CUSTODIAN CONTRACT
between
SUNAMERICA STRATEGIC INVESTMENT SERIES, INC.
and
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
Page
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1. Employment of Custodian and Property to be Held By
It. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
2. Duties of the Custodian with Respect to Property
of the Corporation Held by the Custodian in the United States . . . . . . . . .2
2.1 Holding Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
2.2 Delivery of Securities . . . . . . . . . . . . . . . . . . . . . . . . . .2
2.3 Registration of Securities . . . . . . . . . . . . . . . . . . . . . . . .4
2.4 Bank Accounts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.5 Availability of Federal Funds. . . . . . . . . . . . . . . . . . . . . . .5
2.6 Collection of Income . . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.7 Payment of Fund Monies . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.8 Liability for Payment in Advance of
Receipt of Securities Purchased. . . . . . . . . . . . . . . . . . . . . .7
2.9 Appointment of Agents. . . . . . . . . . . . . . . . . . . . . . . . . . .7
2.10 Deposit of Fund Assets in U.S. Securities System . . . . . . . . . . . . .7
2.11 Fund Assets Held in the Custodian's Direct
Paper System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
2.12 Segregated Account . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
2.13 Ownership Certificates for Tax Purposes. . . . . . . . . . . . . . . . . 10
2.14 Proxies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.15 Communications Relating to Fund Securities . . . . . . . . . . . . . . . 10
3. Duties of the Custodian with Respect to Property of
the Corporation Held Outside of the United States . . . . . . . . . . . . . . 11
3.1 Appointment of Foreign Sub-Custodians. . . . . . . . . . . . . . . . . . 11
3.2 Assets to be Held. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.3 Foreign Securities Systems . . . . . . . . . . . . . . . . . . . . . . . 11
3.4 Holding Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.5 Agreements with Foreign Banking Institutions . . . . . . . . . . . . . . 12
3.6 Access of Independent Accountants of the Corporation . . . . . . . . . . 12
3.7 Reports by Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.8 Transactions in Foreign Custody Account. . . . . . . . . . . . . . . . . 12
3.9 Liability of Foreign Sub-Custodians. . . . . . . . . . . . . . . . . . . 13
3.10 Liability of Custodian . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.11 Reimbursement for Advances . . . . . . . . . . . . . . . . . . . . . . . 13
3.12 Monitoring Responsibilities. . . . . . . . . . . . . . . . . . . . . . . 14
3.13 Branches of U.S. Banks . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.14 Tax Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
4. Payments for Sales or Repurchase or Redemptions
of Shares of the Corporation. . . . . . . . . . . . . . . . . . . . . . .14
5. Proper Instructions . . . . . . . . . . . . . . . . . . . . . . . . . . .15
6. Actions Permitted Without Express Authority . . . . . . . . . . . . . . .15
7. Evidence of Authority . . . . . . . . . . . . . . . . . . . . . . . . . .16
8. Duties of Custodian With Respect to the Books of Account and Calculation
of Net Asset Value and Net Income . . . . . . . . . . . . . . . . . . . .16
9. Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
10. Opinion of Fund's Independent Accountants . . . . . . . . . . . . . . . .17
11. Reports to Fund by Independent Public Accountants . . . . . . . . . . . .17
12. Compensation of Custodian . . . . . . . . . . . . . . . . . . . . . . . .17
13. Responsibility of Custodian . . . . . . . . . . . . . . . . . . . . . . .17
14. Effective Period, Termination and Amendment . . . . . . . . . . . . . . .19
15. Successor Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . .19
16. Interpretive and Additional Provisions. . . . . . . . . . . . . . . . . .20
17. Additional Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
18. Massachusetts Law to Apply. . . . . . . . . . . . . . . . . . . . . . . .21
19. Prior Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
20. Shareholder Communications. . . . . . . . . . . . . . . . . . . . . . . .21
CUSTODIAN CONTRACT
This Contract between SunAmerica Strategic Investment Series, Inc., a
corporation organized and existing under the laws of the State of Maryland,
having its principal place of business at The SunAmerica Center, 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000 hereinafter called the "Corporation", and
State Street Bank and Trust Company, a Massachusetts trust company, having its
principal place of business at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx,
00000, hereinafter called the "Custodian",
WITNESSETH:
WHEREAS, the Corporation is authorized to issue shares in separate series,
with each such series representing interests in a separate fund of securities
and other assets; and
WHEREAS, the Corporation intends to initially offer shares in one series,
the Tax Managed Equity Fund (this series together with all other series
subsequently established by the Corporation and made subject to this Contract in
accordance with paragraph 17, being herein referred to as a "Fund", and
collectively as the "Funds");
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
1. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT
The Corporation hereby employs the Custodian as the custodian of the assets
of the Fund of the Corporation, including securities which the Corporation, on
behalf of the applicable Fund desires to be held in places within the United
States ("domestic securities") and securities it desires to be held outside the
United States ("foreign securities") pursuant to the provisions of the Articles
of Incorporation. The Corporation on behalf of the Fund(s) agrees to deliver to
the Custodian all securities and cash of the Fund(s), and all payments of
income, payments of principal or capital distributions received by it with
respect to all securities owned by the Fund(s) from time to time, and the cash
consideration received by it for such new or treasury shares of capital stock of
the Corporation representing interests in the Fund(s), ("Shares") as may be
issued or sold from time to time. The Custodian shall not be responsible for
any property of a Fund held or received by the Fund and not delivered to the
Custodian.
Upon receipt of "Proper Instructions" (within the meaning of Article 5),
the Custodian shall on behalf of the applicable Fund(s) from time to time employ
one or more sub-custodians, located in the United States but only in accordance
with an applicable vote by the Board of Directors of the Corporation on behalf
of the applicable Fund(s), and provided that the Custodian shall have no more or
less responsibility or liability to the Corporation on account of any actions or
omissions of any sub-custodian so employed than any such sub-custodian has to
the Custodian. The Custodian may employ as sub-custodian for the Corporation's
foreign securities on behalf of the applicable Fund(s) the foreign banking
institutions and foreign securities depositories designated in Schedule A hereto
but only in accordance with the provisions of Article 3.
2. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE CORPORATION HELD BY
THE CUSTODIAN IN THE UNITED STATES
2.1 HOLDING SECURITIES. The Custodian shall hold and physically segregate for
the account of each Fund all non-cash property, to be held by it in the
United States including all domestic securities owned by such Fund, other
than (a) securities which are maintained pursuant to Section 2.10 in a
clearing agency which acts as a securities depository or in a book-entry
system authorized by the U.S. Department of the Treasury and certain
federal agencies (each, a "U.S. Securities System") and (b) commercial
paper of an issuer for which State Street Bank and Trust Company acts as
issuing and paying agent ("Direct Paper") which is deposited and/or
maintained in the Direct Paper System of the Custodian (the "Direct Paper
System") pursuant to Section 2.11.
2.2 DELIVERY OF SECURITIES. The Custodian shall release and deliver
domestic securities owned by a Fund held by the Custodian or in a U.S.
Securities System account of the Custodian or in the Custodian's Direct
Paper book entry system account ("Direct Paper System Account") only
upon receipt of Proper Instructions from the Corporation on behalf of
the applicable Fund, which may be continuing instructions when deemed
appropriate by the parties, and only in the following cases:
1) Upon sale of such securities for the account of the Fund and
receipt of payment therefor;
2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Fund;
3) In the case of a sale effected through a U.S. Securities System,
in accordance with the provisions of Section 2.10 hereof;
4) To the depository agent in connection with tender or other similar
offers for securities of the Fund;
5) To the issuer thereof or its agent when such securities are
called, redeemed, retired or otherwise become payable; provided
that, in any such case, the cash or other consideration is to be
delivered to the Custodian;
6) To the issuer thereof, or its agent, for transfer into the name of
the Fund or into the name of any nominee or nominees of the
Custodian or into the name or nominee name of any agent appointed
pursuant to Section 2.9 or into the name or nominee name of any
sub-custodian appointed pursuant to Article 1; or for exchange for
a
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different number of bonds, certificates or other evidence
representing the same aggregate face amount or number of units;
PROVIDED that, in any such case, the new securities are to be
delivered to the Custodian;
7) Upon the sale of such securities for the account of the 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 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 Custodian's own negligence or willful
misconduct;
8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of
the securities of the issuer of such securities, or pursuant to
provisions for conversion contained in such securities, or
pursuant to any deposit agreement; provided that, in any such
case, the new securities and cash, if any, are to be delivered to
the Custodian;
9) In the case of warrants, rights or similar securities, the
surrender thereof in the exercise of such warrants, rights or
similar securities or the surrender of interim receipts or
temporary securities for definitive securities; provided that, in
any such case, the new securities and cash, if any, are to be
delivered to the Custodian;
10) For delivery in connection with any loans of securities made by
the Fund, BUT ONLY against receipt of adequate collateral as
agreed upon from time to time by the Custodian and the Corporation
on behalf of the Fund, which may be in the form of cash or
obligations issued by the United States government, its agencies
or instrumentalities, except that in connection with any loans for
which collateral is to be credited to the Custodian's account in
the book-entry system authorized by the U.S. Department of the
Treasury, the Custodian will not be held liable or responsible for
the delivery of securities owned by the Fund prior to the receipt
of such collateral;
11) For delivery as security in connection with any borrowings by the
Corporation on behalf of the Fund requiring a pledge of assets by
the Corporation on behalf of the Fund, BUT ONLY against receipt of
amounts borrowed;
12) For delivery in accordance with the provisions of any agreement
among the Corporation on behalf of the Fund, the Custodian and a
broker-dealer registered under the Securities Exchange Act of 1934
(the "Exchange Act") and a member of The National Association of
Securities Dealers, Inc. ("NASD"), relating to compliance with the
rules of The Options Clearing Corporation and of any registered
national
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securities exchange, or of any similar organization or
organizations, regarding escrow or other arrangements in
connection with transactions by the Fund of the Corporation;
13) For delivery in accordance with the provisions of any agreement
among the Corporation on behalf of the Fund, the Custodian, and a
Futures Commission Merchant registered under the Commodity
Exchange Act, relating to compliance with the rules of the
Commodity Futures Trading Commission and/or any Contract Market,
or any similar organization or organizations, regarding account
deposits in connection with transactions by the Fund of the
Corporation;
14) Upon receipt of instructions from the transfer agent ("Transfer
Agent") for the Corporation, for delivery to such Transfer Agent
or to the holders of shares in connection with distributions in
kind, as may be described from time to time in the currently
effective prospectus and statement of additional information of
the Corporation, related to the Fund ("Prospectus"), in
satisfaction of requests by holders of Shares for repurchase or
redemption; and
15) For any other proper corporate purpose, BUT ONLY upon receipt of,
in addition to Proper Instructions from the Corporation on behalf
of the applicable Fund, a certified copy of a resolution of the
Board of Directors or of the Executive Committee signed by an
officer of the Corporation and certified by the Secretary or an
Assistant Secretary, specifying the securities of the Fund to be
delivered, setting forth the purpose for which such delivery is to
be made, declaring such purpose to be a proper corporate purpose,
and naming the person or persons to whom delivery of such
securities shall be made.
2.3 REGISTRATION OF SECURITIES. Domestic securities held by the Custodian
(other than bearer securities) shall be registered in the name of the
Fund or in the name of any nominee of the Corporation on behalf of the
Fund or of any nominee of the Custodian which nominee shall be assigned
exclusively to the Fund, UNLESS the Corporation 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 2.9 or in the name or nominee name of any
sub-custodian appointed pursuant to Article 1. All securities accepted
by the Custodian on behalf of the Fund under the terms of this Contract
shall be in "street name" or other good delivery form. If, however,
the Corporation directs the Custodian to maintain securities in "street
name", the Custodian shall utilize its best efforts only to timely
collect income due the Corporation on such securities and to notify the
Corporation on a best efforts basis only of relevant corporate actions
including, without limitation, pendency of calls, maturities, tender or
exchange offers.
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2.4 BANK ACCOUNTS. The Custodian shall open and maintain a separate bank
account or accounts in the United States in the name of each Fund of
the Corporation, subject only to draft or order by the Custodian acting
pursuant to the terms of this Contract, and shall hold in such account
or accounts, subject to the provisions hereof, all cash received by it
from or for the account of the Fund, other than cash maintained by the
Fund in a bank account established and used in accordance with Rule
17f-3 under the Investment Company Act of 1940. Funds held by the
Custodian for a Fund may be deposited by it to its credit as Custodian
in the Banking Department of the 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 Investment Company
Act of 1940 and that each such bank or trust company and the funds to
be deposited with each such bank or trust company shall on behalf of
each applicable Fund be approved by vote of a majority of the Board of
Directors of the Corporation. Such funds shall be deposited by the
Custodian in its capacity as Custodian and shall be withdrawable by the
Custodian only in that capacity.
2.5 AVAILABILITY OF FEDERAL FUNDS. Upon mutual agreement between the
Corporation on behalf of each applicable Fund and the Custodian, the
Custodian shall, upon the receipt of Proper Instructions from the
Corporation on behalf of a Fund, make federal funds available to such
Fund as of specified times agreed upon from time to time by the
Corporation and the Custodian in the amount of checks received in
payment for Shares of such Fund which are deposited into the Fund's
account.
2.6 COLLECTION OF INCOME. Subject to the provisions of Section 2.3, the
Custodian shall collect on a timely basis all income and other payments
with respect to registered domestic securities held hereunder to which
each 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 domestic securities if, on the
date of payment by the issuer, such securities are held by the
Custodian or its agent thereof and shall credit such income, as
collected, to such Fund's custodian account. Without limiting the
generality of the foregoing, the Custodian shall detach and present for
payment all coupons and other income items requiring presentation as
and when they become due and shall collect interest when due on
securities held hereunder. Income due each Fund on securities loaned
pursuant to the provisions of Section 2.2 (10) shall be the
responsibility of the Corporation. The Custodian will have no duty or
responsibility in connection therewith, other than to provide the
Corporation with such information or data as may be necessary to assist
the Corporation in arranging for the timely delivery to the Custodian
of the income to which the Fund is properly entitled.
2.7 PAYMENT OF FUND MONIES. Upon receipt of Proper Instructions from the
Corporation on behalf of the applicable Fund, which may be continuing
instructions when deemed appropriate by the parties, the Custodian
shall pay out monies of a Fund in the following cases only:
5
1) Upon the purchase of domestic securities, options, futures
contracts or options on futures contracts for the account of the
Fund but only (a) against the delivery of such securities or
evidence of title to such options, futures contracts or options on
futures contracts to the Custodian (or any bank, banking firm or
trust company doing business in the United States or abroad which
is qualified under the Investment Company Act of 1940, as amended,
to act as a custodian and has been designated by the Custodian as
its agent for this purpose) registered in the name of the Fund or
in the name of a nominee of the Custodian referred to in Section
2.3 hereof or in proper form for transfer; (b) in the case of a
purchase effected through a U.S. Securities System, in accordance
with the conditions set forth in Section 2.10 hereof; (c) in the
case of a purchase involving the Direct Paper System, in
accordance with the conditions set forth in Section 2.11; (d) in
the case of repurchase agreements entered into between the
Corporation on behalf of the Fund and the Custodian, or another
bank, or a broker-dealer which is a member of NASD, (i) against
delivery of the securities either in certificate form or through
an entry crediting the Custodian's account at the Federal Reserve
Bank with such securities or (ii) against delivery of the receipt
evidencing purchase by the Fund of securities owned by the
Custodian along with written evidence of the agreement by the
Custodian to repurchase such securities from the Fund or (e) for
transfer to a time deposit account of the Corporation in any bank,
whether domestic or foreign; such transfer may be effected prior
to receipt of a confirmation from a broker and/or the applicable
bank pursuant to Proper Instructions from the Corporation as
defined in Article 5;
2) In connection with conversion, exchange or surrender of securities
owned by the Fund as set forth in Section 2.2 hereof;
3) For the redemption or repurchase of Shares issued by the Fund as
set forth in Article 4 hereof;
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, and operating expenses of the
Corporation whether or not such expenses are to be in whole or
part capitalized or treated as deferred expenses;
5) For the payment of any dividends on Shares of the Fund declared
pursuant to the governing documents of the Corporation;
6) For payment of the amount of dividends received in respect of
securities sold short;
6
7) For any other proper purpose, BUT ONLY upon receipt of, in
addition to Proper Instructions from the Corporation on behalf of
the Fund, a certified copy of a resolution of the Board of
Directors or of the Executive Committee of the Corporation signed
by an officer of the Corporation and certified by its Secretary or
an Assistant Secretary, specifying the amount of such payment,
setting forth the purpose for which such payment is to be made,
declaring such purpose to be a proper purpose, and naming the
person or persons to whom such payment is to be made.
2.8 LIABILITY FOR PAYMENT IN ADVANCE OF RECEIPT OF SECURITIES PURCHASED.
Except as specifically stated otherwise in this Contract, in any and
every case where payment for purchase of domestic securities for the
account of a Fund is made by the Custodian in advance of receipt of the
securities purchased in the absence of specific written instructions
from the Corporation on behalf of such Fund to so pay in advance, the
Custodian shall be absolutely liable to the Corporation for such
securities to the same extent as if the securities had been received by
the Custodian.
2.9 APPOINTMENT OF AGENTS. The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the Investment Company Act of
1940, as amended, to act as a custodian, as its agent to carry out such
of the provisions of this Article 2 as the Custodian may from time to
time direct; PROVIDED, however, that the appointment of any agent shall
not relieve the Custodian of its responsibilities or liabilities
hereunder.
2.10 DEPOSIT OF FUND ASSETS IN U.S. SECURITIES SYSTEMS. The Custodian may
deposit and/or maintain securities owned by a 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 "U.S. Securities System" in accordance with
applicable Federal Reserve Board and Securities and Exchange Commission
rules and regulations, if any, and subject to the following provisions:
1) The Custodian may keep securities of the Fund in a U.S. Securities
System provided that such securities are represented in an account
("Account") of the Custodian in the U.S. Securities System which
shall not include any assets of the Custodian other than assets
held as a fiduciary, custodian or otherwise for customers;
2) The records of the Custodian with respect to securities of the
Fund which are maintained in a U.S. Securities System shall
identify by book-entry those securities belonging to the Fund;
7
3) The Custodian shall pay for securities purchased for the account
of the Fund upon (i) receipt of advice from the U.S. Securities
System that such securities have been transferred to the Account,
and (ii) the making of an entry on the records of the Custodian to
reflect such payment and transfer for the account of the Fund.
The Custodian shall transfer securities sold for the account of
the Fund upon (i) receipt of advice from the U.S. Securities
System that payment for such securities has been transferred to
the Account, and (ii) the making of an entry on the records of the
Custodian to reflect such transfer and payment for the account of
the Fund. Copies of all advices from the U.S. Securities System
of transfers of securities for the account of the Fund shall
identify the Fund, be maintained for the Fund by the Custodian and
be provided to the Corporation at its request. Upon request, the
Custodian shall furnish the Corporation on behalf of 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
Corporation on behalf of the Fund copies of daily transaction
sheets reflecting each day's transactions in the U.S. Securities
System for the account of the Fund.
4) The Custodian shall provide the Corporation for the Fund with any
report obtained by the Custodian on the U.S. Securities System's
accounting system, internal accounting control and procedures for
safeguarding securities deposited in the U.S. Securities System;
5) The Custodian shall have received from the Corporation on behalf
of the Fund the initial or annual certificate, as the case may be,
required by Article 14 hereof;
6) Anything to the contrary in this Contract notwithstanding, the
Custodian shall be liable to the Corporation for the benefit of
the Fund for any loss or damage to the Fund resulting from use of
the U.S. Securities System by reason of any negligence,
misfeasance or misconduct of the Custodian or any of its agents or
of any of its or their employees or from failure of the Custodian
or any such agent to enforce effectively such rights as it may
have against the U.S. Securities System; at the election of the
Corporation, it shall be entitled to be subrogated to the rights
of the Custodian with respect to any claim against the U.S.
Securities System or any other person which the Custodian may have
as a consequence of any such loss or damage if and to the extent
that the Fund has not been made whole for any such loss or damage.
2.11 FUND ASSETS HELD IN THE CUSTODIAN'S DIRECT PAPER SYSTEM. The Custodian
may deposit and/or maintain securities owned by a Fund in the Direct
Paper System of the Custodian subject to the following provisions:
8
1) No transaction relating to securities in the Direct Paper System
will be effected in the absence of Proper Instructions from the
Corporation on behalf of the Fund;
2) The Custodian may keep securities of the Fund in the Direct Paper
System only if such securities are represented in an account
("Account") of the Custodian in the Direct Paper System which
shall not include any assets of the Custodian other than assets
held as a fiduciary, custodian or otherwise for customers;
3) The records of the Custodian with respect to securities of the
Fund which are maintained in the Direct Paper System shall
identify by book-entry those securities belonging to the Fund;
4) The Custodian shall pay for securities purchased for the account
of the Fund upon the making of an entry on the records of the
Custodian to reflect such payment and transfer of securities to
the account of the Fund. The Custodian shall transfer securities
sold for the account of the Fund upon the making of an entry on
the records of the Custodian to reflect such transfer and receipt
of payment for the account of the Fund;
5) The Custodian shall furnish the Corporation on behalf of the Fund
confirmation of each transfer to or from the account of the Fund,
in the form of a written advice or notice, of Direct Paper on the
next business day following such transfer and shall furnish to the
Corporation on behalf of the Fund copies of daily transaction
sheets reflecting each day's transaction in the U.S. Securities
System for the account of the Fund;
6) The Custodian shall provide the Corporation on behalf of the Fund
with any report on its system of internal accounting control as
the Corporation may reasonably request from time to time.
2.12 SEGREGATED ACCOUNT. The Custodian shall upon receipt of Proper
Instructions from the Corporation on behalf of each applicable Fund
establish and maintain a segregated account or accounts for and on
behalf of each such Fund, into which account or accounts may be
transferred cash and/or securities, including securities maintained in
an account by the Custodian pursuant to Section 2.10 hereof, (i) in
accordance with the provisions of any agreement among the Corporation
on behalf of the Fund, the Custodian and a broker-dealer registered
under the Exchange Act and a member of the NASD (or any futures
commission merchant registered under the Commodity Exchange Act),
relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange (or the
Commodity Futures Trading Commission or any registered contract
market), or of any similar organization or organizations, regarding
escrow or other arrangements in connection with transactions by the
Fund, (ii) for purposes of segregating cash or government securities in
connection with options purchased, sold or written by the
9
Fund or commodity futures contracts or options thereon purchased or
sold by the Fund, (iii) for the purposes of compliance by the Fund with
the procedures required by Investment Company Act Release No. 10666, or
any subsequent release or releases of the Securities and Exchange
Commission relating to the maintenance of segregated accounts by
registered investment companies and (iv) for other proper corporate
purposes, BUT ONLY, in the case of clause (iv), upon receipt of, in
addition to Proper Instructions from the Corporation on behalf of the
applicable Fund, a certified copy of a resolution of the Board of
Directors or of the Executive Committee signed by an officer of the
Corporation and certified by the Secretary or an Assistant Secretary,
setting forth the purpose or purposes of such segregated account and
declaring such purposes to be proper corporate purposes.
2.13 OWNERSHIP CERTIFICATES FOR TAX PURPOSES. The Custodian shall execute
ownership and other certificates and affidavits for all federal and
state tax purposes in connection with receipt of income or other
payments with respect to domestic securities of each Fund held by it
and in connection with transfers of securities.
2.14 PROXIES. The Custodian shall, with respect to the domestic securities
held hereunder, cause to be promptly executed by the registered holder
of such securities, if the securities are registered otherwise than in
the name of the 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.
2.15 COMMUNICATIONS RELATING TO FUND SECURITIES. Subject to the provisions
of Section 2.3, the Custodian shall transmit promptly to the
Corporation for each Fund all written information (including, without
limitation, pendency of calls and maturities of domestic securities and
expirations of rights in connection therewith and notices of exercise
of call and put options written by the Corporation on behalf of the
Fund and the maturity of futures contracts purchased or sold by the
Fund) received by the Custodian from issuers of the securities being
held for the Fund. With respect to tender or exchange offers, the
Custodian shall transmit promptly to the Fund all written information
received by the 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 at least three
business days prior to the date on which the Custodian is to take such
action.
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3. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE CORPORATION HELD
OUTSIDE OF THE UNITED STATES
3.1 APPOINTMENT OF FOREIGN SUB-CUSTODIANS. The Corporation hereby
authorizes and instructs the Custodian to employ sub-custodians for
the Fund's securities and other assets maintained outside the United
States.
3.2 ASSETS TO BE HELD. The Custodian shall limit the securities and other
assets maintained in the custody of the foreign sub-custodians to: (a)
"foreign securities", as defined in paragraph (c)(1) of Rule 17f-5
under the Investment Company Act of 1940, and (b) cash and cash
equivalents in such amounts as the Custodian or the Corporation may
determine to be reasonably necessary to effect the Fund's foreign
securities transactions. The Custodian shall identify on its books as
belonging to the Corporation, the foreign securities of the Corporation
held by each foreign sub-custodian.
3.3 FOREIGN SECURITIES SYSTEMS. Except as may otherwise be agreed upon in
writing by the Custodian and the Corporation, assets of the Funds shall
be maintained in a clearing agency which acts as a securities
depository or in a book-entry system for the central handling of
securities located outside of the United States (each a "Foreign
Securities System") only through arrangements implemented by the
foreign banking institutions serving as sub-custodians pursuant to the
terms hereof (Foreign Securities Systems and U.S. Securities Systems
are collectively referred to herein as the "Securities Systems").
Where possible, such arrangements shall include entry into agreements
containing the provisions set forth in Section 3.5 hereof.
3.4 HOLDING SECURITIES. The Custodian may hold securities and other
non-cash property for all of its customers, including the Corporation,
with a foreign sub-custodian in a single account that is identified as
belonging to the Custodian for the benefit of its customers, provided
however, that (i) the records of the Custodian with respect to
securities and other non-cash property of the Corporation which are
maintained in such account shall identify by book-entry those
securities and other non-cash property belonging to the Corporation and
(ii) the Custodian shall require that securities and other non-cash
property so held by the foreign sub-custodian be held separately from
any assets of the foreign sub-custodian or of others.
11
3.5 AGREEMENTS WITH FOREIGN BANKING INSTITUTIONS. Each agreement with a
foreign banking institution shall provide that: (a) the assets of each
Fund will not be subject to any right, charge, security interest, lien
or claim of any kind in favor of the foreign banking institution or its
creditors or agent, except a claim of payment for their safe custody or
administration; (b) beneficial ownership for the assets of each Fund
will be freely transferable without the payment of money or value other
than for custody or administration; (c) adequate records will be
maintained identifying the assets as belonging to each applicable Fund;
(d) officers of or auditors employed by, or other representatives of
the Custodian, including to the extent permitted under applicable law
the independent public accountants for the Corporation, will be given
access to the books and records of the foreign banking institution
relating to its actions under its agreement with the Custodian; and (e)
assets of the Fund(s) held by the foreign sub-custodian will be subject
only to the instructions of the Custodian or its agents.
3.6 ACCESS OF INDEPENDENT ACCOUNTANTS OF THE CORPORATION. Upon request of
the Corporation, the Custodian will use its best efforts to arrange for
the independent accountants of the Corporation to be afforded access to
the books and records of any foreign banking institution employed as a
foreign sub-custodian insofar as such books and records relate to the
performance of such foreign banking institution under its agreement
with the Custodian.
3.7 REPORTS BY CUSTODIAN. The Custodian will supply to the Corporation
from time to time, as mutually agreed upon, statements in respect of
the securities and other assets of the Fund(s) held by foreign
sub-custodians, including but not limited to an identification of
entities having possession of the Fund(s) securities and other assets
and advices or notifications of any transfers of securities to or from
each custodial account maintained by a foreign banking institution for
the Custodian on behalf of each applicable Fund indicating, as to
securities acquired for a Fund, the identity of the entity having
physical possession of such securities.
3.8 TRANSACTIONS IN FOREIGN CUSTODY ACCOUNT. (a) Except as otherwise
provided in paragraph (b) of this Section 3.8, the provision of
Sections 2.2 and 2.7 of this Contract shall apply, MUTATIS MUTANDIS to
the foreign securities of the Corporation held outside the United
States by foreign sub-custodians. (b) Notwithstanding any provision of
this Contract to the contrary, settlement and payment for securities
received for the account of each applicable Fund and delivery of
securities maintained for the account of each applicable Fund may be
effected in accordance with the customary established securities
trading or securities processing practices and procedures in the
jurisdiction or market in which the transaction occurs, including,
without limitation, delivering securities to the purchaser thereof or
to a dealer therefor (or an agent for such purchaser or dealer) against
a receipt with the expectation of receiving later payment for such
securities from such purchaser or dealer. (c) Securities maintained in
the custody of a foreign sub-custodian may be maintained in the
12
name of such entity's nominee to the same extent as set forth in
Section 2.3 of this Contract, and the Corporation agrees to hold any
such nominee harmless from any liability as a holder of record of such
securities.
3.9 LIABILITY OF FOREIGN SUB-CUSTODIANS. Each agreement pursuant to which
the Custodian employs a foreign banking institution as a foreign
sub-custodian shall require the institution to exercise reasonable care
in the performance of its duties and to indemnify, and hold harmless,
the Custodian and each Fund from and against any loss, damage, cost,
expense, liability or claim arising out of or in connection with the
institution's performance of such obligations. At the election of the
Corporation, it shall be entitled to be subrogated to the rights of the
Custodian with respect to any claims against a foreign banking
institution as a consequence of any such loss, damage, cost, expense,
liability or claim if and to the extent that the Corporation has not
been made whole for any such loss, damage, cost, expense, liability or
claim.
3.10 LIABILITY OF CUSTODIAN. The Custodian shall be liable for the acts or
omissions of a foreign banking institution to the same extent as set
forth with respect to sub-custodians generally in this Contract and,
regardless of whether assets are maintained in the custody of a foreign
banking institution, a foreign securities depository or a branch of a
U.S. bank as contemplated by paragraph 3.13 hereof, the Custodian shall
not be liable for any loss, damage, cost, expense, liability or claim
resulting from nationalization, expropriation, currency restrictions,
or acts of war or terrorism or any loss where the sub-custodian has
otherwise exercised reasonable care. Notwithstanding the foregoing
provisions of this paragraph 3.10, in delegating custody duties to
State Street London Ltd., the Custodian shall not be relieved of any
responsibility to the Corporation for any loss due to such delegation,
except such loss as may result from (a) political risk (including, but
not limited to, exchange control restrictions, confiscation,
expropriation, nationalization, insurrection, civil strife or armed
hostilities) or (b) other losses (excluding a bankruptcy or insolvency
of State Street London Ltd. not caused by political risk) due to Acts
of God, nuclear incident or other losses under circumstances where the
Custodian and State Street London Ltd. have exercised reasonable care.
3.11 REIMBURSEMENT FOR ADVANCES. If the Corporation requires the Custodian
to advance cash or securities for any purpose for the benefit of a Fund
including the purchase or sale of foreign exchange or of contracts for
foreign exchange, or in the event that the Custodian or its nominee
shall incur or be assessed any taxes, charges, expenses, assessments,
claims or liabilities in connection with the performance of this
Contract, except such as may arise from its or its nominee's own
negligent action, negligent failure to act or willful misconduct, any
property at any time held for the account of the applicable Fund shall
be security therefor and should the Corporation fail to repay the
Custodian promptly, the Custodian shall be entitled to utilize
available cash and to dispose of such Funds assets to the extent
necessary to obtain reimbursement.
13
3.12 MONITORING RESPONSIBILITIES. The Custodian shall furnish annually to
the Corporation, during the month of June, information concerning the
foreign sub-custodians employed by the Custodian. Such information
shall be similar in kind and scope to that furnished to the Corporation
in connection with the initial approval of this Contract. In addition,
the Custodian will promptly inform the Corporation in the event that
the Custodian learns of a material adverse change in the financial
condition of a foreign sub-custodian or any material loss of the assets
of the Corporation or in the case of any foreign sub-custodian not the
subject of an exemptive order from the Securities and Exchange
Commission is notified by such foreign sub-custodian that there appears
to be a substantial likelihood that its shareholders' equity will
decline below $200 million (U.S. dollars or the equivalent thereof) or
that its shareholders' equity has declined below $200 million (in each
case computed in accordance with generally accepted U.S. accounting
principles).
3.13 BRANCHES OF U.S. BANKS. (a) Except as otherwise set forth in this
Contract, the provisions hereof shall not apply where the custody of
the Funds assets are maintained in a foreign branch of a banking
institution which is a "bank" as defined by Section 2(a)(5) of the
Investment Company Act of 1940 meeting the qualification set forth in
Section 26(a) of said Act. The appointment of any such branch as a
sub-custodian shall be governed by paragraph 1 of this Contract. (b)
Cash held for each Fund of the Corporation in the United Kingdom shall
be maintained in an interest bearing account established for the
Corporation with the Custodian's London branch, which account shall be
subject to the direction of the Custodian, State Street London Ltd. or
both.
3.14 TAX LAW. The Custodian shall have no responsibility or liability for
any obligations now or hereafter imposed on the Corporation or the
Custodian as custodian of the Corporation by the tax law of the United
States of America or any state or political subdivision thereof. It
shall be the responsibility of the Corporation to notify the Custodian
of the obligations imposed on the Corporation or the Custodian as
custodian of the Corporation by the tax law of jurisdictions other than
those mentioned in the above sentence, including responsibility for
withholding and other taxes, assessments or other governmental charges,
certifications and governmental reporting. The sole responsibility of
the Custodian with regard to such tax law shall be to use reasonable
efforts to assist the Corporation with respect to any claim for
exemption or refund under the tax law of jurisdictions for which the
Corporation has provided such information.
4. PAYMENTS FOR SALES OR REPURCHASES OR REDEMPTIONS OF SHARES OF THE
CORPORATION
The Custodian shall receive from the distributor for the Shares or from the
Transfer Agent of the Corporation and deposit into the account of the
appropriate Fund such payments as are received for Shares of that Fund issued or
sold from time to time by the Corporation. The Custodian will provide timely
notification to the Corporation on behalf of each such Fund and the Transfer
Agent of any receipt by it of payments for Shares of such Fund.
14
From such funds as may be available for the purpose but subject to the
limitations of the Articles of Incorporation and any applicable votes of the
Board of Directors of the Corporation pursuant thereto, the Custodian shall,
upon receipt of instructions from the Transfer Agent, make funds available for
payment to holders of Shares who have delivered to the Transfer Agent a request
for redemption or repurchase of their Shares. In connection with the redemption
or repurchase of Shares of a Fund, the Custodian is authorized upon receipt of
instructions from the Transfer Agent to wire funds to or through a commercial
bank designated by the redeeming shareholders. In connection with the
redemption or repurchase of Shares of the Corporation, the Custodian shall honor
checks drawn on the Custodian by a holder of Shares, which checks have been
furnished by the Corporation to the holder of Shares, when presented to the
Custodian in accordance with such procedures and controls as are mutually agreed
upon from time to time between the Corporation and the Custodian.
5. PROPER INSTRUCTIONS
Proper Instructions as used throughout this Contract means a writing signed
or initialled by one or more person or persons as the Board of Directors shall
have from time to time authorized. Each such writing shall set forth the
specific transaction or type of transaction involved, including a specific
statement of the purpose for which such action is requested. Oral instructions
will be considered Proper Instructions if the Custodian reasonably believes them
to have been given by a person authorized to give such instructions with respect
to the transaction involved. The Corporation shall cause all oral instructions
to be confirmed in writing. Upon receipt of a certificate of the Secretary or
an Assistant Secretary as to the authorization by the Board of Directors of the
Corporation accompanied by a detailed description of procedures approved by the
Board of Directors, Proper Instructions may include communications effected
directly between electro-mechanical or electronic devices provided that the
Board of Directors and the Custodian are satisfied that such procedures afford
adequate safeguards for the Funds' assets. For purposes of this Section, Proper
Instructions shall include instructions received by the Custodian pursuant to
any three-party agreement which requires a segregated asset account in
accordance with Section 2.12.
6. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY
The Custodian may in its discretion, without express authority from the
Corporation on behalf of each applicable Fund:
1) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under
this Contract, PROVIDED that all such payments shall be accounted
for to the Corporation on behalf of the Fund;
2) surrender securities in temporary form for securities in
definitive form;
15
3) endorse for collection, in the name of the Fund, checks, drafts
and other negotiable instruments; and
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 Board of Directors of the
Corporation.
7. 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 Corporation.
The Custodian may receive and accept a certified copy of a vote of the Board of
Directors of the Corporation as conclusive evidence (a) of the authority of any
person to act in accordance with such vote or (b) of any determination or of any
action by the Board of Directors pursuant to the Articles of Incorporation as
described in such vote, and such vote may be considered as in full force and
effect until receipt by the Custodian of written notice to the contrary.
8. DUTIES OF CUSTODIAN WITH RESPECT TO THE BOOKS OF ACCOUNT AND CALCULATION OF
NET ASSET VALUE AND NET INCOME
The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the Board of Directors of the Corporation to
keep the books of account of each Fund and/or compute the net asset value per
share of the outstanding shares of each Fund or, if directed in writing to do so
by the Corporation on behalf of the Fund, shall itself keep such books of
account and/or compute such net asset value per share. If so directed, the
Custodian shall also calculate daily the net income of the Fund as described in
the Corporation's currently effective prospectus related to such Fund and shall
advise the Corporation and the Transfer Agent daily of the total amounts of such
net income and, if instructed in writing by an officer of the Corporation to do
so, shall advise the Transfer Agent periodically of the division of such net
income among its various components. The calculations of the net asset value
per share and the daily income of each Fund shall be made at the time or times
described from time to time in the Corporation's currently effective prospectus
related to such Fund.
9. RECORDS
The Custodian shall with respect to each Fund create and maintain all
records relating to its activities and obligations under this Contract in such
manner as will meet the obligations of the Corporation under the Investment
Company Act of 1940, with particular attention to Section 31 thereof and Rules
31a-1 and 31a-2 thereunder. All such records shall be the property of the
Corporation and shall at all times during the regular business hours of the
Custodian be open for inspection by duly authorized officers, employees or
agents of the Corporation and employees and
16
agents of the Securities and Exchange Commission. The Custodian shall, at the
Corporation's request, supply the Corporation with a tabulation of securities
owned by each Fund and held by the Custodian and shall, when requested to do so
by the Corporation and for such compensation as shall be agreed upon between the
Corporation and the Custodian, include certificate numbers in such tabulations.
10. OPINION OF CORPORATION'S INDEPENDENT ACCOUNTANT
The Custodian shall take all reasonable action, as the Corporation on behalf
of each applicable Fund may from time to time request, to obtain from year to
year favorable opinions from the Corporation's independent accountants with
respect to its activities hereunder in connection with the preparation of the
Corporation's Form N-1A, and Form N-SAR or other annual reports to the
Securities and Exchange Commission and with respect to any other requirements of
such Commission.
11. REPORTS TO CORPORATION BY INDEPENDENT PUBLIC ACCOUNTANTS
The Custodian shall provide the Corporation, on behalf of each of the Funds
at such times as the Corporation may reasonably require, with reports by
independent public accountants on the accounting system, internal accounting
control and procedures for safeguarding securities, futures contracts and
options on futures contracts, including securities deposited and/or maintained
in a Securities System, relating to the services provided by the Custodian under
this Contract; such reports, shall be of sufficient scope and in sufficient
detail, as may reasonably be required by the Corporation to provide reasonable
assurance that any material inadequacies would be disclosed by such examination,
and, if there are no such inadequacies, the reports shall so state.
12. COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to reasonable compensation for its services
and expenses as Custodian, as agreed upon from time to time between the
Corporation on behalf of each applicable Fund and the Custodian.
13. RESPONSIBILITY OF CUSTODIAN
So long as and to the extent that it is in the exercise of reasonable care,
the Custodian shall not be responsible for the title, validity or genuineness of
any property or evidence of title thereto received by it or delivered by it
pursuant to this Contract and shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably believed by it to
be genuine and to be signed by the proper party or parties, including any
futures commission merchant acting pursuant to the terms of a three-party
futures or options agreement. The Custodian shall be held to the exercise of
reasonable care in carrying out the provisions of this Contract, but shall be
kept indemnified by and shall be without liability to the Corporation for any
action taken or omitted by it in good faith without negligence. It shall be
entitled to rely on and may act upon advice of counsel
17
(who may be counsel for the Corporation) on all matters, and shall be without
liability for any action reasonably taken or omitted pursuant to such advice.
Except as may arise from the Custodian's own negligence or willful
misconduct or the negligence or willful misconduct of a sub-custodian or agent,
the Custodian shall be without liability to the Corporation for any loss,
liability, claim or expense resulting from or caused by; (i) events or
circumstances beyond the reasonable control of the Custodian or any
sub-custodian or Securities System or any agent or nominee of any of the
foregoing, including, without limitation, nationalization or expropriation,
imposition of currency controls or restrictions, the interruption, suspension or
restriction of trading on or the closure of any securities market, power or
other mechanical or technological failures or interruptions, computer viruses or
communications disruptions, acts of war or terrorism, riots, revolutions, work
stoppages, natural disasters or other similar events or acts; (ii) errors by the
Corporation or the Investment Advisor in their instructions to the Custodian
provided such instructions have been in accordance with this Contract; (iii) the
insolvency of or acts or omissions by a Securities System; (iv) any delay or
failure of any broker, agent or intermediary, central bank or other commercially
prevalent payment or clearing system to deliver to the Custodian's sub-custodian
or agent securities purchased or in the remittance or payment made in connection
with securities sold; (v) any delay or failure of any company, corporation, or
other body in charge of registering or transferring securities in the name of
the Custodian, the Corporation, the Custodian's sub-custodians, nominees or
agents or any consequential losses arising out of such delay or failure to
transfer such securities including non-receipt of bonus, dividends and rights
and other accretions or benefits; (vi) delays or inability to perform its duties
due to any disorder in market infrastructure with respect to any particular
security or Securities System; and (vii) any provision of any present or future
law or regulation or order of the United States of America, or any state
thereof, or any other country, or political subdivision thereof or of any court
of competent jurisdiction.
The Custodian shall be liable for the acts or omissions of a foreign banking
institution to the same extent as set forth with respect to sub-custodians
generally in this Contract.
If the Corporation on behalf of a Fund requires the Custodian to take any
action with respect to securities, which action involves the payment of money or
which action may, in the opinion of the Custodian, result in the Custodian or
its nominee assigned to the Corporation or the Fund being liable for the payment
of money or incurring liability of some other form, the Corporation on behalf of
the Fund, as a prerequisite to requiring the Custodian to take such action,
shall provide indemnity to the Custodian in an amount and form satisfactory to
it.
If the Corporation requires the Custodian, its affiliates, subsidiaries or
agents, to advance cash or securities for any purpose (including but not limited
to securities settlements, foreign exchange contracts and assumed settlement) or
in the event that the Custodian or its nominee shall incur or be assessed any
taxes, charges, expenses, assessments, claims or liabilities in connection with
the performance of this Contract, except such as may arise from its or its
nominee's own
18
negligent action, negligent failure to act or willful misconduct, any
property at any time held for the account of the applicable Fund shall be
security therefor and should the Corporation fail to repay the Custodian
promptly, the Custodian shall be entitled to utilize available cash and to
dispose of such Fund's assets to the extent necessary to obtain reimbursement.
In no event shall the Custodian be liable for indirect, special or
consequential damages.
14. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT
This Contract shall become effective as of its execution, shall continue in
full force and effect until terminated as hereinafter provided, may be amended
at any time by mutual agreement of the parties hereto and may be terminated by
either party by an instrument in writing delivered or mailed, postage prepaid to
the other party, such termination to take effect not sooner than thirty (30)
days after the date of such delivery or mailing; PROVIDED, however that the
Custodian shall not with respect to a Fund act under Section 2.10 hereof in the
absence of receipt of an initial certificate of the Secretary or an Assistant
Secretary that the Board of Directors of the Corporation has approved the
initial use of a particular Securities System by such Fund, as required by Rule
17f-4 under the Investment Company Act of 1940, as amended and that the
Custodian shall not with respect to a Fund act under Section 2.11 hereof in the
absence of receipt of an initial certificate of the Secretary or an Assistant
Secretary that the Board of Directors has approved the initial use of the Direct
Paper System by such Fund; PROVIDED FURTHER, however, that the Corporation shall
not amend or terminate this Contract in contravention of any applicable federal
or state regulations, or any provision of the Articles of Incorporation, and
further provided, that the Corporation on behalf of one or more of the Funds may
at any time by action of its Board of Directors (i) substitute another bank or
trust company for the Custodian by giving notice as described above to the
Custodian, or (ii) immediately terminate this Contract in the event of the
appointment of a conservator or receiver for the Custodian by the Comptroller of
the Currency or upon the happening of a like event at the direction of an
appropriate regulatory agency or court of competent jurisdiction.
Upon termination of the Contract, the Corporation on behalf of each
applicable 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 for its
costs, expenses and disbursements.
15. SUCCESSOR CUSTODIAN
If a successor custodian for the Corporation, of one or more of the Funds
shall be appointed by the Board of Directors of the Corporation, the Custodian
shall, upon termination, deliver to such successor custodian at the office of
the Custodian, duly endorsed and in the form for transfer, all securities of
each applicable Fund then held by it hereunder and shall transfer to an account
of the successor custodian all of the securities of each such Fund held in a
Securities System.
19
If no such successor custodian shall be appointed, the Custodian shall, in
like manner, upon receipt of a certified copy of a vote of the Board of
Directors of the Corporation, deliver at the office of the Custodian and
transfer such securities, Corporations and other properties in accordance with
such vote.
In the event that no written order designating a successor custodian or
certified copy of a vote of the Board of Directors shall have been delivered to
the Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank or trust
company, which is a "bank" as defined in the Investment Company Act of 1940,
doing business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $25,000,000, all securities, funds and other
properties held by the Custodian on behalf of each applicable Fund and all
instruments held by the Custodian relative thereto and all other property held
by it under this Contract on behalf of each applicable Fund and to transfer to
an account of such successor custodian all of the securities of each such Fund
held in any Securities System. Thereafter, such bank or trust company shall be
the successor of the Custodian under this Contract.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Corporation to procure the certified copy of the vote referred to
or of the Board of Directors to appoint a successor custodian, the Custodian
shall be entitled to fair compensation for its services during such period as
the Custodian retains possession of such securities, funds and other properties
and the provisions of this Contract relating to the duties and obligations of
the Custodian shall remain in full force and effect.
16. INTERPRETIVE AND ADDITIONAL PROVISIONS
In connection with the operation of this Contract, the Custodian and the
Corporation on behalf of each of the Funds, may from time to time agree on such
provisions interpretive of or in addition to the provisions of this Contract as
may in their joint opinion be consistent with the general tenor of this
Contract. Any such interpretive or additional provisions shall be in a writing
signed by both parties and shall be annexed hereto, PROVIDED that no such
interpretive or additional provisions shall contravene any applicable federal or
state regulations or any provision of the Articles of Incorporation of the
Corporation. No interpretive or additional provisions made as provided in the
preceding sentence shall be deemed to be an amendment of this Contract.
17. ADDITIONAL FUNDS
In the event that the Corporation establishes one or more series of Shares
in addition to the Tax Managed Equity Fund with respect to which it desires to
have the Custodian render services as custodian under the terms hereof, it shall
so notify the Custodian in writing, and if the Custodian agrees in writing to
provide such services, such series of Shares shall become a Fund hereunder.
18. MASSACHUSETTS LAW TO APPLY
20
This Contract shall be construed and the provisions thereof interpreted
under and in accordance with laws of The Commonwealth of Massachusetts.
19. PRIOR CONTRACTS
This Contract supersedes and terminates, as of the date hereof, all prior
contracts between the Corporation on behalf of each of the Funds and the
Custodian relating to the custody of the Corporation's assets.
20. SHAREHOLDER COMMUNICATIONS
Securities and Exchange Commission Rule 14b-2 requires banks which hold
securities for the account of customers to respond to requests by issuers of
securities for the names, addresses and holdings of beneficial owners of
securities of that issuer held by the bank unless the beneficial owner has
expressly objected to disclosure of this information. In order to comply with
the rule, the Custodian needs the Corporation to indicate whether the
Corporation authorizes the Custodian to provide the Corporation's name, address,
and share position to requesting companies whose stock the Corporation owns. If
the Corporation tells the Custodian "no", the Custodian will not provide this
information to requesting companies. If the Corporation tells the Custodian
"yes" or do not check either "yes" or "no" below, the Custodian is required by
the rule to treat the Corporation as consenting to disclosure of this
information for all securities owned by the Corporation or any funds or accounts
established by the Corporation. For the Corporation's protection, the Rule
prohibits the requesting company from using the Corporation's name and address
for any purpose other than corporate communications. Please indicate below
whether the Corporation consent or object by checking one of the alternatives
below.
YES [ ] The Custodian is authorized to release the Corporation's name,
address, and share positions.
NO [ ] The Custodian is not authorized to release the Corporation's name,
address, and share positions.
21
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 18th day of February, 1999.
ATTEST SUNAMERICA STRATEGIC INVESTMENT
SERIES, INC.
-------------------- By
----------------------------
Name:
Title:
ATTEST STATE STREET BANK AND TRUST COMPANY
-------------------- By
------------------------------
Name:
Title:
