CUSTODIAN AGREEMENT
AGREEMENT dated as of November 9, 1995 between BANKERS TRUST
COMPANY (the "Custodian") and THE FIRST NATIONAL BANK OF MARYLAND
(the "Customer").
WHEREAS, the Customer desires to appoint the Custodian as
custodian on behalf of the Customer for certain assets held by
the Customer for an investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), and
other customers under the terms and conditions set forth in this
Agreement, and the Custodian has agreed to so act as custodian.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the parties hereto agree as follows:
1. Employment of Custodian. The Customer hereby employs
the Custodian as custodian of all assets held by the Customer
which are delivered to and accepted by the Custodian or any
Subcustodian (as that term is defined in Section 4) (the
"Property") pursuant to the terms and conditions set forth
herein. Without limitation, such Property shall include stocks
and other equity interests of every type, evidences of
indebtedness, other instruments representing same or rights or
obligations to receive, purchase, deliver or sell same and other
non-cash investment property held by the Customer which is
acceptable for deposit ("Securities") and cash from any source
and in any currency ('Cash"). The Custodian shall not be
responsible for any property held or received by the Customer or
others and not delivered to the Custodian or any Subcustodian.
2. Maintenance of Securities and Cash-at Custodian and
Subcustodian Locations. Pursuant to Instructions, the Customer
shall direct the Custodian to (a) settle Securities transactions
and maintain cash in the country or other jurisdiction in which
the principal trading market for such Securities is located,
where such Securities are to be presented for payment or where
such Securities are acquired and (b) maintain cash and cash
equivalents in such countries in amounts reasonably necessary to
effect the transactions in such Securities. Instructions to
settle Securities transactions in any country shall be deemed to
authorize the holding of such Securities and Cash in that
country.
3. Custody Account. The Custodian agrees to establish and
maintain custody account or accounts on its books in the name of
the Customer (the "Account") for any and all Property from time
to time received and accepted by the Custodian or any
Subcustodian for the account of the Customer. The Account shall
contain, in the manner and on the terms specified herein,
exclusively assets held by the Customer as a fiduciary, custodian
or otherwise for customers. The Custodian shall have the right,
in its sole discretion, to refuse to accept any Property that is
not in proper form for deposit for any reason. The Customer
acknowledges its responsibility as a principal for all of its
obligations to the Custodian arising under or in connection with
this Agreement, warrants its authority to deposit in the Account
any Property received therefor by the Custodian or a Subcustodian
and to give, and authorize others to give, instructions relative
thereto. The Custodian may deliver securities of the same class
in place of those deposited in the Account.
The Custodian shall hold, keep safe and protect as custodian
for the Account, on behalf of the Customer, all Property in such
Account. All transactions, including, but not limited to,
foreign exchange transactions, involving the Property shall be
executed or settled solely in accordance with Instructions,
except that until the Custodian receives Instructions to the
contrary, the Custodian will:
(a) collect all interest and dividends and all other income
and payments, whether paid in cash or in kind, on the
Property, as the same become payable and credit the same
to the Account;
(b) present for payment all Securities held in the Account
which are called, redeemed or retired or otherwise
become payable and all coupons and other income items
which call for payment upon presentation to the extent
that the Custodian or Subcustodian is actually aware of
such opportunities and hold the cash received in the
Account pursuant to this Agreement;
(c)(i) 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 wan-ants, or other documents of
entitlement to securities, for the Securities
themselves) and (ii) when notification of a tender or
exchange offer (other than ministerial exchanges
described in (i) above) is received for the Account,
endeavor to receive Instructions, provided that if such
Instructions are not received in time for the Custodian
to take timely action, no action shall be taken with
respect thereto;
(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, if after endeavoring to obtain
Instructions such Instructions are not received in time
for the Custodian to take timely action or if actual
notice of such actions was received too late to seek
Instructions, sell in the discretion of the Custodian
(which sale the Customer hereby authorizes the Custodian
to make) such rights entitlement or fractional interest
and credit the Account with the net proceeds of such
sale;
(e) execute in the Customer's name for the Account, whenever
the Custodian deems it appropriate, such ownership and
other certificates as may be required to obtain the
payment of income from the Property in the Account;
(f) pay for the Account, any and all taxes and levies in the
nature of taxes imposed on interest, dividends or other
similar income on the Property in the Account by any
governmental authority. In the event there is
insufficient Cash available in the Account to pay such
taxes and levies, the Custodian shall notify the
Customer of the amount of the shortfall and the
Customer, at its option, may deposit additional Cash in
the Account or take steps to have sufficient Cash
available. The Customer agrees, when and if requested
by the Custodian and required in connection with the
payment of any such taxes to cooperate with the
Custodian in furnishing information, executing documents
or otherwise; and
(g) appoint brokers and agents for any of the ministerial
transactions involving the Securities described in (a) -
(f), including, without limitation, affiliates of the
Custodian or any Subcustodian.
4. Subcustodians and Securities Systems. The Customer
authorizes and instructs the Custodian to hold the Property in
the Account in custody accounts which have been established by
the Custodian with (a) one of its branches or another bank or
trust company located within or outside of the U.S.
(individually, a "Subcustodian"); and (b) a securities depository
or clearing agency or system in which the Custodian or a
Subcustodian participates (individually, a "Securities System").
The Custodian may, at any time in its discretion, upon written
notification to the Customer, terminate the employment of any
Subcustodian or Securities System.
5. Subcustodians and Securities Systems. The Customer
authorizes and instructs the Custodian to hold the Property in
the Account in custody, ,accounts which have been established by
the Custodian with (a) one of its U.S. branches or another U.S.
bank or trust company or branch thereof located in the U.S. which
is itself qualified -under the Investment Company Act of 1940, as
amended (" 1 940 Act"), to act as custodian (individually, a
"U.S. Subcustodian"), or a U.S. securities depository or clearing
agency or system in which the Custodian or a U.S. Subcustodian
participates (individually, a "U.S. Securities System") or (b)
one of its non-U.S. branches or majority-owned non-U.S.
subsidiaries, a non-U.S. branch or majority-owned subsidiary of a
U.S. bank or a non-U.S. bank or trust company, acting as
custodian (individually, a "non-U.S. Subcustodian"; U.S.
Subcustodians and non-U.S. Subcustodians, collectively,
"Subcustodians"), or a non-U.S. depository or clearing agency or
system in which the Custodian or any Subcustodian participates
(individually, a "non-U.S. Securities System"; U.S. Securities
System and non-U.S. Securities System, collectively, Securities
System"), provided that in each case in which a U.S. Subcustodian
or U.S. Securities System is employed, each such Subcustodian or
Securities System shall have been approved by Instructions;
provided further that in each case in which a non-U.S.
Subcustodian or non-U.S. Securities System is employed, (a) such
Subcustodian or Securities System either is (i) a 'qualified U.S.
bank" as defined by Rule 17f-5 under the 1940 Act ("Rule 17f-5")
or (ii) an "eligible foreign custodian" within the meaning of
Rule 17f-5 or such Subcustodian or Securities System is the
subject of an order granted by the U.S. Securities and Exchange
Commission ("SEC") exempting such agent or the subcustody
arrangements thereto from all or part of the provisions of Rule
17f-5 and (b) the agreement between the Custodian and such non-
U.S. Subcustodian has been approved by Instructions; it being
understood that the Custodian shall have no liability or
responsibility for determining whether the approval of any
Subcustodian or Securities System has been proper under the 1940
Act or any rule or regulation thereunder.
Upon receipt of Instructions, the Custodian agrees to cease
the employment of any Subcustodian or Securities System with
respect to the Customer, and if desirable and practicable,
appoint a replacement subcustodian or securities system in
accordance with the provisions of this Section. In addition, the
Custodian may, at any time in its discretion, upon written
notification to the Customer, terminate the employment of any
Subcustodian or Securities System.
Upon request of the Customer, the Custodian shall deliver to
the Customer annually a certificate stating: (a) the identity of
each non-U.S. Subcustodian and non-U.S. Securities System then
acting on behalf of the Custodian and the name and address of the
governmental agency or other regulatory authority that supervises
or regulates such non-U.S Subcustodian and non-U.S. Securities
System; (b) the countries in which each non-U.S. Subcustodian or
non-U.S. Securities System is located; and (c) so long as Rule
17f-5 requires the Customer's Board of Trustees to directly
approve its foreign custody arrangements, such other information
relating to such non-U.S. Subcustodians and non-U.S. Securities
Systems as may reasonably be requested by the Customer to ensure
compliance with Rule 17f-5. So long as Rule 17f-5 requires the
Customer's Board of Trustees to directly approve its foreign
custody arrangements, the Custodian also shall furnish annually
to the Customer information concerning such non-U.S.
Subcustodians and non-U.S. Securities Systems similar in kind and
scope as that furnished to the Customer in connection with the
initial approval of this Agreement. Custodian agrees to promptly
notify the Customer if, in the normal course of its custodial
activities, the Custodian has reason to believe that any non-U.S.
Subcustodian or non-U.S. Securities System has ceased to be a
qualified U.S. bank or an eligible foreign custodian each within
the meaning of Rule 17f-5 or has ceased to be subject to an
exemptive order from the SEC.
5. Use of Subcustodian. With respect to Property in the
Account which is maintained by the Custodian in the custody of a
Subcustodian employed pursuant to Section 4:
(a) The Custodian will identify on its books as being held
by the Customer for its customers any Property held by
such-Subcustodian.
(b) Any Property . in the Account held by a Subcustodian
will be subject only to the instructions of the
Custodian or its agents.
(c) Property deposited with a Subcustodian will be
maintained in an account holding only assets for
customers of the Custodian.
(d) Any agreement the Custodian shall enter into with a non-
U.S. Subcustodian with respect to the holding of
Property shall require that (i) the Account will be
adequately indemnified or its losses adequately insured;
(ii) the Securities are not subject to any right,
charge, security interest, lien or claim of any kind in
favor of such Subcustodian or its creditors except a
claim for payment in accordance with such agreement for
their safe custody or administration and expenses
related thereto, (iii) beneficial ownership of such
Securities be freely transferable without the payment of
money or value other than for safe custody or
administration and expenses related thereto, and (iv)
adequate records will be maintained identifying the
Property held pursuant to such Agreement as belonging to
the Custodian, on behalf of its customers.
6. Use of Securities System. With respect to Property in
the Account which is maintained by the Custodian or any
Subcustodian in the custody of a Securities System employed
pursuant to Section 4:
(a) The Custodian shall, and the Subcustodian will be
required by its agreement with the Custodian to,
identify on its books such Property as being held for
the account of the Custodian or Subcustodian for its
customers.
(b) Any Property held in a Securities System for the account
of the Custodian or a Subcustodian will be subject only
to the instructions of the Custodian or such
Subcustodian, as the case may be.
(c) Property deposited with a Securities System will be
maintained in an account holding only assets for
customers of the Custodian or Subcustodian, as the case
may be, unless precluded by applicable law, rule, or
regulation.
(d) The Custodian shall provide the Customer 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.
7. Records.- Ownership of Property. Statements, Opinions
of Independent Certified Public Accountants.
(a) The ownership of the Property whether Securities, Cash
and/or other property, and whether held by the Custodian or a
Subcustodian or in a Securities System as authorized herein,
shall be clearly recorded on the Custodian's books as belonging
to the Account and not for the Custodian's own interest. The
Custodian shall keep accurate and detailed-accounts of all
investments, receipts, disbursements and other transactions for
the Account. Consistent with the requirements of the applicable
rules under the 1940 Act, all accounts, books and records of the
Custodian relating thereto shall be open to inspection and audit
at all reasonable times during normal business hours by any
person designated by the Customer. All such accounts shall be
maintained and preserved in the form reasonably requested by the
Customer. The Custodian will supply to the Customer from time to
time, as mutually agreed upon, a statement with respect to any
Property in the Account held by the Custodian or by a
Subcustodian. In the absence of the filing in writing with the
Custodian by the Customer of exceptions or objections to any such
statement within sixty (60) days of the mailing thereof, the
Customer shall be deemed to have approved such statement and in
such case or upon written approval of the Customer of any such
statement, such statement shall be presumed to be for all
purposes correct with respect to all information set forth
therein.
(b) At the request of the Customer, the Custodian shall
deliver to the Customer a written report prepared by the
Custodian's independent certified public accountants with respect
to the services provided by the Custodian under this Agreement,
including, without limitation, the Custodian's accounting system,
internal accounting control and procedures for safeguarding Cash
and Securities, including Cash and Securities deposited and/or
maintained in a Securities System or with a Subcustodian.
(c) The Customer may elect to participate in any of the
electronic on-line service and communications systems offered by
the Custodian which can provide the Customer, on a daily basis,
with the ability to view on-line or to print on hard copy various
reports of Account activity and of Securities and/or Cash being
held in the Account. To the extent that such service shall
include market values of Securities in the Account, the Customer
hereby acknowledges that the Custodian now obtains and may in the
future obtain information on such values from outside sources
that the Custodian considers to be reliable and the Customer
agrees that the Custodian (i) does not verify nor represent or
warrant either the reliability of such service nor the accuracy
or completeness of any such information furnished or obtained by
or through such service and (ii) shall be without liability in
selecting and utilizing such service or furnishing any
information derived therefrom.
8. Holding of Securities, Nominees, etc. Securities in the
Account which are held by the Custodian or any Subcustodian may
be held by such entity in the name of the Customer, in the
Custodian's or Subcustodian's name, in the name of the
Custodian's or Subcustodian's nominee, or in bearer form.
Securities that are held by a Subcustodian or which are eligible
for deposit in a Securities System as provided above may be
maintained with the Subcustodian or the Securities System in an
account for the Custodian's or Subcustodian's customers, unless
prohibited by law, rule, or regulation. The Custodian or
Subcustodian, as the case may be, may combine certificates
representing Securities held in the Account with certificates of
the same issue held by it as fiduciary or as a custodian. In the
event that any Securities in the name of the Custodian or its
nominee or held by a Subcustodian and registered in the name of
such Subcustodian or its nominee are called for partial
redemption by the issuer of such Security, the Custodian may,
subject to the rules or regulations pertaining to allocation by
any Securities System in which such Securities have been
deposited, allot, or cause to be allotted, the called portion of
the respective beneficial holders of such class of security in
any manner the Custodian deems to be fair and equitable.
9. Proxies, etc. With respect to any proxies, notices,
reports or other communications relative to any of the Securities
in the Account, the Custodian shall perform such services and
only such services relative thereto as are (i) set forth in
Section 3 of this Agreement, (ii) described in Exhibit A attached
hereto (as such service therein described may be in effect from
time to time) (the "Proxy Service") and (iii) as may otherwise be
agreed upon between the Custodian and the Customer. The
liability and responsibility of the Custodian in connection with
the Proxy Service referred to in clause (ii) of the immediately
preceding sentence and in connection with any additional services
which the Custodian and the Customer may agree upon as provided
in clause (iii) of the immediately preceding sentence shall be as
set forth in the description of the Proxy Service and as may be
agreed upon by the Custodian and the Customer in connection with
the furnishing of any such additional service and shall not be
affected by any other term of this Agreement. Neither the
Custodian nor its nominees or agents shall vote upon or in
respect of any of the Securities in the Account, execute any form
of proxy to vote thereon, or give any consent or take any action
(except as provided in Section 3) with respect thereto except
upon the receipt of Instructions relative thereto.
10. Settlement Procedures. Securities will be transferred,
exchanged or delivered by the Custodian or a Subcustodian upon
receipt by the Custodian of Instructions which include all
information required by the Custodian. Settlement and payment
for Securities received for the Account and delivery of
Securities out of the Account 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 expectation of receiving later payment for such
Securities from such purchaser or dealer, as such practices and
procedures may be modified or supplemented in accordance with the
standard operating procedures of the Custodian in effect from
time to time for that jurisdiction or market. The Custodian
shall not be liable for any loss which results from effecting
transactions in accordance with the customary or established
securities trading or securities processing practices and
procedures in the applicable jurisdiction or market.
Notwithstanding that the Custodian may settle purchases and
sales against, or credit income to, the Account, on a contractual
basis, as outlined in the Investment Manager User Guide provided
to the Customer by the Custodian, the Custodian may, at its sole
option, reverse such credits or debits to the Account in the
event that the transaction does not settle, or the income is not
received in a timely manner, and the Customer agrees to hold the
Custodian harmless from any losses which may result therefrom;
provided that the Custodian has met the standard of reasonable
care provided for in Section 12.
Except as otherwise may be agreed upon by the parties
hereto, the Custodian shall not be required to comply with
Instructions to settle the purchase of any Securities for the
Account unless there is sufficient Cash in the Account at the
time or to settle the sale of any Securities in the Account
unless such Securities are in deliverable form. Notwithstanding
the foregoing, if the purchase price of such Securities exceeds
the amount of Cash in the Account at the time of settlement of
such purchase, the Custodian may, in its sole discretion, but in
no way shall have any obligation to, permit an overdraft in the
Account in the amount of the difference solely for the purpose of
facilitating the settlement of such purchase of Securities for
prompt delivery for the Account. The Customer agrees to
immediately repay the amount of any such overdraft in the
ordinary course of business and further agrees to indemnify and
hold the Custodian harmless from and against any and all losses,
costs, including, without limitation the cost of funds, and
expenses incurred in connection with such overdraft. The
Customer agrees that it will not use the Account to facilitate
the purchase of securities without sufficient funds in the
Account (which funds shall not include the proceeds of the sale
of the purchased securities). The Custodian shall have a lien on
the Property in the Account for any amount payable to the
Custodian pursuant to this paragraph of Section 10. 'Me
provisions of this paragraph shall survive the termination of
this Agreement.
11. Instructions. The term "Instructions" means
instructions from the Customer in respect of any of the
Custodian's duties hereunder which have been received by the
Custodian at its address set forth in Section 18 below (i) in
writing (including, without limitation, facsimile transmission)
or by tested telex signed or given by such one or more person or
persons as the Customer shall have from time to time authorized
in writing to give the particular class of Instructions in
question and whose name and (if applicable) signature and office
address have been filed with the Custodian, or (ii) which have
been transmitted electronically through an electronic on-line
service and communications system offered by the Custodian or
other electronic instruction system acceptable to the Custodian,
or (iii) a telephonic or oral communication by one or more
persons as the Customer shall have from time to time authorized
to give the particular class of Instructions in question and
whose name has been filed with the Custodian; or (iv) upon
receipt of such other form of instructions as the Customer may
from time to time authorize in writing and which the Custodian
has agreed in writing to accept. Instructions in the form of
oral communications shall be confirmed by the Customer by tested
telex or writing in the manner set forth in clause (i) above, but
the lack of such confirmation shall in no way affect any action
taken by the Custodian in reliance upon such oral instructions
prior to the Custodian's receipt of such confirmation.
Instructions may relate to specific transactions or to types or
classes of transactions, and may be in the form of standing
instructions.
The Custodian shall have the right to assume in the absence
of notice to the contrary from the Customer that any person whose
name is on file with the Custodian pursuant to this Section has
been authorized by the Customer to give the Instructions in
question and that such authorization has not been revoked. The
Custodian may act upon and conclusively rely on, without any
liability to the Customer or any other person or entity for any
losses resulting therefrom, any Instructions reasonably believed
by it to be furnished by the proper person or persons as provided
above.
12. Standard of Care. The Custodian shall be responsible for
the performance of only such duties as are set forth herein or
contained in Instructions given to the Custodian which are not
contrary to the provisions of this Agreement. The Custodian will
use reasonable care with respect to the safekeeping of Property
in the Account and, except as otherwise expressly provided herein
in carrying out its obligations under this Agreement. So long as
and to the extent that it has exercised reasonable care, the
Custodian shall not be responsible for the title, validity or
genuineness of any Property or other property or evidence of
title thereto received by it or delivered by it pursuant to this
Agreement and shall be held harmless in acting upon, and may
conclusively rely on, without liability for any loss resulting
therefrom, any notice, request, consent, certificate or other
instrument reasonably believed by it to be genuine and to be
signed or furnished by the proper party or parties, including,
without limitation, Instructions, and shall be indemnified by the
Customer for any losses, damages, costs and expenses (including,
without limitation, the fees and expenses of counsel) incurred by
the Custodian and arising out of action taken or omitted with
reasonable care by the Custodian hereunder or under any
Instructions. The Custodian shall be liable to the Customer for
any act or omission to act of any Subcustodian to the same extent
as if the Custodian committed such act itself. With respect to a
Securities System, the Custodian shall only be responsible or
liable for losses arising from employment of such Securities
System caused by the Custodian's own failure to exercise
reasonable care. In the event of any loss to the Customer by
reason of the failure of the Custodian or a Subcustodian to
utilize reasonable care, the Custodian shall be liable to the
Customer to the extent of the Customer's actual damages at the
time such loss was discovered without reference to any special
conditions or circumstances. In no event shall the Custodian be
liable for any consequential or special damages. The Custodian
shall be entitled to rely, and may act, on advice of counsel (who
may be counsel for the Customer) on all matters and shall be
without liability for any action reasonably taken or omitted
pursuant to such advice.
In the event the Customer subscribes to an electronic on-line
service and communications system offered by the Custodian, the
Customer shall be fully responsible for the security of the
Customer's connecting terminal, access thereto and the proper and
authorized use thereof and the initiation and application of
continuing effective safeguards with respect thereto and agree to
defend and indemnify the Custodian and hold the Custodian
harmless from and against any and all losses, damages, costs and
expenses (including the fees and expenses of counsel) incurred by
the Custodian as a result of any improper or unauthorized use of
such terminal by the Customer or by any others.
All collections of funds or other property paid or
distributed in respect of Securities in the Account, including
funds involved in third-party foreign exchange transactions,
shall be made at the risk of the Customer.
Subject to the exercise of reasonable care, the Custodian
shall have no liability for any loss occasioned by delay in the
actual receipt of notice by the Custodian or by a Subcustodian of
any payment, redemption or other transaction regarding Securities
in the Account in respect of which the Custodian has agreed to
take action as provided in Section 3 hereof. The Custodian shall
not be liable for any loss resulting from, or caused by, or
resulting from acts of governmental authorities (whether de jure
or de facto), including, without limitation, nationalization,
expropriation, and the imposition of currency restrictions;
devaluations of or fluctuations in the value of currencies;
changes in laws and regulations applicable to the banking or
securities industry; market conditions that prevent the orderly
execution of securities transactions or affect the value of
Property; acts of war, terrorism, insurrection or revolution;
strikes or work stoppages; the inability of a local clearing and
settlement system to settle transactions for reasons beyond the
control of the Custodian; hurricane, cyclone, earthquake,
volcanic eruption, nuclear fusion, fission or radioactivity, or
other acts of God.
The Custodian shall have no liability in respect of any loss,
damage or expense suffered by the Customer, insofar as such loss,
damage or expense arises from the performance of the Custodian's
duties hereunder by reason of the Custodian's reliance upon
records that were maintained for the Customer by entities other
than the Custodian prior to the Custodian's employment under this
Agreement.
The Customer hereby agrees to hold the Custodian harmless
from any liability or loss resulting from any taxes or other
governmental charges, and any expense related thereto, which may
be imposed, or assessed with respect to any Property in the
Account and also agrees to hold the Custodian, its Subcustodians,
and their respective nominees harmless from any liability as a
record holder of Property in
the Account.
The provisions of this Section shall survive termination of
this Agreement.
13. Investment Limitations and Legal or Contractual
Restrictions or Regulations. The Custodian shall not be liable
to the Customer and the Customer agrees to indemnify the
Custodian and its nominees, for any loss, damage or expense
suffered or incurred by the Custodian or its nominees arising out
of any violation of any investment restriction or other
restriction or limitation applicable to the Customer or its
customers pursuant to any contract or any law or regulation. The
provisions of this Section shall survive termination of this
Agreement.
14. Fees and Expenses. The Customer agrees to pay to the
Custodian such compensation for its services pursuant to this
Agreement as may be mutually agreed upon in writing from time to
time and the Custodian's reasonable out-of-pocket or incidental
expenses in connection with the performance of this Agreement,
including (but without limitation) legal fees as described herein
and/or deemed necessary in the judgment of the Custodian to keep
safe or protect the Property in the Account. The initial fee
schedule is attached hereto as Exhibit B. 'Me Custodian is
authorized to charge the Account for such items.
15. Tax Reclaims. With respect to withholding taxes
deducted and which may be deducted from any income received from
any Property in the Account, the Custodian shall perform such
services with respect thereto as are described in Exhibit C
attached hereto and shall in connection therewith be subject to
the standard of care set forth in such Exhibit C. Such standard
of care shall not be affected by any other term of this Agreement
16. Amendment, Modifications, etc., No provision of this
Agreement may be amended, modified or waived except in a writing
signed by the parties hereto. No waiver of any provision hereof
shall be deemed a continuing waiver unless it is so designated.
No failure or delay on the part of either party in exercising any
power or right under this Agreement operates as a waiver, nor
does any single or partial exercise of any power or right
preclude any other or further exercise thereof or the exercise of
any other power or right.
17. Termination. This Agreement may be terminated by the
Customer or the Custodian by sixty (60) days' written notice to
the other, provided that notice by the Customer shall specify the
names of the persons to whom the Custodian shall deliver the
Securities in the Account and to whom the Cash in the Account
shall be paid. If notice of termination is given by the
Custodian, the Customer shall within sixty (60) days following
the giving of such notice, deliver to the Custodian a written
notice specifying the names of the persons to whom the Custodian
shall deliver the Securities in the Account and to whom the Cash
in the Account shall be paid. In either case, the Custodian will
deliver such Securities and Cash to the persons so specified, (a)
after deducting therefrom any amounts which the Custodian
determines to be owed to it under the last paragraph of Section I
0, the penultimate paragraph of Section 12 and under Section 14
of this Agreement, and (b) withholding, in its discretion, such
Cash and Securities as may be necessary to settle transactions
pending at the time of such delivery. If within sixty (60) days
following the giving of a notice of termination by the Custodian,
the Custodian does not receive from the Customer a written notice
specifying the names of the persons to whom the Custodian shall
deliver the Securities in the Account and to whom the Cash in the
Account shall be paid, the Custodian, at its election, may
deliver such Securities and pay such Cash to a bank or trust
company doing business in the State of New York to be held and
disposed of pursuant to the provisions of this Agreement, or may
continue to hold such Securities and Cash until a written notice
as aforesaid is delivered to the Custodian, provided that the
Custodian's obligations shall be limited to safekeeping.
18. Notices. Except as otherwise provided in this
Agreement, all requests, demands or other communications between
the parties or notices in connection herewith (a) shall be in
writing, hand delivered or sent by telex, telegram, cable,
facsimile or other means of electronic communication agreed upon
by the parties hereto addressed, if to the Customer, to:
The First National Bank of Maryland
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
if to the Custodian, to:
Bankers Trust Company
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX I 0005
Attention: Xxxxx Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
or in either case to such other address as shall have been
furnished to the receiving party pursuant to the provisions
hereof and (b) shall be deemed effective when received, or, in
the case of a telex, when sent to the proper number and
acknowledged by a proper answerback.
19. Security for Payment. To secure payment of the
obligations due under the last paragraph of Section 10, the
penultimate paragraph of Section 12 and under Section 14 of this
Agreement, the Customer hereby grants to Custodian a continuing
security interest in and right of setoff against the Account and
all Property held therein from time to time in the full amount of
such obligations. Should the Customer fail to pay promptly any
amounts owed under such provisions, Custodian shall be entitled
to use available Cash in the Account and to dispose of Securities
in the Account as is necessary. In any such case and without
limiting the foregoing, Custodian shall be entitled to take such
other action(s) or exercise such other options, powers and rights
as Custodian now or hereafter has as a secured creditor under the
New York Uniform Commercial Code or any other applicable law.
20. Representations and Warranties.
(a) The Customer hereby represents and warrants to the
Custodian that:
(i) the employment of the Custodian and the allocation
of fees, expenses and other charges to the Account as herein
provided, is not prohibited by law or any governing documents or
contracts to which the Customer is subject;
(ii) the terms of this Agreement do not violate any
obligation by which the Customer is bound, whether arising by
contract, operation of law or otherwise;
(iii) this Agreement has been duly authorized by
appropriate action and when executed and delivered will be
binding upon the Customer in accordance with its terms; and
(iv) the Customer will deliver to the Custodian such
evidence of such authorization as the Custodian may reasonably
require, whether by way of a certified resolution or otherwise.
(b) The Custodian hereby represents and wan-ants to the
Customer that:
(i) the terms of this Agreement do not violate any
obligation by which the Custodian is bound, whether arising by
contract, operation of law or otherwise;
(ii) this Agreement has bee ,p duly authorized by
appropriate action and when executed and delivered will be
binding upon the Custodian in accordance with its terms; and
(iii) the Custodian will deliver to the Customer such
evidence of such authorization as the Customer may reasonably
require, whether by way of a certified resolution or otherwise.
21. Governing Law and Successors and Assigns. This
Agreement shall be governed by the law of the State of New York
and shall not be assignable by either party, but shall bind the
successors in interest of the Customer and the Custodian.
22. Publicity. Customer shall furnish to Custodian at its
office referred to in Section 18 above, prior to any distribution
thereof, copies of any material prepared for distribution to any
persons who are not parties hereto that refer in any way to the
Custodian. Customer shall not distribute or permit the
distribution of such materials if Custodian reasonably objects in
writing within ten (10) business days of receipt thereof (or such
other time as may be mutually agreed) after receipt thereof. The
provisions of this Section shall survive the termination of this
Agreement.
23. Submission to Jurisdiction. To the extent if any, to
which the Customer or any of its respective properties may be
deemed to have or hereafter to acquire immunity, on the ground of
sovereignty or otherwise, from any judicial process or proceeding
to enforce this Agreement or to collect amounts due hereunder
(including, without limitation, attachment proceedings prior to
judgment or in aid of execution) in any jurisdiction, the
Customer hereby waives such immunity and agrees not to claim the
same. Any suit, action or proceeding arising out of this
Agreement may be instituted in any State or Federal court sitting
in the City of Xxx Xxxx, Xxxxx xx Xxx Xxxx, Xxxxxx Xxxxxx of
America, and the Customer irrevocably submits to the exclusive
jurisdiction of any such court in any such suit, action or
proceeding and waives, to the fullest extent permitted by law,
any objection which it may now or hereafter have to the laying of
venue of any such suit, action or proceeding brought in such a
court and any claim that such -suit, action or proceeding was
brought in an inconvenient forum. The Customer hereby
irrevocably designates, appoints and empowers Allied Irish Banks,
p.l.c.; 000 Xxxx Xxxxxx; Xxx Xxxx, XX 00000 as its authorized
agent to receive, for and on behalf of the Customer and its
property service of process in the State of New York when and as
such legal actions or proceedings may be brought in any of the
aforementioned courts, and such service of process shall be
deemed complete upon the date of delivery thereof to such agent
whether or not such agent gives notice thereof to the Customer or
upon the earliest of any other date permitted by applicable law.
The Customer further irrevocably consents to the service of
process out of any of the aforementioned courts in an h action or
proceeding by the mailing of copies thereof by certified air
mail, postage prepaid, to the Customer at its address set forth
in Section 18 or in any other manner permitted by law, such
service to become effective upon the earlier of (i) the date
fifteen (IS) days after such mailing or (ii) any earlier date
permitted by applicable law. The Customer agrees that it will at
all times continuously maintain an agent to receive service of
process in the City and State of New York on behalf of itself and
its properties with respect to this Agreement and in the event
that, for any reason, the agent named above or its successor
shall no longer serve as agent of the Customer to receive service
of process in the City and State of New York on its behalf, the
Customer shall promptly appoint a successor to so serve and shall
advise the Custodian thereof.
24. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an
original. This Agreement shall become effective when one or more
counterparts have been signed and delivered by each of the
parties hereto.
25. Confidentiality. The parties hereto agree that each
shall treat confidentially the terms and conditions of this
Agreement and all information provided by each party to the other
regarding its business and operations. All confidential
information provided by a party hereto shall be used by any other
party hereto solely for the purpose of rendering services
pursuant to this Agreement and, except as may be required in
carrying out this Agreement shall not be disclosed to any third
party without the prior consent of such providing party. The
foregoing shall not be applicable to any information that is
publicly available when provided or thereafter becomes publicly
available other than through a breach of this Agreement, or that
is required or requested to be disclosed by any bank or other
regulatory examiner of the Custodian, Customer, or any
Subcustodian, any auditor of the parties hereto, by judicial or
administrative process or otherwise by applicable law or
regulation.
26. Severability. If any provision of this Agreement is
determined to be invalid or unenforceable, such determination
shall not affect the validity or enforceability of any other
provision of this Agreement.
27. Headings. The headings of the paragraphs hereof are
included for convenience reference only and do not form a part of
this Agreement.
THE FIRST NATIONAL BANK OF MARYLAND
By: /s/
Name: Xxxxxx Xxxxxx
Title: Vice President
BANKERS TRUST COMPANY
By: /s/
Name: Xxxxxxx X. Quinim
Title: Managing Director
EXHIBIT A
To Custodian Agreement dated as of November 9, 1995 between
Bankers Trust Company and The First National Bank of
Maryland.
PROXY SERVICE
The following is a description of the Proxy Service referred
to in Section 9 of the above referred to Custodian Agreement.
Terms used herein as defined terms shall have the meanings
ascribed to them therein unless otherwise defined below.
The Custodian provides a service, described below, for the
transmission of corporate communications in connection with
shareholder meetings relating to Securities held in Argentina,
Australia, Austria, Canada, Denmark, Finland, France, Germany,
Greece, Hong Kong, Indonesia, Ireland, Italy, Japan, Korea,
Malaysia, Mexico, Netherlands, New Zealand, Pakistan, Poland,
Singapore, South Africa, Spain, Sri Lanka, Sweden, United
Kingdom, United States, and Venezuela. For the United States and
Canada, the term "corporate communications" means the proxy
statements or meeting agenda, proxy cards, annual reports and any
other meeting materials received by the Custodian. For countries
other than the United States and Canada, the term "corporate
communications" means the meeting agenda only and does not
include any meeting circulars, proxy statements or any other
corporate communications furnished by the issuer in connection
with such meeting. Non-meeting related corporate communications
are not included in the transmission service to be provided by
the Custodian except upon request as provided below.
The Custodian's process for transmitting and translating
meeting agendas will be as follows:
1) If the meeting agenda is not provided by the issuer in
the English language, and if the language of such
agenda is in the official language of the country in
which the related security is held, the Custodian will
as soon as practicable after receipt of the original
meeting agenda by a Subcustodian provide an English
translation prepared by that Subcustodian.
2) If an English translation of the meeting agenda is
furnished, the local language agenda will not be
furnished unless requested.
Translations will be free translations and neither the
Custodian nor any Subcustodian will be liable or held responsible
for the accuracy thereof or any direct or indirect consequences
arising therefrom, including without limitation arising out of
any action taken or omitted to be taken based thereon.
If requested, the Custodian will, on a reasonable efforts
basis, endeavor to obtain any additional corporate communication
such as annual or interim reports, proxy statements, meeting
circulars, or local language agendas, and provide them in the
form obtained.
Timing in the voting process is important and, in that
regard, upon receipt by the Custodian of notice from a
Subcustodian, the Custodian will provide a notice to the Customer
indicating the deadline for receipt of its instructions to enable
the voting process to take place effectively and efficiently. As
voting procedures will vary from market to market attention to
any required procedures will be very important. Upon timely
receipt of voting instructions, the Custodian will promptly
forward such instructions to the applicable Subcustodian. If
voting instructions are not timely received, the Custodian shall
have no liability or obligation to take any action.
For Securities held in markets other than those set forth in
the first paragraph, the Custodian will not furnish the material
described above or seek voting instructions. However, if
requested to exercise voting rights at a specific meeting, the
Custodian will endeavor to do so on a reasonable efforts basis
without any assurance that such rights will be so exercised at
such meeting.
If the Custodian or any Subcustodian incurs extraordinary
expenses in exercising voting rights related to any Securities
pursuant to appropriate instructions or direction (e.g., by way
of illustration only and not by way of limitation, physical
presence is required at a meeting and/or travel expenses are
incurred), such expenses will be reimbursed out of the Account
unless other arrangements have been made for such reimbursement.
It is the intent of the Custodian to expand the Proxy
Service to include jurisdictions which are not currently included
as set forth in the second paragraph hereof. The Custodian will
notify the Customer as to the inclusion of additional countries
or deletion of existing countries after their inclusion or
deletion and this Exhibit A will be deemed to be automatically
amended to include or delete such countries as the case may be.
Dated as of November 9, 1995 THE FIRST NATIONAL BANK OF MARYLAND
By: /s/
Name: Xxxxxx Xxxxxx
Title: Vice President
BANKERS TRUST COMPANY
By: /s/
Name: Xxxxxxx X. Quinim
Title: Managing Director
Exhibit B
To Custodian Agreement dated as of November 9, 1995 between
Bankers Trust Company and
The First National Bank of Maryland.
Bankers Trust Company
Global Custody Fee Schedule
for
The First National Bank of Maryland
1. Annual Asset Fee (based on market value per annum)
US Assets 1 BASIS POINT
Tier I 3 BASIS POINTS
> Cedel (Eurobonds)
> Euroclear (Eurobonds)
> Canada
> Germany
> Italy
> Japan
> United Kingdom
Tier II 5 BASIS POINTS
> Australia > Luxembourg
> Austria > Netherlands
> Belgium > New Zealand
> Denmark > Norway
> France > Switzerland
> Ireland > Sweden
Tier III 8 BASIS POINTS
> Hong Kong
> Indonesia
> Malaysia
> Mexico
> Philippines
> Singapore
> South Africa
> Spain
> Thailand
Standard Fee Schedule
Tier IV
Receive and Deliver
Country Annual Asset Fee Transactions
Argentina 45 Basis Points $150
Brazil 40 Basis Points $100
Chile 30 Basis Points $100
Columbia 30 Basis Points $100
Finland 15 Basis Points $100
Greece 50 Basis Points $120
Israel 25 Basis Points $50
Mexico (Bonds) 30 Basis Points $100
Pakistan 30 Basis Points $150
Xxxx 00 Basis Points $125
Portugal 15 Basis Points $100
Xxxxxxx.Xxxxxxxx 00 Xxxxx Xxxxxx $100
South Korea 15 Basis Points $100
Sri Lanka 30 Basis Points $100
Taiwan 15 Basis Points $100
Turkey 30 Basis Points $100
Venezuela 35 Basis Points $100
2. Account Charge - $350 per account (per month)
3. U.S. Security Trades - Receive and Deliver Transactions $20
For Tier 1, II, III Trades - Receive and Deliver Transactions $50
Assumes electronic trade entry for mutual trades (i.e. fax, telex)
a premium for trade charge will be added.
4. Front End System - Free of Charge
5. Minimum Annual Fee $15,000
1. Fees are billed monthly.
2. Fees for the receipt of positions relating to the initial
asset transition will be waived with the exception of the
United Kingdom, Spain and Indonesia where re-registration
fees will be assessed.
3. Cash movements relating to third party FX trades will be
assessed at $25 per U.S. wire movement and $50 per non U.S.
wire movement. For FX trades concluded with BTCo., this
charge will be waived.
4. Fees for investment in countries not listed will be
negotiated separately.
The Exhibit B shall be amended upon delivery by the Custodian of
a new Exhibit B to the Customer and acceptance thereof by the
Customer and shall be effective as of the date of acceptance by
the Customer or a date agreed upon between the Custodian and the
Customer.
The First National Bank of Maryland Bankers Trust Company
Accepted by: /s/ Prepared by: /s/
XXXXXX X. XXXXXX, VICE PRESIDENT XXXXXXX X. QUINIM, MANAGING DIRECTOR
(PRINT NAME/TITLE) (PRINT NAME/TITLE)
11/13/95 11/09/95
(DATE) (DATE)
EXHIBIT C
To Custodian Agreement dated as of November 9, 1995 between
Bankers Trust Company and The First National Bank of Maryland.
TAX RECLAIMS
Pursuant to Section 15 of the above referred to Custodian
Agreement, the Custodian shall perform the following services
with respect to withholding taxes imposed or which may be imposed
on income from Property in the Account. Terms used herein as
defined terms shall unless otherwise defined have the meanings
ascribed to them in the above referred to Custodian Agreement
When withholding tax has been deducted with respect to
income from any Property in an Account, the Custodian will
actively pursue on a reasonable efforts basis the reclaim
process, provided that the Custodian shall not be required to
institute any legal or administrative proceeding against any
Subcustodian or other person. The Custodian will provide fully
detailed advices/vouchers to support reclaims submitted to the
local authorities by the Custodian or its designee. In all cases
of withholding, the Custodian will provide full details to the
Customer. If exemption from withholding at the source can be
obtained in the future, the Custodian will notify the Customer
and advise what documentation, if any, is required to obtain the
exemption. Upon receipt of such documentation from the Customer,
the Custodian will file for exemption on the Customer's behalf
and notify the Customer when it has been obtained.
In connection with providing the foregoing service, the Custodian
shall be entitled to apply categorical treatment of the Customer
according to the Customer's nationality, the particulars of its
organization and other relevant details that shall be supplied by
the Customer. It shall be the duty of the Customer to inform the
Custodian of any change in the organization, domicile or other
relevant fact concerning tax treatment of the Customer and
further to inform the Custodian if the Customer is or becomes the
beneficiary of any special ruling or treatment not applicable to
the general nationality and category or entity of which the
Customer is a part under general laws and treaty provisions. The
Custodian may rely on any such information provided by the
Customer.
In connection with providing the foregoing service, the
Custodian may also rely on professional tax services published by
a major international accounting firm and/or advice received from
a Subcustodian in the jurisdictions in question. In addition,
the Custodian may seek the advice of counsel or other
professional tax advisers in such jurisdictions. The Custodian
is entitled to rely, and may act, on information set forth in
such services and on advice received from a Subcustodian, counsel
or other professional tax advisers and shall be without liability
to the Customer for any action reasonably taken or omitted
pursuant to information contained in such services or such
advice.
Dated as of THE FIRST NATIONAL BANK OF MARYLAND
By:/s/
Name: Xxxxxx Xxxxxx
Title: Vice President
BANKERS TRUST COMPANY
By:/s/
Name: Xxxxxxx X. Quinim
Title: Managing Director
