EXHIBIT 99.8
CUSTODIAN CONTRACT
between
International Heritage Fund
and
STATE STREET BANK AND TRUST COMPANY
ASCGS 07/87
Revised 2/10/88
TABLE OF CONTENTS
Page
1. Employment of Custodian and Property to be Held by It ........... 2
2. Duties of the Custodian with Respect to Property of the
Fund Held by the Custodian in the United States ................. 3
2.1 Holding Securities ....................................... 3
2.2 Delivery of Securities ................................... 4
2.3 Registration of Securities ............................... 9
2.4 Bank Accounts ............................................ 10
2.4A Payments For Shares ...................................... 10
2.5 Availability of Federal Funds ............................ 10
2.6 Collection of Income ..................................... 11
2.7 Payment of Fund Monies ................................... 11
2.8 Liability for Payment in Advance of
Receipt of Securities Purchased .......................... 14
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 ....................................... 20
2.12 Ownership Certificates for Tax Purposes .................. 25
2.13 Proxies .................................................. 26
2.14 Communications Relating Portfolio Securities ............. 26
3. Duties of the Custodian with Respect to Property of
the Fund Held Outside of the United States ...................... 27
3.1 Appointment of Foreign Sub-Custodians .................... 27
3.2 Assets to be Held ........................................ 27
3.3 Foreign Securities Depositories .......................... 28
3.4 Segregation of Securities ................................ 28
3.5 Agreements with Foreign Banking Institutions ............. 28
3.6 Access of Independent Accountants of the Fund ............ 29
3.7 Reports by Custodian ..................................... 30
3.8 Transactions in Foreign Custody Account .................. 30
3.9 Liability of Foreign Sub-Custodians ...................... 31
3.10 Monitoring Responsibilities .............................. 32
3.11 Branches of U.S. Banks ................................... 32
4. Payments for Repurchases or Redemptions and Sales
of Shares of the Fund ........................................... 33
5. Proper Instructions ............................................. 34
6. Actions Permitted Without Express Authority...................... 34
7. Evidence of Authority............................................ 35
8. Duties of Custodian With Respect to the Books of Account
and Calculation of Net Asset Value and Net Income ............... 35
9. Records ......................................................... 36
10. Opinion of Fund's Independent Accountant ........................ 37
11. Reports to Fund by Independent Public Accountant ................ 37
12. Compensation of Custodian ....................................... 37
13. Responsibility of Custodian ..................................... 38
14. Effective Period, Termination and Amendment ..................... 40
15. Successor Custodian ............................................. 41
15A. Special Provisions Concerning Repurchase Agreements ............. 43
16. Interpretive and Additional Provisions .......................... 43
17. Additional Funds ................................................ 44
18. Massachusetts Law to Apply ...................................... 44
19. Prior Contracts ................................................. 44
20. Names ........................................................... 44
CUSTODIAN CONTRACT
This Contract between International Heritage Fund, a business trust
organized and existing under the laws of the Commonwealth of Massachusetts
having its principal place of business at Boston, Massachusetts, hereinafter
called the "Fund" 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 Fund 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 Fund intends to initially offer shares in five series:
-- International Heritage Government Portfolio
-- International Heritage High Yield Portfolio
-- International Heritage Growth and Income Portfolio
-- International Heritage Overseas Growth Portfolio
-- International Heritage Overseas Income Portfolio
(such series together with all other series subsequently established
by the Fund 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:
1. Employment of Custodian and Property to be Held by It
The Fund hereby employs the Custodian as the custodian of the assets of
the Portfolios of the Fund, including securities which the Fund, 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") pursuant to the provisions of the Declaration of
Trust. The Fund on behalf of the Portfolio(s) agrees to deliver to the Custodian
all securities and cash of the Portfolios, 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 beneficial
interest of the Fund representing interests in the Portfolios, ("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 Fund, on
behalf of the applicable Portfolio(s), and provided that the Custodian shall
have no more or less responsibility or liability to the Fund 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-custodians
for the Fund'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.
The Fund may from time to time employ a special custodian in connection
with certain repurchase agreements entered into by the Fund, with the terms of
such employment to be governed by a special custodian agreement between the Fund
and the special custodian. However, the Fund agrees not to employ any such
special custodian until the Fund and the Custodian have entered into a master
repurchase agreement or other agreement which sets forth the terms governing the
relationship, including the method of transfer of securities and cash, between
the Custodian and such special custodian.
The Custodian acknowledges that additional Portfolios may be
established and that Portfolios may be terminated, from time to time by action
of the Trustees of the Fund.
2. Duties of the Custodian with Respect to Property of the Fund
Held By the Custodian in the United States
2.1 Holding Securities. The Custodian shall hold and physically segregate
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 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, with 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 (as used in this subsection, the term
"sale" shall include without limitation the disposition of a
portfolio security upon the exercise of an option written by the
Portfolio);
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 1; 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 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; provided
that the Custodian shall adopt such procedures, as the Fund from
time to time shall approve, to ensure their prompt return to the
Custodian by the broker in the event the broker elects not to
accept them;
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 Fund on
behalf of the Portfolio, which may be in the form of cash or
obligations issued by the United States 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 may deliver securities prior to the credit
of such collateral, provided that the Custodian shall promptly
notify the Fund if such collateral is not credited;
11) For delivery as security in connection with any borrowings by the
Fund on behalf of the Portfolio requiring a pledge of assets by the
Fund on behalf of the Portfolio, but only against receipt of
amounts borrowed;
12) For delivery in accordance with the provisions of any agreement
among the Fund on behalf of the Portfolio, the Custodian and a
broker-dealer registered under the Securities Exchange Act of 0000
(xxx "Xxxxxxxx Xxx.) 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 Fund;
13) For delivery in accordance with the provisions of any agreement
among the Fund on behalf of the Portfolio, the Custodian, and a
Futures Commission Merchant registered under 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 Fund;
14) Upon receipt of instructions from the transfer agent for the Fund
("Transfer Agent"), for delivery to such Transfer Agent or 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 Fund
("Prospectus") in satisfaction of requests by holders of Shares for
repurchase or redemption; and
15) For any other proper corporate purpose, but only upon receipt of,
in addition to Proper Instructions from the Fund on behalf of the
applicable Portfolio, a certified copy of a resolution of the Board
of Trustees or of the Executive Committee signed by an officer of
the Fund 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 Reqistration of Securities. Domestic securities held by the Custodian
(other than bearer securities) shall be registered in the name of the
Portfolio or in the name of any nominee of the Fund on behalf of the
Portfolio or of any nominee of the Custodian which nominee shall be
assigned exclusively to the Portfolio, unless the Fund has authorized
in writing the appointment of a 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
account or accounts in the United States in the name of each Portfolio
of the Fund, 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 as amended Funds
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
each other or trust companies as it may in its discretion deem
necessary or desirable; provided, however, that every such bank or
trust company shall be qualified to act as 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 and
the shall on behalf of each applicable Portfolio be approved by vote of
a majority of the Board of Trustees of the Fund. Such funds shall be
deposited by the Custodian in its capacity as Custodian shall be
withdrawable by the Custodian only in its capacity.
2.4A Payments for Shares. The Custodian shall receive from the distributor
of the Fund's Shares or from the Transfer Agent and deposit into the
Fund's account such payments as are received for Shares of the Fund
issued or sold from time to time by the Fund. The Custodian will
provide timely notification to the Fund and the Transfer Agent of any
receipt by it of payments for Shares of the Fund.
2.5 Availability of Federal Funds. Upon mutual agreement between the Fund
on behalf of each applicable Portfolio and the Custodian, the Custodian
shall, upon the receipt of Proper Instructions from the Fund on behalf
of a Portfolio, make federal funds available to such Portfolio, as of
specified times agreed upon from time to time by the Fund 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
income and other payments with respect to United States registered
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 United States bearer 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.
Income due each Portfolio on securities loaned pursuant to the
provisions of Section 2.2 (10) shall be the responsibility of the Fund.
The Custodian will have no duty or responsibility in connection
therewith, other than to provide the Fund with such information or data
as may be necessary to assist the Fund in arranging for the timely
delivery to the Custodian of the income to which the Portfolio is
properly entitled.
2.7 Payment of Fund Monies. Upon receipt of Proper Instructions from the
Fund 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 securities, options, futures
contracts or options on futures contracts for the account of the
Portfolio but only (a) against the delivery of such securities, or
evidence of title to such options, futures contracts or options on
futures 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 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 or (c) in the case
of a purchase involving the Direct Paper System, in accordance with
the conditions set forth in Section 2.10A; or (d) in the case of
repurchase agreements entered into between the Fund 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 Fund 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 Fund;
6) For payment of the amount of dividends received in respect to
securities sold short;
7) For any other proper purpose, but only upon receipt of, in addition
to Proper Instructions from the Fund on behalf of the Portfolio, a
certified copy of a resolution of the Board of Trustees signed by
an officer of the Fund 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 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 Fund on behalf of such Portfolio to so pay in
advance, the Custodian shall be absolutely liable to the Fund for such
securities to the same extent as if the securities had been received by
the Custodian, except that in the case of repurchase agreements entered
into by the Fund with a bank which is a member of the Federal Reserve
System, the Custodian may transfer funds to the account of such bank
prior to the receipt of written evidence that the securities subject to
such repurchase agreement have been transferred by book-entry into a
segregated non-proprietary account of the Custodian maintained with the
Federal Reserve Bank of Boston or of the safe-keeping receipt, provided
that such securities have in fact been so transferred by book-entry.
2.9 Appointment of Aqents. The Custodian may at any time or times in its
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 Custodian may from time to
time direct; provided, however, that the appointment of any agent shall
not relieve the Custodian of its responsibilities or liabilities
hereunder.
2.10 Deposit of Fund Assets in Securities Systems. The Custodian may deposit
and/or maintain domestic 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, 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 domestic securities of the Portfolio in a
Securities System provided that such securities are represented in
an account ("Account") of the Custodian of 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 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 Fund at its request. Upon request,
the Custodian shall furnish the Fund 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 Fund on behalf of the Portfolio copies of daily
transactions in the Securities System for the account of the
Portfolio.
4) The Custodian shall provide the Fund 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;
5) The Custodian shall have received from the Fund 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 Fund 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 of 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 Fund, 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 Fund Assets Held in the Custodian's Direct Paper System. The
Custodian may deposit and/or maintain securities owned by a
Portfolio in the Direct Paper System of the Custodian subject to
the following provisions:
1) No transaction relating to securities in the Direct Paper System
will be effected in the absence of Proper Instructions from the
Fund 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 any 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 any 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 Fund 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
Paper on the next business day following such transfer and shall
furnish to the Fund on behalf of the Portfolio copies of daily
transaction sheets reflecting each day's transaction in the Direct
Paper System for the account of the Portfolio;
6) The Custodian shall provide the Fund on behalf of the Portfolio
with any report on. its system of internal accounting control as
the Fund may reasonably request from time to time;
2.11 Segregated Account. The Custodian shall upon receipt of Proper
Instructions from the Fund on behalf of each applicable Portfolio
establish and maintain a segregated account of 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 Fund 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 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 (iv),
upon receipt of, in addition to Proper Instructions from the Fund on
behalf of the applicable Portfolio, a certified copy of a resolution of
the Board of Trustees or of the Executive Committee signed by an
officer of the Fund 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.
Whenever the Fund writes a Covered Call Option, the Fund shall promptly
deliver to the Custodian proper instructions specifying with respect to such
Covered Call Option: (a) the name of the issuer and title and number of shares
for which the Covered Call Option was written and which underlie the same; (b)
the expiration date; (c) the exercise price; (d) the premium to be received by
the Fund; (e) the name of the person or broker from whom the premium is to be
received; and (f) the Fund for which the option was written. The Custodian shall
upon receipt of the proper instructions receive or cause to be received, the
premium specified in such proper instructions with respect to such Covered Call
Option, such receipts as are required in accordance with the customs prevailing
among dealers in such Covered Call Options, and shall impose, or direct the
Depository to impose upon the underlying securities specified in the proper
instructions such restrictions as may be required by such receipts.
Notwithstanding the forgoing, the Custodian has the right, upon prior written
notification to the Fund, at any time refuse to issue any receipts for
securities, in the possession of the Custodian and not deposited with the
Depository, underlying a Covered Call Option.
Whenever the Fund writes a Covered Put Option with respect to
securities, the Fund shall promptly deliver to the Custodian proper instructions
specifying with respect to each such Put Option written: (a) the name of the
issuer and title and number of shares for which the Put Option was written; (b)
the expiration date; (c) the exercise price; (d) the premium to be received by
the Fund; (e) the name of the person or broker from whom the premium is to be
received; (f) the amount of cash and/or the amount and kind of securities, if
any, to be deposited by the Custodian in a Segregated Account, and (9) the Fund
for which the option was written. The Custodian shall, upon receipt of the
premium specified in the Certificate, deposit in a Segregated Account the amount
of cash and the amount and kind of securities specified in such Certificate.
The Custodian shall from time to time make such additional deposits to
or withdrawals from, the Segregated Account as may be required by the proper
instructions. In the event that the Fund fails to specify in the proper
instructions the name of the issuer, the title and the number of shares or the
principal amount of any particular securities to be deposited in any Segregated
Account by the Custodian, the Custodian shall not be under any obligation to
make any such deposit and shall so notify the Fund.
Whenever a Covered Call Option described in this Section written by the
Fund is exercised, the Fund shall promptly deliver to the Custodian the proper
instructions instructing the Custodian to deliver, or to direct the Depository
to deliver, the securities subject to such Covered Call Option and specifying:
(a) the Fund for which the Call Option was written; (b) the name of the issuer
and the title and number of shares subject to the Covered Call option; (c) the
person or broker to whom the underlying securities are to be delivered; and (d)
the total amount payable to the Fund upon such exercise. The Custodian shall
deliver, or cause the Depository to deliver, the underlying securities as
specified in the proper instructions upon the return and/or cancellation of any
receipts delivered pursuant to paragraph 2 of this Section, and receipt of the
total amount payable to the Fund as specified in the proper instructions.
Whenever a Put Option described in this Section written by the Fund is
exercised, the Fund shall promptly deliver to the Custodian proper instructions
instructing the Custodian to pay the exercise price of the Put Option to the
holder thereof and specifying: (a) the Fund for which the Put Option was
written; (b) the name of the issuer and the title and number of shares which are
to be delivered to the Fund upon the exercise of the Put Option; (c) the total
dollar amount to be paid to the holder of the Put Option; (d) the person to whom
payment is to be made; (e) the amount of cash and/or the amount and kind of
securities, if any, to be withdrawn from a Segregated Account with respect to
such Put Option and (f) the name of the broker or dealer through whom the Put
Option is being exercised. The Custodian shall upon receipt of the securities
specified in the proper instructions make the payment and effect the withdrawals
from the related Segregated Account therein specified.
Whenever a Put Option or Covered Call Option described in this Section
written by the Fund expires, the Fund shall promptly deliver to the Custodian
proper instructions in accordance with paragraph 2 or 3 of this Section and
instructing the Custodian; (a) to delete such Option from the statements
delivered to the Fund; (b) with respect to Covered Call Options, to free, or
instruct the Depository to free, the securities underlying such Covered Call
Option from the restrictions imposed by receipts issued in connection therewith;
and (c) with respect to Put Options, to withdraw from the related Segregated
Account any and all moneys, securities and other assets of the Fund held with
respect to such Put Option.
Whenever the Fund purchases any option identical to a previously
written Put Option or Covered Call Option described in this Section in a
transaction expressly designated as a "Closing Purchase Transaction" in order to
liquidate its position as a writer of a Put Option or Covered Call Option, the
Fund shall promptly deliver to the Custodian proper instructions specifying with
respect to the Option or Covered Call Option being purchased: (a) that the
transaction is a Closing Purchase Transaction; (b) the name of the issuer and
the title and number of shares of the securities subject to the Put option or
Covered Call Option; (c) the exercise price; (d) the Fund for which the Option
was purchased; (e) the premium to be paid by the Fund; (f) the expiration date;
(g) the name of the person or broker to whom the premium is to be paid; and (h)
in case of a closing Purchase Transaction on a Put Option, the amount of cash
and/or the amount and kind of securities, if any, to be withdrawn from the
related Segregated Account upon completion of the Closing Purchase Transaction.
In the case of a covered Call Option liquidated through a Closing Purchase
Transaction, the Custodian shall, upon the return and/or cancellation of any
cancellation of any receipt issued pursuant to paragraph 2 of this Section, make
the payment and effect the withdrawals from the related Segregated Account
specified in the proper instructions, remove or direct the Depository to remove,
the previously imposed restrictions on the securities underlying the Covered
Call Option, and delete such option from statements delivered to the Fund by the
Custodian. In the case of any Put Option liquidated through a Closing Purchase
Transaction, upon the Custodian's receipt of a broker's or dealer's statement
confirming the liquidation of the Fund's position as writer of such Put Option,
the Custodian shall make the payment and effect the withdrawals from the related
Segregated Account specified in the proper instructions and shall delete such
Option from statements delivered to the Fund.
2.12 Ownership Certificates for Tax Purposes. The Custodian shall execute
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 such securities.
2.13 Proxies. The Custodian shall, with respect to the domestic securities
held 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 such proxies, all proxy
soliciting materials and all notices relating to such securities.
2.14 Communications Relatinq to Fund Portfolio Securities. The Custodian
shall transmit promptly to the Fund 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 Fund 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 all written information received by the
Custodian from issuers of the domestic 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 Fund Held
Outside of the United States
3.1 Appointment of Foreign Sub-Custodians. The Custodian is authorized and
instructed to employ as sub-custodians for the securities and other
assets of the Portfolios maintained outside of the United States the
foreign banking institutions and foreign securities depositories
designated on Schedule A hereto ("foreign sub-custodians). Upon receipt
of "Proper Instructions", together with a certified resolution of the
Fund's Board of Trustees on behalf of the applicable Portfolio(s), the
Custodian and the Fund may on behalf of the applicable Portfolio(s) to
amend Schedule A hereto from time to time to designate additional
foreign banking institutions and foreign securities depositories to act
as sub-custodians. Upon receipt of Proper Instructions from the Fund on
behalf of the applicable Portfolio(s) the Custodian shall cease the
employment of any one or more of such sub-custodians for maintaining
custody of the applicable Portfolio(s) assets.
3.2 Assets to be Held. The Custodian shall limit the securities and other
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 Fund may determine
to be reasonably necessary to effect the foreign securities
transactions of the applicable Portfolios.
3.3 Foreiqn Securities Depositories. Except as may otherwise be agreed upon
in writing by the Custodian and the Fund on behalf of the applicable
Portfolio, assets of the applicable Portfolios shall be maintained in
foreign securities depositories only through arrangements implemented
by the foreign banking institutions serving as sub-custodians pursuant
to the terms hereof.
3.4 Segregation of Securities. The Custodian shall identify on its books as
belonging to each applicable Portfolio of the Fund, 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 custody
account(s) for the Custodians on behalf of the Fund for each applicable
Portfolio of the Fund and physically segregate in each such account
securities and other assets of the Portfolios, 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 (all collectively
referred to as the "Account").
3.5 Aqreements with Foreign Bankinq 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, 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 the
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 Fund, 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 Fund. Upon request of the
Fund, the Custodian will use its best efforts to arrange for the
independent accountants of the Fund to be afforded access to the books
and records of any foreign banking institution employed as a foreign
sub-custodian insofar as such books and records relate to the
performance of such foreign banking institutions under its agreement
with the Custodian.
3.7 Reports by Custodian. The Custodian will supply to the Fund 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 Foreiqn Custody Account. (a) Upon receipt of Proper
Instructions, which may be continuing instructions when so stated by
the parties, the Custodian shall on behalf of each applicable Portfolio
make or cause its foreign sub-custodian to transfer, exchange or
deliver foreign securities owned by the Portfolio, but except to the
extent explicitly provided herein only in any of the cases specified in
Section 2.2 (b) Upon receipt of Proper Instructions, which may be
continuing instructions when so stated by the parties the Custodian
shall on behalf of each applicable Portfolio pay out or cause its
foreign sub-custodians to pay out monies of a Portfolio, but except to
the extent explicitly provided herein only in any of the cases
specified in Section 2.7.(c) Notwithstanding any provision of this
Contract to the contrary, settlement and payment for foreign securities
received for the account of each applicable Portfolio and delivery of
such securities maintained for the account of each applicable Portfolio
may be effected in accordance with the customary or 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 exception of receiving later payment for
such securities from such purchaser or dealer.
(d) 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 Fund 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 and Fund 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
Fund, it shall be entitled to be subrogated to the rights of the
Custodian with respect to any claims against a foreign banking
institution as a consequence of any such loss, damage, cost, expense,
liability or claim if and to the extent that the Fund has not been made
whole for any such loss, damage, cost, expense, liability or claim.
3.10 Monitoring Responsibilities. The Custodian shall furnish annually to
the Fund, during the month of June, information concerning the foreign
sub-custodians employed by the Custodian. Such information shall be
similar in kind and scope to that furnished to the fund in connection
with the initial approval of this Contract. In addition, the Custodian
will promptly inform the Fund in the event that the Custodian learns of
a material adverse change in the financial condition of a foreign
sub-custodian or is notified by a foreign banking institution employed
as a foreign sub-custodian that 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. accounting
principles).
3.11 Branches of U.S. Banks. Except as otherwise set forth in this Contract,
the provisions hereof shall not apply where the custody of the Fund
assets 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 which meets 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 Article 1 of this Contract.
4. Payments for Sales or Repurchase or Redemptions of Shares of the Fund.
The Custodian shall receive from the distributor for the Shares or from
the Transfer Agent of the Fund 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 Fund. The Custodian
will provide timely notification to the Fund on behalf of each such
Portfolio and the Transfer Agent of any receipt by it of payments for
Shares of such Portfolio.
From such funds as may be available for the purpose but subject to the
limitations of the Declaration of Trust and any applicable votes of the Board of
Trustees of the Fund pursuant thereto, the Custodian shall, upon receipt of
instructions from the Transfer Agent, make funds available for payment to
holders of Shares who have delivered to the Transfer Agent a request for
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 the Transfer Agent to wire funds to or through a commercial
bank designated by the redeeming shareholders. In connection with the redemption
or repurchase of Shares of the Fund, the Custodian shall honor checks drawn on
the Custodian by a holder of Shares, which checks have been furnished by the
Fund to the holder of Shares, when presented to the Custodian in accordance with
such procedures and controls as are mutually agreed upon from time to time
between the Fund and the Custodian.
5. Proper Instructions. Proper Instructions as used throughout this
Contract means a writing signed or initialled by one or more person or
persons as the Board of Trustees 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 so authorized to give such
instructions with respect to the transaction involved. The Fund shall
cause all oral instructions to be confirmed in writing. Upon receipt of
a certificate of the Secretary or an Assistant Secretary as to the
authorization by the Board of Trustees of the Fund accompanied by a
detailed description of procedures approved by the Board of Trustees,
Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the
Board of Trustees and the Custodian are satisfied that such procedures
afford adequate safeguards for the Portfolio's assets.
6. Actions Permitted without Express Authority. The Custodian may in its
discretion, without express authority from the Fund 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 Fund 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
vith 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 Trustees of the Fund.
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 Fund. The Custodian may
receive and accept a certified copy of a vote of the Board of Trustees
of the Fund 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 of Trustees pursuant to the Declaration of
Trust 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
The Custodian shall cooperate with and supply necessary information to
the entity or entities appointed by the Board of Trustees of the Fund to keep
the books of account of each Portfolio and/or compute the net asset value per
share of the outstanding shares of each Portfolio or, if directed in writing to
do so by the Fund on behalf of the Portfolio, shall itself keep such books of
account and/or compute such net asset value per share. If so directed, the
Custodian shall also calculate daily the net income of the Portfolio as
described in the Fund's currently effective prospectus related to such Portfolio
and shall advise the Fund and the Transfer Agent daily of the total amounts of
such net income and, if instructed in writing by an officer of the Fund to do
so, shall advise the Transfer Agent periodically of the division of such net
income among its various components. The calculations of the net asset value per
share and the daily income of each Portfolio shall be made at the time or times
described from time to time in the Fund's currently effective prospectus related
to such Portfolio.
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 Fund under the Investment
Company Act of 1940, with particular 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 Fund.
All such records shall be the property of the Fund 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 Fund and employees and agents of
the Securities and Exchange Commission. The Custodian shall, at the Fund's
request, supply the Fund with a tabulation of securities owned by each Portfolio
and held by the Custodian and shall, when requested to do so by the Fund and for
such compensation as shall be agreed upon between the Fund and the Custodian,
include certificate numbers in such tabulations.
10. Opinion of Fund's Independent Accountant
The Custodian shall take all reasonable actions, as the Fund on behalf
of each applicable Portfolio may from time to time request, to obtain from year
to year favorable opinions from the Fund's independent accountants with respect
to its activities hereunder in connection with the preparation of the Fund's
Form N-1A, 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 Fund by Independent Public Accountants
The Custodian shall provide the Fund, on behalf of each of the
Portfolios at such time as the Fund may reasonably require, with reports by
independent public accountants on the accounting system, internal accounting
control and procedures for safeguarding securities, futures contracts and
options on futures 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 Fund 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 reasonable compensation for its
services and expenses as Custodian, as agreed upon from time to time between the
Fund on behalf of each applicable Portfolio and the Custodian. (See Schedule B
attached)
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
qenuineness 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 actinq
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.
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 Fund for any action taken or omitted by it in good
faith without negligence. It shall be entitled to rely on and may act upon
advice of counsel (who may be counsel for the Fund) on all matters, and shall be
without liability for any action reasonably taken or omitted pursuant to such
advice. Notwithstanding the foregoing, the responsibility of the Custodian with
respect to redemptions effected by check shall be in accordance with a separate
Agreement entered into between the Custodian and the Fund.
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 foreian
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 Fund to maintain custody or any
securities or cash of the Fund in a foreign country including, but not limited
to, losses resulting from nationalization, expropriation, currency restrictions,
or acts of war or terrorism.
If the Fund 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 Fund or the Portfolio being liable for the payment
of money or incurring liability of some other form, the Fund on behalf of the
Portfolio, as a prerequisite to requiring the Custodian to take such actions,
shall provide indemnity to the Custodian in an amount and form satisfactory to
it.
If the Fund 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 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
therefore and should the Fund fail to repay the Custodian promptly, the
Custodian shall be entitled to utilize available cash and to dispose of the such
Portfolio's assets to the extent necessary to obtain reimbursement.
14. Effective Period, Termination and Amendment
This Contract shall become effective as 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 thirty (30) 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 of Trustees of the Fund 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 of Trustees has reviewed the use 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 of
Trustees has approved the initial use of the Direct Paper System by such
Portfolio and the receipt of an annual certificate of the Secretary or an
Assistant Secretary that the Board of Trustees has reviewed the use by such
Portfolio of the Direct Paper System; provided further, however, that the Fund
shall not amend or terminate this Contract in contravention of any applicable
federal or state regulations, or any provision of the Declaration of Trust, and
further provided, that the Fund on behalf of one or more of the Portfolios may
at any time by action of its Board of Trustees, (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 Fund 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 Fund, of one or more of the Portfolios
shall be appointed by the Board of Trustees of the Fund, 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 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 or in the Direct Paper 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 of
Trustees of the Fund, deliver at the office of the 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 of Trustees 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 any
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 and to transfer to an account of such successor
custodian all the 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 Fund to procure the certified copy of
the vote referred to or of the Board of Trustees 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.
15A. Special Provisions Concerning Repurchase Aqreements.
Notwithstanding anything to the contrary in this Agreement, upon
receipt of proper instructions, which may be standing instructions, in
connection with repurchase agreements, the Custodian shall transmit, prior to
receipt on behalf of the Fund of any securities or other property, funds from
the Fund's custodian account to a special custodian approved by the Trustees of
the Fund, which funds shall be used to pay for securities to be purchased by the
Fund subject to the Fund's obligation to sell and the seller's obligation to
repurchase such securities. In such a case, the securities shall be held in the
custody of the special custodian.
16. Interpretive and Additional Provisions
In connection with the operation of this Contract, the Custodian and
the Fund 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 be in their joint opinion be consistent with the general tenor
of this Contract. Any such interpretive or additional provisions shall be in
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 or any provision of the Declaration of Trust of the
Fund. No interpretive or additional provisions made as provided in the preceding
sentence shall be deemed to be an amendment of this Contract.
17. Additional Funds
In the event that the Fund establishes one or more series of Shares in
addition to International Heritage Government Portfolio, International Heritage
High Yield Portfolio, International Heritage Growth and Income Portfolio,
International Heritage Overseas Growth Portfolio, and International Heritage
Overseas Income Portfolio 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. Prior Contracts
This Contract supersedes and terminates, as of the date hereof, all
prior contracts between the Fund on behalf of each of the Portfolios and the
Custodian relating to the custody of the Fund's assets.
20. Names
The names International Heritage Fund and Trustees of International
Heritage Fund refer respectively to the Trust created and the Trustees, as
trustees but not individually or personally, acting from time to time under a
Declaration of Trust dated September 5, 1986 which is hereby referred to and a
copy of which is on file at the office of the State Secretary of the
Commonwealth of Massachusetts and at the principal office of the Trust. The
obligations of International Heritage Fund entered into in the name or on behalf
thereof by any of the Trustees, representatives or agents are made not
individually, but in such capacities, and are not binding upon any of the
Trustees, Shareholders, or representatives of the Trust personally, but bind
only the Trust Property, and all persons dealing with any class of shares of the
Trust must look solely to the Trust property belonging to such class for the
enforcement of any claims against the Trust.
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 the thirty-first day of May, 1988.
International Heritage Fund
BY: [illegible] President
--------------------------------------------
ATTEST: [illegible], Secretary
-------------------------------------------------
STATE STREET BANK AND TRUST COMPANY
BY: [illegible]
---------------------------------------------
Vice President
ATTEST:
[illegible]
-------------------------------------------------
Assistant Secretary
Schedule A
The following foreign banking institutions and foreign securities
depositories have been approved by the Board of Trustees of the International
Heritage Fund for the use as sub-custodians for the Fund's securities and other
assets:
1. ANZ Banking Group Ltd. (Australia)
2. Girozentrale Und Bank Der Osterreichischen (Austria)
3. Banque Bruxelles Xxxxxxx (Belgium)
4. Canada Trust Company (Canada)
5. Den Danske Bank (Denmark)
6. Credit Commercial De France (France)
7. Berliner Handels Und Frankfurter Bank (West Germany)
8. Standard Chartered Bank (Hong Kong)
9. Credito Italiano (Italy)
10. Monte Titoli S.P.A. (Italian central securities deposit)
11. Sumitomo Trust & Banking Company Limited (Japan)
12. Bank Mees & Hope, N.V. (The Netherlands)
13. Westpac Banking Corp. (New Zeland)
14. Christiania Bank Og Kreditkasse (Norway)
15. DBS Bank Ltd. (Singapore)
16. Banco Hispano Americano (Spain)
17. Skandinaviska Enskilda Banken (Sweden)
18. Union Bank of Switzerland (Switzerland)
19. State Street London Limited, State Street Boston Corp.
(United Kingdom)
EXHIBIT 1
CUSTODIAN AGREEMENT
TO:
Gentlemen:
The undersigned ("State Street") hereby request that you (the Bank)
establish a custody account and a cash account for each custodian/employee
benefit plan identified in the Schedule attached to this Agreement and each
additional account which is identified to this Agreement. Each such custody or
cash account as applicable will be referred to herein as the "Account" and will
be subject to the following terms and conditions:
1. The Bank shall hold as agent for State Street and shall physically
segregate in the Account such cash, bullion, coin, stocks, shares,
bonds, debentures, notes and other securities and other property which
is delivered to the Bank for that State Street Account (the
"Property").
2. a. Without the prior approval of State Street it will not deposit
securities in any securities depository or utilize a clearing
agency, incorporated or organized under the laws of a country other
than the United States, unless such depository or clearing house
operates the central system for handling of securities or
equivalent book-entries in that country or operates a transnational
system for the central handling of securities or equivalent
book-entries;
b. When securities held for an Account are deposited in a securities
depository or clearing agency by the Bank, the Bank shall identify
on its books as belonging to State Street as agent for such
Account, the securities so deposited.
3. The Banks represents that either:
a. It currently has stockholders' equity in excess of $200 million
(U.S. dollars or the equivalent of U.S. dollars computed in
accordance with generally accepted U.S. accounting principles) and
will promptly inform State Street in the event that there appears
to be substantial likelihood that its stockholders' equity will
decline below $200 million, or in any event, at such time as its
stockholders' equity in fact decline below $200 million; or
b. It is the subject of an exemptive order issued by the United States
Securities and Exchange Commission, which such order permits State
Street to employ the Bank as a sub custodian, notwithstanding the
fact that the Bank's stockholders' equity is currently below $200
million or may in the future decline below $200 million due to
currency fluctuation.
4. Upon the written instructions of State Street, as permitted by
Paragraph 8, the Bank is authorized to pay cash from the Account and to
sell, assign, transfer, deliver or exchange, or to purchase for the
Account, any and all stocks, shares, bonds, debentures, notes and other
securities ("Securities"), bullion, coin and any other property, but
only as provided in such written instructions. The bank shall not be
held liable for any act or omission to act on instructions given or
purported to be given should there by any error in such instructions.
5. Unless the Bank receives written instructions of State Street to the
contrary, the Bank is authorized:
a. To promptly receive and collect all income and principal with
respect to the Property and to credit cash receipts to the Account;
b. To promptly exchange securities where the exchange is purely
ministerial (including, without limitation, the exchange of
temporary securities for those in definitive form and the exchange
of warrants, or other documents of entitlement to securities, for
the securities themselves);
c. To promptly surrender securities at maturity or when called for
redemption upon receiving payment therefor;
d. Whenever notification of a rights entitlement or a fractional
interest resulting from a rights issue, stock dividend or stock
split is received for the Account and such rights entitlement or
fractional interest bears an expiration date, the Bank will
endeavor to obtain State Street Bank's instructions, but should
these not be received in time for the Bank to take timely actions,
the Bank is authorized to sell such rights entitlements or
fractional interest and to credit the Account;
e. To hold registered in the name of the nominee of the Bank or its
agents such Securities as are ordinarily held in registered form;
f. To execute in State Street's name for the Account, whenever the
Bank deems it appropriate, such ownership on other certificates as
may be required to obtain the payment of income from the Property;
and
g. To pay or cause to be paid, from the Account any and all taxes and
levies in the nature of taxes imposed on such assets by any
governmental authority and shall use reasonable efforts, to
promptly reclaim any foreign withholding tax relating to the
Account.
6. If the Bank shall receive any proxies, notices, reports or other
communications relative to any of the Securities of the account in
connection with tender offers, reorganization, mergers, consolidations,
or similar events which may have an impact upon the issuer thereof, the
Bank shall promptly transmit any such communication to State Street
Bank by means as will permit State Street Bank to take timely action
with respect thereto.
7. The Bank is authorized in its discretion to appoint brokers and agents
in connection with the Bank's handling of transactions relating to the
Property provided that any such appointment shall not relieve the Bank
of any of its responsibilities or liabilities hereunder.
8. Written instructions shall include (i) instructions in writing signed
by such persons as are designated in writing by State Street; (ii)
telex or tested telex instructions of State Street; (iii) other forms
of instruction in computer readable form as shall be customarily
utilized for the transmission of like information; an (iv) such other
forms of communication as from time to time shall be agreed upon by
State Street and the Bank.
9. The Bank shall supply periodic reports with respect to the safekeeping
of assets held by it under this agreement. The content of such reports
shall include but not be limited to any transfer to or from any account
held by the Bank hereunder and such other information as State Street
may reasonably request.
10. In addition to its obligations under Section 2B hereof, the Bank shall
maintain such other records as may be necessary to identify the assets
hereunder as belonging to each custodian/employee benefit plan
identified in our Schedule attached to this agreement and each
additional account which is identified to this agreement.
11. The Bank agrees that its books and records relating to its actions
under this Agreement shall be opened to the physical, on-premises
inspection and audit at reasonable times by officers of, auditors
employed by or other representatives of State Street (including to the
extent permitted under law the independent public accountants for any
entity whose Property is being held hereunder) and shall be retained
for such period as shall be agreed by State Street and the Bank.
12. The Bank shall be entitled to reasonable compensation for its services
and expenses as custodian under this Agreement, as agreed upon from
time to time by the Bank and State Street.
13. The Bank shall exercise reasonable care in the performance of its
duties, as are set forth or contemplated herein or contained in
instructions given to the Bank which are not contrary to this
Agreement, shall maintain adequate insurance and agrees to indemnify
and hold harmless, State Street and each Account from and against any
loss, damage, cost, expense, liability or claim arising out of or in
connection with the Bank's performance of its obligations hereunder.
14. The Bank agrees (i) the property held hereunder is not subject to any
right, charge, security interest, lien or claim of any kind in favor of
the Bank or any of its agents or its creditors except a claim of
payment for their safe custody and administration and (ii) the
beneficial ownership of the property shall be freely transferable
without the payment of money or other value other than for safe custody
or administration.
15. The Bank agrees to meet State Street Operating Requirements (See
Exhibit A).
16. This Agreement may be terminated by the Bank or State Street by 60
days' written notice to the other, sent by registered mail or express
courier. The Bank, upon the date this Agreement terminate pursuant to
notice which has been given in a timely fashion, shall deliver the
Property to the beneficial owner unless the Bank has received from the
beneficial owner 60 days' prior to the date on which this Agreement is
to be terminated written instructions of State Street specifying the
name(s) of the person(s) to whom the Property shall be delivered.
17. The Bank and State Street shall each use its best efforts to maintain
the confidentiality of the Property in each Account, subject, however,
to the provisions of any laws requiring the disclosure of the Property.
18. Unless otherwise specified in this Agreement, all notices with respect
to matters contemplated by this Agreement, shall be deemed duly given
when received in writing or by confirmed telex by the Bank or State
Street at their respective addresses set forth below or at such other
address as be specified in each case in a notice similarly given:
To State Street Master Trust Division, Global Custody
STATE STREET BANK AND TRUST COMPANY
X.X. Xxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
X.X.X.
To the Bank
19. This Agreement shall be governed by and construed in accordance with
the laws of except to the extent that such laws are preempted by the
laws of the United States of America.
Please acknowledge your agreement to the foregoing by executing a copy of this
letter,
Very truly yours,
STATE STREET BANK AND TRUST COMPANY
By:
---------------------------------
Vice President
Date:
-------------------------------
Agreed to by:
By:
------------------------------
Date:
------------------------------
0043k/4
November 10, 1986
CUSTODIAN AGREEMENT -- SCHEDULE
MUTUAL FUNDS
CUSTODY CHARGES
CUSTODY, PORTFOLIO & FUND ACCOUNTING SERVICES
LEVEL II
Our asset charge for Custody, Portfolio, and Fund Accounting covers the
following services:
o Safekeeping Services
o General Ledger & Portfolio Fund Accounting
o Subsidiary Accounting
o Daily Cash Management Control
o Monthly Report Production
o Foreign Custodial Services
o Pricing Services for Mutual Funds
o Direct Account Liaison
Annual Asset Fees
GNMA,
Equity Bond International,
Funds Funds Tax Free Funds
First $20 million .00080 .00095 .00115
Next $80 mi11ion .00045 .00055 .00065
Excess .00020 .00025 .00030
There is a $3,000 per month minimum charge for fund servicing.
Supplemental charges are attached.
Earning Allowance Formula for Custody's Funds
Seventy-five percent of the average rate on thirteen week treasury bills
divided by twelve to determine the monthly percentage rate.
CUSTODIAN AGREEMENT November 10, o 1986
SCHEDULE B
Supplemental Charges
o Transaction Charges
Shawmut Bank repo 14.00
Book entry transaction 13 00
Physical transaction 22.00
o Wire Charges
Incoming 4.00
Outgoing 5.00
o Holdings Charge
Monthly charge for each issue. 6.00
o Option Charges
Writing covered options charge 25.00
Expiration or exercise charge 15.00
o GNMA
Paydown/Payup charge 25.00
o Lending of Securities
Deliver loaned securities-versus cash collateral 25.00
Deliver loaned securities versus securities collateral 30.00
Receive/deliver additional cash collateral 6.00
Substitutions of securities collateral 30.00
Deliver cash collateral versus receipt of loaned
securities 15.00
Deliver securities collateral versus receipt of loaned
securities 25.00
Loaned administration - xxxx-to market per day, per
loan 3.00
Out-of-Pocket-Expenses
Monthly out-of-pocket expenses, such as telephone, postage, sub-custodian
charges, etc., will be billed at the end of each month.
AGREEMENT made by and between State Street Bank and Trust Company (the
"Custodian") and INTERNATIONAL HERITAGE FUND (the "Fund").
WHEREAS, the Custodian and the Fund are parties to a custodian contract
dated May 20, 1988 (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 Custodian Contract
to provide for the maintenance of the Fund's foreign securities, and cash
incidental to transactions in such securities, in the custody of certain foreign
banking institutions and foreign securities depositories acting as
sub-custodians in conformity with the requirements of Rule 17f-5 under the
Investment Company Act of 1940;
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 conditions;
1. Appointment of Foreign Sub-Custodians
The Fund hereby authorizes and instructs the Custodian to employ as
sub-custodians for the Fund's securities and other assets of the Portfolios
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
2.17 of the Custodian Contract, together with a certified resolution of the
Fund's Board of Trustees, on behalf of the applicable Portfolio(s), the
Custodian and the Fund may agree to amend Schedule A hereto from time to time to
designate additional foreign banking institutions and foreign securities
depositories to act as sub-custodians. Upon receipt of Proper Instructions, the
Fund may, on behalf of the applicable Portfolio(s) instruct the Custodian to
cease the employment of any one or more of such sub-custodians for maintaining
custody of the Portfolio's assets.
2. Assets to be Held
The Custodian shall limit the securities and other assets maintained in
the custody of the foreign sub-custodians to: (a) "foreign securities", as
defined in paragraph (c)(1) 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
Fund may determine to be reasonably necessary to effect the Fund's foreign
securities transactions of the applicable Portfolios.
3. Foreiqn Securities Depositories
Except as may otherwise be agreed upon in writing by the Custodian and
the Fund, on behalf of the applicable Portfolio, assets of the applicable
Portfolios shall be maintained in foreign securities depositories only through
arrangements implemented by the foreign banking institutions serving as
sub-custodians pursuant to the terms hereof. Where possible, such arrangements
shall include entry into agreements containing the provisions set forth in
Section 5 hereof.
4. Segregation of Securities
The Custodian shall identify on its books as belonging to each
applicable Portfolio of the Fund, 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 Fund
for each applicable Portfolio of the Fund and physically segregate in each such
account, securities and other assets of the Portfolios, and, in the event that
such institution deposits the Portfolio's 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 the Fund, the securities so
deposited.
5. Agreements with Foreiqn 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 agents, 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 in the independent public accounts for
the Fund, 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.
6. Access of Independent Accounts of the Fund
Upon request of the Fund, the Custodian will use its best efforts to
arrange for the independent accounts of the Fund to be afforded access to the
books and records of any foreign banking institution employed as a foreign
sub-custodian insofar as such books and records relate to the performance of
such foreign banking institution under its agreement with the Custodian. 7.
7. Reports by Custodian
The Custodian will supply to the Fund 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.
8. Transactions in Foreign Custody Account
(a) Except as otherwise provided in paragraph (b) of this Section 8,
the provisions of Section 2.2 and 2.8 of the Custodian Contract shall
apply, mutatis mutandis to the foreign securities of the Fund held outside the
United States by foreign sub-custodians.
(b) Notwithstanding any provision of the Custodian Contract to the
contrary, settlement and payment for securities received for the account of each
applicable Portfolio of the Fund and delivery of such securities maintained for
the account of each applicable Portfolio of the Fund may be effected in
accordance with the customary or 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 exception 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 the Custodian Contract, and the Fund agrees to hold
any such nominee harmless from any liability as a holder of record of such
securities.
9. Liability of Foreiqn 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 and each Fund 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 Fund, it
shall be entitled to be subrogated to the rights of the Custodian with respect
to any claims against a foreign banking institution as a consequence of any such
loss, damage, cost, expense, liability or claim if and to the extent that the
Fund has not been made whole for any such loss, damage, cost, expense, liability
or claim.
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 generally in the Custodian 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 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 or war or terrorism or otherwise resulting from any action
or omission by a foreign banking institution or a foreign securities depository
provided that any such act or omission shall not have resulted from or
constitute the failure to exercise reasonable care by such institution or
depository. Notwithstanding the foregoing provisions of this paragraph 10, in
delegating custody duties to State Street London Ltd., the Custodian shall not
be relieved of any responsibility to the Fund for any loss due to such
delegations, 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 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).
11. Reimbursement for Advances
If the Fund requires the Custodian to advance cash or securities for
any purpose 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 Fund shall be security therefor and should the Fund fail
to repay the Custodian promptly, the Custodian shall be entitled to utilize
available cash and to dispose of the Fund assets to the extent necessary to
obtain reimbursement.
12. Monitoring Responsibilities
The Custodian shall furnish annually to the Fund, during the month of
June, information concerning the foreign sub-custodians employed by the
Custodian. Such information shall be similar in kind and scope to that furnished
to the Fund in connection with the initial approval of this amendment to the
Custodian Contract. In addition, the Custodian will promptly inform the Fund in
the event that the Custodian learns of a material adverse change in the
financial condition of a foreign sub-custodian or any material loss of the
assets of the Fund or in the case of any foreign sub-custodian not the subject
of an exemptive order from the Securities and Exchange Commission is notified by
such foreign sub-custodian that 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.
accounting principles).
13. Branches of U.S. Banks
(a) Except as otherwise set forth in this amendment to the Custodian
Contract, the provisions hereof shall not apply where the custody of the Fund
assets is 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 the Custodian Contract.
(b) Cash held for the Fund in the United Kingdom shall be maintained in
an interest bearing account established for the Fund with the Custodian's London
Branch, which account shall be subject to the direction of the Custodian, State
Street London Ltd. or both.
14. Applicability of Custodian Contract
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 in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 31st day of May, 1988.
INTERNATIONAL HERITAGE FUND
ATTEST:
[illegible] By: [illegible]
--------------------- ---------------------------------
(Title) Secretary (Title) President
STATE STREET BANK AND TRUST COMPANY
ATTEST:
[illegible] By: [illegible]
---------------------- ---------------------------------
Assistant Secretary Vice President
Schedule A
The following foreign banking institutions and foreign securities
depositories have been approved by the Board of Trustees of the International
Heritage Fund for use as subcustodians for the Fund's securities and other
assets.
1. ANZ Banking Group Ltd. (Australia)
2. Girozentrale Und Bank Der Osterreichischen (Austria)
3. Banque Bruxelles Xxxxxxx (Belgium)
4. Canada Trust Company (Canada)
5. Den Danske Bank (Denmark)
6. Credit Commercial De France (France)
7. Erliner Handels Und Frankfurter Bank (West Germany)
8. Standard Chartered Bank (Hong Kong)
9. Credito Italiano (Italy)
10. Monte Titoli S.P.A. (Italian central securities deposit)
11. Sumitomo Trust & Banking Company Limited (Japan)
12. Bank Mees & Hope, N.V. (The Netherlands)
13. Westpac Banking Corp. (New Zealand)
14. Christiania Bank Og Kreditkasse (Norway)
15. DBS Bank Ltd. (Singapore)
16. Banco Hispano Americano (Spain)
17. Skandinaviska Enskilda Banken (Sweden)
18. Union Bank of Switzerland (Switzerland)
19. Xxxxx Xxxxxx Xxxxxx Xxxxxxx, Xxxxx Xxxxxx Xxxxxx Xxxx.
(Xxxxxx Xxxxxxx)
FIRST
AMENDMENT
TO
CUSTODIAN, FUND ACCOUNTING AND RECORDKEEPING AGREEMENT
BY AND BETWEEN
KEYSTONE AMERICA WORLD BOND FUND
AND
STATE STREET BANK AND TRUST COMPANY
This First Amendment to the Custodian, Fund Accounting and Recordkeeping
Agreement by and between KEYSTONE AMERICA WORLD BOND FUND ("Fund") and STATE
STREET BANK AND TRUST COMPANY ("State Street"), dated May 31, 1988 ("Agreement")
is made by and between the Fund and State Street as of February 8, 1990.
In consideration of the mutual agreements contained herein, State Street and
the Fund hereby agree to amend the Agreement as
follows:
1. Section II is amended by deleting Paragraph 12 and by inserting the
following as Paragraph 12:
" 12. The Fund shall pay State Street for its services as Custodian
such compensation as specified in the existing Schedule A. Such
compensation shall remain fixed until March 31, 1990 unless this Agreement
is terminated as provided in Paragraph 12."
2. In all other respects the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed in its name and on its behalf by a duly authorized officer as of the
day and year first above written.
ATTEST: KEYSTONE AMERICA WORLD BOND FUND
/s/ Illegible /s/ Illegible
-------------------------- By: --------------------------
ATTEST: STATE STREET BANK AND
TRUST COMPANY
/s/ Illegible /s/ Illegible
-------------------------- By: --------------------------
Vice President
SECOND
AMENDMENT
TO
CUSTODIAN, FUND ACCOUNTING AND RECORDKEEPING AGREEMENT
BY AND BETWEEN
KEYSTONE AMERICA WORLD BOND FUND
AND
STATE STREET BANK AND TRUST COMPANY
This Second Amendment to the Custodian, Fund Accounting and Recordkeeping
Agreement by and between KEYSTONE AMERICA WORLD BOND FUND, a Massachusetts
business trust organized and existing under the laws of the Commonwealth of
Massachusetts and having a principal place of business at 00 Xxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000 (hereinafter called the "Fund"), 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").
WHEREAS: The Fund and the Custodian are parties to a Custodian, Fund
Accounting and Recordkeeping Agreement dated May 31, 1988, (the "Custodian
Contract");
WHEREAS: The Fund desires that the Custodian issue a letter of credit (the
"Letter of Credit") on behalf of the Fund for the benefit of ICI Mutual
Insurance Company (the "Company") in accordance with the Continuing Letter of
Credit and Security Agreement and that the Fund's obligations to the Custodian
with respect to the Letter of Credit shall be fully collateralized at all times
while the Letter of Credit is outstanding by, among other things, segregated
assets of the Fund equal to 100% of the Fund's proportionate share of the face
amount of the Letter of Credit;
WHEREAS: the Custodian Contract provides for the establishment of
segregated accounts for proper Fund purposes upon Proper Instructions (as
defined in the Custodian Contract); and
WHEREAS: The Fund and the Custodian desire to establish a segregated
account to hold the collateral for the Fund's obligations to the Custodian with
respect to the Letter of Credit and to amend the Custodian Contract to provide
for the establishment and maintenance thereof:
WITNESSETH: That in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto hereby amend the Custodian Contract as
follows:
1. Capitalized terms used herein without definition shall have the
meanings ascribed to them in the Custodian Contract.
2. The Fund hereby instructs the Custodian to establish and maintain a
segregated account (the "Letter of Credit Custody Account") for and on
behalf of the Fund as contemplated by Section 2.11 (iv) of the
Custodian Contract for the purpose of collateralizing the Fund's
obligations under this Amendment to the Custodian Contract.
3. The Fund shall deposit with the Custodian and the Custodian shall hold
in the Letter of Credit Custody Account cash, certificates of deposit,
U.S. government securities or other high-grade debt securities owned
by the Fund acceptable to the Custodian (collectively "Collateral
Securities") equal to 100% of the Fund's proportionate share of the
face amount which the Company may draw under the Letter of Credit.
Upon receipt of such Collateral Securities in the Letter of Credit
Custody Account, the Custodian shall issue the Letter of Credit to the
Company.
4. The Fund hereby grants to the Custodian a security interest in the
Collateral Securities from time to time in the Letter of Credit
Custody Account (the "Collateral") to secure the performance of the
Fund's obligations to the Custodian with respect to the Letter of
Credit, including, without limitation, under Section 5-144(3) of the
Uniform Commercial Code. The Fund shall register the pledge of
Collateral and execute and deliver to the Custodian such powers and
instruments of assignment as may be requested by the Custodian to
evidence and perfect the limited interest in the Collateral granted
hereby.
5. The Collateral Securities in the Letter of Credit Custody Account may
be substituted or exchanged (including substitutions or exchanges
which increase or decrease the aggregate value of the Collateral) only
pursuant to Proper Instructions from the Fund after the Fund notifies
the Custodian of the contemplated substitution or exchange and the
Custodian agrees that such substitution or exchange is acceptable to
the Custodian.
6. Upon any payment made pursuant to the Letter of Credit by the
Custodian to the Company, the Custodian may withdraw from the Letter
of Credit Custody Account Collateral Securities in an amount equal in
value to the amount actually so paid. The Custodian shall have with
respect to the Collateral so withdrawn all of the rights of a secured
creditor under the Uniform Commercial Code as adopted in the
Commonwealth of Massachusetts at the time of such withdrawal and all
other rights granted or permitted to it under law.
7. The Custodian will transfer upon receipt all income earned on the
Collateral to the Fund custody account unless the Custodian receives
Proper Instructions from the Fund to the contrary.
8. Upon the drawing by the Company of all amounts which may become
payable to it under the Letter of Credit and the withdrawal of all
Collateral Securities with respect thereto by the Custodian pursuant
to Section 6 hereof, or upon the termination of the Letter of Credit
by the Fund with the written consent of the Company, the Custodian
shall transfer any Collateral Securities then remaining in the Letter
of Credit Custody Account to another fund custody account.
9. Collateral held in the Letter of Credit Custody Account shall be
released only in accordance with the provisions of this Amendment to
Custodian Contract. The Collateral shall at all times until withdrawn
pursuant to Section 6 hereof remain the property of the Fund, subject
only to the extent of the interest granted herein to the Custodian.
10. Notwithstanding any other termination of the Custodian Contract, the
Custodian Contract shall remain in full force and effect with respect
to the Letter of Credit Custody Account until transfer of all
Collateral Securities pursuant to Section 8 hereof.
11. The Custodian shall be entitled to reasonable compensation for its
issuance of the Letter of Credit and for its services in connection
with the Letter of Credit Custody Account as agreed upon from time to
time between the Fund and the Custodian.
12. The Custodian Contract as amended hereby shall be governed by, and
construed and interpreted under, the laws of the Commonwealth of
Massachusetts.
13. The parties agree to execute and deliver all such further documents
and instruments and to take such further action as may be required to
carry out the purposes of the Custodian Contract, as amended hereby.
14. Except as provided in this Amendment, the Custodian Contract shall
remain in full force and effect, without amendment or modification,
and all applicable provisions of the Custodian Contract, as amended
hereby, shall govern the Letter of Credit Custody Account and the
rights and obligations of the Fund and the Custodian under this
Amendment to Custodian Contract. No provision of this Amendment to
Custodian Contract shall be deemed to constitute a waiver of any
rights of the Custodian under the Custodian Contract or under law.
IN WITNESS WHEREOF, each of the parties has caused this Amendment to
Custodian Contract to be executed in its name and behalf by its duly authorized
representatives and its seal to be hereunder affixed as of the 8th day of
February, 1990.
ATTEST: KEYSTONE AMERICA WORLD BOND FUND
/s/ Illegible /s/ Illegible
-------------------------- By: --------------------------
ATTEST: STATE STREET BANK AND
TRUST COMPANY
/s/ Illegible /s/ Illegible
-------------------------- By: --------------------------
Assistant Secretary Vice President
