EXHIBIT 10.
CUSTODIAN AGREEMENT
AGREEMENT amended and restated as of June 1, 2001, between each of the
Xxxxxx Funds listed in Schedule A, each of such Funds acting on its own
behalf separately from all the other Funds and not jointly or jointly
and severally with any of the other Funds (each of the Funds being
hereinafter referred to as the "Fund"), and Xxxxxx Fiduciary Trust
Company (the "Custodian").
WHEREAS, the Custodian represents to the Fund that it is eligible to
serve as a custodian and foreign custody manager for a management
investment company registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), and
WHEREAS, the Fund wishes to appoint the Custodian as the Fund's
custodian and foreign custody manager.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:
1. Appointment of Custodian. The Fund hereby employs and appoints the
Custodian as custodian of its assets for the term and subject to the
provisions of this Agreement. At the direction of the Custodian, the
Fund agrees to deliver to the Sub-Custodians appointed pursuant to
Section 2 below (the "Sub-Custodians") securities, funds and other
property owned by it. The Custodian shall have no responsibility or
liability for or on account of securities, funds or other property not
so delivered to the Sub-Custodians. Upon request, the Fund shall deliver
to the Custodian or to such Sub-Custodians as the Custodian may direct
such proxies, powers of attorney or other instruments as may be
reasonably necessary or desirable in connection with the performance by
the Custodian or any Sub-Custodian of their respective obligations under
this Agreement or any applicable Sub-Custodian Agreement.
2. Appointment of Sub-Custodians. The Custodian may at any time and from
time to time appoint, at its own cost and expense, as a Sub-Custodian
for the Fund any bank or trust company which meets the requirements of
the 1940 Act and the rules and regulations thereunder to act as a
custodian, provided that the Fund shall have approved any such bank or
trust company and the Custodian gives prompt notice to the Fund of any
such appointment. The agreement between the Custodian and any
Sub-Custodian shall be substantially in the form of the Sub-Custodian
agreement attached hereto as Exhibit 1 (the "Sub-Custodian Agreement")
unless otherwise approved by the Fund, provided, however, that the
agreement between the Custodian and any Sub-Custodian appointed
primarily for the purpose of holding foreign securities of the Fund
shall be substantially in the form of the Sub-Custodian Agreement
attached hereto as Exhibit 1(A) (the "Foreign Sub-Custodian Agreement";
the "Sub-Custodian Agreement" and the "Foreign Sub-Custodian Agreement"
are herein referred to collectively and each individually as the
"Sub-Custodian Agreement"). All Sub-Custodians shall be subject to the
instructions of the Custodian and not the Fund. The Custodian may, at
any time in its discretion, remove any bank or trust company which has
been appointed as a Sub-Custodian but shall in such case promptly notify
the Fund in writing of any such action. Securities, funds and other
property of the Fund delivered pursuant to this Agreement shall be held
exclusively by Sub-Custodians appointed pursuant to the provisions of
this Section 2.
The Sub-Custodians which the Fund has approved to date are set forth in
Schedule B hereto. Schedule B shall be amended from time to time as
Sub-Custodians are changed, added or deleted.
With respect to the securities, funds or other property held by a
Sub-Custodian, the Custodian shall be liable to the Fund if and only to
the extent that such Sub-Custodian is liable to the Custodian. The
Custodian shall nevertheless be liable to the Fund for its own
negligence in transmitting any instructions received by it from the Fund
and for its own negligence in connection with the delivery of any
securities, funds or other property of the Fund to any such
Sub-Custodian.
In the event that any Sub-Custodian appointed pursuant to the provisions
of this Section 2 fails to perform any of its obligations under the
terms and conditions of the applicable Sub-Custodian Agreement, the
Custodian shall use its best efforts to cause such Sub-Custodian to
perform such obligations. In the event that the Custodian is unable to
cause such Sub-Custodian to perform fully its obligations thereunder,
the Custodian shall forthwith terminate such Sub-Custodian and, if
necessary or desirable, appoint another Sub-Custodian in accordance with
the provisions of this Section 2. The Custodian may with the approval of
the Fund commence any legal or equitable action which it believes is
necessary or appropriate in connection with the failure by a
Sub-Custodian to perform its obligations under the applicable
Sub-Custodian Agreement. Provided the Custodian shall not have been
negligent with respect to any such matter, such action shall be at the
expense of the Fund. The Custodian shall keep the Fund fully informed
regarding such action and the Fund may at any time upon notice to the
Custodian elect to take responsibility for prosecuting such action. In
such event the Fund shall have the right to enforce and shall be
subrogated to the Custodian's rights against any such Sub-Custodian for
loss or damage caused the Fund by such Sub-Custodian.
At the written request of the Fund, the Custodian will terminate any
Sub-Custodian appointed pursuant to the provisions of this Section 2 in
accordance with the termination provisions of the applicable
Sub-Custodian Agreement. The Custodian will not amend any Sub-Custodian
Agreement in any material manner except upon the prior written approval
of the Fund and shall in any case give prompt written notice to the Fund
of any amendment to the Sub-Custodian Agreement.
3. Duties of the Custodian with Respect to Property of the Fund Held by
Sub-Custodians.
3.1. Holding Securities -- The Custodian shall cause one or more
Sub-Custodians to hold and, by book-entry or otherwise, identify as
belonging to the Fund all non-cash property delivered to such
Sub-Custodian.
3.2. Delivery of Securities -- The Custodian shall cause Sub-Custodians
holding securities of the Fund to release and deliver securities owned
by the Fund held by the Sub-Custodian or in a Securities System (as
defined in Section 3.12) account of the Sub-Custodian only upon receipt
of Proper Instructions (as defined in Section 3.16), which may be
continuing instructions when deemed appropriate by the parties, and only
in the following cases:
3.2.1. Upon sale of such securities for the account of the Fund and
receipt of payment therefor; provided, however, that a Sub-Custodian may
release and deliver securities prior to the receipt of payment therefor
if (i) in the Sub-Custodian's judgment, (A) release and delivery prior
to payment is required by the terms of the instrument evidencing the
security or (B) release and delivery prior to payment is the prevailing
method of settling securities transactions between institutional
investors in the applicable market and (ii) release and delivery prior
to payment is in accordance with generally accepted trade practice and
with any applicable governmental regulations and the rules of Securities
Systems or other securities depositories and clearing agencies in the
applicable market. The Custodian agrees, upon request, to advise the
Fund of all pending transactions in which release and delivery will be
made prior to the receipt of payment therefor;
3.2.2. Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Fund;
3.2.3. In the case of a sale effected through a Securities System, in
accordance with the provisions of Section 3.12 hereof;
3.2.4. To the depository agent in connection with tender or other
similar offers for portfolio securities of the Fund; provided that, in
any such case, the cash or other consideration is thereafter to be
delivered to the Sub-Custodian;
3.2.5. To the issuer thereof or its agent, when such securities are
called, redeemed, retired or otherwise become payable; provided that, in
any such case, the cash or other consideration is to be delivered to the
Sub-Custodian;
3.2.6. To the issuer thereof, or its agent for transfer into the name of
the Fund or into the name of any nominee or nominees of the
Sub-Custodian or into the name or nominee name of any agent appointed
pursuant to Section 3.11 or any other name permitted pursuant to Section
3.3; or for exchange for a different number of bonds, certificates or
other evidence representing the same aggregate face amount or number of
units; provided that, in any such case, the new securities are to be
delivered to the Sub-Custodian;
3.2.7. Upon the sale of such securities for the account of the Fund, to
the broker or its clearing agent, against a receipt, for examination in
accordance with "street delivery" custom; provided that in any such
case, the Sub-Custodian shall have no responsibility or liability for
any loss arising from the delivery of such securities prior to receiving
payment for such securities except as may arise from the Sub-Custodian's
own negligence or willful misconduct;
3.2.8. For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the
securities of the issuer of such securities, or pursuant to provisions
for conversion contained in such securities, or pursuant to any deposit
agreement; provided that, in any such case, the new securities and cash,
if any, are to be delivered to the Sub-Custodian;
3.2.9. In the case of warrants, rights or similar securities, the
surrender thereof in the exercise of such warrants, rights or similar
securities or the surrender of interim receipts or temporary securities
for definitive securities; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the Sub-Custodian;
3.2.10. For delivery in connection with any loans of securities made by
the Fund;
3.2.11. For delivery as security in connection with any borrowings by
the Fund requiring a pledge of assets by the Fund, but only against
receipt of amounts borrowed;
3.2.12. Upon receipt of instructions from the transfer agent ("Transfer
Agent") for the Fund, for delivery to such Transfer Agent or to the
shareholders of the Fund in connection with distributions in kind, as
may be described from time to time in the Fund's Declaration of Trust
and currently effective registration statement, if any, in satisfaction
of requests by Fund shareholders for repurchase or redemption;
3.2.13. For delivery to another Sub-Custodian of the Fund; and
3.2.14. For any other proper corporate purpose, but only upon receipt
of, in addition to Proper Instructions, a certified copy of a resolution
of the Trustees or of the Executive Committee of the Fund signed by an
officer of the Fund and certified by its Clerk or an Assistant Clerk,
specifying the securities to be delivered, setting forth the purpose for
which such delivery is to be made, declaring such purposes to be proper
corporate purposes, and naming the person or persons to whom delivery of
such securities shall be made.
3.3. Registration of Securities. Securities of the Fund held by the
Sub-Custodians hereunder (other than bearer securities) shall be
registered in the name of the Fund or in the name of any nominee of the
Fund or of any nominee of the Sub-Custodians or any Eligible Foreign
Custodian subject to a Contract (each as defined in Section 3.11A) or
eligible securities depository (as defined in Section 3.11B), which
nominee shall be assigned exclusively to the Fund, unless the Fund has
authorized in writing the appointment of a nominee to be used in common
with other registered investment companies having the same investment
adviser as the Fund, or in the name or nominee name of any agent
appointed pursuant to Section 3.12. Notwithstanding the foregoing, a
Sub-Custodian, agent, Eligible Foreign Custodian or eligible securities
depository may hold securities of the Fund in a nominee name which is
used for its other clients provided that such name is not used by the
Sub-Custodian, agent, Eligible Foreign Custodian or eligible securities
depository for its own securities and that securities of the Fund are,
by book-entry or otherwise, at all times identified as belonging to the
Fund and distinguished from other securities held for other clients
using the same nominee name. In addition, and notwithstanding the
foregoing, a Sub-Custodian or agent thereof or Eligible Foreign
Custodian or eligible securities depository may hold securities of the
Fund in its own name if such registration is the prevailing method in
the applicable market by which custodians register securities of
institutional clients and provided that securities of the Fund are, by
book-entry or otherwise, at all times identified as belonging to the
Fund and distinguished from other securities held for other clients or
for the Sub-Custodian or agent thereof or Eligible Foreign Custodian or
eligible securities depository. All securities accepted by a
Sub-Custodian under the terms of a Sub-Custodian Agreement shall be in
good delivery form.
3.4. Bank Accounts. The Custodian shall cause one or more
Sub-Custodians to open and maintain a separate bank account or accounts
in the name of the Fund or the Custodian, subject only to draft or order
by the Sub-Custodian acting pursuant to the terms of a Sub-Custodian
Contract or by the Custodian acting pursuant to this Agreement, and
shall hold in such account or accounts, subject to the provisions
hereof, all cash received by it from or for the account of the Fund,
other than cash maintained by the Fund in a bank account established and
used in accordance with Rule 17f-3 under the 1940 Act. Funds held by the
Sub-Custodian for the Fund may be deposited by it to its credit as
sub-custodian or to the Custodian's credit as custodian in the Banking
Department of the Sub-Custodian or in such other banks or trust
companies as it may in its discretion deem necessary or desirable;
provided, however, that every such bank or trust company shall be
qualified to act as a custodian under the 1940 Act and that each such
bank or trust company and the funds to be deposited with each such bank
or trust company shall be approved by vote of a majority of the Trustees
of the Fund. Such funds shall be deposited by the Sub-Custodian or the
Custodian in its capacity as sub-custodian or custodian, respectively,
and shall be withdrawable by the Sub-Custodian or the Custodian only in
that capacity. The Sub-Custodian shall be liable for actual losses
incurred by the Fund attributable to any failure on the part of the
Sub-Custodian to report accurate cash availability information with
respect to the Fund's or the Custodian's bank accounts maintained by the
Sub-Custodian or any of its agents.
3.5. Payments for Shares. The Custodian shall cause one or more
Sub-Custodians to deposit into the Fund's account amounts received from
the Transfer Agent of the Fund for shares of the Fund issued by the Fund
and sold by its distributor. The Custodian will provide timely
notification to the Fund of any receipt by the Sub-Custodian from the
Transfer Agent of payments for shares of the Fund.
3.6. Availability of Federal Funds. Upon mutual agreement between the
Fund and the Custodian, the Custodian shall cause one or more
Sub-Custodians, upon the receipt of Proper Instructions, to make federal
funds available to the Fund as of specified times agreed upon from time
to time by the Fund and the Custodian with respect to amounts received
by the Sub-Custodians for the purchase of shares of the Fund.
3.7. Collection of Income. The Custodian shall cause one or more
Sub-Custodians to collect on a timely basis all income and other
payments with respect to registered securities held hereunder, including
securities held in a Securities System, to which the Fund shall be
entitled either by law or pursuant to custom in the securities business,
and shall collect on a timely basis all income and other payments with
respect to bearer securities if, on the date of payment by the issuer,
such securities are held by the Sub-Custodian or agent thereof and shall
credit such income, as collected, to the Fund's account. Without
limiting the generality of the foregoing, the Custodian shall cause the
Sub-Custodian to detach and present for payment all coupons and other
income items requiring presentation as and when they become due and
shall collect interest when due on securities held under the applicable
Sub-Custodian Agreement. Arranging for the collection of income due the
Fund on securities loaned pursuant to the provisions of Section 3.2.10
shall be the responsibility of the Fund. The Custodian will have no
duty or responsibility in connection therewith, other than to provide
the Fund with such information or data as may be necessary to assist the
Fund in arranging for the timely delivery to the Sub-Custodian of the
income to which the Fund is properly entitled.
3.8. Payment of Fund Monies. Upon receipt of Proper Instructions, which
may be continuing instructions when deemed appropriate by the parties,
the Custodian shall cause one or more Sub-Custodians to pay out monies
of the Fund in the following cases only:
3.8.1. Upon the purchase of securities for the account of the Fund but
only (a) against the delivery of such securities to the Sub-Custodian
(or any bank, banking firm or trust company doing business in the United
States or abroad which is qualified under the 1940 Act, as amended, to
act as a custodian and has been designated by the Sub-Custodian as its
agent for this purpose) or any Eligible Foreign Custodian or eligible
securities depository and registered in the name of the Fund or in the
name of a nominee of the Sub-Custodian, any Eligible Foreign Custodian
or eligible securities depository referred to in Section 3.3 hereof or
in proper form for transfer; provided, however, that the Sub-Custodian
may cause monies of the Fund to be paid out prior to delivery of such
securities if (i) in the Sub-Custodian's judgment, (A) payment prior to
delivery is required by the terms of the instrument evidencing the
security or (B) payment prior to delivery is the prevailing method of
settling securities transactions between institutional investors in the
applicable market and (ii) payment prior to delivery is in accordance
with generally accepted trade practice and with any applicable
governmental regulations and the rules of Securities Systems or other
securities depositories and clearing agencies in the applicable market;
the Custodian agrees, upon request, to advise the Fund of all pending
transactions in which payment will be made prior to the receipt of
securities in accordance with the provision to the foregoing sentence;
(b) in the case of a purchase effected through a Securities System, in
accordance with the conditions set forth in Section 3.13 hereof; or
(c)(i) in the case of a repurchase agreement entered into between the
Fund and the Sub-Custodian, another bank, or a broker-dealer against
delivery of the securities either in certificate form or through an
entry crediting the Sub-Custodian's account at the Federal Reserve Bank
with such securities or (ii) in the case of a repurchase agreement
entered into between the Fund and the Sub-Custodian, against delivery of
a receipt evidencing purchase by the Fund of securities owned by the
Sub-Custodian along with written evidence of the agreement by the
Sub-Custodian to repurchase such securities from the Fund; or (d) for
transfer to a time deposit account of the Fund in any bank, whether
domestic or foreign, which transfer may be effected prior to receipt of
a confirmation of the deposit from the applicable bank or a financial
intermediary;
3.8.2. In connection with conversion, exchange or surrender of
securities owned by the Fund as set forth in Section 3.2 hereof;
3.8.3. For the redemption or repurchase of shares issued by the Fund as
set forth in Section 3.10 hereof;
3.8.4. For the payment of any expense or liability incurred by the Fund,
including but not limited to the following payments for the account of
the Fund: interest, taxes, management, accounting, transfer agent and
legal fees, including the Custodian's fee; and operating expenses of the
Fund whether or not such expenses are to be in whole or part capitalized
or treated as deferred expenses;
3.8.5. For the payment of any dividends or other distributions declared
to shareholders of the Fund;
3.8.6. For transfer to another Sub-Custodian of the Fund;
3.8.7. For any other proper purpose, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a resolution of the
Trustees or of the Executive Committee of the Fund signed by an officer
of the Fund and certified by its Clerk or an Assistant Clerk, specifying
the amount of such payment, setting forth the purpose for which such
payment is to be made, declaring such purpose to be a proper purpose,
and naming the person or persons to whom such payments is to be made.
3.9. Liability for Payment in Advance of Receipt of Securities
Purchased. Except as otherwise provided in this Agreement, in any and
every case where payment for purchase of securities for the account of
the Fund is made by a Sub-Custodian in advance of receipt of the
securities purchased in the absence of specific written instructions
from the Fund to so pay in advance, the Custodian shall cause the
Sub-Custodian to be absolutely liable to the Fund in the event any loss
results to the Fund from the payment by the Sub-Custodian in advance of
delivery of such securities.
3.10. Payments for Repurchase or Redemptions of Shares of the Fund. From
such funds as may be available, the Custodian shall, upon receipt of
Proper Instructions, cause one or more Sub-Custodians to make funds
available for payment to a shareholder who has delivered to the Transfer
Agent a request for redemption or repurchase of shares of the Fund. In
connection with the redemption or repurchase of shares of the Fund, the
Custodian is authorized, upon receipt of Proper Instructions, to cause
one or more Sub-Custodian, to wire funds to or through a commercial bank
designated by the redeeming shareholder. In connection with the
redemption or repurchase of shares of the Fund, the Custodian, upon
receipt of Proper Instructions, shall cause one or more Sub-Custodians
to honor checks drawn on the Sub-Custodian by a shareholder when
presented to the Sub-Custodian in accordance with such procedures and
controls as are mutually agreed upon from time to time among the Fund,
the Custodian and the Sub-Custodian.
3.11. Appointment of Agents with respect to U.S. Assets. With respect
to Fund assets maintained in the United States, the Custodian may permit
any Sub-Custodian at any time or times in its discretion to appoint (and
may at any time remove) any other bank or trust company which is itself
qualified under the 1940 Act to act as a custodian, as its agent to
carry out such of the provisions of this Section 3 as the Sub-Custodian
may from time to time direct; provided, however, that the appointment of
any agent shall not relieve the Custodian or any Sub-Custodian of its
responsibilities or liabilities hereunder and provided that any such
agent shall have been approved by vote of the Trustees of the Fund. The
agents which the Fund and the Custodian have approved to date are set
forth in Schedule B hereto. Any Sub-Custodian Agreement shall provide
that the engagement by the Sub-Custodian of one or more agents shall not
relieve the Sub-Custodian of its responsibilities or liabilities
thereunder.
3.11A Appointment of Foreign Custody Manager. Pursuant to Rule 17f-5 under
the 1940 Act, the Fund's Trustees appoint the Custodian as foreign custody
manager and delegate to the Custodian, and the Custodian accepts such
delegation and agrees to perform, the duties set forth below concerning the
safekeeping of the Fund's assets in each of the countries set forth in
Schedule B-1, as may be amended from time to time by the Fund and the
Custodian. The Custodian agrees to exercise reasonable care, prudence and
diligence such as a person having responsibility for the safekeeping of the
Fund's foreign assets would exercise. The Fund acknowledges that advance
notice may be required before the Custodian shall be able to perform its
duties with respect to a country added to Schedule B-1 (such advance notice
to be reasonable in light of the specific facts and circumstances attendant
to performance of duties in such country). The Custodian may at any time
and from time to time appoint, at its own cost and expense, as a
sub-foreign custody manager any Sub-Custodian that meets the requirements
of the 1940 Act and the rules and regulations thereunder to act as a
foreign custody manager, provided that the Fund shall have approved the
delegation of responsibilities to such Sub-Custodian as sub-foreign custody
manager, and the Custodian gives prompt notice to the Fund of any such
appointment. The Custodian or Sub-Custodian, as the case may be, is
authorized to take such actions on behalf of or in the name of the Fund as
are reasonably required to discharge its duties, which are as follows:
3.11A.1 The Custodian shall cause the Sub-Custodian to place and maintain
the Fund's assets with a custodian; provided that (i) each custodian is
either an eligible foreign custodian, as defined in subparagraph (a)(1) of
Rule 17f-5 or a bank eligible to serve as a custodian under Section 17(f)
of the 1940 Act ("Eligible Foreign Custodian"); and (ii) the Sub-Custodian
shall have determined that the Fund's assets will be subject to reasonable
care, based on the standards applicable to custodians in the relevant
market, after considering all factors relevant to the safekeeping of such
assets, including, without limitation, those factors set forth in clauses
(i) through (iv) of subparagraph (c)(1) of Rule 17f-5.
3.11A.2 The foreign custody arrangements are governed by a written contract
that the Sub-Custodian has determined will provide reasonable care for the
Fund's assets based on those factors set forth in clauses (i) through (iv)
of subparagraph (c)(1) of Rule 17f-5, which contract shall include the
provisions required by clause (i) of subparagraph (c)(2) of Rule 17f-5, or
in lieu of any or all of such provisions, the contract may contain such
other provisions that the Sub-Custodian determines will provide, in their
entirety, the same or a greater level of care and protection for the Fund's
assets as the provisions set forth in such clause, in their entirety.
3.11A.3 The Sub-Custodian shall have established a system to monitor at
reasonable intervals (but at least annually) the appropriateness of
maintaining the Fund's assets with each Eligible Foreign Custodian selected
hereunder. The Sub-Custodian shall monitor the continuing appropriateness
of placement of the Fund's assets in accordance with the criteria set forth
above. The Sub-Custodian shall monitor the continuing performance of the
contract governing the Fund's arrangements in accordance with the criteria
set forth above.
3.11A.4 The Custodian shall provide to the Fund's Trustees at least
annually, and more frequently if requested by the Fund, written reports
specifying placement of the Fund's assets with each Eligible Foreign
Custodian selected hereunder, and shall promptly report as to any material
changes to the Fund's foreign custody arrangements.
3.11A.5 If an arrangement with a specific Eligible Foreign Custodian
selected hereunder no longer meets the requirements of this Agreement, the
Sub- Custodian shall withdraw the Fund's assets from the non-complying
arrangement as soon as reasonably practicable; provided, however, that if
in the reasonable judgment of the Sub-Custodian, such withdrawal would
require liquidation of any of the Fund's assets or would materially impair
the liquidity, value or other investment characteristics of the Fund's
assets, it shall be the duty of the Sub-Custodian to provide the Fund's
investment manager information regarding the particular circumstances and
to act only in accordance with Proper Instructions with respect to such
liquidation or other withdrawal.
If a specific Eligible Foreign Custodian fails to perform any of its
obligations under the terms and conditions of the applicable contract,
the Sub-Custodian shall use its best efforts to cause such Eligible
Foreign Custodian to perform such obligations. If the Sub-Custodian is
unable to cause such Eligible Foreign Custodian to perform fully its
obligations thereunder, the Sub-Custodian shall terminate such Eligible
Foreign Custodian and, if necessary or desirable, appoint another
Eligible Foreign Custodian.
At the written request of the Fund, the Custodian shall cause the
Sub-Custodian to terminate any Eligible Foreign Custodian in accordance
with the termination provisions under the applicable contract.
3.11A.6 Notwithstanding the foregoing provisions, the Fund, acting through
its Trustees, its investment manager or its other authorized
representative, may direct the Custodian (and, in turn, the Custodian may
direct the Sub-Custodian) to place and maintain the Fund's assets with a
particular Eligible Foreign Custodian. In such event, the Custodian and,
as applicable, the Sub-Custodian shall be entitled to rely on any such
instruction as a Proper Instruction under the terms of the Custodian
Agreement and the Sub-Custodian Agreement, respectively, and shall have no
duties under this Section with respect to such arrangement save those that
it may undertake specifically in writing with respect to each particular
instance.
3.11B Deposit of Fund Assets in Foreign Securities Depositories. The
Custodian may permit any Sub-Custodian to deposit and/or maintain non-U.S.
investments of the Fund in any non-U.S. Securities Depository provided such
Securities Depository meets the requirements of an "eligible securities
depository" under Rule 17f-7 under the 1940 Act, or any successor rule or
regulation, or which by order of the Securities and Exchange Commission is
exempted therefrom. Prior to the placement of any assets of the Fund with a
non-U.S. Securities Depository, the Sub-Custodian: (a) shall provide to the
Fund's investment manager an assessment of the custody risks associated
with maintaining assets with such Securities Depository; and (b) shall have
established a system to monitor the custody risks associated with
maintaining assets with such Securities Depository. The Sub-Custodian
shall monitor such risks on a continuing basis and promptly notify the
Fund's investment manager of any material changes in such risk. If an
arrangement with a non-U.S. Securities Depository with which the assets of
the Fund are maintained hereunder no longer meets the requirements of this
Agreement, the Sub-Custodian shall withdraw the Fund's assets from the
non-complying arrangement as soon as reasonably practicable; provided,
however, that if in the reasonable judgment of the Sub-Custodian, such
withdrawal would require liquidation of any of the Fund's assets or would
materially impair the liquidity, value or other investment characteristics
of the Fund's assets, it shall be the duty of the Sub-Custodian to provide
the Fund's investment manager with information regarding the particular
circumstances and to act only in accordance with Proper Instructions with
respect to such liquidation or other withdrawal. In performing its duties
under this subsection, the Sub-Custodian shall use reasonable care,
prudence and diligence. The Sub-Custodian may rely on such reasonable
sources of information as may be available including but not limited to:
(i) published ratings; (ii) information supplied by a sub-custodian that is
a participant in such Securities Depository; (iii) industry surveys or
publications; (iv) information supplied by the depository itself, by its
auditors (internal or external) or by the relevant Foreign Financial
Regulatory Authority. It is acknowledged that information procured through
some or all of these sources may not be independently verifiable by the
Sub-Custodian and that direct access to Securities Depositories is limited
under most circumstances. Accordingly, the Sub-Custodian shall not be
responsible for errors or omissions in its duties hereunder provided that
it has performed its monitoring and assessment duties with reasonable care.
The risk assessment shall be provided to the Fund's investment manager by
such means as the Sub-Custodian shall reasonably establish. Notice of
material change in such assessment may be provided by the Sub-Custodian in
the manner established as customary for transmission of material market
information.
3.12. Deposit of Fund Assets in Securities Systems. The Custodian may
permit any Sub-Custodian to deposit and/or maintain securities owned by
the Fund in a clearing agency registered with the Securities and
Exchange Commission under Section 17A of the Securities Exchange Act of
1934, which acts as a securities depository, or in the book-entry system
authorized by the U.S. Department of the Treasury and certain federal
agencies, collectively referred to herein as "Securities System" in
accordance with applicable rules and regulations (including Rule 17f-4
of the 0000 Xxx) and subject to the following provisions:
3.12.1. The Sub-Custodian may, either directly or through one or more
agents, keep securities of the Fund in a Securities System provided that
such securities are represented in an account ("Account") of the
Sub-Custodian in the Securities System which shall not include any
assets of the Sub-Custodian other than assets held as a fiduciary,
custodian or otherwise for customers;
3.12.2. The records of the Sub-Custodian with respect to securities of
the Fund which are maintained in a Securities System shall identify by
book-entry those securities belonging to the Fund;
3.12.3. The Sub-Custodian shall pay for securities purchased for the
account of the Fund upon (i) receipt of advice from the Securities
System that such securities have been transferred to the Account, and
(ii) the making of an entry on the records of the Sub-Custodian to
reflect such payment and transfer for the account of the Fund. The
Sub-Custodian shall transfer securities sold for the account of the Fund
upon (i) receipt of advice from the Securities System that payment for
such securities has been transferred to the Account, and (ii) the making
of an entry on the records of the Sub-Custodian to reflect such transfer
and payment for the account of the Fund. Copies of all advices from the
Securities System of transfers of securities for the account of the Fund
shall be maintained for the Fund by the Sub-Custodian or such an agent
and be provided to the Fund at its request. The Sub-Custodian shall
furnish the Fund confirmation of each transfer to or from the account of
the Fund in the form of a written advice or notice and shall furnish to
the Fund copies of daily transaction sheets reflecting each day's
transactions in the Securities System for the account of the Fund on the
next business day;
3.12.4. The Sub-Custodian shall provide the Fund with any report
obtained by the Sub-Custodian on the Securities System's accounting
system, internal accounting controls and procedures for safeguarding
securities deposited in the Securities System;
3.12.5. The Sub-Custodian shall utilize only such Securities Systems as
are approved by the Board of Trustees of the Fund, and included on a
list maintained by the Custodian;
3.12.6. Anything to the contrary in this Agreement notwithstanding, the
Sub-Custodian shall be liable to the Fund for any loss or damage to the
Fund resulting from use of the Securities System by reason of any
negligence, misfeasance or misconduct of the Sub-Custodian or any of its
agents or of any of its or their employees or from failure of the
Sub-Custodian or any such agent to enforce effectively such rights as it
may have against the Securities System; at the election of the Fund, it
shall be entitled to be subrogated to the rights of the Sub-Custodian
with respect to any claim against the Securities System or any other
person which the Sub-Custodian may have as a consequence of any such
loss or damage if and to the extent that the Fund has not been made
whole for any such loss or damage.
3.12A Depositary Receipts. Only upon receipt of Proper Instructions, the
Sub-Custodian shall instruct an Eligible Foreign Custodian or an agent of
the Sub-Custodian appointed pursuant to the applicable Contract (an
"Agent") to surrender securities to the depositary used by an issuer of
American Depositary Receipts or International Depositary Receipts
(hereinafter collectively referred to as "ADRs") for such securities
against a written receipt therefor adequately describing such securities
and written evidence satisfactory to the Eligible Foreign Custodian or
Agent that the depositary has acknowledged receipt of instructions to
issue with respect to such securities ADRs in the name of the
Sub-Custodian, or a nominee of the Sub-Custodian, for delivery to the
Sub-Custodian.
Only upon receipt of Proper Instructions, the Sub-Custodian shall
surrender ADRs to the issuer thereof against a written receipt therefor
adequately describing the ADRs surrendered and written evidence
satisfactory to the Sub-Custodian that the issuer of the ADRs has
acknowledged receipt of instructions to cause its depository to deliver
the securities underlying such ADRs to an Eligible Foreign Custodian or
an Agent.
3.12B Foreign Exchange Transactions and Futures Contracts. Only upon
receipt of Proper Instructions, the Sub-Custodian shall enter into foreign
exchange contracts or options to purchase and sell foreign currencies for
spot and future delivery on behalf and for the account of the Fund or shall
enter into futures contracts or options on futures contracts. Such
transactions may be undertaken by the Sub-Custodian with such banking
institutions, including the Sub-Custodian and Eligible Foreign Custodian(s)
appointed pursuant to the applicable Contract, as principals, as approved
and authorized by the Fund. Foreign exchange contracts, futures contracts
and options, other than those executed with the Sub-Custodian, shall for
all purposes of this Agreement be deemed to be portfolio securities of the
Fund.
3.12C Option Transactions. Only upon receipt of Proper Instructions, the
Sub-Custodian shall enter into option transactions in accordance with the
provisions of any agreement among the Fund, the Custodian and/or the
Sub-Custodian and a broker-dealer.
3.13. Ownership Certificates for Tax Purposes. The Custodian shall
cause one or more Sub-Custodians as may be appropriate to execute
ownership and other certificates and affidavits for all federal and
state tax purposes in connection with receipt of income or other
payments with respect to securities of the Fund held by the
Sub-Custodian and in connection with transfers of securities.
3.14. Proxies. The Custodian shall, with respect to the securities
held by the Sub-Custodians, cause to be promptly executed by the
registered holder of such securities, if the securities are registered
other than in the name of the Fund or a nominee of the fund, all
proxies, without indication of the manner in which such proxies are to
be voted, and shall promptly deliver to the Fund such proxies, all proxy
soliciting materials and all notices relating to such securities.
3.15. Communications Relating to Fund Portfolio Securities. The
Custodian shall cause the Sub-Custodians to transmit promptly to the
Custodian, and the Custodian shall transmit promptly to the Fund, all
written information (including, without limitation, pendency of calls
and maturities of securities and expirations of rights in connection
therewith) received by the Sub-Custodian from issuers of the securities
being held for the account of the Fund. With respect to tender or
exchange offers, the Custodian shall cause the Sub-Custodian to transmit
promptly to the Fund, all written information received by the
Sub-Custodian from issuers of the securities whose tender or exchange is
sought and from the party (or his agents) making the tender or exchange
offer. If the Fund desires to take action with respect to any tender
offer, exchange offer or any other similar transaction, the Fund shall
notify the Custodian of the action the Fund desires such Sub-Custodian
to take, provided, however, neither the Custodian nor the Sub-Custodian
shall be liable to the Fund for the failure to take any such action
unless such instructions are received by the Custodian at least four
business days prior to the date on which the Sub-Custodian is to take
such action or, in the case of foreign securities, such longer period as
shall have been agreed upon in writing by the Custodian and the
Sub-Custodian.
3.16. Proper Instructions. Proper Instructions as used throughout this
Agreement means a writing signed or initialed by one or more person or
persons who are authorized by the Trustees of the Fund and the
Custodian. Each such writing shall set forth the specific transaction or
type of transaction involved, including a specific statement of the
purpose for which such action is requested. Oral instructions will be
considered Proper Instructions if the Custodian or Sub-Custodian, as the
case may be, reasonably believes them to have been given by a person
authorized to give such instructions with respect to the transaction
involved. All oral instructions shall be confirmed in writing. Proper
Instructions also include communications effected directly between
electro-mechanical or electronic devices provided that the Trustees have
approved such procedures. Notwithstanding the foregoing, no Trustee,
officer, employee or agent of the Fund shall be permitted access to any
securities or similar investments of the Fund deposited with any
Sub-Custodian or any agent of any Sub-Custodian for any reason except in
accordance with the provisions of Rule 17f-2 under the 1940 Act.
3.17. Actions Permitted Without Express Authority. The Custodian may in
its discretion, and may permit one or more Sub-Custodians in their
discretion, without express authority from the Fund to:
3.17.1. make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this
Agreement, or in the case of a Sub-Custodian, under the applicable
Sub-Custodian Agreement, provided that all such payments shall be
accounted for to the Fund;
3.17.2. surrender securities in temporary form for securities in
definitive form;
3.17.3. endorse for collection, in the name of the Fund, checks, drafts
and other negotiable instruments; and
3.17.4. in general, attend to all non-discretionary details in
connection with the sale, exchange, substitution, purchase, transfer and
other dealings with the securities and property of the Fund except as
otherwise directed by the Trustees of the Fund.
3.18. Evidence of Authority. The Custodian shall be protected in acting
upon any instructions, notice, request, consent, certificate or other
instrument or paper believed by it to be genuine and to have been
properly executed by or on behalf of the Fund.
3.19. Investment Limitations. In performing its duties generally, and
more particularly in connection with the purchase, sale and exchange of
securities made by or for the Fund, the Custodian may assume, unless and
until notified in writing to the contrary, that Proper Instructions
received by it are not in conflict with or in any way contrary to any
provisions of the Fund's Declaration of Trust or By-Laws (or comparable
documents) or votes or proceedings of the shareholders or Trustees of
the Fund. The Custodian shall in no event be liable to the Fund and
shall be indemnified by the Fund for any violation of any investment
limitations to which the Fund is subject or other limitations with
respect to the Fund's powers to expend funds, encumber securities,
borrow or take similar actions affecting its portfolio.
4. Performance Standards. The Custodian shall use its best efforts to
perform its duties hereunder in accordance with the standards set forth
in Schedule C hereto. Schedule C may be amended from time to time as
agreed to by the Custodian and the Trustees of the Fund.
5. Records. The Custodian shall create and maintain all records
relating to the Custodian's activities and obligations under this
Agreement and cause all Sub-Custodians to create and maintain all
records relating to the Sub-Custodian's activities and obligations under
the appropriate Sub-Custodian Agreement in such manner as will meet the
obligations of the Fund under the 1940 Act, with particular attention to
Sections 17(f) and 31 thereof and Rules 17f-2, 3la-1 and 31a-2
thereunder, applicable federal and state tax laws, and any other law or
administrative rules or procedures which may be applicable to the Fund.
All such records shall be the property of the Fund and shall at all
times during the regular business hours of the Custodian or during the
regular business hours of the Sub-Custodian, as the case may be, be open
for inspection by duly authorized officers, employees or agents of the
Custodian and Fund and employees and agents of the Securities and
Exchange Commission. At the Fund's request, the Custodian shall supply
the Fund and cause one or more Sub-Custodians to supply the Custodian
with a tabulation of securities owned by the Fund and held under this
Agreement. When requested to do so by the Fund and for such
compensation as shall be agreed upon, the Custodian shall include and
cause one or more Sub-Custodians to include certificate numbers in such
tabulations.
6. Opinion and Reports of Fund's Independent Accountants. The Custodian
shall take all reasonable actions, as the Fund may from time to time
request, to furnish such information with respect to its activities
hereunder as the Fund's independent public accountants may request in
connection with the accountant's verification of the Fund's securities
and similar investments as required by Rule 17f-2 under the 1940 Act,
the preparation of the Fund's registration statement and amendments
thereto, the Fund's reports to the Securities and Exchange Commission,
and with respect to any other requirements of such Commission.
The Custodian shall also direct any Sub-Custodian to take all reasonable
actions, as the Fund may from time to time request, to furnish such
information with respect to its activities under the applicable
Sub-Custodian Agreement as the Fund's independent public accountant may
request in connection with the accountant's verification of the Fund's
securities and similar investments as required by Rule 17f-2 under the
1940 Act, the preparation of the Fund's registration statement and
amendments thereto, the Fund's reports to the Securities and Exchange
Commission, and with respect to any other requirements of such
Commission.
7. Reports of Custodian's and Sub-Custodians' Independent Accountants.
The Custodian shall provide the Fund, at such times as the Fund may
reasonably require, with reports by its independent public accountant on
its accounting system, internal accounting controls and procedures for
safeguarding securities, including securities deposited and/or
maintained in Securities Systems, relating to services provided by the
Custodian under this Agreement. The Custodian shall also cause one or
more of the Sub-Custodians to provide the Fund, at such time as the Fund
may reasonably require, with reports by independent public accountants
on their accounting systems, internal accounting controls and procedures
for safeguarding securities, including securities deposited and/or
maintained in Securities Systems, relating to services provided by those
Sub-Custodians under their respective Sub-Custody Agreements. Such
reports, which shall be of sufficient scope and in sufficient detail as
may reasonably be required by the Fund, shall provide reasonable
assurance that any material inadequacies would be disclosed by such
examinations, and, if there is no such inadequacies, shall so state.
8. Compensation. The Custodian shall be entitled to reasonable
compensation for its services and expenses as custodian, as agreed upon
from time to time between the Fund and the Custodian. Such expenses
shall not include, however, the fees paid by the Custodian to any
Sub-Custodian.
9. Responsibility of Custodian. The Custodian shall exercise reasonable
care and diligence in carrying out the provisions of this Agreement and
shall not be liable to the Fund for any action taken or omitted by it in
good faith without negligence. So long as and to the extent that it is
in the exercise of reasonable care, neither the Custodian nor any
Sub-Custodian shall be responsible for the title, validity or
genuineness of any property or evidence of title thereto received by it
or delivered by it pursuant to this Agreement and shall be held harmless
in acting upon any notice, request, consent, certificate or other
instrument reasonably believed by it to be genuine and, if in writing,
reasonably believed by it to be signed by the proper party or parties.
It shall be entitled to rely on and may act upon advice of counsel (who
may be counsel for the Fund) on all matters, and shall be without
liability for any action reasonably taken or omitted pursuant to such
advice. Notwithstanding the foregoing, the responsibility of the
Custodian or a Sub-Custodian with respect to redemptions effected by
check shall be in accordance with a separate Agreement entered into
between the Custodian and the Fund.
It is also understood that the Custodian shall not be liable for any
loss resulting from a Sovereign Risk or Force Majeure. A "Sovereign
Risk" shall mean nationalization, expropriation, devaluation,
revaluation, confiscation, seizure, cancellation, destruction or similar
action by any governmental authority, de facto or de jure; or enactment,
promulgation, imposition or enforcement by any such governmental
authority of currency restrictions, exchange controls, taxes, levies or
other charges affecting the Fund's property; or acts of war, terrorism,
insurrection or revolution; or any other similar act or event beyond the
Custodian's control. "Force Majeure" shall mean any circumstance or
event which is beyond the reasonable control of the Custodian, a
Sub-Custodian or any agent of the Custodian or a Sub-Custodian and which
adversely affects the performance by the Custodian of its obligations
hereunder, by the Sub-Custodian of its obligations under its
Sub-Custodian Agreement or by any other agent of the Custodian or the
Sub-Custodian, including any event caused by, arising out of or
involving (a) an act of God, (b) accident, fire, water damage or
explosion, (c) any computer, system or other equipment failure or
malfunction caused by any computer virus or the malfunction or failure
of any communications medium, (d) any interruption of the power supply
or other utility service, (e) any strike or other work stoppage, whether
partial or total, (f) any delay or disruption resulting from or
reflecting the occurrence of any Sovereign Risk, (g) any disruption of,
or suspension of trading in, the securities, commodities or foreign
exchange markets, whether or not resulting from or reflecting the
occurrence of any Sovereign Risk, (h) any encumbrance on the
transferability of a currency or a currency position on the actual
settlement date of a foreign exchange transaction, whether or not
resulting from or reflecting the occurrence of any Sovereign Risk, or
(i) any other cause similarly beyond the reasonable control of the
Custodian.
If the Fund requires the Custodian which in turn may require a
Sub-Custodian to take any action with respect to securities, which
action involves the payment of money or which action may, in the opinion
of the Custodian or the Sub-Custodian result in the Custodian or its
nominee or a Sub-Custodian or its nominee being liable for the payment
of money or incurring liability of some other form, the Fund, as a
prerequisite to requiring the Custodian or the Custodian requiring any
Sub-Custodian to take such action, shall provide indemnity to the
Custodian in an amount and form satisfactory to it.
The Fund agrees to indemnify and hold harmless the Custodian and its
nominee from and against all taxes, charges, expenses, assessments,
claims and liabilities (including counsel fees) incurred or assessed
against it or its nominee or any Sub-Custodian or its nominee in
connection with the performance of this Agreement, or any Sub-Custodian
Agreement except, as to the Custodian, such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful
misconduct, and as to a Sub-Custodian, such as may arise from such
Sub-Custodian's or its nominee's own negligent action, negligent failure
to act or willful misconduct. The negligent action, negligent failure
to act or willful misconduct of the Custodian shall not diminish the
Fund's obligation to indemnify the Custodian in the amount, but only in
the amount, of any indemnity required to be paid to a Sub-Custodian
under its Sub-Custodian Agreement. The Custodian may assign this
indemnity from the Fund directly to, and for the benefit of, any
Sub-Custodian. The Custodian is authorized, and may authorize any
Sub-Custodian, to charge any account of the Fund for such items and such
fees. To secure any such authorized charges and any advances of cash or
securities made by the Custodian or any Sub-Custodian to or for the
benefit of the Fund for any purpose which results in the Fund incurring
an overdraft at the end of any business day or for extraordinary or
emergency purposes during any business day, the Fund hereby grants to
the Custodian a security interest in and pledges to the Custodian
securities up to a maximum of 10% of the value of the Fund's net assets
for the purpose of securing payment of any such advances and hereby
authorizes the Custodian on behalf of the Fund to grant to any
Sub-Custodian a security interest in and pledge of securities held for
the Fund (including those which may be held in a Securities System) up
to a maximum of 10% of the value of the net assets held by such
Sub-Custodian. The specific securities subject to such security
interest may be designated in writing from time to time by the Fund or
its investment adviser. In the absence of any designation of securities
subject to such security interest, the Custodian or the Sub-Custodian,
as the case may be, may designate securities held by it. Should the
Fund fail to repay promptly any authorized charges or advances of cash
or securities, the Custodian or the Sub-Custodian shall be entitled to
use such available cash and to dispose of pledged securities and
property as is necessary to repay any such authorized charges or
advances and to exercise its rights as a secured party under the U.C.C.
The Fund agrees that a Sub-Custodian shall have the right to proceed
directly against the Fund and not solely as subrogee to the Custodian
with respect to any indemnity hereunder assigned to a Sub-Custodian, and
in that regard, the Fund agrees that it shall not assert against any
Sub-Custodian proceeding against it any defense or right of set-off the
Fund may have against the Custodian arising out of the negligent action,
negligent failure to act or willful misconduct of the Custodian, and
hereby waives all rights it may have to object to the right of a
Sub-Custodian to maintain an action against it.
10. Successor Custodian. If a successor custodian shall be appointed
by the Trustees of the Fund, the Custodian shall, upon termination,
cause to be delivered to such successor custodian, duly endorsed and in
the form for transfer, all securities, funds and other properties then
held by the Sub-Custodians and all instruments held by the
Sub-Custodians relative thereto and cause the transfer to an account of
the successor custodian all of the Fund's securities held in any
Securities System.
If no such successor custodian shall be appointed, the Custodian shall,
in like manner, upon receipt of a certified copy of a vote of the
Trustees of the Fund, cause to be delivered at the office of the
Custodian and transfer such securities, funds and other properties in
accordance with such vote.
In the event that no written order designating a successor custodian or
certified copy of a vote of the Trustees shall have been delivered to
the Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank
or trust company, which meets the requirements of the 1940 Act and the
rules and regulations thereunder, such securities, funds and other
properties. Thereafter, such bank or trust company shall be the
successor of the Custodian under this Agreement.
In the event that such securities, funds and other properties remain in
the possession of the Custodian or any Sub-Custodian after the date of
termination hereof owing to failure of the Fund to procure the certified
copy of the vote referred to or of the Trustees to appoint a successor
custodian, the Custodian shall be entitled to fair compensation for its
services during such period as the Sub-Custodians retain possession of
such securities, funds and other properties and the provisions of this
Agreement relating to the duties and obligations of the Custodian shall
remain in full force and effect.
11. Effective Period, Termination and Amendment. This Agreement shall
become effective as of its execution, shall continue in full force and
effect until terminated as hereinafter provided, may be amended at any
time by mutual agreement of the parties hereto and may be terminated by
either party by an instrument in writing delivered or mailed, postage
prepaid to the other party, such termination to take effect not sooner
than thirty (30) days after the date of such delivery or mailing;
provided either party may at any time immediately terminate this
Agreement in the event of the appointment of a conservator or receiver
for the other party or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction. No provision of this Agreement may be amended or
terminated except by a statement in writing signed by the party against
which enforcement of the amendment or termination is sought.
Upon termination of the Agreement, the Fund shall pay to the Custodian
such compensation as may be due as of the date of such termination and
shall likewise reimburse the Custodian and through the Custodian any
Sub-Custodian for its costs, expenses and disbursements.
12. Interpretation. This Agreement constitutes the entire understanding
and agreement of the parties hereto with respect to the subject matter
hereof. In connection with the operation of this Agreement, the
Custodian and the Fund may from time to time agree in writing on such
provisions interpretive of or in addition to the provisions of this
Agreement as may in their joint opinion be consistent with the general
tenor of this Agreement. No interpretive or additional provisions made
as provided in the preceding sentence shall be deemed to be an amendment
of this Agreement.
13. Governing Law. This instrument is executed and delivered in The
Commonwealth of Massachusetts and shall be governed by and construed
according to the internal laws of said Commonwealth, without regard to
principles of conflicts of law.
14. Notices. Notices and other writings delivered or mailed postage
prepaid to the Fund addressed to the Fund attention: Executive Vice
President, or to such other person or address as the Fund may have
designated to the Custodian in writing, or to the Custodian at Xxx Xxxx
Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 attention: Director of
Custody Services, or to such other address as the Custodian may have
designated to the Fund in writing, shall be deemed to have been properly
delivered or given hereunder to the respective addressee.
15. Binding Obligation. This Agreement shall be binding on and shall
inure to the benefit of the Fund and the Custodian and their respective
successors and assigns, provided that neither party hereto may assign
this Agreement or any of its rights or obligations hereunder without the
prior written consent of the other party.
16. Declaration of Trust. A copy of the Declaration of Trust of each
of the Funds is on file with the Secretary of The Commonwealth of
Massachusetts and notice is hereby given that this instrument is
executed on behalf of the Trustees of each of the Funds as Trustees and
not individually and that the obligations of this instrument are not
binding on any of the Trustees or officers or shareholders individually,
but are binding only on the assets and property of each Fund with
respect to its obligations hereunder.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf as of the day and year first above
written.
THE XXXXXX FUNDS LISTED IN SCHEDULE A
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------
Xxxxxxx X. Xxxxxx
Executive Vice President and Treasurer
XXXXXX FIDUCIARY TRUST COMPANY
By: /s/ Xxxx X. Xxxxxxxxx
----------------------------
Xxxx X. Xxxxxxxxx
Managing Director and Director of Custody Services
Xxxxxx Investment LLC ("Xxxxxx"), the owner of the Custodian, agrees
that Xxxxxx shall be the primary obligor with respect to compensation
due the Sub-Custodians pursuant to the Sub-Custodian Agreements in
connection with the Sub-Custodians' performance of their
responsibilities thereunder and agrees to take all actions necessary and
appropriate to assure that the Sub-Custodians shall be compensated in
the amounts and on the schedules agreed to by the Custodian and the
Sub-Custodians pursuant to those Agreements.
XXXXXX INVESTMENTS, LLC
By: /s/ Xxxxx X. Xxxxx
----------------------------
Xxxxx X. Xxxxx
Managing Director and Treasurer
Schedule A
XXXXXX FUNDS
Putnam American Government Income Fund
Xxxxxx Arizona Tax Exempt Income Fund
Xxxxxx Asia Pacific Growth Fund
Xxxxxx Asset Allocation Funds
-- Balanced Portfolio
-- Conservative Portfolio
-- Growth Portfolio
Xxxxxx Balanced Retirement Fund
Xxxxxx California Investment Grade Municipal Trust
Xxxxxx California Tax Exempt Income Fund
Xxxxxx California Tax Exempt Money Market Fund
Xxxxxx Capital Appreciation Fund
Xxxxxx Classic Equity Fund
Xxxxxx Convertible Income-Growth Trust
Xxxxxx Convertible Opportunities and Income Trust
Xxxxxx Diversified Income Trust
Xxxxxx Dividend Income Fund
Xxxxxx Equity Income Fund
Xxxxxx Europe Growth Fund
Xxxxxx Florida Tax Exempt Income Fund
The Xxxxxx Fund for Growth and Income
Xxxxxx Funds Trust
-- Xxxxxx Asia Pacific Fund II
-- Xxxxxx Equity Fund 98
-- Xxxxxx Equity Fund 2000
-- Xxxxxx Financial Services Fund
-- Xxxxxx Growth Fund
-- Xxxxxx High Yield Trust II
-- Putnam International Core Fund
-- Putnam International Fund 2000
-- Putnam International Growth and Income Fund
-- Putnam Mid Cap Fund 2000
-- Putnam New Century Growth Fund
-- Xxxxxx Latin America Fund
-- Xxxxxx Technology Fund
-- Xxxxxx U.S. Core Fund
The Xxxxxx Xxxxxx Fund of Boston
Xxxxxx Global Equity Fund
Xxxxxx Global Governmental Income Trust
Xxxxxx Global Growth Fund
Xxxxxx Global Natural Resources Fund
Putnam Health Sciences Trust
Xxxxxx High Income Convertible and Bond Fund
Xxxxxx High Yield Advantage Fund
Xxxxxx High Yield Municipal Trust
Xxxxxx High Yield Trust
Putnam Income Fund
Putnam Intermediate U.S. Government Income Fund
Putnam International Growth Fund
Xxxxxx Investment Funds
-- Xxxxxx Balanced Fund
-- Xxxxxx Capital Opportunities Fund
-- Xxxxxx Emerging Markets Fund
-- Xxxxxx Global Aggressive Growth Fund
-- Xxxxxx Global Growth and Income Fund
-- Xxxxxx Growth Opportunities Fund
-- Xxxxxx International Fund
-- Xxxxxx International Blend Fund
-- Xxxxxx International Large Cap Growth Fund
-- Xxxxxx International New Opportunities Fund
-- Xxxxxx International Voyager Fund
-- Xxxxxx Mid-Cap Value Fund
-- Xxxxxx New Value Fund
-- Xxxxxx Research Fund
-- Xxxxxx Small Cap Value Fund
Xxxxxx Investment Grade Municipal Trust
Xxxxxx Investment Grade Municipal Trust II
Xxxxxx Investment Grade Municipal Trust III
Xxxxxx Investors Fund
Xxxxxx Managed High Yield Trust
Xxxxxx Managed Municipal Income Trust
Xxxxxx Massachusetts Tax Exempt Income Fund
Xxxxxx Master Income Trust
Xxxxxx Master Intermediate Income Trust
Xxxxxx Michigan Tax Exempt Income Fund
Xxxxxx Minnesota Tax Exempt Income Fund
Xxxxxx Money Market Fund
Xxxxxx Municipal Income Fund
Xxxxxx Municipal Opportunities Trust
Xxxxxx New Jersey Tax Exempt Income Fund
Xxxxxx New Opportunities Fund
Xxxxxx New York Investment Grade Municipal Trust
Xxxxxx New York Tax Exempt Income Fund
Xxxxxx New York Tax Exempt Money Market Fund
Xxxxxx New York Tax Exempt Opportunities Fund
Xxxxxx Ohio Tax Exempt Income Fund
Xxxxxx OTC & Emerging Growth Fund
Xxxxxx Pennsylvania Tax Exempt Income Fund
Xxxxxx Preferred Income Fund
Xxxxxx Premier Income Trust
Xxxxxx Strategic Income Fund
Xxxxxx Tax Exempt Income Fund
Xxxxxx Tax Exempt Money Market Fund
Xxxxxx Tax-Free Health Care Fund
Xxxxxx Tax-Free Income Trust
-- Tax-Free High Yield Fund
-- Tax-Free Insured Fund
Xxxxxx Tax Smart Funds Trust
-- Xxxxxx Tax Smart Equity Fund
Xxxxxx US Government Income Trust
Xxxxxx Utilities Growth and Income Fund
Xxxxxx Variable Trust
-- Xxxxxx VT American Government Income Fund
-- Xxxxxx VT Asia Pacific Growth Fund
-- Xxxxxx VT Capital Appreciation Fund
-- Xxxxxx VT Diversified Income Fund
-- Xxxxxx VT Global Asset Allocation Fund
-- Xxxxxx VT Global Growth Fund
-- Xxxxxx VT Growth and Income Fund
-- Xxxxxx VT Growth Opportunities Fund
-- Xxxxxx VT Health Sciences Fund
-- Xxxxxx VT High Yield Fund
-- Xxxxxx VT Income Fund
-- Xxxxxx VT Investors Fund
-- Xxxxxx VT International Growth Fund
-- Xxxxxx VT International Growth and Income Fund
-- Xxxxxx VT International New Opportunities Fund
-- Xxxxxx VT Money Market Fund
-- Xxxxxx VT New Opportunities Fund
-- Xxxxxx VT New Value Fund
-- Xxxxxx VT OTC & Emerging Growth Fund
-- Xxxxxx VT Research Fund
-- Xxxxxx VT Small Cap Value Fund
-- Xxxxxx VT Technology Fund
-- Xxxxxx VT The Xxxxxx Xxxxxx Fund of Boston
-- Xxxxxx VT Utilities Growth and Income Fund
-- Xxxxxx VT Vista Fund
-- Xxxxxx VT Voyager Fund
-- Xxxxxx VT Voyager Fund II
Xxxxxx Vista Fund
Xxxxxx Voyager Fund
Xxxxxx Voyager Fund II
Schedule B
Custodian / Agent Bank List
Bank of New York
Bankers Trust Company
Boston Safe Deposit and Trust Company
Xxxxx Brothers Xxxxxxxx
Citibank
Deutsche Bank
Fleet Bank
XX Xxxxxx
State Street Corporation
The Northern Trust Company
United Missouri Bank
Schedule B-1
Country List
XX Xxxxxx Xxxxx Brothers Xxxxxxxx
Australia Argentina
Austria Bangledesh
Belguim Bermuda
Canada Botswana
Cedel Brazil
Denmark Chile
Euroclear China
Finland Colombia
France Czech Republic
Germany Egypt
Greece Ghana
Hong Kong Hungary
Ireland India
Italy Indonesia
Japan Israel
Luxembourg Kenya
Malaysia Korea
Netherlands Mexico
New Zealand Morocco
Norway Pakistan
Portugal Peru
Singapore Philippines
South Africa Poland
Spain Russia
Sweden Slovakia
Switzerland Sri Lanka
Taiwan Swaziland
United Kingdom Thailand
Turkey
Uruguay
Venezuela
Zambia
Zimbabwe
XXXXXX FIDUCIARY TRUST COMPANY
Domestic Custody Fee Schedule
I. Account Maintenance (per fund):
----------------------------------------------------------------------------
Assets Basis Points Accumulative Assets
----------------------------------------------------------------------------
First $100 Million 4.0 basis points $100 Million
Next $100 Million 3.5 basis points $200 Million
Next $200 Million 2.0 basis points $400 Million
Over $400 Million 0.2 basis points ---
----------------------------------------------------------------------------
II. Holdings Charge and Transaction Fees:
Holdings Charge: Per Position, per Year $90.00
Transaction Fees: DTC Receipt or Delivery $10.00
FBE Receipt or Delivery 12.50
GNMA Receipt or Delivery 12.50
Non-GNMA Physical Receipt or Delivery 25.00
Non-GNMA Physical Bond Maturates 25.00
Short Term Maturates 20.00
GNMA P&I Payments (physical) 10.00
GNMA P&I Payments (PTC) 1.00
For funds with assets $10 million and under the combined fees are capped
at 10 basis points.
XXXXXX FIDUCIARY TRUST COMPANY
International Custody Fee Schedule
I. Account Maintenance / Transaction Charge
Market Asset Charge Transaction
(b.p.) Charge ($)
Euro/Developed
Austria 16.00 $ 70.00
Belgium 16.00 $ 70.00
Finland 12.50 $ 70.00
France 9.00 $ 60.00
Germany 9.00 $ 60.00
Greece 80.00 $ 85.00
Ireland 9.25 $ 70.00
Italy 9.00 $ 60.00
Netherlands 9.50 $ 60.00
Portugal 40.00 $ 60.00
Spain 11.25 $ 70.00
Australia 10.00 $ 60.00
Canada 6.50 $ 50.00
Cedel 4.25 $ 35.00
Denmark 7.50 $ 85.00
Euroclear 4.25 $ 35.00
Hong Kong 8.50 $ 115.00
Japan 7.50 $ 40.00
Luxembourg 9.50 $ 50.00
Malaysia 10.00 $ 120.00
New Zealand 10.00 $ 90.00
Norway 12.50 $ 120.00
Singapore 10.25 $ 100.00
South Africa 7.50 $ 60.00
Sweden 9.50 $ 110.00
Switzerland 6.50 $ 105.00
Taiwan 30.00 $ 110.00
United Kingdom 7.00 $ 50.00
Emerging
Argentina 39.00 $ 130.00
Bangladesh 45.00 $ 150.00
Bermuda 65.00 $ 125.00
Botswana 47.00 $ 150.00
Brazil 29.00 $ 88.00
Chile 39.00 $ 130.00
China 58.50 $ 130.00
Colombia 47.00 $ 150.00
Czech Republic 40.00 $ 100.00
Egypt 55.00 $ 150.00
Ghana 47.00 $ 150.00
Hungary 55.00 $ 175.00
India 50.00 $ 175.00
Indonesia 33.00 $ 130.00
Israel 39.00 $ 105.00
Kenya 47.00 $ 150.00
Korea 20.00 $ 87.00
Mexico 16.00 $ 88.00
Morocco 45.00 $ 50.00
Pakistan 45.00 $ 150.00
Peru 47.00 $ 150.00
Philippines 25.50 $ 155.00
Poland 60.00 $ 150.00
Russia 110.00 $ 177.00
Slovakia 45.00 $ 150.00
Sri Lanka 30.00 $ 100.00
Swaziland 47.00 $ 150.00
Thailand 21.50 $ 105.00
Turkey 49.00 $ 140.00
Uruguay 52.00 $ 150.00
Venezuela 40.00 $ 125.00
Zambia 47.00 $ 150.00
Zimbabwe 47.00 $ 150.00
I. Out-of-Pocket Expenses:
Out-of-Pocket Expenses including, but not limited to, the following:
* Telex
* Legal
* Registration Fees
* Stamp Duty
* Depository Withdrawal
* Certificate fees
* Postage and Direct Expenses
* Local Administration Fees
XXXXXX FIDUCIARY TRUST COMPANY
Fee Credits
FEE CREDITS
The aggregate fees set forth in Sections I and II above shall be reduced
prospectively by crediting the Funds with such credits as the Funds have
customarily received from custodians, plus an amount equal to 50% of the
net pre-tax profits attributable to PFTC's custodian activities (before
such extraordinary items as are not properly chargeable as an expense to
purchasers of custodian services) to the extent such profits would
increase PFTC's pre-tax profit margin attributable to such activities
above 30% and by crediting the Funds an amount equal to 70% of such
profits to the extent such profits would increase such margin above 40%.
The customary credits referred to above shall be credited to the Funds
monthly as part of the normal billing process, with any unapplied credit
applied to the Funds' transfer agent fees for such month and then so
credited and applied for each succeeding month until such credit shall
have been fully applied. These credits shall be provided against the
custody and transfer agency fees charged to the Funds in respect of which
such credits are received.
With respect to the credits, if any, attributable to PFTC's pre-tax
profits, on or before the calendar quarter ending March 31 of each year,
the Custodian shall apply the appropriate credit for the preceding
calendar year against the custody fees billed to the Funds for such
quarter and it shall apply the unapplied balance, if any, of such credit
to the custody fees billed to the Fund in each successive quarter until
such credit shall have been fully applied. The Custodian's calendar
year-end financial statements (and the profit margin reflected therein)
shall be reviewed by the independent public accountants of the Funds, and
an appropriate adjustment to the credit balance, if any, due the Funds in
respect of such year will be made following the end of the next succeeding
quarter after which the amount of such adjustment is determined. The fee
credits attributable to PFTC's pre-tax profits shall be allocated among
the Funds on the basis of each Fund's pro rata share of the aggregate
custody fees billed by the Custodian (before any reduction) or on such
other basis as the Trustees of the Funds may from time to time determine.
