EXHIBIT No. EX-99.g.4.b
SUBCUSTODIAN AGREEMENT
Between
STATE STREET TRUST COMPANY CANADA
and
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
PAGE
I. THE ACCOUNTS................................................................................................1
A. ESTABLISHMENT OF THE ACCOUNTS...................................................................1
B. SECURITIES......................................................................................2
C. CUSTODY AND DEPOSIT ACCOUNTS FOR SUBSIDIARIES AND AFFILIATES OF CUSTODIAN.......................2
D. USE OF THE ACCOUNTS.............................................................................2
E. TRANSFER OF PROPERTY IN THE ACCOUNTS............................................................2
F. OWNERSHIP AND SEGREGATION OF PROPERTY IN ACCOUNTS...............................................2
G. REGISTRATION OF SECURITIES IN THE ACCOUNTS......................................................2
II. SERVICES TO BE PROVIDED BY THE SUBCUSTODIAN.................................................................3
A. SERVICES PERFORMED PURSUANT TO INSTRUCTIONS.....................................................3
B. SERVICES TO BE PERFORMED WITHOUT INSTRUCTIONS...................................................3
1. COLLECT CASH...........................................................................3
2. EXCHANGE SECURITIES....................................................................3
3. SALE OF RIGHTS AND FRACTIONAL INTERESTS................................................3
4. EXECUTE CERTIFICATES...................................................................3
5. PAY TAXES AND RECEIVE REFUNDS..........................................................4
6. PREVENT LOSSES.........................................................................4
C. ADDITIONAL SERVICES.............................................................................4
1. TRANSMISSION OF NOTICES OF CORPORATE ACTION............................................4
2. COMMUNICATIONS REGARDING THE EXERCISE OF ENTITLEMENTS..................................4
3. MONITOR FINANCIAL SERVICE..............................................................4
III. USE OF SECURITIES DEPOSITORY................................................................................4
A. PRIOR APPROVAL..................................................................................4
IV. CLAIMS AGAINST PROPERTY IN THE ACCOUNTS.....................................................................5
V. SUBCUSTODIAN'S REPRESENTATIONS AND WARRANTIES...............................................................5
VI. INSTRUCTIONS................................................................................................6
A. DEFINITION......................................................................................6
B. EFFECT..........................................................................................7
VII. MISCELLANEOUS PROVISIONS....................................................................................7
A. STATEMENTS REGARDING ACCOUNTS...................................................................7
B. EXAMINATION OF BOOKS AND RECORDS................................................................7
C. STANDARD OF CARE................................................................................8
D. LOSS OF CASH OR SECURITIES......................................................................8
E. COMPENSATION OF SUBCUSTODIAN....................................................................8
F. OPERATING REQUIREMENTS..........................................................................8
G. TERMINATION.....................................................................................8
H. NOTICES.........................................................................................9
I. CONFIDENTIALITY.................................................................................9
J. ASSIGNMENT......................................................................................9
K. GOVERNING LAW..................................................................................10
SUBCUSTODIAN AGREEMENT
AGREEMENT made this 23rd day of February, 1998; between State Street Bank
and Trust Company, a Massachusetts Trust Company (hereinafter referred to as the
"Custodian"), having its principal place of business at 000 Xxxxxxxx Xxxxxx,
Xxxxxx, XX, and State Street Trust Company Canada (hereinafter referred to as
the "Subcustodian"), a trust company organized under the laws of Canada and
having its registered office at 000 Xxxx Xxxxxx Xxxx, Xxxxxxx, Xxxxxxx, Xxxxxx.
WHEREAS, Custodian acts as global custodian for various of its subsidiaries
and affiliates;
WHEREAS, Subcustodian is an affiliate of Custodian;
WHEREAS, Custodian and various subsidiaries and affiliates (including
Subcustodian) have been appointed to act as trustee, custodian or subcustodian
of securities and monies on behalf of certain of its customers including,
without limitation, collective investment undertakings; investment companies
subject to the U.S. Investment Company Act of 1940, as amended, and employee
benefit plans subject to the U.S. Employee Retirement Income Security Act of
1974, as amended, and Canadian mutual funds subject to National Policy Statement
No. 39 of the Canadian securities administrators, as amended;
WHEREAS, Custodian wishes to establish Accounts (the "Accounts") with the
Subcustodian to hold and maintain certain property for which Custodian is
responsible as custodian; and
WHEREAS, Subcustodian agrees to establish the Accounts and to hold and
maintain all property in the Accounts in accordance with the terms and
conditions herein set forth.
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the Custodian and the Subcustodian agree as follows:
I. The Accounts
A. Establishment of the Accounts
Custodian hereby requests that Subcustodian establish in accordance with
Custodian's instructions, Accounts which shall be composed of:
1. One or more accounts for any and all Securities (as hereinafter
defined) from time to time received by Subcustodian therefor ("Custody
Accounts"); and
2. One or more accounts for any and all Cash (as hereinafter defined)
from time to time received by Subcustodian therefor ("Deposit Accounts").
Subaccounts of any Custody Account or Deposit Account shall be established as
requested by Custodian. The Custody Accounts and the Deposit Accounts (and any
subaccounts thereof) are herein collectively called the "Accounts".
B. Securities
The term "Securities" includes, without limitation, stocks, shares, bonds,
debentures, debt securities (convertible or non-convertible), notes, or other
obligations or securities and any certificates, receipts, futures contracts,
foreign exchange contracts, options, warrants, scrip or other instruments or
book-entries representing rights to receive, purchase or subscribe for the same,
or evidencing or representing any other rights or interests therein, or in any
property or assets.
C. Custody and Deposit Accounts for Subsidiaries and Affiliates of
Custodian
From time to time, Custodian may request the establishment of separate
Custody and/or Deposit Accounts (or subaccounts thereof) for various
subsidiaries and affiliates of Custodian, for which Custodian acts as global
custodian. In such event, the terms of this Agreement shall apply in all
respects to these accounts, which shall be considered accounts of Custodian in
all respects (including fees and responsibility of Custodian therefor), save
that such accounts shall be designated to the particular subsidiary or affiliate
indicated by Custodian.
D. Use of the Accounts
The Accounts shall be used exclusively to hold, acquire, transfer or
otherwise care for, on behalf of Custodian as custodian and the customers of
Custodian and not for Custodian's own interest, Securities, and such Cash or
cash equivalents as are transferred to Subcustodian or as are received in
payment of any transfer of, or as payment on, or interest on, or dividend from,
any such Securities (herein collectively called "Cash").
E. Transfer of Property in the Accounts
Beneficial ownership of the Securities and Cash in the Accounts shall be
freely transferable without payment of money or value other than for safe
custody and administration.
F. Ownership and Segregation of Property in Accounts
The ownership of the property in the Accounts, whether Securities, Cash or
both, and whether any such property is held by Subcustodian in an Eligible
Depository, shall be clearly recorded on Subcustodian's books as belonging to
Custodian on behalf of Custodian's customers, and not for Custodian's own
interest and, to the extent that Securities are physically held in the Accounts,
such Securities shall also be physically segregated from the general assets of
Subcustodian, the assets of Custodian in its individual capacity and the assets
of Subcustodian's other customers. In addition, Subcustodian shall ensure that
such other records are maintained as may be necessary to identify the property
hereunder as belonging to each Account.
G. Registration of Securities in the Accounts
Securities which are eligible for deposit in a depository as provided for
in Section III may be maintained with the depository in an account for
Subcustodian's customers, unless alternate Instructions are furnished by
Custodian. Securities which are not held in a depository and that are ordinarily
held in registered form will be registered in the name of the Subcustodian or in
the name of Subcustodian's nominee, unless alternate Instructions are furnished
by Custodian.
II. Services to be Provided by the Subcustodian
The Services Subcustodian will provide to Custodian and the manner in which
such services will be performed will be as set forth below in this Agreement.
A. Services Performed Pursuant to Instructions
All transactions involving the Securities and Cash in the Accounts shall be
executed solely in accordance with Custodian's Instructions as that term is
defined in Section VI hereof, except those described in Section B below.
B. Services to be Performed without Instructions
Subcustodian will, unless it receives Instructions from Custodian to the
contrary:
1. Collect Cash
Promptly collect and receive all dividends, income, principal, proceeds
from transfer and other payments with respect to property held in the Accounts,
and present for payment all Securities held in the Accounts which are called,
redeemed or retired or otherwise become payable and all coupons and other income
items which call for payment upon presentation, and credit Cash receipts
therefrom to the Deposit Accounts.
2. Exchange Securities
Promptly exchange Securities where the exchange is purely ministerial
including, without limitation, the exchange of temporary Securities for those in
definitive form and the exchange of warrants, or other documents of entitlement
to Securities, for the Securities themselves.
3. Sale of Rights and Fractional Interests
Whenever notification of a rights entitlement or a fractional interest
resulting from a rights issue, stock dividend or stock split is received for the
Accounts and such rights entitlement or fractional interest bears an expiration
date, Subcustodian will promptly endeavor to obtain Custodian's Instructions,
but should these not be received in time for Subcustodian to take timely action,
Subcustodian is authorized to sell such rights entitlement or fractional
interest and to credit the sales proceeds therefrom to the Accounts.
4. Execute Certificates
Execute in Custodian's name for the Accounts, whenever Subcustodian deems
it appropriate, such ownership and other certificates as may be required to
obtain the payment of income from the Securities held in the Accounts.
5. Pay Taxes and Receive Refunds
To pay or cause to be paid from the Accounts any and all taxes and levies
in the nature of taxes imposed on the property in the Accounts by any
governmental authority, and to take all steps necessary to obtain all tax
exemptions, privileges or other benefits, including reclaiming and recovering
any withholding tax, relating to the Accounts and to execute any declarations,
affidavits, or certificates of ownership which may be necessary in connection
therewith.
6. Prevent Losses
Take such steps as may be reasonably necessary to secure, or otherwise
prevent the loss of, entitlements attached to or otherwise relating to property
held in the Accounts.
C. Additional Services
1. Transmission of Notices of Corporate Action
By such means as will permit Custodian to take timely action with respect
thereto, Subcustodian will promptly notify Custodian upon receiving notices or
reports, or otherwise becoming aware, of corporate actions affecting Securities
held in the Accounts (including, but not limited to, calls for redemption,
mergers, consolidations, reorganizations, recapitalizations, tender offers,
rights offerings, exchanges, subscriptions and other offerings) and dividend,
interest and other income payments relating to such Securities.
2. Communications Regarding the Exercise of Entitlements
Upon request by Custodian, Subcustodian will promptly deliver, or cause any
Eligible Depository authorized and acting hereunder to deliver, to Custodian all
notices, proxies, proxy soliciting materials and other communications that call
for voting or the exercise of rights or other specific action (including
material relative to legal proceedings intended to be transmitted to security
holders) relating to Securities held in the Accounts to the extent received by
Subcustodian or said Eligible Depository, such proxies or any voting instruments
to be executed by the registered holder of the Securities, but without
indicating the manner in which such Securities are to be voted.
3. Monitor Financial Service
In furtherance of its obligations under this Agreement, Subcustodian will
monitor a leading financial information service and other sources (such as local
financial newspapers, stock exchange publications, official gazettes, etc.) with
respect to announcements and other information respecting property held in the
Accounts, including announcements and other information with respect to
corporate actions and dividend, interest and other income payments.
III. Use of Securities Depository
A. Prior Approval
Subcustodian may, with the prior written approval of Custodian, maintain
all or any part of the Securities in the Accounts with a securities depository
or clearing agency which is incorporated or organized under the laws of a
country other than the United States of America and is supervised or regulated
by a government agency or regulatory authority in the foreign jurisdiction
having authority over such depositories or agencies, and which operates (a) a
central system for handling of designated securities or equivalent book entries
in Canada or (b) a transnational system for the central handling of securities
or equivalent book entries (herein called "Eligible Depository"), provided,
however, that, while so maintained, such Securities shall be subject only to the
directions of Subcustodian and that Subcustodian's duties, obligations and
responsibilities with regard to such Securities shall be the same as if such
Securities were held by Subcustodian on its premises.
B. At any time before or after Custodian approves the use of an Eligible
Depository, Subcustodian shall timely provide Custodian with such information as
Custodian may reasonably request with regard to such Eligible Depository.
C. With respect to the use of an Eligible Depository:
1. Subcustodian shall, subject to reimbursement for any reasonable
costs and expenses which it may incur, use its best efforts to
enforce its rights against the Eligible Depository on behalf of
Custodian and Custodian's customers, and Custodian shall have the
right, to the extent permitted by law, to be subrogated to the
rights of Subcustodian against the Eligible Depository in respect
of the relevant assets. Subcustodian shall be responsible to
Custodian for any amounts recovered in regard to the relevant
assets.
2. Subcustodian shall be deemed to represent, and shall be solely
responsible for determining on an ongoing basis, that the use of
such Eligible Depository is commercially reasonable, that the
assets held in the Eligible Depository will be subject to
reasonable care, and that the conditions applicable to
Subcustodian's holding of the property in the Eligible Depository
are at least as favorable as the conditions applicable to
property held by other participants in the Eligible Depository.
IV. Claims Against Property in the Accounts
The property in the Accounts shall not be subject to any right, charge,
security interest, lien or claim of any kind (collectively "Charges") in favor
of Subcustodian or any Eligible Depository or any creditor of Subcustodian or of
any Eligible Depository except a claim for payment by Subcustodian for such
property's safe custody or administration in accordance with the terms of this
Agreement. Subcustodian will immediately notify Custodian of any attempt by any
party to assert any Charge against the property held in the Accounts and shall
take all lawful actions to protect such property from such Charges until
Custodian has had reasonable time to respond to such notice.
V. Subcustodian's Representations and Warranties
Subcustodian represents and warrants that:
A. Subcustodian is qualified to hold Securities and cash belonging to
registered investment companies under the U.S. Investment Company Act of 1940,
being (i) a branch of a "U.S. Bank" that has aggregate capital surplus and
undivided profits of not less than $500,000; or (ii) an "eligible foreign
custodian", as those terms are defined in Sections (a)(1) and (7) respectively
Rule 17f-5 of the Investment Company Act (a copy of which as currently in effect
are attached hereto as Attachment A); or (iii) subject to any rule, exemptive
order, or other appropriate action of the U.S. Securities and Exchange
Commission thereunder. Subcustodian shall immediately notify Custodian, in
writing or by other authorized means, in the event that there appears to be a
substantial likelihood that Subcustodian will cease to qualify to so act.
B. Subcustodian qualifies to "act as a subcustodian of portfolio
securities" of a Canadian mutual fund in accordance with Section 7 of the
National Policy Statement No. 39 of the Canadian securities administrators (a
copy of which as currently in effect is attached hereto as Attachment B), and
Subcustodian shall immediately notify the Custodian, in writing or by other
authorized means, in the event that there appears to be a substantial likelihood
that Subcustodian will cease to qualify to so act.
Upon receipt of any such notification required under (A) or (B) of this
section, Custodian may terminate this Agreement immediately without prior notice
to Subcustodian.
C. Subcustodian's (i) practices, procedures and internal controls
(including but not limited to physical protections, method of keeping custodial
records, and security and data protection practices); (ii) financial strength
and reputation enable it to provide reasonable care for the property held under
this Agreement.
D. Subcustodian will immediately notify Custodian upon becoming aware of
any of the following:
1. Any event that has or may have a material adverse effect (i) on
any of the matters described in Section C above, or (ii)
otherwise on Subcustodian's ability to provide reasonable care
for the property held under this Agreement or to act on
"Instructions".
2. Any material breach of any term, condition, representation or
warranty of this Agreement.
3. Any material change or anticipated change in any arrangements
contemplated hereunder, including any change (or anticipated
change) in the conditions applicable to holding securities at an
Eligible Depository; and any change (or anticipated change) in
control of Subcustodian.
VI. Instructions
A. Definition
The term "Instructions" means:
1. instructions in writing signed by authorized individuals
designated as such by Custodian;
2. SWIFT or tested telex instructions of Custodian;
3. other forms of instructions in computer readable form as
shall customarily be used for the transmission of like
information, and
4. such other forms of communication as from time to time may
be agreed upon by Custodian and Subcustodian, which
Subcustodian believes in good faith to have been given by
Custodian or which are transmitted with proper testing or
authentication pursuant to terms and conditions which
Custodian may specify.
B. Effect
Unless otherwise expressly provided, all Instructions shall continue in
full force and effect until canceled or superseded. Subcustodian shall act in
accordance with Instructions and shall not be liable for any act or omission in
respect of any Instruction except in the case of willful default, negligence,
fraud, bad faith, willful misconduct, or reckless disregard of duties on the
part of Subcustodian. Subcustodian in executing all Instructions will take
relevant action in accordance with accepted industry practice and local
settlement practices.
VII. Compliance with Canadian Rules on Related/Restricted Party Transactions
The services performed by Subcustodian under this Contract shall comply
with applicable Canadian laws. For greater certainty, the parties hereby agree
to ensure that such services shall at all times be permitted related party
transactions under Section 483 of the Trust and Loan Companies Act (Canada) and
permitted restricted party transactions under Section 142 of the Loan and Trust
Corporations Act (Ontario). The parties shall from time to time review and
amend, if necessary, this Contract to comply with the development, amendment or
replacement of applicable rules and regulations affecting the delivery of
services by Subcustodian to Custodian under this Contract.
VIII. Miscellaneous Provisions
A. Statements Regarding the Accounts
Subcustodian will supply Custodian with such statements regarding the
Accounts as Custodian may request, including the identity and location of any
Eligible Depository authorized and acting hereunder. In addition, Subcustodian
will supply Custodian with an advice or notification of any transfers of
Securities to or from the Accounts indicating, as to Securities acquired for the
Accounts, if applicable, the Eligible Depository having possession of such
securities.
B. Examination of Books and Records
Subcustodian agrees that its books and records relating to the Accounts and
Subcustodian's actions under this agreement shall be open to the physical,
on-premises inspection and audit at reasonable times by officers of, auditors
employed by, or other representatives of Custodian including (to the extent
permitted under the laws of Canada the independent public accountants for any
customer of Custodian whose property is being held hereunder) and such books and
records shall be retained for such period as shall be agreed upon by Custodian
and Subcustodian.
As Custodian may reasonably request from time to time, Subcustodian will
furnish its auditor's reports on its system of internal controls, and
Subcustodian will use its best efforts to obtain and furnish similar reports of
any Eligible Depository authorized and acting hereunder.
C. Standard of Care
In holding, maintaining, servicing and disposing of Property under this
Agreement, and in fulfilling any other obligations hereunder, Subcustodian shall
exercise the same standard of care that it exercises or would exercise over its
own assets, provided that Subcustodian shall exercise at least the degree of
care and maintain adequate insurance as expected of a prudent professional
Subcustodian for hire and shall assume the burden of proving that it has
exercised such care in its maintenance of Property held by Subcustodian in its
Accounts. The maintenance of the Property in an Eligible Depository shall not
affect Subcustodian's standard of care, and Subcustodian will remain as fully
responsible for any loss or damage to such securities as if it had itself
retained physical possession of them. Subcustodian shall indemnify and hold
harmless Custodian and each of Custodian's customers from and against any loss,
damage, cost, expense, liability or claim (including reasonable attorney's fees)
arising out of or in connection with the improper or negligent performance or
the nonperformance of the duties of Subcustodian.
Subcustodian shall be responsible for complying with all provisions of the
laws of Canada, or any other law, applicable to Subcustodian in connection with
its duties hereunder, including (but not limited to) the payment of all transfer
taxes or other taxes and compliance with any currency restrictions and
securities laws in connection with its duties as Subcustodian.
D. Loss of Cash or Securities
Subcustodian agrees that, in the event of any loss of Securities or Cash in
the Accounts, Subcustodian will use its best efforts to ascertain the
circumstances relating to such loss and will promptly report the same to
Custodian and shall use every legal means available to it to effect the quickest
possible recovery.
E. Compensation of Subcustodian
Custodian agrees to pay to Subcustodian from time to time such compensation
for its services and such out-of-pocket or incidental expenses of Subcustodian
pursuant to this Agreement as may be mutually agreed upon in writing from time
to time.
F. Operating Requirements
Subcustodian agrees to follow such Operating Requirements as Custodian may
establish from time to time.
G. Termination
This Agreement may be terminated by Subcustodian or Custodian on 60 days'
written notice to the other party, sent by registered mail, provided that any
such notice, whether given by Subcustodian or Custodian, shall be followed
within 60 days by Instructions specifying the names of the persons to whom
Subcustodian shall deliver the Securities in the Accounts and to whom the Cash
in the Accounts shall be paid. If within 60 days following the giving of such
notice of termination, Subcustodian does not receive such Instructions,
Subcustodian shall continue to hold such Securities and Cash subject to this
Agreement until such Instructions are given. The obligations of the parties
under this Agreement shall survive the termination of this Agreement.
H. Notices
Unless otherwise specified in this Agreement, all notices and
communications with respect to matters contemplated by this Agreement shall be
in writing, and delivered by mail, postage prepaid, telex, SWIFT, or other
mutually agreed telecommunication methods to the following addresses (or to such
other address as either party hereto may from time to time designate by notice
duly given in accordance with this paragraph):
To Custodian: State Street Bank and Trust Company
Securities Operations/Network Administration
X.X. Xxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
To Subcustodian: State Street Trust Company Canada
000 Xxxx Xxxxxx Xxxx
Xxxxx 0000, X.X. Xxx 00
Xxxxxxx, Xxxxxxx XXX xX0
Xxxxxx
I. Confidentiality
Subcustodian and Custodian shall each use its best efforts to maintain the
confidentiality of the property in the Account and the beneficial owners
thereof, subject, however, to the provisions of any laws requiring disclosure.
In addition, Subcustodian shall safeguard any test keys, identification codes or
other security devices which Custodian shall make available to it. The
Subcustodian further agrees it will not disclose the existence of this Agreement
or any current business relationship unless compelled by applicable law or
regulation or unless it has secured the Custodian's written consent.
J. Assignment
This Agreement shall not be assignable by either party but shall bind any
successor in interest of Custodian and Subcustodian respectively.
K. Governing Law
This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts. The Subcustodian hereby submits to
the jurisdiction of the State and Federal courts located in the Commonwealth of
Massachusetts including any appellate court thereof. To the extent inconsistent
with this Agreement or Custodian's Operating Requirements as attached hereto,
Subcustodian's rules and conditions regarding accounts generally or custody
accounts specifically shall not apply.
CUSTODIAN: STATE STREET BANK AND TRUST COMPANY
By: /s/
Date: 2/20/98
AGREED TO BY STATE STREET TRUST
COMPANY CANADA AS SUBCUSTODIAN:
By: /s/ By: /s/
Date: Feb. 20 '98 Date: Feb. 20 '98
