other legal protections available in respect
thereof. The Trust further acknowledges that all or a part of the
Electronic Services may be copyrighted or trademarked (or a registration or
claim made therefor) by Custodian or its suppliers. The Trust shall
not take any action with respect to the Electronic Services inconsistent with
the foregoing acknowledgments, nor shall the Trust attempt to decompile, reverse
engineer or modify the Electronic Services. The Trust may not copy,
distribute, sell, lease or provide, directly or indirectly, the Electronic
Services or any portion thereof to any other person or entity without
Custodian’s prior written consent. The Trust may not remove any
statutory copyright notice or other notice included in the Electronic
Services. The Trust shall reproduce any such notice on any
reproduction of any portion of the Electronic Services and shall add any
statutory copyright notice or other notice upon Custodian’s
request.
(c)
Portions of the Electronic Services may contain, deliver or rely on data
supplied by third parties (“Third Party Data”), such as pricing data and
indicative data, and services supplied by third parties (“Third Party Services”)
such as analytic and accounting services. Third Party Data and Third
Party Services supplied hereunder are obtained from sources that Custodian
believes to be reliable but are provided without any independent investigation
by Custodian. Custodian and its suppliers do not represent or warrant
that the Third Party Data or Third Party Services are correct, complete or
current. Third Party Data and Third Party Services are proprietary to
their suppliers, are provided solely for the Trust’s internal use, and may not
be reused, disseminated or redistributed in any form. The Trust shall
not use any Third Party Data in any manner that would act as a substitute for
obtaining a license for the data directly from the supplier. Third
Party Data and Third Party Services should not be used in making any investment
decision. CUSTODIAN AND ITS SUPPLIERS ARE NOT RESPONSIBLE FOR ANY
RESULTS OBTAINED FROM THE USE OF OR RELIANCE UPON THIRD PARTY DATA OR THIRD
PARTY SERVICES. Custodian’s suppliers of Third Party Data and
Services are intended third party beneficiaries of this Section 1(c) and Section
5 below.
(d) The
Trust understands and agrees that any links in the Electronic Services to
Internet sites may be to sites sponsored and maintained by third
parties. Custodian make no guarantees, representations or warranties
concerning the information contained in any third party site (including without
limitation that such information is correct, current, complete or free of
viruses or other contamination), or any products or services sold through third
party sites. All such links to third party Internet sites are
provided solely as a convenience to the Trust and the Trust accesses and uses
such sites at its own risk. A link in the Electronic Services to a
third party site does not constitute Custodian’s endorsement, authorisation or
sponsorship of such site or any products and services available from such
site.
2. Equipment. The
Trust shall obtain and maintain at its own cost and expense all equipment and
services, including but not limited to communications services, necessary for it
to utilize and obtain access to the Electronic Services, and Custodian shall not
be responsible for the reliability or availability of any such equipment or
services.
3. Proprietary
Information. The Electronic Services, and any proprietary data
(including Third Party Data), processes, software, information and documentation
made available to the Trust (other than which are or become part of the public
domain or are legally required to be made available to the public)
(collectively, the "Information"), are the exclusive and confidential property
of Custodian or its suppliers. However, for the avoidance of doubt,
reports generated by the Trust containing information relating to its account(s)
(except for Third Party Data contained therein) are not deemed to be within the
meaning of the term “Information.” the Trust shall keep the
Information confidential by using the same care and discretion that the Trust
uses with respect to its own confidential property and trade secrets, but not
less than reasonable care. Upon termination of the Agreement or the
licenses granted herein for any reason, the Trust shall return to Custodian any
and all copies of the Information which are in its possession or under its
control (except that the Trust may retain reports containing Third Party Data,
provided that such Third Party Data remains subject to the provisions of this
Appendix). The provisions of this Section 3 shall not affect the
copyright status of any of the Information which may be copyrighted and shall
apply to all information whether or not copyrighted.
4. Modifications. Custodian
reserves the right to modify the Electronic Services from time to
time. The Trust agrees not to modify or attempt to modify the
Electronic Services without Custodian's prior written consent. The
Trust acknowledges that any modifications to the Electronic Services, whether by
the Trust or Custodian and whether with or without Custodian's consent, shall
become the property of Custodian.
5. NO REPRESENTATIONS OR
WARRANTIES; LIMITATION OF LIABILITY. CUSTODIAN AND ITS
MANUFACTURERS AND SUPPLIERS MAKE NO WARRANTIES OR REPRESENTATIONS WITH RESPECT
TO THE ELECTRONIC SERVICES OR ANY THIRD PARTY DATA OR THIRD PARTY SERVICES,
EXPRESS OR IMPLIED, IN FACT OR IN LAW, INCLUDING BUT NOT LIMITED TO WARRANTIES
OF MERCHANTABILITY, NON-INFRINGEMENT AND FITNESS FOR A PARTICULAR
PURPOSE. THE TRUST ACKNOWLEDGES THAT THE ELECTRONIC SERVICES, THIRD
PARTY DATA AND THIRD PARTY SERVICES ARE PROVIDED “AS IS.” TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT SHALL CUSTODIAN OR ANY
SUPPLIER BE LIABLE FOR ANY DAMAGES, WHETHER DIRECT, INDIRECT SPECIAL, OR
CONSEQUENTIAL, WHICH CUSTOMER MAY INCUR IN CONNECTION WITH THE ELECTRONIC
SERVICES, THIRD PARTY DATA OR THIRD PARTY SERVICES, EVEN IF CUSTODIAN OR SUCH
SUPPLIER KNEW OF THE POSSIBILITY OF SUCH DAMAGES. IN NO EVENT SHALL
CUSTODIAN OR ANY SUPPLIER BE LIABLE FOR ACTS OF GOD, MACHINE OR COMPUTER
BREAKDOWN OR MALFUNCTION, INTERRUPTION OR MALFUNCTION OF COMMUNICATION
FACILITIES, LABOR DIFFICULTIES OR ANY OTHER SIMILAR OR DISSIMILAR CAUSE BEYOND
THEIR REASONABLE CONTROL.
6. Security; Reliance;
Unauthorized Use; Trust Transfers. Custodian will establish
security procedures to be followed in connection with the use of the Electronic
Services, and the Trust agrees to comply with the security
procedures. The Trust understands and agrees that the security
procedures are intended to determine whether instructions received by Custodian
through the Electronic Services are authorized but are not (unless otherwise
specified in writing) intended to detect any errors contained in such
instructions. The Trust will cause all persons utilizing the
Electronic Services to treat any user and authorization codes, passwords,
authentication keys and other security devices with the highest degree of care
and confidentiality. Upon termination of the Trust’s use of the
Electronic Services, the Trust shall return to Custodian any security devices
(e.g., token cards) provided by Custodian. Custodian is hereby
irrevocably authorized to comply with and rely upon on Written Instructions and
other communications, whether or not authorized, received by it through the
Electronic Services. The Trust acknowledges that it has sole
responsibility for ensuring that only Authorized Persons use the Electronic
Services and that to the fullest extent permitted by applicable law Custodian
shall not be responsible nor liable for any unauthorized use thereof or for any
losses sustained by the Trust arising from or in connection with the use of the
Electronic Services or Custodian’s reliance upon and compliance with Written
Instructions and other communications received through the Electronic
Services. With respect to instructions for a transfer of Trust issued
through the Electronic Services, when instructed to credit or pay a party by
both name and a unique numeric or alpha-numeric identifier (e.g., ABA number or
account number), the Custodian, its affiliates, and any other bank participating
in the Trust transfer, may rely solely on the unique identifier, even if it
identifies a party different than the party named. Such reliance on a
unique identifier shall apply to beneficiaries named in such instructions as
well as any financial institution which is designated in such instructions to
act as an intermediary in a Trust transfer. It is understood and
agreed that unless otherwise specifically provided herein, and to the extent
permitted by applicable law, the parties hereto shall be bound by the rules of
any Trust transfer system utilized to effect a Trust transfer
hereunder.
7. Acknowledgments. Custodian
shall acknowledge through the Electronic Services its receipt of each Written
Instruction communicated through the Electronic Services, and in the absence of
such acknowledgment Custodian shall not be liable for any failure to act in
accordance with such Written Instruction and the Trust may not claim that such
Written Instruction was received by Custodian. Custodian may in its
discretion decline to act upon any instructions or communications that are
insufficient or incomplete or are not received by Custodian in sufficient time
for Custodian to act upon, or in accordance with such instructions or
communications.
8. Viruses. The
Trust agrees to use reasonable efforts to prevent the transmission through the
Electronic Services of any software or file which contains any viruses, worms,
harmful component or corrupted data and agrees not to use any device, software,
or routine to interfere or attempt to interfere with the proper working of the
Electronic Services.
9. Encryption. The
Trust acknowledges and agrees that encryption may not be available for every
communication through the Electronic Services, or for all data. The
Trust agrees that Custodian may deactivate any encryption features at any time,
without notice or liability to the Trust, for the purpose of maintaining,
repairing or troubleshooting its systems.
10. On-Line Inquiry and
Modification of Records. In connection with the Trust’s use of the
Electronic Services, Custodian may, at the Trust’s request, permit the Trust to
enter data directly into a Custodian database for the purpose of modifying
certain information maintained by Custodian’s systems, including, but not
limited to, change of address information. To the extent that the
Trust is granted such access, the Trust agrees to indemnify and hold Custodian
harmless from all loss, liability, cost, damage and expense (including
attorney’s fees and expenses) to which Custodian may be subjected or which may
be incurred in connection with any claim which may arise out of or as a result
of changes to Custodian database records initiated by the Trust.
11. Agents. the
Trust may, on advance written notice to the Custodian, permit its agents and
contractors (“Agents”) to access and use the Electronic Services on the Trust’s
behalf, except that the Custodian reserves the right to prohibit the Trust’s use
of any particular Agent for any reason. The Trust shall require its
Agent(s) to agree in writing to be bound by the terms of the Agreement, and the
Trust shall be liable and responsible for any act or omission of such Agent in
the same manner, and to the same extent, as though such act or omission were
that of the Trust. Each submission of a Written Instruction or other
communication by the Agent through the Electronic Services shall constitute a
representation and warranty by the Trust that the Agent continues to be duly
authorized by the Trust to so act on its behalf and the Custodian may rely on
the representations and warranties made herein in complying with such Written
Instruction or communication. Any Written Instruction or other
communication through the Electronic Services by an Agent shall be deemed that
of the Trust, and the Trust shall be bound thereby whether or not authorized.
The Trust may, subject to the terms of this Agreement and upon advance written
notice to the Bank, provide a copy of the Electronic Service user manuals to its
Agent if the Agent requires such copies to use the Electronic Services on the
Trust’s behalf. Upon cessation of any such Agent's services, the
Trust shall promptly terminate such Agent’s access to the Electronic Services,
retrieve from the Agent any copies of the manuals and destroy them, and retrieve
from the Agent any token cards or other security devices provided by Custodian
and return them to Custodian.
