CUSTODIAN CONTRACT
Between
NORTH AMERICAN SECURITY TRUST
and
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
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Page
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1. Employment of Custodian and Property to be Held By It................................ 5
2. Duties of the Custodian with Respect to Property of the Fund Held by
the Custodian in the United States.................................................. 6
2.1 Holding Securities............................................................ 6
2.2 Delivery of Securities........................................................ 6
2.3 Registration of Securities.................................................... 10
2.4 Bank Accounts................................................................. 11
2.5 Availability of Federal Funds................................................. 11
2.6 Collection of Income.......................................................... 12
2.7 Payment of Fund Monies........................................................ 12
2.8 Liability for Payment in Advance of
Receipt of Securities Purchased............................................... 15
2.9 Appointment of Agents......................................................... 15
2.10 Deposit of Fund Assets in Securities System................................... 15
2.10A Fund Assets Held in the Custodian's Direct Paper System....................... 18
2.11 Segregated Account............................................................ 19
2.12 Ownership Certificates for Tax Purposes....................................... 20
2.13 Proxies....................................................................... 20
2.14 Communications Relating to Portfolio Securities............................... 21
3. Duties of the Custodian with Respect to Property of the Fund Held
Outside of the United States........................................................ 21
3.1 Appointment of Foreign Sub-Custodians......................................... 22
3.2 Assets to be Held............................................................. 22
3.3 Foreign Securities Depositories............................................... 22
3.4 Segregation of Securities..................................................... 23
3.5 Agreements with Foreign Banking Institutions.................................. 23
3.6 Access of Independent Accountants of the Fund................................. 24
3.7 Reports by Custodian.......................................................... 24
3.8 Transactions in Foreign Custody Account....................................... 24
3.9 Liability of Foreign Sub-Custodians........................................... 25
3.10 Liability of Custodian........................................................ 26
3.11 Reimbursement for Advances.................................................... 26
3.12 Monitoring Responsibilities................................................... 27
3.13 Branches of U.S. Banks........................................................ 28
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4 Payments for Sales or Repurchase or Redemptions of Shares
of the Fund............................................................. 28
5 Proper Instructions..................................................... 29
6 Actions Permitted Without Express Authority............................. 29
7 Evidence of Authority................................................... 30
8 Duties of Custodian With Respect to the Books of Account and
Calculation of Net Asset Value and Net Income........................... 30
9 Record.................................................................. 31
10 Opinion of Fund's Independent Public Accountants........................ 32
11 Reports to Fund by Independent Public Accountants....................... 32
12 Compensation of Custodian............................................... 33
13 Responsibility of Custodian............................................. 33
14 Effective Period, Termination and Amendment............................. 35
15 Successor Custodian..................................................... 36
16 Interpretive and Additional Provisions.................................. 37
17 Additional Series....................................................... 38
18 Massachusetts Law to Apply.............................................. 38
19 Limitation of Liability................................................. 38
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CUSTODIAN CONTRACT
This Contract between North American Security Trust, a business trust
organized and existing under the laws of Massachusetts, having its principal
place of business at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000
hereinafter called the "Trust", and State Street Bank and Trust Company, a
Massachusetts trust company, having its principal place of business at 000
Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, 00000, hereinafter called the
"Custodian",
WITNESSETH:
WHEREAS, the Trust is authorized to issue shares in separate series,
with each such series representing interests in a separate portfolio of
securities and other assets; and
WHEREAS, the Trust intends to initially offer shares in six series,
the Growth Trust, U.S. Government High Yield Trust, Money Market Trust,
Conservative Asset Allocation Trust, Moderate Asset Allocation Trust and
Aggressive Asset Allocation Trust (such series together with all other series
subsequently established by the Trust and made subject to this Contract in
accordance with paragraph 17, being herein referred to as the "Portfolio(s)");
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
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1. Employment of Custodian and Property to be Held by It
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The Trust hereby employs the Custodian as the custodian of the assets of
the Portfolios of the Trust, including securities which the Trust, on behalf of
the applicable Portfolio desires to be held in places within the United States
("domestic securities") and securities it desires to be held outside the United
States ("foreign securities"). The Trust on behalf of the Portfolio(s) agrees to
deliver to the Custodian all securities and cash of the Portfolio(s), and all
payments of income, payments of principal or capital distributions received by
it with respect to all securities owned by the Portfolio(s) from time to time,
and the cash consideration received by it for such new or treasury shares of the
Trust representing interests in the Portfolio(s), ("Shares") as may be issued or
sold from time to time. The Custodian shall not be responsible for any property
of a Portfolio held or received by the Portfolio and not delivered to the
Custodian.
Upon receipt of "Proper Instructions" (within the meaning of Article 5),
the Custodian shall on behalf of the applicable Portfolio(s) from time to time
employ one or more sub-custodians, located in the United States but only in
accordance with an applicable vote by the Board of Trustees of the Trust
("Board") on behalf of the applicable Portfolio(s), and provided that the
Custodian shall have no more or less responsibility or liability to the Trust on
account of any actions or omissions of any sub-custodian so employed than any
such sub-custodian has to the Custodian. The Custodian may employ as sub-
custodian for the Trust's foreign securities on behalf of the applicable
Portfolio(s) the foreign banking institutions and foreign securities
depositories designated in Schedule A hereto but only in accordance with the
provisions of Article 3.
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2. Duties of the Custodian with Respect to Property of the Trust Held By the
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Custodian in the United States
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2.1 Holding Securities. The Custodian shall hold and physically segregate
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for the account of each Portfolio all non-cash property, to be held by it
in the United States including all domestic securities owned by such
Portfolio, other than (a) securities which are maintained pursuant to
Section 2.10 in a clearing agency which acts as a securities depository or
in a book-entry system authorized by the U.S. Department of the Treasury,
collectively referred to herein as "Securities System" and (b) commercial
paper of an issuer for which State Street Bank and Trust Company acts as
issuing and paying agent ("Direct Paper") which is deposited and/or
maintained in the Direct Paper System of the Custodian pursuant to Section
2.10A.
2.2 Delivery of Securities. The Custodian shall release and deliver domestic
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securities owned by a Portfolio held by the Custodian or in a Securities
System account of the Custodian or in the Custodian's Direct Paper book
entry system account ("Direct Paper System Account") only upon receipt of
Proper Instructions from the Trust on behalf of the applicable Portfolio,
which may be continuing instructions when deemed appropriate by the
parties, and only in the following cases:
1) Upon sale of such securities for the account of the
Portfolio and receipt of payment therefor;
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2) Upon the receipt of payment in connection with any
repurchase agreement related to such securities entered into by
the Portfolio ;
3) In the case of a sale effected through a Securities
System, in accordance with the provisions of Section 2.10 hereof;
4) To the depository agent in connection with tender or
other similar offers for securities of the Portfolio;
5) To the issuer thereof or its agent when such securities
are called, redeemed, retired or otherwise become payable;
provided that, in any such case, the cash or other consideration
is to be delivered to the Custodian;
6) To the issuer thereof, or its agent, for transfer into
the name of the Portfolio or into the name of any nominee or
nominees of the Custodian or into the name or nominee name of any
agent appointed pursuant to Section 2.9 or into the name or
nominee name of any sub-custodian appointed pursuant to Article
l; or for exchange for a different number of bonds, certificates
or other evidence representing the same aggregate face amount or
number of units; provided that, in any such case, the new
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securities are to be delivered to the Custodian;
7) Upon the sale of such securities for the account of the
Portfolio, to the broker or its clearing agent, against a
receipt, for examination in accordance with "street delivery"
custom;
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provided that in any such case, the Custodian shall have no
responsibility or liability for any loss arising from the
delivery of such securities prior to receiving payment for such
securities except as may arise from the Custodian's own
negligence or willful misconduct;
8) For exchange or conversion pursuant to any plan of
merger, consolidation, recapitalization, reorganization or
readjustment of the securities of the issuer of such securities,
or pursuant to provisions for conversion contained in such
securities, or pursuant to any deposit agreement; provided that,
in any such case, the new securities and cash, if any, are to be
delivered to the Custodian;
9) In the case of warrants, rights or similar securities,
the surrender thereof in the exercise of such warrants, rights or
similar securities or the surrender of interim receipts or
temporary securities for definitive securities; provided that, in
any such case, the new securities and cash, if any, are to be
delivered to the Custodian;
10) For delivery in connection with any loans of securities
made by the Portfolio, but only against receipt of adequate
collateral as agreed upon from time to time by the Custodian and
the Trust on behalf of the Portfolio, which may be in the form of
cash or obligations issued by the United States
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government, its agencies or instrumentalities, except that in
connection with any loans for which collateral is to be credited
to the Custodian's account in the book-entry system authorized by
the U.S. Department of the Treasury, the Custodian will not be
held liable or responsible for the delivery of securities owned
by the Portfolio prior to the receipt of such collateral;
11) For delivery as security in connection with any
borrowings by the Trust on behalf of the Portfolio requiring a
pledge of assets by the Trust on behalf of the Portfolio, but
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only against receipt of amounts borrowed;
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12) For delivery in accordance with the provisions of any
agreement among the Trust on behalf of the Portfolio, the
Custodian and a broker-dealer registered under the Securities
Exchange Act of 1934 (the "Exchange Act") and a member of The
National Association of Securities Dealers, Inc. ("NASD"),
relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange,
or of any similar organization or organizations, regarding escrow
or other arrangements in connection with transactions by the
Portfolio of the Trust;
13) For delivery in accordance with the provisions of any
agreement among the Trust on behalf of the Portfolio, the
Custodian, and a Futures Commission Merchant registered under
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the Commodity Exchange Act, relating to compliance with the rules
of the Commodity Futures Trading Commission and/or any Contract
Market, or any similar organization or organizations, regarding
account deposits in connection with transactions by the Portfolio
of the Trust;
14) Upon receipt of instructions from the Trust for
delivery to the holders of shares in connection with
distributions in kind, as may be described from time to time in
the currently effective prospectus and statement of additional
information of the Trust, related to the Portfolio
("Prospectus"), in satisfaction of requests by holders of Shares
for repurchase or redemption; and
15) For any other proper corporate purpose, but only upon
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receipt of, in addition to Proper Instructions from the Trust on
behalf of the applicable Portfolio, a certified copy of a
resolution of the Board or of the Executive Committee signed by
an officer of the Trust and certified by the Secretary or an
Assistant Secretary, specifying the securities of the Portfolio
to be delivered, setting forth the purpose for which such
delivery is to be made, declaring such purpose to be a proper
corporate purpose, and naming the person or persons to whom
delivery of such securities shall be made.
2.3 Registration of Securities. Domestic securities held by the Custodian
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(other than bearer securities) shall be registered in the name of the
applicable Portfolio or in
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the name of any nominee of the Trust on behalf of the Portfolio or of any
nominee of the Custodian which nominee shall be assigned exclusively to the
Portfolio, unless the Trust has authorized in writing the appointment of a
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nominee to be used in common with other registered investment companies
having the same investment adviser as the Portfolio, or in the name or
nominee name of any agent appointed pursuant to Section 2.9 or in the name
or nominee name of any sub-custodian appointed pursuant to Article 1. All
securities accepted by the Custodian on behalf of the Portfolio under the
terms of this Contract shall be in "street name" or other good delivery
form.
2.4 Bank Accounts. The Custodian shall open and maintain a separate bank
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account or accounts in the United States in the name of each Portfolio of
the Trust, subject only to draft or order by the Custodian acting pursuant
to the terms of this Contract, and shall hold in such account or accounts,
subject to the provisions hereof, all cash received by it from or for the
account of the Portfolio, other than cash maintained by the Portfolio in a
bank account established and used in accordance with Rule 17f-3 under the
Investment Company Act of 1940. Trusts held by the Custodian for a
Portfolio may be deposited by it to its credit as Custodian in the Banking
Department of the Custodian or in such other banks or trust companies as it
may in its discretion deem necessary or desirable; provided, however, that
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every such bank or trust company shall be qualified to act as a custodian
under the Investment Company Act of 1940 and that each such bank or trust
company and the funds to be deposited with each such bank or trust company
shall on behalf of each applicable Portfolio be approved by vote of a
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majority of the Board of the Trust. Such funds shall be deposited by the
Custodian in its capacity as Custodian and shall be withdrawable by the
Custodian only in that capacity.
2.5 Availability of Federal Trusts. Upon mutual agreement between the Trust on
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behalf of each applicable Portfolio and the Custodian, the Custodian shall,
upon the receipt of Proper Instructions from the Trust on behalf of a
Portfolio, make federal funds available to such Portfolio as of specified
times agreed upon from time to time by the Trust and the Custodian in the
amount of checks received in payment for Shares of such Portfolio which are
deposited into the Portfolio's account.
2.6 Collection of Income. The Custodian shall collect on a timely basis all
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income and other payments with respect to registered domestic securities
held hereunder to which each Portfolio shall be entitled either by law or
pursuant to custom in the securities business, and shall collect on a
timely basis all income and other payments with respect to bearer domestic
securities if, on the date of payment by the issuer, such securities are
held by the Custodian or its agent thereof and shall credit such income, as
collected, to such Portfolio's custodian account. Without limiting the
generality of the foregoing, the Custodian shall detach and present for
payment all coupons and other income items requiring presentation as and
when they become due and shall collect interest when due on securities held
hereunder. The risk of collection of income due each Portfolio on
securities loaned pursuant to the provisions of Section 2.2 (10) shall be
the responsibility of the Trust. The Custodian will have no duty or
responsibility in connection therewith, other than
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to arrange for the timely delivery to the Custodian of the income to which
the Portfolio is properly entitled.
2.7 Payment of Trust Monies. Upon receipt of Proper Instructions from the
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Trust on behalf of the applicable Portfolio, which may be continuing
instructions when deemed appropriate by the parties, the Custodian shall
pay out monies of a Portfolio in the following cases only:
1) Upon the purchase of domestic or foreign securities,
options on securities or securities indices or foreign
currencies, futures contracts on financial instruments or
securities indices or foreign currencies, or options on such
futures contracts and forward currency contracts for the account
of the Portfolio but only (a) against the delivery of such
securities or evidence of title to such options or contracts to
the Custodian (or any bank, banking firm or trust company doing
business in the United States or abroad which is qualified under
the Investment Company Act of 1940, as amended, to act as a
custodian and has been designated by the Custodian as its agent
for this purpose) registered in the name of the Portfolio or in
the name of a nominee of the Custodian referred to in Section 2.3
hereof or in proper form for transfer; (b) in the case of a
purchase effected through a Securities System, in accordance with
the conditions set forth in Section 2.10 hereof; (c) in the case
of a purchase involving the Direct Paper System, in accordance
with the conditions set forth in Section 2.10A; (d) in
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the case of repurchase agreements entered into between the Trust
on behalf of the Portfolio and the Custodian, or another bank, or
a broker-dealer which is a member of NASD, (i) against delivery
of the securities either in certificate form or through an entry
crediting the Custodian's account at the Federal Reserve Bank
with such securities or (ii) against delivery of the receipt
evidencing purchase by the Portfolio of securities owned by the
Custodian along with written evidence of the agreement by the
Custodian to repurchase such securities from the Portfolio;
2) In connection with conversion, exchange or surrender of
securities owned by the Portfolio as set forth in Section 2.2
hereof;
3) For the redemption or repurchase of Shares issued by the
Portfolio as set forth in Article 4 hereof;
4) For the payment of any expense or liability incurred by
the Portfolio, including but not limited to the following
payments for the account of the Portfolio: interest, taxes,
management, accounting, transfer agent and legal fees, and
operating expenses of the Trust whether or not such expenses are
to be in whole or part capitalized or treated as deferred
expenses;
5) For the payment of any dividends on Shares of the
Portfolio declared pursuant to the governing documents of the
Trust;
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6) For payment of the amount of dividends received in
respect of securities sold short;
7) For any other proper purpose, but only upon receipt of,
in addition to Proper Instructions from the Trust on behalf of
the Portfolio, a certified copy of a resolution of the Board of
Trustees or of the Executive Committee of the Trust signed by an
officer of the Trust and certified by its Secretary or an
Assistant Secretary, specifying the amount of such payment,
setting forth the purpose for which such payment is to be made,
declaring such purpose to be a proper purpose, and naming the
person or persons to whom such payment is to be made.
2.8 Liability for Payment in Advance of Receipt of Securities Purchased. In any
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and every case where payment for purchase of domestic securities for and
every case where payment for purchase of domestic securities for the
account of a Portfolio is made by the Custodian in advance of receipt of
the securities purchased in the absence of specific written instructions
from the Trust on behalf of such Portfolio to so pay in advance or unless
specifically authorized by this contract to so pay in advance, the
Custodian shall be absolutely liable to the Trust for such securities to
the same extent as if the securities had been received by the Custodian.
2.9 Appointment of Agents. The Custodian may at any time or times in its
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discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the Investment Company Act of 1940,
as amended, to act as a custodian, as its agent to carry out such of the
provisions of this Article 2 as the
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Custodian may from time to time direct; provided, however, that the
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appointment of any agent shall not relieve the Custodian of its
responsibilities or liabilities hereunder.
2.10 Deposit of Trust Assets in Securities Systems. The Custodian may deposit
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and/or maintain securities owned by a Portfolio in a clearing agency
registered with the Securities and Exchange Commission under Section 17A of
the Securities Exchange Act of 1934, which acts as a securities depository,
or in the book-entry system authorized by the U.S. Department of the
Treasury and certain federal agencies, collectively referred to herein as
"Securities System" in accordance with applicable Federal Reserve Board and
Securities and Exchange Commission rules and regulations, if any, and
subject to the following provisions:
1) The Custodian may keep securities of the Portfolio in a
Securities System provided that such securities are represented
in an account ("Account") of the Custodian in the Securities
System which shall not include any assets of the Custodian other
than assets held as a fiduciary, custodian or otherwise for
customers;
2) The records of the Custodian with respect to securities
of the Portfolio which are maintained in a Securities System
shall identify by book-entry those securities belonging to the
Portfolio;
3) The Custodian shall pay for securities purchased for the
account of the Portfolio upon (i) receipt of advice from the
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Securities System that such securities have been transferred to
the Account, and (ii) the making of an entry on the records of
the Custodian to reflect such payment and transfer for the
account of the Portfolio. The Custodian shall transfer
securities sold for the account of the Portfolio upon (i) receipt
of advice from the Securities System that payment for such
securities has been transferred to the Account, and (ii) the
making of an entry on the records of the Custodian to reflect
such transfer and payment for the account of the Portfolio.
Copies of all advices from the Securities System of transfers of
securities for the account of the Portfolio shall identify the
Portfolio, be maintained for the Portfolio by the Custodian and
be provided to the Trust. The Custodian shall furnish the Trust
on behalf of the Portfolio confirmation of each transfer to or
from the account of the Portfolio in the form of a written advice
or notice and shall furnish to the Trust on behalf of the
Portfolio copies of daily transaction sheets reflecting each
day's transactions in the Securities System for the account of
the Portfolio.
4) The Custodian shall provide the Trust for the Portfolio
with any report obtained by the Custodian on the Securities
System's accounting system, internal accounting control and
procedures for safeguarding securities deposited in the
Securities System;
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5) The Custodian shall have received from the Trust on
behalf of the Portfolio the initial or annual certificate, as the
case may be, required by Article 14 hereof;
6) Anything to the contrary in this Contract
notwithstanding, the Custodian shall be liable to the Trust for
the benefit of the Portfolio for any loss or damage to the
Portfolio resulting from use of the Securities System by reason
of any negligence, misfeasance or misconduct of the Custodian or
any of its agents or of any of its or their employees or from
failure of the Custodian or any such agent to enforce effectively
such rights as it may have against the Securities System; at the
election of the Trust, it shall be entitled to be subrogated to
the rights of the Custodian with respect to any claim against the
Securities System or any other person which the Custodian may
have as a consequence of any such loss or damage if and to the
extent that the Portfolio has not been made whole for any such
loss or damage.
2.10A Trust Assets Held in the Custodian's Direct Paper System. The Custodian
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may deposit and/or maintain securities owned by a Portfolio in the Direct
Paper System of the Custodian subject to the procedures outlined in the
Securities and Exchange Commission's response dated July 8, 1985 to the
Custodian's request for a "no-action" letter and the following provisions:
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1) No transaction relating to securities in the Direct
Paper System will be effected in the absence of Proper
Instructions from the Trust on behalf of the Portfolio;
2) The Custodian may keep securities of the Portfolio in
the Direct Paper System only if such securities are represented
in an account ("Account") of the Custodian in the Direct Paper
System which shall not include any assets of the Custodian other
than assets held as a fiduciary, custodian or otherwise for
customers;
3) The records of the Custodian with respect to securities
of the Portfolio which are maintained in the Direct Paper System
shall identify by book-entry those securities belonging to the
Portfolio ;
4) The Custodian shall pay for securities purchased for the
account of the Portfolio upon the making of an entry on the
records of the Custodian to reflect such payment and transfer of
securities to the account of the Portfolio. The Custodian shall
transfer securities sold for the account of the Portfolio upon
the making of an entry on the records of the Custodian to reflect
such transfer and receipt of payment for the account of the
Portfolio;
5) The Custodian shall furnish the Trust on behalf of the
Portfolio confirmation of each transfer to or from the account of
the Portfolio, in the form of a written advice or notice, of
Direct
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Paper on the next business day following such transfer and shall
furnish to the Trust on behalf of the Portfolio copies of daily
transaction sheets reflecting each day's transaction in the
Securities System for the account of the Portfolio;
6) The Custodian shall provide the Trust on behalf of the
Portfolio with any report on its system of internal accounting
control as the Trust may reasonably request from time to time.
2.11 Segregated Account. The Custodian shall upon receipt of Proper
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Instructions from the Trust on behalf of each applicable Portfolio
establish and maintain a segregated account or accounts for and on behalf
of each such Portfolio, into which account or accounts may be transferred
cash and/or securities, including securities maintained in an account by
the Custodian pursuant to Section 2.10 hereof, (i) in accordance with the
provisions of any agreement among the Trust on behalf of the Portfolio, the
Custodian and a broker-dealer registered under the Exchange Act and a
member of the NASD (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 of any similar organization or organizations,
regarding escrow or other arrangements in connection with transactions by
the Portfolio, (ii) for purposes of segregating cash or government
securities in connection with options purchased, sold or written by the
Portfolio or commodity futures contracts or options thereon purchased or
sold by the Portfolio, (iii) for the
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purposes of compliance by the Portfolio 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) for other proper corporate purposes, but only, in the case of clause
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(iv), upon receipt of, in addition to Proper Instructions from the Trust on
behalf of the applicable Portfolio, a certified copy of a resolution of the
Board or of the Executive Committee signed by an officer of the Trust and
certified by the Secretary or an Assistant Secretary, setting forth the
purpose or purposes of such segregated account and declaring such purposes
to be proper corporate purposes.
2.12 Ownership Certificates for Tax Purposes. The Custodian shall execute
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ownership and other certificates and affidavits for all federal and state
tax purposes in connection with receipt of income or other payments with
respect to domestic securities of each Portfolio held by it and in
connection with transfers of securities.
2.13 Proxies. The Custodian shall, with respect to the domestic securities held
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hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name of
the Portfolio or a nominee of the Portfolio, all proxies, without
indication of the manner in which such proxies are to be voted, and shall
promptly deliver to the Portfolio or such other persons as may be
designated by the Board such proxies, all proxy soliciting materials and
all notices relating to such securities.
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2.14 Communications Relating to Portfolio Securities. The Custodian shall
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transmit promptly to the Trust for each Portfolio all written information
(including, without limitation, pendency of calls and maturities of
domestic securities and expirations of rights in connection therewith and
notices of exercise of call and put options written by the Trust on behalf
of the Portfolio and the maturity of futures contracts purchased or sold by
the Portfolio) received by the Custodian from issuers of the securities
being held for the Portfolio. With respect to tender or exchange offers,
the Custodian shall transmit promptly to the Portfolio or such other
persons as may be designated by the Board all written information received
by the Custodian from issuers of the securities whose tender or exchange is
sought and from the party (or his agents) making the tender or exchange
offer. If the Portfolio desires to take action with respect to any tender
offer, exchange offer or any other similar transaction, the Portfolio shall
notify the Custodian at least three business days prior to the date on
which the Custodian is to take such action.
3. Duties of the Custodian with Respect to Property of the Trust Held Outside
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of the United States
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3.1 Appointment of Foreign Sub-Custodians.
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The Trust hereby authorizes and instructs the Custodian to employ as sub-
custodians for the Portfolio's securities and other assets maintained
outside the United States the foreign banking institutions and foreign
securities depositories designated on Schedule A hereto ("foreign sub-
custodians"). Upon receipt of "Proper Instructions", as defined in Section
5 of this Contract, together with a certified resolution of the Trust's
Board, the Custodian and the Trust may agree to amend Schedule A hereto
from time to time to designate additional foreign banking institutions and
foreign securities depositories to act as foreign sub-custodian. Upon
receipt of Proper Instructions, the Trust may instruct the Custodian to
cease the employment of any one or more such foreign sub-custodians for
maintaining custody of the Portfolio's assets.
3.2 Assets to be Held. The Custodian shall limit the securities and other
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assets maintained in the custody of the foreign sub-custodians to: (a)
"foreign securities", as defined in paragraph (c)(l) of Rule 17f-5 under
the Investment Company Act of 1940, and (b) cash and cash equivalents in
such amounts as the Custodian or the Trust may determine to be reasonably
necessary to effect the Portfolio's foreign securities transactions.
3.3 Foreign Securities Depositories. Except as may otherwise be agreed upon in
-------------------------------
writing by the Custodian and the Trust, assets of the Portfolios shall be
maintained in foreign securities depositories only through arrangements
implemented by the foreign banking institutions serving as sub-custodians
-23-
pursuant to the terms hereof. Where possible, such arrangements shall
include entry into agreements containing the provisions set forth in
Section 3.5 hereof.
3.4 Segregation of Securities. The Custodian shall identify on its books as
-------------------------
belonging to each applicable Portfolio of the Trust, the foreign securities
of such Portfolios held by each foreign sub-custodian. Each agreement
pursuant to which the Custodian employs a foreign banking institution shall
require that such institution establish a custody account for the Custodian
on behalf of the Trust for each applicable Portfolio of the Trust and
physically segregate in each account, securities and other assets of that
Portfolio, and, in the event that such institution deposits the securities
of one or more of the Portfolios in a foreign securities depository, that
it shall identify on its books as belonging to the Custodian, as agent for
each applicable Portfolio, the securities so deposited.
3.5 Agreements with Foreign Banking Institutions. Each agreement with a foreign
--------------------------------------------
banking institution shall be substantially in the form set forth in Exhibit
1 hereto and shall provide that: (a) the assets of each Portfolio will not
be subject to any right, charge, security interest, lien or claim of any
kind in favor of the foreign banking institution or its creditors or agent,
except a claim of payment for their safe custody or administration; (b)
beneficial ownership for the assets of each Portfolio will be freely
transferable without the payment of money or value other than for custody
or administration; (c) adequate records will be maintained identifying the
assets as belonging to each applicable Portfolio; (d) officers of or
auditors employed by, or other representatives of the Custodian, including
to the extent permitted under applicable law the independent public
accountants for the
-24-
Trust, will be given access to the books and records of the foreign banking
institution relating to its actions under its agreement with the Custodian;
and (e) assets of the Portfolios held by the foreign sub-custodian will be
subject only to the instructions of the Custodian or its agents.
3.6 Access of Independent Accountants of the Trust. Upon request of the Trust,
----------------------------------------------
the Custodian will use its best efforts to arrange for the independent
accountants of the Trust to be afforded access to the books and records of
any foreign banking institution employed as a foreign sub-custodian, or if
requested by the Trust to be provided with the confirmation of the contents
of such books and records insofar as such books and records relate to the
performance of such foreign banking institution under its agreement with
the Custodian.
3.7 Reports by Custodian. The Custodian will supply to the Trust from time to
--------------------
time, as mutually agreed upon, statements in respect of the securities and
other assets of the Portfolio(s) held by foreign sub-custodians, including
but not limited to an identification of entities having possession of the
Portfolio(s) securities and other assets and advices or notifications of
any transfers of securities to or from each custodial account maintained by
a foreign banking institution for the Custodian on behalf of each
applicable Portfolio indicating, as to securities acquired for a Portfolio,
the identity of the entity having physical possession of such securities.
3.8 Transactions in Foreign Custody Account.
---------------------------------------
(a) Except as otherwise provided in paragraph (b) of this Section 3.8, the
provision of Sections 2.2 and 2.7 of this Contract shall apply, mutatis
-------
mutandis
--------
-25-
to the foreign securities of the Trust held outside the United States by
foreign sub-custodians.
(b) Notwithstanding any provision of this Contract to the contrary,
settlement and payment for securities received for the account of each
applicable Portfolio and delivery of securities maintained for the account
of each applicable Portfolio may be effected in accordance with the
customary established securities trading or securities processing practices
and procedures in the jurisdiction or market in which the transaction
occurs, including, without limitation, delivering securities to the
purchaser thereof or to a dealer therefor (or an agent for such purchaser
or dealer) against a receipt with the expectation of receiving later
payment for such securities from such purchaser or dealer.
(c) Securities maintained in the custody of a foreign sub-custodian may be
maintained in the name of such entity's nominee to the same extent as set
forth in Section 2.3 of this Contract, and the Trust agrees to hold any
such nominee harmless from any liability as a holder of record of such
securities.
3.9 Liability of Foreign Sub-Custodians. Each agreement pursuant to which the
-----------------------------------
Custodian employs a foreign banking institution as a foreign sub-custodian
shall require the institution to exercise reasonable care in the
performance of its duties and to indemnify, and hold harmless, the
Custodian the Trust and each Portfolio for which it acts as foreign sub-
custodian from and against any loss, damage, cost, expense, liability or
claim arising out of or in connection with the institution's performance of
such obligations. At the election of the Trust, it shall be entitled to be
subrogated to the rights of the Custodian with respect to any claims
against a
-26-
foreign banking institution as a consequence of any such loss, damage,
cost, expense, liability or claim if and to the extent that the Trust has
not been made whole for any such loss, damage, cost, expense, liability or
claim.
3.10 Liability of Custodian. The Custodian shall be liable for the acts or
----------------------
omissions of a foreign banking institution to the same extent as set forth
with respect to sub-custodians in paragraph 1 of this Contract and,
regardless of whether assets are maintained in the custody of a foreign
banking institution, a foreign securities depository or a branch of a U.S.
bank as contemplated by paragraph 3.13 hereof, the Custodian shall not be
liable for any loss, damage, cost, expense, liability or claim resulting
from nationalization, expropriation, currency restrictions, or acts of war
or terrorism or any other circumstance where the Custodian and its agent
exercised reasonable care. Notwithstanding the foregoing provisions of
this paragraph 3.10, in delegating custody duties to State Street London
Ltd., the Custodian shall not be relieved of any responsibility to the
Trust for any loss due to such delegation, except such loss as may result
from (a) political risk (including, but not limited to, exchange control
restrictions, confiscation, expropriation, nationalization, insurrection,
civil strife or armed hostilities) or (b) other risk of loss (excluding a
bankruptcy or insolvency of State Street London Ltd. not caused by
political risk) for which neither the Custodian nor State Street London
Ltd. would be liable (including, but not limited to, losses due to Acts of
God, nuclear incident or other losses under circumstances where the
Custodian and State Street London Ltd. have exercised reasonable care).
-27-
3.11 Reimbursement for Advances. If the Trust requires the Custodian to advance
--------------------------
cash or securities for any purpose for the benefit of a Portfolio including
the purchase or sale of foreign exchange or of contracts for foreign
exchange, or in the event that the Custodian or its nominee shall incur or
be assessed any taxes, charges, expenses, assessments, claims or
liabilities in connection with the performance of this Contract, except
such as may arise from its or its nominee's own negligent action, negligent
failure to act or willful misconduct, any property at any time held for the
account of the applicable Portfolio shall be security therefor and should
the Trust fail to repay the Custodian promptly, the Custodian shall be
entitled to utilize available cash and to dispose of such Portfolios assets
to the extent necessary to obtain reimbursement.
3.12 Monitoring Responsibilities. The Custodian shall furnish annually to the
---------------------------
Trust, during the month of June, information concerning the foreign sub-
custodians employed by the Custodian and listed in Schedule A hereto. Such
information shall be similar in kind and scope to that furnished to the
Trust in connection with the initial approval of this Contract. In
addition, the Custodian will promptly inform the Trust of any material
change in circumstances surrounding the foreign custody arrangements or any
loss of the assets of the Trust or, in the case of any foreign sub-
custodian not the subject of an exemptive order from the Securities and
Exchange Commission, there appears to be a substantial likelihood that its
shareholders' equity will decline below $200 million (U.S. dollars or the
equivalent thereof) or that its shareholders' equity has declined below
$200 million (in each case computed in accordance with generally accepted
U.S.
-28-
accounting principles). The Custodian shall supply the Trust on a
continuous basis with all information readily available to it which is
relevant to the Trust's compliance with Rule 17f-5 under the Investment
Company Act of 1940.
3.13 Branches of U.S. Banks.
----------------------
(a) Except as otherwise set forth in this Contract, the provisions hereof
shall not apply where the custody of the Portfolios assets are maintained
in a foreign branch of a banking institution which is a "bank" as defined
by Section 2(a)(5) of the Investment Company Act of 1940 meeting the
qualification set forth in Section 26(a) of said Act. The appointment of
any such branch as a sub-custodian shall be governed by paragraph 1 of this
Contract.
(b) Cash held for each Portfolio of the Trust in the United Kingdom shall
be maintained in an interest bearing account established for the Trust with
the Custodian's London branch, which account shall be subject to the
direction of the Custodian, State Street London Ltd. or both.
4. Payments for Sales or Repurchases or Redemptions of Shares of the Trust
-----------------------------------------------------------------------
The Custodian shall receive from the Trust's transfer agent and deposit
into the account of the appropriate Portfolio such payments as are received for
Shares of that Portfolio issued or sold from time to time by the Trust. The
Custodian will provide timely notification to the Trust on behalf of each such
Portfolio of any receipt by it of payments for Shares of such Portfolio. From
such funds as may be available for the purpose, the Custodian, subject to the
limitations of any applicable votes of the Board, shall, upon receipt of
instructions from the Trust, make funds available for payment to holders of
Shares who have delivered to the Trust or its transfer agent a request for
-29-
redemption or repurchase of their Shares. In connection with the redemption or
repurchase of Shares of a Portfolio, the Custodian is authorized upon receipt of
instructions from holders of Shares or the Trust's transfer agent to wire funds
to or through a commercial bank designated by the redeeming shareholders.
5. Proper Instructions
-------------------
Proper Instructions as used throughout this Contract means a writing signed
or initialed by one or more person or persons as the Board shall have from time
to time authorized. Each such writing shall set forth the specific transaction
or type of transaction involved, including a specific statement of the purpose
for which such action is requested. Oral instructions will be considered Proper
Instructions if the Custodian reasonably believes them to have been given by a
person authorized to give such instructions with respect to the transaction
involved. The Trust shall cause all oral instructions to be confirmed in
writing. Upon receipt of a certificate of the Secretary or an Assistant Secr
etary as to the authorization by the Board accompanied by a detailed description
of procedures approved by the Board, Proper Instructions may include
communications effected directly between electro-mechanical or electronic
devices provided that the Board and the Custodian are satisfied that such
procedures afford adequate safeguards for the Portfolios' assets. For purposes
of this Section, Proper Instructions shall include instructions received by the
Custodian pursuant to any three party agreement which requires a segregated
asset account in accordance with Section 2.11.
6. Actions Permitted without Express Authority
-------------------------------------------
-30-
The Custodian may in its discretion, without express authority from the
Trust, on behalf of each applicable Portfolio:
1) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this Contract,
provided that all such payments shall be accounted for to the Trust on behalf of
--------
the Portfolio;
2) surrender securities in temporary form for securities in definitive
form;
3) endorse for collection, in the name of the Portfolio, checks, drafts
and other negotiable instruments; and
4) in general, attend to all non-discretionary details in connection with
the sale, exchange, substitution, purchase, transfer and other dealings with the
securities and property of the Portfolio except as otherwise directed by the
Board of the Trust.
7. Evidence of Authority
---------------------
The Custodian shall be protected in acting upon any instructions, notice,
request, consent, certificate or other instrument or paper reasonably believed
by it to be genuine and to have been properly executed by or on behalf of the
Trust. The Custodian may receive and accept a certified copy of a vote of the
Board as conclusive evidence (a) of the authority of any person to act in
accordance with such vote or (b) of any determination or of any action by the
Board as described in such vote, and such vote may be considered as in full
force and effect until receipt by the Custodian of written notice to the
contrary.
8. Duties of Custodian with Respect to the Books of Account and Calculation of
---------------------------------------------------------------------------
Net Asset Value and Net Income
------------------------------
-31-
The Custodian shall keep the books of account and records of each
Portfolio. The Custodian shall compute the net asset value per share of the
outstanding shares of each Portfolio. In computing the value of securities held
in a Portfolio the Custodian shall use the State Street Bank automated pricing
system or such other pricing methods as are from time to time directed by the
Trust. The Custodian shall also calculate daily the net income and realized
gains of the Portfolio as described in the Trust's currently effective
prospectus related to such Portfolio and shall advise the Trust daily of the
total amounts of such net income and realized gains and, shall advise the Trust
and the holders of Shares periodically of the division of such net income and
realized gains among its various components. The calculations of the net asset
value per share and the daily net income and realized gains of each Portfolio
shall be made at the time or times described from time to time in the Trust's
currently effective prospectus related to such Portfolio and the Custodian shall
use its best efforts to advise the Trust of such calculations on a daily basis
by no later than 5:30 p.m. eastern time on the day for which such calculations
are made. The Custodian agrees to provide, from the effective date of this
Contract forward, the Trust and the holders of Shares with copies of reports and
other information necessary for the preparation of tax returns, audited
financial statements, Form N-SAR and any other reports or returns that the Trust
or its holders of Shares files with any state or federal authority from time to
time.
9. Records
-------
The Custodian shall with respect to each Portfolio create and maintain all
records relating to its activities and obligations under this Contract in such
manner as will meet the obligations of the Trust under the Investment Company
Act of 1940, with particular
-32-
attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder, applicable
federal and state tax laws and any other law or administrative rules or
procedures which may be applicable to the Trust. All such records shall be the
property of the Trust and shall at all times during the regular business hours
of the Custodian be open for inspection by duly authorized officers, employees
or agents of the Trust and employees and agents of the Securities and Exchange
Commission. The Custodian shall, at the Trust's request, supply the Trust with a
tabulation of securities owned by each Portfolio and held by the Custodian and
shall, when requested to do so by the Trust, include certificate numbers in such
tabulations. The Custodian shall also provide the Trust with access to the
Trust's books and records through the "Horizon Plus" system or a similar system.
10. Opinion of Trust's Independent Public Accountants
-------------------------------------------------
The Custodian shall take all reasonable action, as the Trust on behalf of
each applicable Portfolio may from time to time request, to obtain from year to
year favorable opinions from the Trust's independent accountants with respect to
its activities hereunder in connection with the preparation of the Trust's Form
N-lA, and Form N-SAR or other annual reports to the Securities and Exchange
Commission and with respect to any other requirements of such Commission.
11. Reports to Trust by Independent Public Accountants
--------------------------------------------------
The Custodian shall provide the Trust, on behalf of each of the Portfolios
at such times as the Trust may reasonably require, with reports by independent
public accountants on the accounting system, internal accounting control and
procedures for safeguarding securities, options on securities or securities
indices or foreign currencies, futures contracts on financial instruments or
securities indices or foreign currencies,
-33-
options on such futures contracts and forward currency contracts, including
securities deposited and/or maintained in a Securities System, relating to the
services provided by the Custodian under this Contract; such reports, shall be
of sufficient scope and in sufficient detail, as may reasonably be required by
the Trust to provide reasonable assurance that any material inadequacies would
be disclosed by such examination, and, if there are no such inadequacies, the
reports shall so state.
12. Compensation of Custodian
-------------------------
The Custodian shall be entitled to the compensation for its services and
expenses as Custodian as set forth in Schedules B and C which are herein
incorporated and made apart of the Contract, or as shall be agreed upon from
time to time between the Trust on behalf of each applicable Portfolio and the
Custodian.
13. Responsibility of Custodian
---------------------------
So long as and to the extent that it is in the exercise of reasonable care,
the Custodian shall not be responsible for the title, validity or genuineness of
any property or evidence of title thereto received by it or delivered by it
pursuant to this Contract and shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably believed by it to
be genuine and to be signed by the proper party or parties, including any
futures commission merchant acting pursuant to the terms of a three-party
futures or options agreement. The Custodian shall be held to the exercise of
reasonable care in carrying out the provisions of this Contract, but shall be
kept indemnified by and shall be without liability to the Trust for any action
taken or omitted by it in good faith without negligence except as hereinafter
provided with respect to sub-custodians located in the United States or foreign
sub-custodians. It shall be entitled to rely on and may act
-34-
upon advice of counsel (who may be counsel for the Trust) on all matters, and
shall be without liability for any action reasonably taken or omitted pursuant
to such advice.
The Custodian shall be liable for the acts or omissions of a foreign
banking institution appointed pursuant to the provisions of Article 3 to the
same extent as set forth in Article 1 hereof with respect to sub-custodians
located in the United States (except as specifically provided in Article 3.10)
and, regardless of whether assets are maintained in the custody of a foreign
banking institution, a foreign securities depository or a branch of a U.S. bank
as contemplated by paragraph 3.11 hereof, the Custodian shall not be liable for
any loss, damage, cost, expense, liability or claim resulting from, or caused
by, the direction of or authorization by the Trust to maintain custody or any
securities or cash of the Trust in a foreign country including, but not limited
to, losses resulting from nationalization, expropriation, currency restrictions,
or acts of war or terrorism.
If the Trust on behalf of a Portfolio requires the Custodian to take any
action with respect to securities, which action involves the payment of money or
which action may, in the opinion of the Custodian, result in the Custodian or
its nominee assigned to the Trust or the Portfolio being liable for the payment
of money or incurring liability of some other form, the Trust on behalf of the
Portfolio, as a prerequisite to requiring the Custodian to take such action,
shall provide indemnity to the Custodian in an amount and form satisfactory to
it.
If the Trust requires the Custodian to advance cash or securities for any
purpose for the benefit of a Portfolio including the purchase or sale of foreign
exchange or of contracts for foreign exchange or in the event that the Custodian
or its nominee shall incur or be assessed any taxes, charges, expenses,
assessments, claims or liabilities in
-35-
connection with the performance of this Contract, except such as may arise from
its or its nominee's own negligent action, negligent failure to act or willful
misconduct, any property at any time held for the account of the applicable
Portfolio shall be security therefor and should the Trust fail to repay the
Custodian promptly, the Custodian shall be entitled to utilize available cash
and to dispose of such Portfolio's assets to the extent necessary to obtain
reimbursement.
14. Effective Period, Termination and Amendment
-------------------------------------------
This Contract shall become effective on the later of (i) the effective date
of the Trust's registration statement under the Securities Act of 1933 and the
Investment Company Act of 1940 and (ii) the date of its execution, shall
continue in full force and effect until terminated as hereinafter provided, may
be amended at any time by mutual agreement of the parties hereto and may be
terminated by either party by an instrument in writing delivered or mailed,
postage prepaid to the other party, such termination to take effect not sooner
than sixty (60) days after the date of such delivery or mailing; provided,
--------
however that the Custodian shall not with respect to a Portfolio act under
Section 2.10 hereof in the absence of receipt of an initial certificate of the
Secretary or an Assistant Secretary that the Board has approved the initial use
of a particular Securities System by such Portfolio and the receipt of an annual
certificate of the Secretary or an Assistant Secretary that the Board has
reviewed the use by such Portfolio of such Securities System, as required in
each case by Rule 17f-4 under the Investment Company Act of 1940, as amended and
that the Custodian shall not with respect to a Portfolio act under Section 2.10A
hereof in the absence of receipt of an initial certificate of the Secretary or
an Assistant Secretary that the Board has approved the initial use of the Direct
Paper System
-36-
by such Portfolio and the receipt of an annual certificate of the Secretary or
an Assistant Secretary that the Board has reviewed the use by such Portfolio of
the Direct Paper System; provided further, however, that the Trust shall not
-------- -------
amend or terminate this Contract in contravention of any applicable federal or
state regulations, and further provided, that the Trust on behalf of one or more
of the Portfolios may at any time by action of its Board (i) substitute another
bank or trust company for the Custodian by giving notice as described above to
the Custodian, or (ii) immediately terminate this Contract in the event of the
appointment of a conservator or receiver for the Custodian by the Comptroller of
the Currency or upon the happening of a like event at the direction of an
appropriate regulatory agency or court of competent jurisdiction.
Upon termination of the Contract, the Trust on behalf of each applicable
Portfolio shall pay to the Custodian such compensation as may be due as of the
date of such termination and shall likewise reimburse the Custodian for its
costs, expenses and disbursements.
15. Successor Custodian
-------------------
If a successor custodian for the Trust, of one or more of the Portfolios
shall be appointed by the Board, the Custodian shall, upon termination, deliver
to such successor custodian at the office of the Custodian, duly endorsed and in
the form for transfer, all securities and other property of each applicable
Portfolio then held by it hereunder and shall transfer to an account of the
successor custodian all of the securities of each such Portfolio held in a
Securities System.
If no such successor custodian shall be appointed, the Custodian shall, in
like manner, upon receipt of a certified copy of a vote of the Board, deliver at
the office of the
-37-
Custodian and transfer such securities, funds and other properties in accordance
with such vote.
In the event that no written order designating a successor custodian or
certified copy of a vote of the Board shall have been delivered to the Custodian
on or before the date when such termination shall become effective, then the
Custodian shall have the right to deliver to a bank or trust company, which is a
"bank" as defined in the Investment Company Act of 1940, doing business in
Boston, Massachusetts, of its own selection, having an aggregate capital,
surplus, and undivided profits, as shown by its last published report, of not
less than $25,000,000, all securities, funds and other properties held by the
Custodian on behalf of each applicable Portfolio and all instruments held by the
Custodian relative thereto and all other property held by it under this Contract
on behalf of each applicable Portfolio and to transfer to an account of such
successor custodian all of the securities of each such Portfolio held in any
Securities System. Thereafter, such bank or trust company shall be the
successor of the Custodian under this Contract.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Trust to procure the certified copy of the vote referred to or of
the Board to appoint a successor custodian, the Custodian shall be entitled to
fair compensation for its services during such period as the Custodian retains
possession of such securities, funds and other properties and the provisions of
this Contract relating to the duties and obligations of the Custodian shall
remain in full force and effect.
16. Interpretive and Additional Provisions
--------------------------------------
-38-
In connection with the operation of this Contract, the Custodian and the
Trust on behalf of each of the Portfolios, may from time to time agree on such
provisions interpretive of or in addition to the provisions of this Contract as
may in their joint opinion be consistent with the general tenor of this
Contract. Any such interpretive or additional provisions shall be in a writing
signed by both parties and shall be annexed hereto, provided that no such
--------
interpretive or additional provisions shall contravene any applicable federal or
state regulations. No interpretive or additional provisions made as provided in
the preceding sentence shall be deemed to be an amendment of this Contract.
17. Additional Series
-----------------
In the event that the Trust establishes one or more series of Shares in
addition to the Growth Trust, U.S. Government High Yield Trust, Money Market
Trust, Conservative Asset Allocation Trust, Moderate Asset Allocation Trust and
Aggressive Asset Allocation Trust with respect to which it desires to have the
Custodian render services as custodian under the terms hereof, it shall so
notify the Custodian in writing, and if the Custodian agrees in writing to
provide such services, such series of Shares shall become a Portfolio hereunder.
18. Massachusetts Law to Apply
--------------------------
This Contract shall be construed and the provisions thereof interpreted
under and in accordance with laws of The Commonwealth of Massachusetts.
19. Limitation of Liability
-----------------------
The Agreement and Declaration of Trust establishing the Trust, dated
September 28, 1988, a copy of which, together with all amendments thereto (the
"Declaration of Trust"), is on file in the office of the Secretary of The
Commonwealth of Massachusetts, provides
-39-
that the name "North American Security Trust refers to the Trustees under the
Declaration of Trust collectively as Trustees, but not as individuals or
personally; and no Trustee, shareholder, officer, employee or agent of the Trust
shall be held to any personal liability, nor shall resort be had to their
private property, for the satisfaction of any obligation or claim, in connection
with the affairs of the Trust or any Portfolio thereof, but only the assets
belonging to the Trust, or to the particular Series of Shares with respect to
which the obligation or claim arose, shall be liable.
IN WITNESS WHEREOF, each of the parties has caused this instrument to
be executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of 1st day of June, 1989.
ATTEST NORTH AMERICAN SECURITY TRUST
XXXXX X. XXXXXX X X XXXXXXXX
----------------------------------
Assistant Secretary President
ATTEST STATE STREET BANK AND TRUST COMPANY
___________________ By
Assistant Secretary Vice President
-40-
Schedule A
----------
The following foreign banking institutions and foreign securities
depositories have been approved by the Board of NASL Series Trust, Inc. for use
as sub-custodians for the Trust's securities and other assets:
Country Eligible Foreign Custodian
------- --------------------------
-41-
AMENDMENT TO CUSTODIAN CONTRACT
Agreement made by and between State street Bank and Trust Company (the
"Custodian") and North American Funds (the "Fund").
WHEREAS, the Custodian and the Fund are parties to a custodian contract
dated June 1, 1989 (the "Custodian Contract") governing the terms and conditions
under which the Custodian maintains custody of the securities and other assets
of the Fund; and
WHEREAS, the Custodian and the Fund desire to amend the terms and
conditions under which the Custodian maintains the Fund's securities and other
non-cash property in the custody of certain foreign sub-custodians in conformity
with the requirements of Rule 17f-5 under the Investment Company Act of 1940, as
amended;
NOW THEREFORE, in consideration of the premises and covenants contained
herein, the Custodian and the Fund hereby amend the Custodian Contract by the
addition of the following terms and provisions;
1. Notwithstanding any provisions to the contrary set forth in the
Custodian Contract, the Custodian may hold securities and other non-cash
property for all of its customers, including the Fund, with a foreign sub-
custodian in a single account that is identified as belonging to the custodian
for the benefit of its customers, provided however, that (i) the records of the
-------- -------
respect to securities and other non-cash property of the Fund which are
maintained in such account shall identify by book-entry those securities and
other non-cash property belonging to the Fund and (ii) the Custodian shall
require that securities and other non-cash property so held by the foreign sub-
custodian be held separately from any assets of the foreign sub-custodian or of
others.
2. Except as specifically superseded or modified herein, the terms and
provisions of the Custodian Contract shall continue to apply with full force and
effect.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed as a sealed instrument in its name and behalf by its duly authorized
representative this 1st day of July, 1996.
NORTH AMERICAN FUNDS
By:
Title:
STATE STREET BANK AND TRUST COMPANY
By:
Title:
-42-
