CONFORMED
CASH MANAGEMENT AND RELATED SERVICES AGREEMENT, dated as of July 30, 1999
between each mutual fund and/or portfolio series of each mutual fund listed on
Schedule A hereto (each a "Fund", collectively the "Funds"), and The Bank of New
York (the "Bank").
W I T N E S S E T H :
That in consideration of the mutual agreements and covenants herein
contained, the Bank and each Fund hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, unless the context otherwise requires, the
following words shall have the meanings set forth below:
1. Account" shall mean an account in the name of a Fund or such Fund's
transfer agent for the benefit of such Fund for receiving and disbursing money
as provided in this Agreement.
2. "Account Available Balance" shall mean with respect to an Account for
any given day during a calendar month a positive or negative dollar amount equal
to (A) if such day is a Business Day, the Account Available Balance as of the
close of the last preceding Business Day plus a positive or negative dollar
amount equal to the difference, if any, between the Chargeable Credits with
respect to such day and such Account and the Chargeable Debits with respect to
such day and such Account, and (B) if such day is not a Business Day, the
Account Available Balance as of close of the last preceding Business Day, except
that both (A) and (B) shall be reduced by the United States Federal Reserve
reserve requirements then applicable to the Bank with respect to such Account.
The Account Available Balance of an Account shall be zero on the date
immediately preceding the first date on which an entry, consisting of either a
Chargeable Credit or Chargeable Debit, is first made to such Account hereunder.
3. "ACCESS" shall mean any on-line communication system provided by the
Bank hereunder whereby either the receiver of such communication is able to
verify by codes or otherwise with a reasonable degree of certainty the identity
of the sender of such communication, or the sender is required to provide a
password or other identification code.
4. "Authorized Person" shall mean either (A) any person duly authorized by
corporate resolutions of the board of directors or board of trustees of a Fund
(each, a "Board") to give Oral and/or Written Instructions on behalf of such
Fund, such persons to be designated in a certificate, substantially in the form
of Exhibit A, which contains a specimen signature of such person, or (B) any
person sending or transmitting any instruction or direction through ACCESS.
5. "Business Day" shall mean any day on which the Federal Reserve Bank of
New York is open for business, except for any such day on which the Bank is
required by law or regulation to be closed, or elects to be closed.
6. "Calendar Month Earnings Credit" shall mean with respect to an Account
for any calendar month the dollar amount, whether positive or negative, equal to
the sum of the Gross Calendar Month Earnings Credit with respect to such Account
for such calendar month and the Monthly Overdraft Charges with respect to such
Account for such calendar month.
7. "Chargeable Credits" shall mean with respect to an Account for any given
day during a calendar month a positive amount of dollars equal to the sum, if
any, of (A) the aggregate dollar amount of Federal Funds credited to such
Account by the Bank in accordance with the then applicable availability schedule
of the Federal Reserve Bank of New York, and (B) the aggregate dollar amount of
Bank internal transfers of Federal Funds to such Account.
8. "Chargeable Debits" shall mean with respect to an Account for any given
day during a calendar month a negative dollar amount equal to the sum, if any,
of (A) the aggregate dollar amount of Federal Funds relating to such Account
charged against the Bank by the Federal Reserve Bank of New York on or as of
such day, and (B) the aggregate dollar amount of drafts drawn on such Account
which are deposited in the Bank by customers of the Bank on such day, or Bank
internal transfers from, or charges to, such Account.
9. "Daily Earnings" shall mean with respect to an Account for any day
during a calendar month a positive dollar amount equal to the product of (A) the
positive Account Available Balance, if any, of such Account for such day,
multiplied by (B) the Daily Earnings Rate for such day. The Daily Earnings with
respect to an Account for any day during a calendar month on which the Account
Available Balance of such Account is negative shall be zero.
10. "Daily Earnings Rate" shall mean for any day during a calendar month
one three hundred and sixty-fifth of the 91 day U.S. Treasury Xxxx discount rate
of the Monday auction first preceding such day (whether or not such day is a
Monday, and whether or not such Monday auction was in the immediately prior
month), as such Monday auction 91 day U.S. Treasury Xxxx discount rate is
reported in The Wall Street Journal.
11. "Daily Overdraft Charges" shall mean with respect to an Account for any
day during any calendar month a negative dollar amount equal to the product, if
any, of (A) the negative Account Available Balance, if any, with respect to such
Account for such day during such calendar month, multiplied by (B) the Overdraft
Rate.
12. "Federal Funds" shall mean immediately available same day funds.
13. "Gross Calendar Month Earnings Credit" shall mean with respect to an
Account for any calendar month a positive dollar amount equal to the aggregate
sum of the Daily Earnings of such Account for such calendar month.
14. "Monthly Overdraft Charges" shall mean with respect to an Account for
any calendar month a negative dollar amount equal to the aggregate sum of the
Daily Overdraft Charges with respect to such Account for such calendar month
which have not been previously paid to the Bank by the Fund to which such
Account relates.
15. "Omnibus Account" shall mean an account at the Bank for the benefit of
the Funds into which money (A) to be deposited into an Account is initially
credited pending its transfer to such Account pursuant to Article III hereof, or
(B) transferred from an Account pursuant to Article III is deposited pending its
disbursement pursuant to Article III.
16. "Oral Instructions" shall mean verbal instructions actually received by
the Bank from an Authorized Person or from a person reasonably believed by the
Bank to be an Authorized Person.
17. "Overdraft Rate" shall mean with respect to an Account for any calendar
day during any calendar month a rate equal to one three hundred and sixtieth of
the fed funds rate on such date plus 100 basis points (1.00 percent).
18. "Shareholder" shall mean any record holder of any Shares, as identified
to the Bank from time to time pursuant to this Agreement.
19. "Shares" shall mean all or any part of each class of the shares of
capital stock, beneficial interest, or limited partnership interest of a Fund,
as the case may be, which are authorized and/or issued from time to time.
20. "Written Instructions" shall mean written instructions actually
received by the Bank from an Authorized Person or from a person reasonably
believed by the Bank to be an Authorized Person by letter, memorandum, telegram,
cable, telex, facsimile or through ACCESS.
ARTICLE II
APPOINTMENT OF BANK; REPRESENTATIONS AND WARRANTIES
1. APPOINTMENT; ESTABLISHMENT OF ACCOUNTS. Each Fund hereby appoints the
Bank as its agent for the term of this Agreement to perform the cash management
services set forth herein and in Schedule I attached hereto and made a part
hereof (as such Schedule may be amended or supplemented from time to time by
mutual agreement) which are selected by such Fund from time to time. The Bank
hereby accepts appointment as such agent for each Fund and agrees to establish
and maintain one or more Accounts and/or Omnibus Accounts as the parties shall
determine are necessary to receive and disburse money as provided in this
Agreement.
2. REPRESENTATIONS AND WARRANTIES. Each Fund hereby represents and warrants
only as to itself, and not jointly, to the Bank, which representations and
warranties shall be deemed to be continuing and to be reaffirmed upon delivery
to the Bank of any Oral or Written Instructions, that:
(a) It is duly organized and existing under the laws of the jurisdiction of
its organization, with full power to carry on its business as now conducted, to
enter into this Agreement and to perform its obligations hereunder;
(b) This Agreement has been duly authorized, executed and delivered by the
Fund in accordance with all requisite corporate action and constitutes a valid
and legally binding obligation of the Fund enforceable in accordance with its
terms, except to the extent such enforcement may be limited by general equity
principles or bankruptcy principles; and
(c) It is conducting its business in compliance with all applicable laws
and regulations in all material respects, both state and federal, and has
obtained all regulatory licenses, approvals and consents necessary to carry on
its business as now conducted; there is no statute, regulation, rule, order or
judgment binding on it and no provision of its charter or by-laws, nor of any
mortgage, indenture, credit agreement or other contract binding on it or
affecting its property which would prohibit its execution or performance of this
Agreement.
3. BOARD RESOLUTIONS. Each Fund shall provide the Bank with a certified
copy of a resolution of its Board appointing the Bank as its agent to act
hereunder and providing for the creation of such Fund's Account(s), the
utilization by such Fund of one or more Omnibus Accounts and the execution by
such Fund of this Agreement, it being understood that receipt of the same by the
Bank shall be a condition precedent to the Bank's establishing an Account for
such Fund or such Fund's utilization of an Omnibus Account.
ARTICLE III
CASH MANAGEMENT SERVICES
1. RECEIPT OF MONEY. The Bank shall receive money for credit to an Account
only:
(i) by personal presentment by a Fund, but not by a Shareholder of such
Fund, of drafts at the branch or branches in Manhattan identified
from time to time by the Bank to such Fund, provided such
presentment is in accordance with the time frames specified by the
Bank to such Fund;
(ii) by mailing of drafts to a post office box designated by the Bank
for such purpose, provided such drafts are accompanied by a
properly completed investment stub;
(iii) by wire transfer to an account maintained at the Federal Reserve
Bank of New York as identified in writing by the Bank to a Fund;
(iv) by transfer to an account identified in writing by the Bank to a
Fund through the New York Automated Clearing House;
(v) by transfer from another Account maintained by such Fund with the
Bank under this Agreement;
(vi) by transfer from another account maintained by such Fund with the
Bank, including such Fund's custodian account under its Custody
Agreement with the Bank as Custodian; or
(vii) by transfer from any other account maintained with the Bank.
All money received by the Bank shall be credited upon receipt, but subject to
final payment and receipt by the Bank of immediately available funds, and
receipt by the Bank of such forms, documents and information previously
specified to the Funds as reasonably required by the Bank from time to time and
received in the appropriate time frames. If an Omnibus Account has been
established for the Funds, such money shall be initially credited to the Omnibus
Account pending its allocation to, and deposit in, an Account. The Bank shall be
entitled to reverse any credits previously made to a Fund's Account or an
Omnibus Account where money is not finally collected or where a credit to such
account was in error.
2. DISBURSEMENT OF MONEY. The Bank shall disburse money credited to an
Account only:
(i) pursuant to Written Instructions of such Fund transmitted through
ACCESS (except as otherwise provided in Article V, Section 7
hereof), to transfer funds as directed by such Fund (including
transfers through the Federal Reserve Bank of New York transfer
wire and the New York Automated Clearing House);
(ii) in payment of drafts drawn by an Authorized Person or Shareholder
(as appropriate for the particular Account), subject to the terms
hereof; or
(iii) in payment of charges to such Account representing amounts payable
to the Bank, and chargeable against such Account, as provided in
this Agreement.
The Bank shall be required to disburse money in accordance with the foregoing
only insofar as such money is immediately available and on deposit with the
Bank. If an Omnibus Account has been established for the Funds, such money shall
be credited to the Omnibus Account pending such disbursement. All instructions
directing the disbursement of money credited to an Account or Omnibus Account
under this Agreement (whether through ACCESS or by Oral Instructions pursuant to
Article V hereof) must identify an account to which such money shall be
transferred, and include all other information previously specified to the Funds
as reasonably required by the Bank from time to time. It is understood and
agreed that with respect to any such instructions, when instructed to credit or
pay a party by both name and a unique numeric or alpha-numeric identifier (E.G.,
ABA number or account number), the Bank and any other financial institution
participating in the funds transfer may rely solely on the unique identifier,
even if it identifies a party different than the party named. Such reliance on a
unique identifier shall apply to beneficiaries named in such instructions as
well as any financial institution which is designated in such instruction to act
as an intermediary in a funds transfer.
3. REDEMPTION DRAFTS; SHAREHOLDER INFORMATION. (a) Each Fund shall be
entitled to supply its Shareholders with redemption drafts, but only in a form
and substance agreed to by the Bank. The Bank agrees to give each Fund sixty
(60) days prior notice of any changes to the form or substance of redemption
drafts required by the Bank, provided that if such change is required by
applicable rules or procedures of the Federal Reserve or any clearinghouse
through which such drafts may be presented, the Bank may give less than sixty
(60) days prior notice of such change. Any such notice shall be given promptly
by the Bank.
(a) Each Fund which has elected to permit redemption drafts will promptly
furnish to the Bank (i) the name, mailing address and telephone number of each
Shareholder of such Fund, and (ii) specimen signatures for all individuals
authorized to draw redemption drafts (whether on their own behalf or on behalf
of third parties). Each Fund will promptly advise the Bank of individuals no
longer authorized to draw redemption drafts, and those individuals newly
authorized. Such information shall be provided to the Bank in a mutually agreed
upon format.
4. REDEMPTION DRAFT RETURNS. A Fund may give the Bank Oral or Written
Instructions from time to time to return unpaid redemption drafts of the Fund to
the presenting financial institution for any reason, and the Bank shall use
reasonable efforts to comply with such Oral or Written Instructions provided
that such compliance would not prejudice or impair any rights or privileges of
the Bank under prevailing draft return procedures and would not be contrary to
prevailing industry rules, procedures, customs or practices. Notwithstanding the
foregoing, or any other provision in this Agreement or Schedule I hereto, the
Bank (i) may return redemption drafts with unauthorized or missing signatures to
the presenting financial institution in accordance with prevailing banking
industry draft return procedures, and (ii) shall have no obligation to request
Oral or Written Instructions from a Fund with respect to any redemption drafts.
ARTICLE IV
ADVANCES, OVERDRAFTS OR INDEBTEDNESS
1. If the Bank in its sole discretion advances funds, or if there shall
arise for whatever reason an overdraft or other indebtedness in connection with
any Account or Omnibus Account, such advance, overdraft or indebtedness shall be
deemed a loan made by the Bank to the Fund to which the Account relates, or in
the case of an Omnibus Account, to which such advance, overdraft or indebtedness
relates, payable on demand and bearing interest from the date incurred at the
Overdraft Rate, such Overdraft Rate to be adjusted on the effective date of any
change in the fed funds rate constituting a part thereof. In the event of any
advance, overdraft or other indebtedness in connection with an Omnibus Account,
the Bank shall be furnished promptly (and in any event by 12:00 noon on the next
Business Day after such advance, overdraft or indebtedness) with Written
Instructions identifying each Fund to which such advance, overdraft or
indebtedness relates, and the amount allocable to such Fund(s).
2. Each Fund hereby agrees with respect to its Account(s), any Omnibus
Account(s) and any advances, overdrafts or other indebtedness that the Bank
shall have a continuing lien and security interest in and to any property at any
time held by it for the benefit of the Fund either hereunder or under such
Fund's Custody Agreement with the Bank, or in which the Fund may have an
interest which is then in the Bank's possession or control or in possession or
control of any third party acting in the Bank's behalf, including in its behalf
as Custodian under the Fund's Custody Agreement with the Bank. Each Fund
authorizes the Bank, in its sole discretion, at any time to charge any advance,
overdraft or indebtedness together with interest due thereon at the Overdraft
Rate against any balance standing to the Fund's credit on the books of the Bank,
including those books maintained by the Bank in its capacity as Custodian for
the Fund under its Custody Agreement with the Fund.
3. Each Fund agrees that upon allocation of all advances, overdrafts or
indebtedness to its account pursuant to paragraph 1 above, its total borrowings
from all sources (including the Bank) shall be in conformity with the
requirements and limitations set forth in the Investment Company Act of 1940, as
amended, and the Fund's Prospectus. Each Fund shall promptly (and in any event
within one Business Day) notify the Bank in writing whenever it fails to comply
with any of the foregoing requirements.
ARTICLE V
ACCESS; CALL-BACK SECURITY PROCEDURE
1. SERVICES GENERALLY. Each Fund shall be permitted to utilize ACCESS to
obtain direct on-line access to its Accounts and Omnibus Accounts. ACCESS shall
permit each Fund at the times mutually agreed upon by the Bank and such Fund to
receive reports, make inquiries, instruct the Bank to disburse money in
accordance with Article III, and perform such other functions as are more fully
set forth in Schedule I hereto.
2. PERMITTED USE; PROPRIETARY INFORMATION; EQUIPMENT. (a) Upon delivery to
a Fund of software enabling such Fund to utilize ACCESS (the "Software"), the
Bank grants to the Fund a personal, nontransferable and nonexclusive license to
use the Software solely for the purpose of transmitting Written Instructions,
receiving reports, making inquiries or otherwise communicating with the Bank in
connection with the Account(s) or the Omnibus Account. Each Fund shall use the
Software solely for its own internal and proper business purposes and not in the
operation of a service bureau. Except as set forth herein, no license or right
of any kind is granted to any Fund with respect to the Software. Each Fund
acknowledges that the Bank and its suppliers retain and have title and exclusive
proprietary rights to the Software, including any trade secrets or other ideas,
concepts, know-how, methodologies, or information incorporated therein and the
exclusive rights to any copyrights, trademarks and patents (including
registrations and applications for registration of either), or other statutory
or legal protections available in respect thereof. Each Fund further
acknowledges that all or a part of the Software may be copyrighted or
trademarked (or a registration or claim made therefor) by the Bank or its
suppliers. No Fund shall take any action with respect to the Software
inconsistent with the foregoing acknowledgments, nor shall any Fund attempt to
decompile, reverse engineer or modify the Software. No Fund may copy, sell,
lease or provide, directly or indirectly, any of the Software or any portion
thereof to any other person or entity without the Bank's prior written consent.
No Fund may remove any statutory copyright notice or other notice included in
the Software or on any media containing the Software. Each Fund shall reproduce
any such notice on any reproduction of the Software and shall add any statutory
copyright notice or other notice to the Software or media upon the Bank's
request.
(b) Each Fund acknowledges that all data bases made available as part of,
or through ACCESS, and any proprietary data, processes, information and
documentation (other than any such which are or become part of the public domain
or are legally required to be made available to the public and other than
information concerning any Fund) (collectively, the "Information"), are the
exclusive and confidential property of the Bank. Each Fund shall keep the
Information confidential by using the same care and discretion that each Fund
uses with respect to its own confidential property and trade secrets, and shall
neither make nor permit any disclosure without the express prior written consent
of the Bank, provided that nothing herein shall limit the right of each Fund to
make such disclosure of Information as may be required by statute, rule,
regulation or judicial process. The Bank acknowledges that all information
concerning the Funds ("Fund Information") is the exclusive and confidential
property of the Fund to which it pertains. The Bank shall keep the Fund
Information confidential by using the same care and discretion that the Bank
uses with respect to its own confidential property and trade secrets, and shall
not authorize any disclosure without the express prior written consent of such
Fund, provided that the Bank may without any prior consent disclose the same to
its internal and external accountants, auditors, and counsel, to its and each
respective Fund's regulators, and to any other person or entity whenever the
Bank is advised by its counsel that it may be liable for a failure to make such
disclosure.
(c) Each Fund shall obtain and maintain at its own cost and expense all
equipment and services, including but not limited to communications services,
necessary for it to utilize ACCESS and receive the services thereby, and the
Bank shall not be responsible for the reliability or availability of any such
equipment or any services used in connection with ACCESS.
(d) Upon termination of this Agreement for any reason, each Fund shall
return to the Bank any and all copies of the Information which are in such
Fund's possession or under its control, or distributed to third parties. The
provisions of this Article shall not affect the copyright status of any of the
Information which may be copyrighted and shall apply to all Information whether
or not copyrighted.
3. MODIFICATIONS. The Bank reserves the right to modify ACCESS or the
Software from time to time without notice to any Fund. Each Fund agrees not to
modify or attempt to modify ACCESS or the Software without the Bank's prior
written consent. Each Fund acknowledges that ACCESS and the Software are the
property of the Bank and, accordingly, each Fund agrees that any modifications
to ACCESS or the Software, whether by such Fund or the Bank and whether with or
without the Bank's consent, shall become the property of the Bank.
4. NO REPRESENTATIONS OR WARRANTIES. The Bank and its manufacturers and
suppliers make no warranties or representations, express or implied, in fact or
in law, including but not limited to warranties of merchantability and fitness
for a particular purpose, in connection with any Fund's use of ACCESS or the
Software, except that the Bank represents and warrants that the execution and
delivery and performance of this Agreement have been duly authorized by the
Bank, that it has the right to use and grant to each Fund the license to use
ACCESS and the Software granted under this Agreement, and that the use by each
Fund in accordance with such license will not constitute an infringement or a
misappropriation of any copyright, patent, trade secret or any other
intellectual property rights of any third party.
5. SECURITY; RELIANCE; UNAUTHORIZED USE. Each Fund will, and will cause all
persons utilizing ACCESS to, treat the user and authorization codes, passwords
and authentication keys applicable to ACCESS with extreme care. The Bank is
hereby irrevocably authorized to act in accordance with and rely on Written
Instructions received by it through ACCESS subject, however, to the right of a
Fund to timely give countermanding Written Instructions. Each Fund acknowledges
that it is its sole responsibility to assure that only Authorized Persons use
ACCESS and that the Bank shall not be responsible nor liable for any
unauthorized use thereof, and agrees that the security procedures to be followed
in connection with the Fund's transmission of Written Instructions through
ACCESS provide to it a commercially reasonable degree of protection in light of
its particular needs and circumstances.
6. LIMITATIONS OF LIABILITY. (a) Except as otherwise specifically provided
in Section 6(b) below, the Bank shall have no liability for any losses, damages,
injuries, claims, costs or expenses of a Fund arising out of or in connection
with any failure, malfunction or other problem relating to any Fund's use of
ACCESS, except for money damages suffered as the direct result of the negligence
of the Bank in an amount not exceeding, in the aggregate for all such losses,
damages, injuries, claims, costs and expenses of a Fund arising during any
month, the total charges paid by such Fund to the Bank for ACCESS and services
hereunder which caused such loss, damage, injury, claim, cost or expense during
the 12 months preceding the month in question, or such lesser number of months
as a Fund has used ACCESS if such Fund has not received 12 months use of ACCESS;
provided however, that the Bank shall have no liability under this Section 6(a)
if a Fund fails to comply with the provisions of Section 6(d), except to the
extent of losses arising prior to the date the Fund should have complied with
said Section 6(d) which could not have been mitigated if such Fund had complied.
(b) The Bank's liability for its negligence in executing or failing to
execute a Fund's Written Instructions received through ACCESS shall be only with
respect to a transfer, or failure to transfer, funds not in accordance with such
Written Instructions after such instructions have been duly acknowledged by the
Bank, and shall be contingent upon the Fund complying with the provisions of
Section 6(d) below, and shall be limited to (i) restoration of the principal
amount mistransferred, if and to the extent that the Bank would be required to
make such restoration under applicable law, and (ii) the lesser of (A) a Fund's
actual pecuniary loss incurred by reason of its loss of use of the
mistransferred funds or the funds which were not transferred, as the case may
be, or (B) compensation for the loss of the use of the mistransferred funds or
the funds which were not transferred, as the case may be, at a rate per annum
equal to the average Federal Funds rate as computed from the Federal Reserve
Bank of New York's daily determination of the effective rate for Federal Funds,
for the period during which a Fund has lost use of such funds. In no event shall
the Bank have any liability for failing to execute Written Instructions for the
transfer of funds which are received by it through ACCESS other than through the
applicable transfer module for the particular instructions.
(c) Without limiting the generality of the foregoing, it is hereby agreed
that in no event shall the Bank or any manufacturer or supplier of its computer
equipment, software or services be responsible for any special, indirect,
incidental or consequential damages which a Fund may incur arising out of or in
connection with ACCESS or the services provided thereby, even if the Bank or
such manufacturer or supplier has been advised of the possibility of such
damages and regardless of the form of action.
(d) Each Fund shall notify the Bank of any errors, omissions or
interruptions in, or delay or unavailability of, ACCESS as promptly as
practicable, and in any event within one Business Day after the earliest of (i)
discovery thereof, (ii) the date discovery should have occurred through the
exercise of reasonable care, and (iii) in the case of any error, the date of the
earliest notice to such Fund which reflects such error.
(e) ACCESS is designed to promptly and automatically acknowledge the Bank's
receipt of each Written Instruction communicated through ACCESS, and in the
absence of such acknowledgement the Bank shall not be liable for any failure to
act in accordance with such Written Instruction and the Funds may not claim that
such Written Instruction was received by the Bank.
7. FUNDS TRANSFER BACK-UP PROCEDURE. (a) In the event ACCESS is inoperable
and a Fund is unable to utilize ACCESS for the transmission of Written
Instructions to the Bank to transfer funds, the Fund may give Oral Instructions
or Written Instructions regarding funds transfers, it being expressly understood
and agreed that the Bank's acting pursuant to such Oral Instructions shall be
contingent upon the Bank's verification of the authenticity thereof pursuant to
the Call-Back Security Procedure set forth on Schedule III hereto (the
"Procedure"). In this regard, each Fund shall deliver to the Bank a Funds
Transfer Telephone Instruction Authorization in the form of Schedule III-A
hereto, identifying the individuals authorized to deliver and/or confirm all
such Oral Instructions. Each Fund understands and agrees that the Procedure is
intended to determine whether Oral Instructions received pursuant to this
Section are authorized but is not intended to detect any errors contained in
such instructions. Each Fund hereby accepts the Procedure and confirms its
belief that the Procedure is commercially reasonable.
(b) The Bank shall have no liability whatsoever for any funds transfer
executed in accordance with Oral Instructions delivered and confirmed pursuant
to this Section 7 and Schedule III hereto. The Bank's liability for its
negligence in executing or failing to execute any such Oral Instructions shall
be determined by reference to Section 6(b) of this Article.
(c) The Bank reserves the right to suspend acceptance of Oral Instructions
pursuant to this Section 7 if conditions exist which the Bank, in its sole
discretion, believes have created an unacceptable security risk.
8. EXPORT RESTRICTIONS. EXPORT OF THE SOFTWARE IS PROHIBITED BY UNITED
STATES LAW. EACH FUND AGREES THAT IT WILL NOT UNDER ANY CIRCUMSTANCES RESELL,
DIVERT, TRANSFER, TRANSSHIP OR OTHERWISE DISPOSE OF THE SOFTWARE (IN ANY FORM)
IN OR TO ANY OTHER COUNTRY. IF THE BANK DELIVERED THE SOFTWARE TO ANY FUND
OUTSIDE OF THE UNITED STATES, THE SOFTWARE WAS EXPORTED FROM THE UNITED STATES
IN ACCORDANCE WITH THE EXPORT ADMINISTRATION REGULATIONS. DIVERSION CONTRARY TO
U.S. LAW IS PROHIBITED. Each Fund hereby authorizes the Bank to report its name
and address to government agencies to which the Bank is required to provide such
information by law.
9. ENCRYPTION. Customer acknowledges and agrees that encryption may not be
available for every communication through ACCESS, or for all data. Customer
agrees that Custodian may deactivate any encryption features at any time,
without notice or liability to Customer, for the purpose of maintaining,
repairing or troubleshooting ACCESS or the Software.
ARTICLE VI
CONCERNING THE BANK
1. STANDARD OF CARE; PRESENTMENT OF CLAIMS. Except as otherwise provided
herein, the Bank shall not be liable for any costs, expenses, damages,
liabilities or claims (including attorney's fees) incurred by a Fund, except
those costs, expenses, damages, liabilities or claims arising out of the Bank's
own negligence, bad faith or willful misconduct. Notwithstanding the foregoing
or anything contained in Schedule I hereto, the Bank shall not be liable for any
loss or damage, including attorney's fees, resulting from the Bank paying any
redemption draft containing a forged drawer signature, unless such loss or
damage arises out of the Bank's negligence, bad faith or willful misconduct. All
claims against the Bank hereunder shall be made by the respective Fund as
promptly as practicable, and in any event within 6 months from the date of the
action or inaction on which such claim is based, and shall include reasonable
documentation evidencing such claim and loss.
2. NO LIABILITY. The Bank shall have no obligation hereunder for costs,
expenses, damages, liabilities or claims, including attorney's fees, which are
sustained or incurred by reason of any action or inaction by the Federal Reserve
wire transfer system or the New York Automated Clearing House. Notwithstanding
any other provision elsewhere contained in this Agreement, in no event shall the
Bank be liable to any Fund or any third party for special, indirect or
consequential damages, or lost profits or loss of business, arising under or in
connection with this Agreement, even if previously informed of the possibility
of such damages and regardless of the form of action.
3. INDEMNIFICATION. Each Fund shall indemnify and exonerate, save and hold
harmless the Bank from and against any and all costs, expenses, damages,
liabilities or claims, including reasonable attorney's fees and expenses, which
the Bank may sustain or incur or which may be asserted against the Bank by
reason of or as a result of any action taken or omitted by the Bank in
connection with its performance under this Agreement with respect to a Fund,
except those costs, expenses, damages, liabilities or claims arising out of the
Bank's own negligence, bad faith or wilful misconduct. This indemnity shall be a
continuing obligation of each Fund notwithstanding the termination of this
Agreement, any Account or Omnibus Account with respect to a Fund.
4. NO OBLIGATION TO INQUIRE. Without limiting the generality of the
foregoing, the Bank shall in no event be under any obligation to inquire into,
and shall not be liable for:
(a) the due authority of any Authorized Person acting on behalf of a Fund
in connection with this Agreement;
(b) the genuineness of any drawer signature on any draft deposited in any
Account or Omnibus Account, or whether such signature is a forgery, other than
the signature of the drawer of any draft drawn on the Bank;
(c) the existence or genuineness of any endorsement or any marking
purporting to be an endorsement on any draft deposited in any Account or Omnibus
Account, or whether such endorsement or marking is a forgery, it being expressly
understood that all risks associated with the acceptance by the Bank of any
draft payable to a payee other than a Fund for deposit in any Account or Omnibus
Account pursuant to Oral or Written Instructions by the Fund shall be borne by
such Fund;
(d) any discrepancy between the pre-printed investment stub (other than a
substitute stub created by the Bank) and the payee either named on a draft or
written on the face thereof, provided the Bank has acted in accordance with the
investment stub;
(e) any discrepancy between the written amount for which any draft is drawn
and the Magnetic Incription Character Recognition ("MICR") code enscribed
thereon by any bank other than the Bank on any draft presented, provided the
Bank has acted in accordance with the MICR code;
(f) any disbursement directed by a Fund, regardless of the purpose
therefor;
(g) any determination of the Share balance of any Shareholder whose name is
signed on any redemption draft;
(h) any determination of length of time any Shares have been owned by any
Shareholder or the method of payment utilized to purchase such Shares by such
Shareholder;
(i) any claims, liens, attachments, stays or stop payment orders with
respect to any Shares, proceeds, or money, other than a stop payment order
placed by a Fund on a draft drawn by such Fund on its Account or an Omnibus
Account;
(j) the propriety and/or legality of any transaction in any Account or
Omnibus Account;
(k) the lack of authority of any person signing as a drawer of a draft,
provided such person and his specimen signature are specified in the certificate
of authorized signatures last received by the Bank; or
(l) whether any redemption draft equals or exceeds any minimum amount.
5. RELIANCE UPON INSTRUCTIONS. The Bank shall be entitled to rely upon any
Written or Oral Instructions received by the Bank. Each Fund agrees, except as
otherwise provided in any Schedule attached hereto, to forward to the Bank
Written Instructions confirming Oral Instructions in such manner so that such
Written Instructions are received by the Bank by the close of business on the
same day that such Oral Instructions are given to the Bank. Each Fund agrees
that the fact that such confirming Written Instructions are not timely received
or that contrary Written Instructions are received by the Bank shall in no way
affect the validity or enforceability of transactions previously authorized.
6. FORCE MAJEURE. The Bank shall not be responsible or liable for any
failure or delay in the performance of its obligations under this Agreement
arising out of or caused, directly or indirectly, by circumstances beyond its
control, including acts of God; earthquakes; fires; floods; wars; civil or
military disturbances; sabotage; epidemics; riots; interruptions, loss or
malfunctions of utilities, computers (hardware or software), transportation, or
communications service; mechanical breakdowns; interruption or loss of ACCESS
(except as otherwise provided in Section 7 of Article V); accidents; acts of
civil or military authority; governmental actions; labor disputes; or inability
to obtain labor, material, equipment or transportation.
7. NO IMPLIED DUTIES; PERFORMANCE ACCORDING TO APPLICABLE LAW. The Bank
shall have no duties or responsibilities except such duties and responsibilities
as are specifically set forth in this Agreement and Schedule I hereto, and no
covenant or obligation shall be implied against the Bank. The Bank's duties and
responsibilities hereunder shall be performed in accordance with applicable
laws, regulations and rules, including but not limited to Federal Reserve
Regulation CC and the Operating Rules of the New York Automated Clearing House,
and the Bank shall have no obligation to take actions which in the reasonable
opinion of the Bank are either inconsistent with, or prejudice or impair the
Bank's rights under, any such laws, regulations and rules.
8. REQUESTS FOR INSTRUCTIONS. At any time the Bank may apply to an officer
of a Fund for Oral or Written Instructions with respect to any matter arising in
connection with the Bank's duties and obligations hereunder, and the Bank shall
not be liable for any action taken or permitted by it in good faith in
accordance with such Oral or Written Instructions. Such application for Oral or
Written Instructions may, at the option of the Bank, set forth in writing any
action proposed to be taken or omitted by the Bank with respect to its duties or
obligations hereunder and the date on or after which such action shall be taken,
and the Bank shall not be liable for any action taken or omitted in accordance
with a proposal included in any such application on or after the date specified
therein (which shall be at least 5 days after the date of such Fund's receipt of
such application) unless, prior to taking or omitting any such action, the Bank
has received Oral or Written Instructions in response to such application
specifying the action to be taken or omitted. The Bank may apply for and obtain
the advice and opinion of counsel to the Fund or of its own counsel, at the
expense of the Fund, and shall be fully protected with respect to anything done
or omitted by it in good faith in conformity with such advice or opinion.
9. DELEGATION OF DUTIES. The Bank may delegate any of its duties and
obligations hereunder to any delegee and may employ agents or attorneys-in-fact;
provided however, that no such delegation or employment by the Bank shall
discharge the Bank from its obligations hereunder. The Bank shall have no
liability or responsibility whatsoever if any delegee, agent or attorney-in-fact
shall have been selected by a Fund and approved by a resolution of its board.
Notwithstanding the foregoing, nothing contained in this paragraph shall
obligate the Bank to effect any delegation or to employ any agent or
attorney-in-fact.
10. FEES; INVOICES. (a) For its services hereunder, each Fund agrees to pay
the Bank with respect to the Bank's services to such Fund (i) its reasonable
out-of-pocket expenses, (ii) the monthly fees and compensation set forth on
Schedule II attached hereto, and (iii) any negative Calendar Month Earnings
Credits, and such other amounts as may be mutually agreed upon from time to
time. The Bank shall provide each Fund with a monthly activity analysis
detailing service volumes, and including average Account Available Balances and
average ledger balances, and all fees owing for such month.
(b) The Bank shall monthly submit periodic detailed invoices specifying the
amount of all out-of-pocket expenses, fees, compensation and negative Calendar
Month Earnings Credits then due hereunder. The Bank may, and is hereby
authorized by each Fund, to charge such amounts to an Omnibus Account or the
appropriate Fund's Account(s), but only if such amounts remain unpaid for
fifteen (15) days after the end of the period to which such amounts relate.
11. APPLICATION OF CALENDAR MONTH EARNINGS CREDITS. (a) Any positive
Calendar Month Earnings Credit for a calendar month shall be applied only as
follows and only in the specified order:
(i) First, applied against such compensation, fees, but not
out-of-pocket expenses, payable by such Fund to the Bank under this
Agreement for such month; and
(ii) Second, applied against such compensation, fees, and negative
Calendar Month Earnings Credits, but not out-of-pocket expenses,
payable by such Fund to the Bank under this Agreement for any
subsequent month in the same calendar year.
(b) Except as provided above, in no event may any Calendar Month Earnings
Credit be applied to any month other than the month in which it was earned.
Calendar Month Earnings Credits may not be transferred to, or utilized by, any
other Fund, person or entity. The portion, if any, of any Calendar Month
Earnings Credit not used by a Fund may be carried, but only forward; provided,
however, that in no event may any Calendar Month Earnings Credit, including
those earned during the fourth calendar quarter, be carried beyond the end of
the calendar year in which earned.
ARTICLE VII
TERMINATION
1. NOTICE. This Agreement may be terminated as to any Fund by either the
Bank giving to such Fund, or such Fund giving to the Bank, a notice in writing
specifying the date of such termination, which date shall be not less than 90
days after the date of the giving of such notice. Notwithstanding the foregoing,
the Bank reserves the right to terminate this Agreement as to any Fund (a) at
any time upon 30 days prior written notice if the condition precedent set forth
in Article II, paragraph 3 is unfulfilled with respect to such Fund, and (b)
upon notice if such Fund either (i) fails to comply with Article IV, Section 3,
or (ii) borrows funds from the Bank in an amount exceeding the Bank's legal
lending limit. Any Fund may terminate this Agreement with respect to such Fund
at any time upon not less than 30 days' prior written notice to the Bank and, in
the event of a material breach of this Agreement by the Bank, may terminate this
Agreement with 10 days' prior written notice.
2. OBLIGATIONS UPON TERMINATION. Upon termination, with respect to a Fund,
the Bank's sole obligations, which shall arise only after, and not before, such
Fund which is the subject of such termination has paid to the Bank all
out-of-pocket expenses, fees, compensation, negative Calendar Month Earnings
Credits and other amounts owed by such Fund to the Bank, shall be (i) to deliver
to the affected Fund(s) such records, if any, as may be owned by such Fund(s),
in the form and manner kept by the Bank on such date of termination, and (ii) to
pay to the affected Fund(s) any monies held for their account hereunder.
Notwithstanding any such termination, this Agreement shall continue in full
force and effect as to all transactions whose processing has been commenced by
the Bank prior to such termination until the completion of such processing.
ARTICLE VIII
MISCELLANEOUS
1. CERTIFICATES OF AUTHORIZED PERSONS. Each Fund agrees to furnish to the
Bank a new certificate of Authorized Persons in the event that any present
Authorized Person of such Fund ceases to be an Authorized Person or in the event
that any other Authorized Persons are appointed and authorized. Until such new
certificate is received, the Bank shall be fully protected in acting under the
provisions of this Agreement upon Oral or Written Instructions or signatures of
the present Authorized Persons as set forth in the last delivered certificate.
2. NOTICES. (a) Any notice or other instrument in writing, authorized or
required by this Agreement to be given to the Bank, shall be sufficiently given
if addressed to the Bank and received by it at its offices at 00 Xxxxxxxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, ATTENTION: Division Manager -
Mutual Funds, or at such other place as the Bank may from time to time designate
in writing.
(b) Any notice or other instrument in writing, authorized or required by
this Agreement to be given to a Fund shall be sufficiently given if addressed to
a Fund and received by it at c/o Shay Assets Management Inc., 000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxx, Xxx. 00000, or at such other place as such Fund may from time
to time designate in writing.
3. CUMULATIVE RIGHTS AND NO WAIVER. Each and every right granted to the
Bank hereunder or under any other document delivered hereunder or in connection
herewith, or allowed it by law or equity, shall be cumulative and may be
exercised from time to time. No failure on the part of the Bank to exercise, and
no delay in exercising, any right will operate as a waiver thereof, nor will any
single or partial exercise by the Bank of any right preclude any other or future
exercise thereof or the exercise of any other right.
4. SEVERABILITY. In case any provision in or obligation under this
Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or obligations
shall not in any way be affected or impaired thereby, and if any provision is
inapplicable to any person or circumstances, it shall nevertheless remain
applicable to all other persons and circumstances.
5. AMENDMENTS. This Agreement may not be amended or modified in any manner
except by a written agreement executed by the Bank and each Fund to be bound
thereby, and, except in the case of an amendment to Schedule I hereto,
authorized or approved by a resolution of each Fund's Board.
6. HEADINGS. The headings in this Agreement are inserted for convenience
and identification only and are in no way intended to describe, interpret,
define or limit the scope, extent or intent of this Agreement or any provisions
hereof.
7. APPLICABLE LAW; CONSENT TO JURISDICTION; JURY TRIAL WAIVER. This
Agreement shall be construed in accordance with the laws of the State of New
York without giving effect to conflict of laws principles thereof. Each party
hereby consents to the jurisdiction of a state or federal court situated in New
York City, New York in connection with any dispute arising hereunder and hereby
waives its right to trial by jury.
8. NO THIRD PARTY BENEFICIARIES. The provisions of this Agreement are
intended to benefit only the Bank and each Fund and their respective permitted
successors and assigns, and no right shall be granted to any other person by
virtue of this Agreement.
9. SUCCESSORS AND ASSIGNS. This Agreement shall extend to and shall be
binding upon the parties hereto, and their respective successors and assigns;
provided, however, that this Agreement shall not be assignable by either party
without the written consent of the other party and in the case of an assignment
by any Fund, such assignment must be authorized or approved by a resolution of
such Fund's Board. No merger, reorganization or consolidation by the Bank shall
be deemed to constitute an assignment.
10. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but such
counterparts shall, together, constitute only one instrument.
11. SEVERAL OBLIGATIONS. The parties acknowledge that the obligations of
the Funds are several and not joint, that no Fund shall be liable for any amount
owing by another Fund and that the Funds have executed one instrument for
convenience only.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective corporate officers, thereunto duly authorized, as of the day
and year first above written.
By: /S/ XXXXXX X. XXXXXXX, XX.
------------------------------
on behalf of each Fund identified
on Schedule A attached hereto
THE BANK OF NEW YORK
By: /S/ XXXXXXX X. GRUNSTON
------------------------------
Title:
SCHEDULE A
NAME OF FUND
------------
Institutional Investors Capital Appreciation Fund, Inc.
EXHIBIT A
I, of Institutional Investors Capital Appreciation Fund, Inc. (the
"Fund"), a New York corporation do hereby certify that:
The following individuals have been duly authorized by the Board of
Directors of the Fund in conformity with the Fund's Certificate of Incorporation
and By-Laws to give Oral Instructions and Written Instructions on behalf of the
Fund for purposes of the Fund's Cash Management and Related Services Agreement,
and the signatures set forth opposite their respective names are their true and
correct signatures.
Name Signature
-------------------------------------- ----------------------------------
-------------------------------------- ----------------------------------
-------------------------------------- ----------------------------------
-------------------------------------- ----------------------------------
-------------------------------------- ----------------------------------
----------------------------------
[Title of Officer]
