Bankers Trust Company EX-99.B8A
Xxx Xxxxxxx Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
Mailing Address:
X.X. Xxx 000, Xxxxxx Xxxxxx Xxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Mutual Fund/Business Trust/Series
CUSTODIAN AGREEMENT
AGREEMENT dated as of June 1, 1996 between BANKERS TRUST COMPANY (the
"Custodian") and those registered investment companies listed on Exhibit A
hereto, as such Exhibit shall be amended from time to time (each, a "Customer").
WHEREAS, the Customer may be organized with one or more series of
shares, each of which shall represent an interest in a separate portfolio of
Securities and Cash (each as hereinafter defined) (all such existing and
additional series now or hereafter listed on Exhibit A being hereafter referred
to individually as a "Portfolio" and collectively, as the "Portfolios"); and
WHEREAS, the Customer desires to appoint the Custodian as custodian on
behalf of the Portfolios under the terms and conditions set forth in this
Agreement, and the Custodian has agreed to so act as custodian.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:
1. Employment of Custodian. The Customer hereby employs the Custodian
as custodian of all assets of each Portfolio which are delivered to and accepted
by the Custodian or any Subcustodian (as that term is defined in Section 4) (the
"Property") pursuant to the terms and conditions set forth herein. Without
limitation, such Property shall include stocks and other equity interests of
every type, evidences of indebtedness, other instruments representing same or
rights or obligations to receive, purchase, deliver or sell same and other
non-cash investment property of a Portfolio which is acceptable for deposit
("Securities") and cash from any source and in any currency ("Cash"). The
Custodian shall not be responsible for any property of a Portfolio held or
received by the Customer or others and not delivered to the Custodian or any
Subcustodian.
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2. Maintenance of Securities and Cash at Custodian and Subcustodian
Locations. Pursuant to Instructions (as hereinafter defined in Section 14), the
Customer shall direct the Custodian to (a) settle Securities transactions and
maintain Cash in the country or other jurisdiction in which the principal
trading market for such Securities is located, where such Securities are to be
presented for payment or where such Securities are acquired and (b) maintain
cash and cash equivalents in such countries in amounts reasonably necessary to
effect the Customer's transactions in such Securities. Instructions to settle
Securities transactions (or Customer's transactions on behalf of a Portfolio) in
any country shall be deemed to authorize the holding of such Securities and Cash
in that country.
3. Custody Account. The Custodian agrees to establish and maintain one
or more separate custody accounts on its books each in the name of, as
appropriate, the Customer or the Customer on behalf of a Portfolio (each, an
"Account") for any and all Property from time to time received and accepted by
the Custodian or any Subcustodian for the account of such Portfolio. Upon
delivery by the Customer to the Custodian of any Property belonging to a
Portfolio, the Customer shall, by Instructions, specifically indicate to which
Portfolio such Property belongs or if such Property belongs to more than one
Portfolio shall allocate such Property to the appropriate Portfolio. The
Custodian shall allocate such Property to the Accounts in accordance with the
Instructions; provided that the Custodian shall have the right, in its sole
discretion, to refuse to accept any Property that is not in proper form for
deposit for any reason. The Customer on behalf of each Portfolio, acknowledges
its responsibility as a principal for all of its obligations to the Custodian
arising under or in connection with this Agreement, warrants its authority to
deposit in the appropriate Account any Property received therefor by the
Custodian or a Subcustodian and to give, and authorize others to give,
Instructions relative thereto. The Custodian may deliver Securities of the same
class in place of those deposited in the Account; provided, however, the
Securities so delivered shall be subject to the same restrictions on transfer
(if any) and shall be of the same market value as the Securities that are the
subject of the Instructions, unless the prevailing market practice in a market
causes the Custodian and the Subcustodian, in the exercise of reasonable care,
to be unable to obtain delivery of Securities which meet the requirements
described in this proviso, in which case, the Custodian shall provide the
Customer prompt written notice of delivery of Securities not meeting such
requirements.
The Custodian shall hold, keep safe and protect as custodian for each
Account, on behalf of the Customer, all Property in such Account. All
transactions, including, but not limited to, foreign exchange transactions,
involving the Property shall be executed or settled solely in accordance with
Instructions (which shall specifically reference the Account for which such
transaction is being settled) pursuant to the terms of this Agreement, except
that until the Custodian receives Instructions to the contrary, the Custodian
will:
(a) collect all interest and dividends and all other income and
payments, whether paid in cash or in kind, on the Property, as
the same become payable and credit the same to the appropriate
Account, and provide prompt notice of any such actions;
(b) present for payment all Securities held in an Account which
are called, redeemed or retired or otherwise become payable
and all coupons and other income items which call for payment
upon presentation to the extent that the Custodian or
Subcustodian is actually aware of such opportunities and hold
the Cash received in such Account pursuant to this Agreement,
and provide prompt notice of any such actions;
(c) (i) exchange Securities where the exchange is purely
ministerial (including, without limitation, the exchange of
temporary securities for those in definitive form and the
exchange of warrants, or other documents of entitlement to
securities, for the Securities themselves) and (ii) when
notification of a tender or exchange offer (other than
ministerial exchanges described in (i) above) is received for
an Account, take all reasonable steps under the circumstances
to obtain Instructions, provided that if such Instructions are
not received in time for the Custodian to take timely action,
no action shall be taken with respect thereto;
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(d) whenever notification of a rights entitlement or a fractional
interest resulting from a rights issue, stock dividend or
stock split is received for an Account and such rights
entitlement or fractional interest bears an expiration date,
if after taking all reasonable steps under the circumstances
to obtain Instructions such Instructions are not received in
time for the Custodian to take timely action or if actual
notice of such actions was received too late for Custodian
reasonably to seek Instructions, sell in the discretion of the
Custodian (which sale the Customer hereby authorizes the
Custodian to make) such rights entitlement or fractional
interest and credit the Account with the net proceeds of such
sale;
(e) execute in the Customer's name for an Account, whenever the
Custodian deems it appropriate, such ownership and other
certificates as may be required to obtain the payment of
income from the Property in such Account;
(f) pay for each Account, any and all taxes and levies in the
nature of taxes imposed on interest, dividends or other
similar income on the Property in such Account by any
governmental authority. In the event there is insufficient
Cash available in such Account to pay such taxes and levies,
the Custodian shall promptly notify the Customer of the amount
of the shortfall and the Customer, at its option, may deposit
additional Cash in such Account or take steps to have
sufficient Cash available. The Customer agrees, when and if
requested by the Custodian and required in connection with the
payment of any such taxes to cooperate with the Custodian in
furnishing information, executing documents or otherwise; and
(g) appoint brokers and agents for any of the ministerial
transactions involving the Securities described in (a) - (f),
including, without limitation, affiliates of the Custodian or
any Subcustodian.
4. Subcustodians and Securities Systems. The Customer authorizes and
instructs the Custodian to hold the Property in each Account in custody accounts
which have been established by the Custodian with (a) one of its U.S. branches
or another U.S. bank or trust company or branch thereof located in the U.S.
which is itself qualified under the Investment Company Act of 1940, as amended
("1940 Act"), to act as custodian (individually, a "U.S. Subcustodian"), or a
U.S. securities depository or clearing agency or system in which the Custodian
or a U.S. Subcustodian participates (individually, a "U.S. Securities System")
or (b) one of its non-U.S. branches or majority-owned non-U.S. subsidiaries, a
non-U.S. branch or majority-owned subsidiary of a U.S. bank or a non-U.S. bank
or trust company, acting as custodian (individually, a "non-U.S. Subcustodian";
U.S. Subcustodians and non-U.S. Subcustodians, collectively, "Subcustodians"),
or a non-U.S. depository or clearing agency or system in which the Custodian or
any Subcustodian participates (individually, a "non-U.S. Securities System";
U.S. Securities System and non-U.S. Securities System, collectively, "Securities
System"), provided that in each case in which a U.S. Subcustodian or U.S.
Securities System is employed, Instructions approving the employment of each
such Subcustodian or Securities System shall have been received by Custodian;
provided further that in each case in which a non-U.S. Subcustodian or non-U.S.
Securities System is employed, (a) such Subcustodian or Securities System either
is (i) a "qualified U.S. bank" as defined by Rule 17f-5 under the 1940 Act as
such Rule may be amended from time to time ("Rule 17f-5") or (ii) an "eligible
foreign custodian" within the meaning of Rule 17f-5 or such Subcustodian or
Securities System is the subject of an order granted by the U.S. Securities and
Exchange Commission ("SEC") exempting such agent or the subcustody arrangements
thereto from all or part of the provisions of Rule 17f-5 and (b) Instructions
approving in advance the employment of such non-U.S. Subcustodian, and the
agreement between the Custodian and such non-U.S. Subcustodian, shall have been
received by Custodian; it being understood that the Custodian shall have no
liability or responsibility for determining whether the approval of any
Subcustodian or Securities System has been proper under the 1940 Act or any rule
or regulation thereunder.
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Upon receipt of Instructions, the Custodian agrees to cease the
employment of any previously approved Subcustodian or Securities System with
respect to the Customer, and if desirable and practicable, appoint a replacement
subcustodian or securities system in accordance with the provisions of this
Section. In addition, the Custodian may, at any time in its discretion, upon
written notification to the Customer, terminate the employment of any
Subcustodian or Securities System.
Upon request of the Customer, the Custodian shall deliver to the
Customer annually a certificate stating: (a) the identity of each non-U.S.
Subcustodian and non-U.S. Securities System then acting on behalf of the
Custodian and the name and address of the governmental agency or other
regulatory authority that supervises or regulates such non-U.S Subcustodian and
non-U.S. Securities System; (b) the countries in which each non-U.S.
Subcustodian or non-U.S. Securities System is located; and (c) so long as Rule
17f-5 requires the Customer's Board of Directors or Trustees to directly approve
its foreign custody arrangements, such other information relating to such
non-U.S. Subcustodians and non-U.S. Securities Systems as may reasonably be
requested by the Customer to ensure compliance with Rule 17f-5. So long as Rule
17f-5 requires the Customer's Board of Directors or Trustees to directly approve
its foreign custody arrangements, the Custodian also shall furnish annually to
the Customer information concerning such non-U.S. Subcustodians and non-U.S.
Securities Systems similar in kind and scope as that furnished to the Customer
in connection with the initial approval of this Agreement. Custodian agrees to
promptly notify the Customer if, in the normal course of its custodial
activities, the Custodian becomes aware of any material adverse changes in the
facts or circumstances upon which such information is based or has reason to
believe that any non-U.S. Subcustodian or non-U.S. Securities System has ceased
to be a qualified U.S. bank or an eligible foreign custodian each within the
meaning of Rule 17f-5 or has ceased to be subject to an exemptive order from the
SEC. Any selection of and form of contract with a Subcustodian shall be subject
to approval by the Customer that such selection and contract are consistent with
the requirements of Rule 17f-5 (and Rule 17f-4, if applicable) under the 1940
Act, and the Custodian warrants that such arrangement shall comply with Section
5 of this Agreement.
5. Use of Subcustodian. With respect to Property in an Account which is
maintained by the Custodian in the custody of a Subcustodian employed pursuant
to Section 4:
(a) The Custodian will identify on its books as belonging to the
Customer on behalf of a Portfolio, any Property held by such
Subcustodian.
(b) Any Property in the Account held by a Subcustodian will be
subject only to the instructions of the Custodian or its
agents.
(c) Property deposited with a Subcustodian will be maintained in
an account holding only assets for customers of the Custodian.
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(d) Any agreement the Custodian shall enter into with a non-U.S.
Subcustodian with respect to the holding of Property shall
require that (i) the Account will be adequately indemnified or
its losses adequately insured in the event of loss; (ii) so
long as and to the extent that Rule 17f-5 requires, the
Property is not subject to any right, charge, security
interest, lien or claim of any kind in favor of such
Subcustodian or its creditors except a claim for payment in
accordance with such agreement for their safe custody or
administration, (iii) so long as and to the extent that Rule
17f-5 requires, beneficial ownership of such Property be
freely transferable without the payment of money or value
other than for safe custody or administration, (iv) adequate
records will be maintained identifying the Property held
pursuant to such Agreement as belonging to the Custodian, on
behalf of its customers and (v) officers of or auditors
employed by, or other representatives of or designated by, the
Custodian, including the independent public accountants of or
designated by, the Customer be given access to the books and
records of such Subcustodian relating to its actions under its
agreement pertaining to any Property held by it thereunder or
confirmation of or pertinent information contained in such
books and records be furnished to such persons designated by
the Custodian.
6. Use of Securities System. With respect to Property in the Account(s)
which are maintained by the Custodian or any Subcustodian in the custody of a
Securities System employed pursuant to Section 4:
(a) The Custodian shall, and the Subcustodian will be required by
its agreement with the Custodian to, identify on its books
such Property as being held for the account of the Custodian
or Subcustodian for its customers.
(b) Any Property held in a Securities System for the account of
the Custodian or a Subcustodian will be subject only to the
instructions of the Custodian or such Subcustodian, as the
case may be.
(c) Property deposited with a Securities System will be maintained
in an account holding only assets for customers of the
Custodian or Subcustodian, as the case may be, unless
precluded by applicable law, rule, or regulation.
(d) The Custodian shall provide the Customer with any report
obtained by the Custodian on the Securities System's
accounting system, internal accounting control and procedures
for safeguarding securities deposited in the Securities
System.
7. Agents. Except for holding of Property pursuant to Section 4 hereof,
the Custodian may at any time or times in its sole discretion, upon advance
written notification to Customer, appoint (or remove) any other U.S. bank or
trust company which is itself qualified under the 1940 Act to act as custodian,
as its agent to carry out such of the provisions of this Agreement as the
Custodian may from time to time direct; provided, however, that the appointment
of any agent shall not, under any circumstances, relieve the Custodian of its
responsibilities or liabilities hereunder.
8. Records, Ownership of Property, Statements, Opinions of Independent
Certified Public Accountants.
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(a) The ownership of the Property whether Securities, Cash and/or other
property, and whether held by the Custodian or a Subcustodian or in a Securities
System as authorized herein, shall be clearly recorded on the Custodian's books
as belonging to the appropriate Account and not for the Custodian's own
interest. Where certificates are legended or otherwise not fungible with
publicly traded certificates (and in other cases where the Custodian and the
Customer may agree), the Customer reserves the right to instruct the Custodian
as to the name only in which such Securities shall be registered and the
Custodian, to the extent reasonably practicable, shall comply with such
Instructions; provided, however if Custodian reasonably determines that
compliance with such Instructions is not reasonably practicable or otherwise may
conflict with applicable law, rule or regulation, Custodian shall promptly
notify Customer and shall comply with reasonable alternatives as to which the
parties may agree. The Custodian shall keep accurate and detailed accounts of
all investments, receipts, disbursements and other transactions for each
Account. All accounts, books and records of the Custodian relating thereto shall
be open to inspection and audit at all reasonable times during normal business
hours by any person designated by the Customer. All such books, records and
accounts shall be maintained and preserved in the form reasonably requested by
the Customer and in accordance with the 1940 Act and the Rules and Regulations
thereunder, including, without limitation, Section 31 thereof and Rule 31a-1 and
31a-2 thereunder. All books, records and accounts pertaining to the Customer and
the Accounts, which are in the possession of the Custodian, shall be the
property of the Customer and such materials or (unless the delivery of original
materials is required pursuant to applicable law) legible copies thereof in a
format acceptable to the Customer, shall be surrendered promptly upon request.
The Custodian will supply to the Customer from time to time, as mutually agreed
upon, a statement in respect to any Property in an Account held by the Custodian
or by a Subcustodian. In the absence of the filing in writing with the Custodian
by the Customer of exceptions or objections to any such statement within one
hundred eighty (180) days of the mailing thereof, the Customer shall be deemed
to have approved such statement and in such case or upon written approval of the
Customer of any such statement, such statement shall be presumed to be for all
purposes correct with respect to all information set forth therein, absent
manifest errors or omissions.
(b) The Custodian shall take all reasonable action as the Customer may
request to obtain from year to year favorable opinions from the Customer's
independent certified public accountants with respect to the Custodian's
activities hereunder in connection with the preparation of the Customer's Form
N-1A and the Customer's Form N-SAR or other periodic reports to the SEC and with
respect to any other requirements of the SEC.
(c) At the request of the Customer, the Custodian shall deliver to the
Customer a written report prepared by the Custodian's independent certified
public accountants with respect to the services provided by the Custodian under
this Agreement, including, without limitation, the Custodian's accounting
system, internal accounting control and procedures for safeguarding Cash and
Securities, including Cash and Securities deposited and/or maintained in a
Securities System or with a Subcustodian. Such report shall be of sufficient
scope and in sufficient detail as may reasonably be required by the Customer and
as may reasonably be obtained by the Custodian.
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(d) The Customer may elect to participate in any of the electronic
on-line service and communications systems offered by the Custodian which can
provide the Customer, on a daily basis, with the ability to view on-line or to
print on hard copy various reports of Account activity and of Securities and/or
Cash being held in any Account. To the extent that such service shall include
market values of Securities in an Account, the Customer hereby acknowledges that
the Custodian now obtains and may in the future obtain information on such
values from outside sources that the Custodian considers to be reliable and the
Customer agrees that the Custodian (i) does not verify or represent or warrant
either the reliability of such service nor the accuracy or completeness of any
such information furnished or obtained by or through such service and (ii) shall
be without liability in selecting such service or furnishing any information
derived therefrom. To the extent that such service shall provide access to
information concerning (i) all transactions involving the delivery in and out of
Custodian of Cash and/or Securities; (ii) payments of principal and interest or
dividends; (iii) pending transactions and fails; (iv) schedules of Custodian
holdings, Custodian shall comply with the standards for reports furnished in
accordance with Section 8(a) above.
9. Holding of Securities, Nominees, etc. Securities in an Account which
are held by the Custodian or any Subcustodian may be held by such entity in the
name of the Customer, on behalf of a Portfolio, in the Custodian's or
Subcustodian's name, in the name of the Custodian's or Subcustodian's nominee,
or in bearer form. Securities that are held by a Subcustodian or which are
eligible for deposit in a Securities System as provided above may be maintained
with the Subcustodian or the Securities System in an account for the Custodian's
or Subcustodian's customers, unless prohibited by law, rule, or regulation. So
long as and to the extent that Rule 17f-5 shall permit, the Custodian or
Subcustodian, as the case may be, may combine certificates representing
Securities held in an Account with certificates of the same issue held by it as
fiduciary or as a custodian. In the event that any Securities in the name of the
Custodian or its nominee or held by a Subcustodian and registered in the name of
such Subcustodian or its nominee are called for partial redemption by the issuer
of such Security, the Custodian may, subject to the rules or regulations
pertaining to allocation of any Securities System in which such Securities have
been deposited, allot, or cause to be allotted, the called portion of the
respective beneficial holders of such class of security in any manner the
Custodian deems to be fair and equitable and shall provide Customer prompt
notice of any such action.
10. Proxies, etc. With respect to any proxies, notices, reports or
other communications relative to any of the Securities in any Account, the
Custodian shall perform such services and only such services relative thereto as
are (i) set forth in Section 3 of this Agreement, (ii) described in Exhibit B
attached hereto (as such service therein described may be in effect from time to
time) (the "Proxy Service") and (iii) as may otherwise be agreed upon between
the Custodian and the Customer. The liability and responsibility of the
Custodian in connection with the Proxy Service referred to in (ii) of the
immediately preceding sentence and in connection with any additional services
which the Custodian and the Customer may agree upon as provided in (iii) of the
immediately preceding sentence shall be as set forth in the description of the
Proxy Service and as may be agreed upon by the Custodian and the Customer in
connection with the furnishing of any such additional service and shall not be
affected by any other term of this Agreement. Neither the Custodian nor its
nominees or agents shall vote upon or in respect of any of the Securities in an
Account, execute any form of proxy to vote thereon, or give any consent or take
any action (except as provided in Section 3) with respect thereto except upon
the receipt of Instructions relative thereto.
11. Segregated Account. To assist the Customer in complying with the
requirements of the 1940 Act and the rules and regulations thereunder, the
Custodian shall, upon receipt of Instructions, establish and maintain a
segregated account or accounts on its books for and on behalf of a Portfolio.
The Custodian shall hold in such segregated accounts for the Account of a
Portfolio, Securities so designated by Customer.
12. Settlement Procedures. (a) Securities will be transferred,
exchanged or delivered by the Custodian or a Subcustodian upon receipt by the
Custodian of Instructions which include all information required by the
Custodian. Settlement and payment for Securities received for an Account and
delivery of Securities out of such Account may be effected in accordance with
the customary or established securities trading or securities processing
practices and procedures in the jurisdiction or market in which the transaction
occurs, including, without limitation, delivering Securities to the purchaser
thereof or to a dealer therefor (or an agent for such purchaser or dealer)
against a receipt with the expectation of receiving later payment for such
Securities from such purchaser or dealer, as such practices and procedures may
be modified or supplemented in accordance with the standard operating procedures
of the Custodian in effect from time to time for that jurisdiction or market. So
long as and to the extent that the Custodian has exercised reasonable care, the
Custodian shall not be liable for any loss which results from effecting
transactions in accordance with the customary or established securities trading
or securities processing practices and procedures in the applicable jurisdiction
or market.
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(b) With respect to Accounts containing Securities maintained outside
the United States, the Custodian shall credit or debit such Accounts on a
contractual settlement date with Cash or Securities with respect to any sale,
exchange or purchase of Securities.
(i) The Custodian may reverse credits or debits made to
the Accounts in its discretion if the related
transaction fails to settle within a reasonable
period, determined by the Custodian in its
discretion, after the contractual settlement date for
the related transaction; provided that, the Custodian
shall give Customer prior notification of any such
reversal. Where the foregoing notification is oral,
the Custodian shall promptly provide written
notification of the same (which confirmation may be
electronic).
(ii) If any Securirites delivered pursuant to this Section
12(b) are returned by the recipient thereof, the
Custodian may, after receiving advance approval from
the Customer, which approval shall not be
unreasonably withheld, reverse the credits and debits
of the particular transaction at any time.
(c) Without affecting the obligations of the Custodian under Section
12(b) and except as otherwise may be agreed upon by the parties hereto, the
Custodian shall not be required to comply with Instructions to settle the
purchase of any Securities for the Account unless there is sufficient Cash in
the Account at the time or to settle the sale of any Securities in the Account
unless such Securities are in deliverable form. Notwithstanding the foregoing,
if the purchase price of such securities exceeds the amount of Cash in the
Account at the time of settlement of such purchase, the Custodian may, in its
sole discretion, but in no way shall have any obligation to, permit an overdraft
in the Account in the amount of the difference solely for the purpose of
facilitating the settlement of such purchase of securities for prompt delivery
for the Account. The Customer agrees to immediately repay the amount of any such
overdraft in the ordinary course of business, exclusively out of the Property in
the Account that has engaged in the transaction that gives rise to such
overdraft and further agrees to indemnify and hold the Custodian harmless from
and against Custodian's actual losses, damages, costs and expenses, including
the charges for such overdraft as set forth in Exhibit C hereof exclusively out
of such Property, provided however, that Customer shall not be liable for any
consequential or special damages. The Customer agrees that it will not use the
Account to facilitate the purchase of securities if at the time Customer places
the purchase order it knows there will not be sufficient funds in the Account at
the time of settlement (which funds shall not include the proceeds of the sale
of the purchased securities).
13. Permitted Transactions. The Customer agrees that it will cause
transactions to be made pursuant to this Agreement only upon Instructions in
accordance with Section 14 and only for the purposes listed below.
(a) In connection with the purchase or sale of Securities at prices as
confirmed by Instructions.
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(b) When Securities are called, redeemed or retired, or otherwise
become payable.
(c) In exchange for or upon conversion into other securities alone or
other securities and cash pursuant to any plan of merger, consolidation,
reorganization, recapitalization or readjustment.
(d) Upon conversion of Securities pursuant to their terms into other
securities.
(e) Upon exercise of subscription, purchase or other similar rights
represented by Securities.
(f) For the payment of interest, taxes, management or supervisory fees,
distributions or operating expenses.
(g) In connection with any borrowings by the Customer requiring a
pledge of Securities, but only against receipt of amounts borrowed.
(h) In connection with any loans or repurchase agreements, but only
against receipt of collateral as specified in Instructions which shall reflect
any restrictions applicable to the Customer.
(i) For the purpose of redeeming shares of the capital stock of the
Customer against delivery of the shares to be redeemed to the Custodian, a
Subcustodian or the Customer's transfer agent.
(j) For the purpose of redeeming in kind shares of the Customer against
delivery of the shares to be redeemed to the Custodian, a Subcustodian or the
Customer's transfer agent.
(k) For delivery in accordance with the provisions of any agreement
among the Customer, on behalf of a Portfolio, the Custodian and a broker-dealer
registered under the Securities Exchange Act of 1934 and a member of the
National Association of Securities Dealers, Inc., relating to compliance with
the rules of The Options Clearing Corporation, the Commodities Futures Trading
Commission and of any registered national securities exchange, or of any similar
organization or organizations, regarding escrow or other arrangements in
connection with transactions by the Customer.
(l) In the case of covered call options, the issuance of a depository
pledge receipt or similar notice of custody or for release of Securities to
designated brokers under such covered call options, provided, however, that such
Securities shall be released only upon payment to the Custodian of monies for
the premium due and a receipt for the Securities which are to be held in escrow.
Upon exercise of the option, or at expiration, the Custodian will receive the
Securities previously deposited from broker. The Custodian will act strictly in
accordance with Instructions in the delivery of Securities to be held in escrow
and will have no responsibility or liability for any such Securities which are
not returned promptly when due other than to make proper request for such
return.
(m) For spot or forward foreign exchange transactions to facilitate
security trading or receipt of income from Securities related transactions.
(n) In connection with the establishment of a segregated account in
accordance with Section 11 hereof.
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(o) Upon the termination of this Agreement as set forth in Section 20
hereof.
(p) For the purpose of paying distributions to shareholders of the
capital stock of the Customer.
(q) In connection with transactions under master repurchase agreements
and master accounts and the delivery of inital and variation margin for futures
contracts.
(r) For other proper purposes as may be specified in Instructions.
The Customer agrees that the Custodian shall have no obligation to
verify the purpose for which a transaction is being effected; provided that if
the Custodian has actual knowledge that the transaction is for an improper
purpose, it shall notify the Customer.
14. Instructions. The term "Instructions" means instructions from the
Customer in respect of any of the Custodian's duties hereunder which have been
received by the Custodian at its address set forth in Section 21 below (i) in
writing (including, without limitation, facsimile transmission) or by tested
telex signed or given by such one or more person or persons as the Customer
shall have from time to time authorized in writing to give the particular class
of Instructions in question and whose name and (if applicable) signature and
office address have been filed with the Custodian, or (ii) which have been
transmitted electronically through an electronic on-line service and
communications system offered by the Custodian or other electronic instruction
system acceptable to the Custodian, or (iii) a telephonic or oral communication
by one or more persons as the Customer shall have from time to time authorized
to give the particular class of Instructions in question and whose name has been
filed with the Custodian; or (iv) upon receipt of such other form of
instructions as the Customer may from time to time authorize in writing and
which the Custodian has agreed in writing to accept. Instructions in the form of
oral communications shall be confirmed by the Customer by tested telex or
writing (including, without limitation, facsimile transmission) in the manner
set forth in clause (i) above, but the lack of such confirmation shall in no way
affect any action taken by the Custodian in reliance upon such oral instructions
prior to the Custodian's receipt of such confirmation. Instructions may relate
to specific transactions or to types or classes of transactions, and may be in
the form of standing instructions, such as the Instructions communicated in the
letter to Xxxxx Xxxxx dated November 14, 1996 concerning confirmation of wire
transfers sent to the Custodian by facsimile transmission, the terms of which
letter are incorporated herein by reference.
The Custodian shall have the right to assume in the absence of notice
to the contrary from the Customer that any person whose name is on file with the
Custodian pursuant to this Section has been authorized by the Customer to give
the Instructions in question and that such authorization has not been revoked.
The Custodian may act upon and conclusively rely on, without any liability to
the Customer or any other person or entity for any losses resulting therefrom,
any Instructions reasonably believed by it in good faith to be furnished by the
proper person or persons as provided above.
-10-
15. Standard of Care. The Custodian shall be responsible for the
performance of only such duties as are set forth herein or contained in
Instructions given to the Custodian which are not contrary to the provisions of
this Agreement. The Custodian shall comply with all applicable provisions and
requirements of the 1940 Act, the Securities Act of 1933 (the "1933 Act"), the
1934 Act, and any laws, rules, and regulations or governmental authorities
having jurisdiction with respect to the provisions which directly apply to the
services provided to the Customer hereunder. The Custodian will use reasonable
care with respect to the safekeeping of Property in each Account and, except as
otherwise expressly provided herein, in carrying out its obligations under this
Agreement. So long as and to the extent that it has exercised reasonable care,
the Custodian shall not be responsible for the title, validity or genuineness of
any Property or other property or evidence of title thereto received by it or
delivered by it pursuant to this Agreement and shall be held harmless in acting
upon, and may conclusively rely on, without liability for any loss resulting
therefrom, any notice, request, consent, certificate or other instrument
reasonably believed by it to be genuine and to be signed or furnished by the
proper party or parties, including, without limitation, Instructions, and shall
be indemnified by the Customer for any losses, damages, costs and expenses
(including, without limitation, the reasonable fees and expenses of counsel)
incurred by the Custodian and arising out of action taken or omitted with
reasonable care by the Custodian hereunder or under any Instructions, such
indemnification to be provided exclusively from the Property in the Account as
to which Custodian shall have acted (or failed to act) when it incurred such
losses, damages, costs and expenses. The Custodian shall be liable to the
Customer for any act or omission to act of any Subcustodian to the same extent
as if the Custodian committed such act itself. With respect to a Securities
System, the Custodian shall only be responsible or liable for losses arising
from employment of such Securities System caused by the Custodian's own failure
to exercise reasonable care. In the event of any loss or damage to the Customer
or, if the Customer shall incur costs and expenses (including, without
limitation, fees and expenses of counsel) by reason of the failure of the
Custodian or a Subcustodian to utilize reasonable care, the Custodian shall be
liable to the Customer to the extent of the Customer's actual losses, damages,
costs and expenses (including reasonable fees and expenses of counsel) by reason
of such failure without reference to any special conditions or circumstances. In
no event shall either the Custodian or the Customer be liable for any
consequential or special damages of such other party. The Custodian shall be
entitled to rely, and may act, on advice of counsel (who may be counsel for the
Customer) on all matters and shall be without liability for any action
reasonably taken or omitted pursuant to such advice.
In the event the Customer subscribes to an electronic on-line service
and communications system offered by the Custodian, the Customer shall be fully
responsible for the security of the Customer's connecting terminal, access
thereto and the proper and authorized use thereof and the initiation and
application of continuing effective safeguards with respect thereto and agrees
to defend and indemnify the Custodian and hold the Custodian harmless from and
against any and all losses, damages, costs and expenses (including the
reasonable fees and expenses of counsel) incurred by the Custodian as a result
of any improper or unauthorized use of such terminal by the Customer or by any
others.
All collections of funds or other property paid or distributed in
respect of Securities in an Account, including funds involved in third-party
foreign exchange transactions, shall be made at the risk of the Customer.
Subject to the exercise of reasonable care, the Custodian shall have no
liability for any loss occasioned by delay in the actual receipt of notice by
the Custodian or by a Subcustodian of any payment, redemption or other
transaction regarding Securities in each Account in respect of which the
Custodian has agreed to take action as provided in Section 3 hereof. The
Custodian shall not be liable for any loss resulting from, or caused by, or
resulting from acts of governmental authorities (whether de jure or de facto),
including, without limitation, nationalization, expropriation, and the
imposition of currency restrictions; devaluations of or fluctuations in the
value of currencies; changes in laws and regulations applicable to the banking
or securities industry; market conditions that prevent the orderly execution of
securities transactions or affect the value of Property; acts of war, terrorism,
insurrection or revolution; strikes or work stoppages; the inability of a local
clearing and settlement system to settle transactions for reasons beyond the
control of the Custodian; hurricane, cyclone, earthquake, volcanic eruption,
nuclear fusion, fission or radioactivity, or other acts of God.
-11-
Upon receipt by the Custodian of notice from a subcustodian, or
otherwise upon the Custodian becoming aware in the ordinary course of its
custodial activities, of any of the events (other than any of such events which
are acts of God) referred to in the immediately preceding paragraph, the
Custodian will as soon as practicable notify the Customer. The Customer may
discuss with the Custodian reasonable steps to safeguard the Property, and the
Custodian shall use reasonable efforts to take such steps as may be agreed
between the Customer and the Custodian; provided that should the Custodian in
good faith determine that the taking of any such steps would result in the
incurrence by the Custodian of costs, expenses and liabilities, the Custodian
need not take any such steps until the Customer shall have furnished to the
Custodian reasonable security or indemnity for such costs, expenses and
liabilities.
The Custodian shall, throughout the term of this Agreement, effect and
maintain insurance cover in respect of such risks with such insurers and on such
terms as it deems appropriate and necessary to protect the Property. Nothing in
this Section 15 shall prohibit the Custodian from self-insuring all or any part
of the risks relating to the performance of this Agreement as it in its sole
discretion deems appropriate, but only as long as Property could be protected to
the same extent as it would were such insurance maintained with a third party
insurer unaffiliated with Custodian; and if Custodian knows or has reason to
know that the Property is not so protected, Custodian shall promptly notify
Customer and shall be obligated to obtain appropriate and necessary insurance
from an unaffiliated third party insurer. The Custodian shall furnish to the
Customer upon request certification as to the effectiveness and amounts of such
insurance.
The Custodian maintains business line and technology resources business
continuity plans which are monitored internally and externally to ensure that
the plans are regularly updated and tested and comply with firmwide standards.
Upon request, Custodian shall provide written assurance to the Customer of the
continued maintenance of reasonable arrangements for the emergency use of
electronic data processing equipment to the extent appropriate.
The Custodian shall have no liability in respect of any loss, damage or
expense suffered by the Customer, insofar as such loss, damage or expense arises
from the performance of the Custodian's duties hereunder by reason of the
Custodian's reasonable reliance upon records that were maintained for the
Customer by entities other than the Custodian prior to the Custodian's
employment under this Agreement.
The provisions of this Section shall survive termination of this
Agreement.
16. Investment Limitations and Legal or Contractual Restrictions or
Regulations. Provided that the Custodian exercises reasonable care to comply
with Instructions generally, and more particularly in connection with the
purchase, sale or exchange of Securities made by or for the Customer in any
country, the Custodian shall not be liable to the Customer and the Customer
agrees to indemnify the Custodian and its nominees, for any loss, damage or
expense suffered or incurred by the Custodian or its nominees arising out of any
violation of any investment restriction or other restriction or limitation
applicable to the Customer or any Portfolio pursuant to any contract or any law
or regulation. The provisions of this Section shall survive termination of this
Agreement.
-12-
17. Fees and Expenses. The Customer agrees to pay to the Custodian such
compensation for its services pursuant to this Agreement as may be mutually
agreed upon in writing from time to time and the Custodian's reasonable
out-of-pocket or incidental expenses in connection with the performance of this
Agreement, including (but without limitation) reasonable legal fees as described
herein and/or deemed necessary in the judgment of the Custodian to keep safe or
protect the Property in the Account. The initial fee schedule is attached hereto
as Exhibit C. The Customer hereby agrees to hold the Custodian harmless from any
liability or loss which is not due to the Custodian's or a Subcustodian's lack
of reasonable care resulting from any taxes or other governmental charges, and
any expense related thereto, which may be imposed, or assessed with respect to
any Property in an Account and also agrees to hold the Custodian, its
Subcustodians, and their respective nominees harmless from any liability as a
record holder of Property in such Account. The Custodian is authorized to charge
the applicable Account for such items, including but not limited to amounts
payable pursuant to indemnities granted by the Customer under this Agreement;
provided that Custodian shall give Customer notification prior to effecting any
such charge. The provisions of this Section shall survive the termination of
this Agreement.
18. Tax Reclaims. With respect to withholding taxes deducted and which
may be deducted from any income received from any Property in an Account, the
Custodian shall perform such services with respect thereto as are described in
Exhibit D attached hereto and shall in connection therewith be subject to the
standard of care set forth in such Exhibit D. Such standard of care shall not be
affected by any other term of this Agreement.
19. Amendment, Modifications, etc. No provision of this Agreement may
be amended, modified or waived except in a writing signed by the parties hereto.
No waiver of any provision hereto shall be deemed a continuing waiver unless it
is so designated. No failure or delay on the part of either party in exercising
any power or right under this Agreement operates as a waiver, nor does any
single or partial exercise of any power or right preclude any other or further
exercise thereof or the exercise of any other power or right.
20. Termination. (a) Termination of Entire Agreement. This Agreement
may be terminated by the Customer or the Custodian by sixty (60) days' written
notice to the other; provided that notice by the Customer shall specify the
names of the persons to whom the Custodian shall deliver the Securities in each
Account and to whom the Cash in such Account shall be paid. If notice of
termination is given by the Custodian, the Customer shall, within sixty (60)
days following the giving of such notice, deliver to the Custodian a written
notice specifying the names of the persons to whom the Custodian shall deliver
the Securities in each Account and to whom the Cash in such Account shall be
paid. In either case, the Custodian will deliver such Securities and Cash to the
persons so specified, after deducting therefrom any amounts which the Custodian
determines to be owed to it under Section 17. In addition, the Custodian may in
its discretion withhold from such delivery such Cash and Securities as may be
necessary to settle transactions pending at the time of such delivery. If within
sixty (60) days following the giving of a notice of termination by the
Custodian, the Custodian does not receive from the Customer a written notice
specifying the names of the persons to whom the Custodian shall deliver the
Securities in each Account and to whom the Cash in such Account shall be paid,
the Custodian, at its election, may upon advance written notice to Customer
deliver such Securities and pay such Cash to a bank or trust company which is
qualified as an eligible foreign custodian under Rule 17f-5 of the 1940 Act and
doing business in the State of New York to be held and disposed of pursuant to
the provisions of this Agreement, or may continue to hold such Securities and
Cash until a written notice as aforesaid is delivered to the Custodian, provided
that the Custodian's obligations shall be limited to safekeeping and the duties
outlined in this subsection 20(a); provided that where the Custodian is the
terminating party and the Custodian had not notified the Customer that
termination is for breach of this Agreement by Customer, such sixty (60) day
period shall be extended for an additional period as requested by Customer of up
to ninety (90) additional days.
-13-
(b) Termination as to One or More Portfolios. This Agreement may be
terminated by the Customer or the Custodian as to one or more Portfolios (but
less than all of the Portfolios) by delivery of an amended Exhibit A deleting
such Portfolios, in which case termination as to such deleted Portfolios shall
take effect sixty (60) days after the date of such delivery, or such earlier
time as mutually agreed. The execution and delivery of an amended Exhibit A
which deletes one or more Portfolios shall constitute a termination of this
Agreement only with respect to such deleted Portfolio(s), shall be governed by
the preceding provisions of Section 20 as to the identification of a successor
custodian and the delivery of Cash and Securities of the Portfolio(s) so deleted
to such successor custodian, and shall not affect the obligations of the
Custodian and the Customer hereunder with respect to the other Portfolios set
forth in Exhibit A, as amended from time to time.
21. Notices. Except as otherwise provided in this Agreement, all
requests, demands or other communications between the parties or notices in
connection herewith (a) shall be in writing, hand delivered or sent by telex,
telegram, cable, facsimile or other means of electronic communication agreed
upon by the parties hereto addressed, if to the Customer, to:
Delaware Group of Funds
0000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
if to the Custodian, to:
Bankers Trust Company
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
or in either case to such other address as shall have been furnished to the
receiving party pursuant to the provisions hereof and (b) shall be deemed
effective when received, or, in the case of a telex, when sent to the proper
number and acknowledged by a proper answerback.
22. Several Obligations of the Portfolios. With respect to any
obligations of the Customer on behalf of each Portfolio and each of its related
Accounts arising out of this Agreement, the Custodian shall look for payment or
satisfaction of any obligation solely to the assets and property of the
Portfolio and such Accounts to which such obligation relates as though the
Customer had separately contracted with the Custodian by separate written
instrument with respect to each Portfolio and its related Accounts.
23. Representations and Warranties.
-14-
(a) The Customer hereby represents and warrants to the Custodian that:
(i) the employment of the Custodian and the allocation of
fees, expenses and other charges to any Account as herein provided, is not
prohibited by law or any governing documents or contracts to which the Customer
is subject;
(ii) the terms of this Agreement do not violate any obligation
by which the Customer is bound, whether arising by contract, operation of law or
otherwise;
(iii) this Agreement has been duly authorized by appropriate
action and when executed and delivered will be binding upon the Customer and
each Portfolio in accordance with its terms; and
(iv) the Customer will deliver to the Custodian such evidence
of such authorization as the Custodian may reasonably require, whether by way of
a certified resolution or otherwise.
(b) The Custodian hereby represents and warrants to the Customer that:
(i) the terms of this Agreement do not violate any obligation
by which the Custodian is bound, whether arising by contract, operation of law
or otherwise;
(ii) this Agreement has been duly authorized by appropriate
action and when executed and delivered will be binding upon the Custodian in
accordance with its terms;
(iii) the Custodian will deliver to the Customer such evidence
of such authorization as the Customer may reasonably require, whether by way of
a certified resolution or otherwise; and
(iv) Custodian is qualified as a custodian under Sections
17(f) and 26(a) of the 1940 Act and warrants that it will remain so qualified or
upon ceasing to be so qualified shall promptly notify the Customer in writing.
24. Governing Law and Successors and Assigns. This Agreement shall be
governed by the law of the State of New York and shall not be assignable by
either party, but shall bind the successors in interest of the Customer and the
Custodian.
25. Publicity. Unless material is produced in accordance with
applicable law, Customer shall furnish to Custodian at its office referred to in
Section 21 above, prior to any distribution thereof, copies of any material
prepared for distribution to any persons who are not parties hereto that refer
in any way to the Custodian. Customer shall not distribute or permit the
distribution of such materials if Custodian reasonably objects in writing within
ten (10) business days of receipt thereof (or such other time as may be mutually
agreed) after receipt thereof. The provisions of this Section shall survive the
termination of this Agreement.
26. Representative Capacity and Binding Obligation. A copy of the
Articles of Incorporation/Declaration of Trust of the Customer is on file with
The Secretary of the State of Maryland or in the Trust's offices, and notice is
hereby given that this Agreement is not executed on behalf of the Directors or
Trustees of the Customer as individuals, and the obligations of this Agreement
are not binding upon any of the Directors or Trustees, officers or shareholders
of the Customer individually but are binding only upon the assets and property
of the Portfolios.
-15-
The Custodian agrees that no shareholder, trustee, director or officer
of the Customer may be held personally liable or responsible for any obligations
of the Customer arising out of this Agreement.
27. Submission to Jurisdiction. Any suit, action or proceeding arising
out of this Agreement may be instituted in any State or Federal court sitting in
the City of Xxx Xxxx, Xxxxx xx Xxx Xxxx, Xxxxxx Xxxxxx of America, and the
Customer irrevocably submits to the non-exclusive jurisdiction of any such court
in any such suit, action or proceeding and waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying
of venue of any such suit, action or proceeding brought in such a court and any
claim that such suit, action or proceeding was brought in an inconvenient forum.
Notwithstanding the foregoing, this Section shall not limit any party from
instituting suit in the competent court of any other jurisdiction.
28. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original. This Agreement shall
become effective when one or more counterparts have been signed and delivered by
each of the parties hereto.
29. Confidentiality. The parties hereto agree that each shall treat
confidentially the terms and conditions of this Agreement and all information
provided by each party to the other regarding its business and operations. All
confidential information provided by a party hereto shall be used by any other
party hereto solely for the purpose of rendering services pursuant to this
Agreement and, except as may be required in carrying out this Agreement, shall
not be disclosed to any third party without the prior consent of such providing
party. The foregoing shall not be applicable to any information that is publicly
available when provided or thereafter becomes publicly available other than
through a breach of this Agreement, or that is required or requested to be
disclosed by any bank or other regulatory examiner of the Custodian, Customer,
or any Subcustodian, any auditor of the parties hereto, by judicial or
administrative process or otherwise by applicable law or regulation.
30. Severability. If any provision of this Agreement is determined to
be invalid or unenforceable, such determination shall not affect the validity or
enforceability of any other provision of this Agreement.
31. Headings. The headings of the paragraphs hereof are included for
convenience of reference only and do not form a part of this Agreement.
DELAWARE GROUP OF FUNDS
on behalf of
each Customer and
Portfolio listed
on Exhibit A
hereto
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President/Chief Administrative
Officer /Chief Financial Officer
BANKERS TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
-16-
EXHIBIT A
To Custodian Agreement dated as of June 1, 1996 between Bankers Trust
Company and Delaware Group of Funds.
LIST OF PORTFOLIOS
The following is a list of Portfolios referred to in the first WHEREAS
clause of the above-referenced Custodian Agreement. Terms used herein as defined
terms unless otherwise defined shall have the meanings ascribed to them in the
above-referenced Custodian Agreement.
Customers: Portfolios
---------- ----------
Delaware Group Trend Fund, Inc.
Delaware Group Decatur Fund, Inc. Decatur Income Fund Series
Decatur Total Return Fund Series
Delaware Group Government Government Income Series
Fund, Inc.
Delaware Group Limited-Term U.S. Government Money Series
Government Funds, Inc.
Limited Term Government Fund Series
Delaware Cash Reserve, Inc.
Delaware Group Tax-Free
Money Fund, Inc.
Delaware Group Tax-Free Fund, Inc. Tax Free USA Fund Series
Tax-Free Insured Fund Series
Tax-Free USA Intermediate Fund
Series
Delaware Pooled Trust, Inc. The Defensive Equity Portfolio
The Aggressive Growth Portfolio
The Fixed Income Portfolio
The Limited Term Maturity Portfolio
The Defensive Equity Small/
Mid-Cap Portfolio
Delaware Group Income Funds, Inc Strategic Income Fund Series
Delaware Group Global Dividend and
Income Fund, Inc.
Dated as of: April 1, 1997 DELAWARE GROUP OF FUNDS,
on behalf of each Customer and Portfolio
listed on this Exhibit A to the
Custodian Agreement
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President/
Chief Administrative Officer/
Chief Financial Officer
BANKERS TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
EXHIBIT B
To Custodian Agreement dated as of June 1, 1996 between Bankers Trust
Company and Delaware Group of Funds.
PROXY SERVICE
The following is a description of the Proxy Service referred to in
Section 10 of the above referenced Custodian Agreement. Terms used herein as
defined terms shall have the meanings ascribed to them therein unless otherwise
defined below.
The Custodian provides a service, described below, for the transmission
of corporate communications in connection with shareholder meetings relating to
Securities held in Argentina, Australia, Austria, Canada, Denmark, Finland,
France, Germany, Greece, Hong Kong, Indonesia, Ireland, Italy, Japan, Korea,
Malaysia, Mexico, Netherlands, New Zealand, Pakistan, Poland, Singapore, South
Africa, Spain, Sri Lanka, Sweden, United Kingdom, United States, and Venezuela.
For the United States and Canada, the term "corporate communications" means the
proxy statements or meeting agenda, proxy cards, annual reports and any other
meeting materials received by the Custodian. For countries other than the United
States and Canada, the term "corporate communications" means the meeting agenda
only and does not include any meeting circulars, proxy statements or any other
corporate communications furnished by the issuer in connection with such
meeting. Non-meeting related corporate communications are not included in the
transmission service to be provided by the Custodian except upon request as
provided below.
The Custodian's process for transmitting and translating meeting
agendas will be as follows:
1) If the meeting agenda is not provided by the issuer in the
English language, and if the language of such agenda is in the
official language of the country in which the related security
is held, the Custodian will as soon as practicable after
receipt of the original meeting agenda by a Subcustodian
provide an English translation prepared by that Subcustodian;
provided, however, under no circumstances (unless
impracticable) shall a translation received by the Custodian
be supplied to Customer later than the day on which action is
required, at a time which shall enable action timely to be
taken.
2) If an English translation of the meeting agenda is furnished,
the local language agenda will not be furnished unless
requested.
Translations will be free translations and neither the Custodian nor
any Subcustodian will be liable or held responsible for the accuracy thereof or
any direct or indirect consequences arising therefrom, including without
limitation arising out of any action taken or omitted to be taken based thereon.
If requested, the Custodian will, on a reasonable efforts basis,
endeavor to obtain any additional corporate communication such as annual or
interim reports, proxy statements, meeting circulars, or local language agendas,
and provide them in the form obtained.
Timing in the voting process is important and, in that regard, upon
receipt by the Custodian of notice from a Subcustodian, the Custodian will
provide a notice to the Customer indicating the deadline for receipt of its
instructions to enable the voting process to take place effectively and
efficiently. As voting procedures will vary from market to market, attention to
any required procedures will be very important. Upon timely receipt of voting
instructions, the Custodian will promptly forward such instructions to the
applicable Subcustodian. If voting instructions are not timely received, the
Custodian shall have no liability or obligation to take any action.
For Securities held in markets other than those set forth in the first
paragraph, the Custodian will not furnish the material described above or seek
voting instructions. However, if requested to exercise voting rights at a
specific meeting, the Custodian will endeavor to do so on a reasonable efforts
basis without any assurance that such rights will be so exercised at such
meeting.
If the Custodian or any Subcustodian incurs extraordinary expenses in
exercising voting rights related to any Securities pursuant to appropriate
instructions or direction (e.g., by way of illustration only and not by way of
limitation, physical presence is required at a meeting and/or travel expenses
are incurred), upon receipt of Instructions to do so, such expenses will be
reimbursed out of the Account containing such Securities unless other
arrangements have been made for such reimbursement.
It is the intent of the Custodian to expand the Proxy Service to
include jurisdictions which are not currently included as set forth in the
second paragraph hereof. The Custodian will notify the Customer as to the
inclusion of additional countries or deletion of existing countries after their
inclusion or deletion and this Exhibit B will be deemed to be automatically
amended to include or delete such countries as the case may be.
Dated as of: June 1, 1996 DELAWARE GROUP OF FUNDS,
on behalf of each Customer and Portfolio
listed on Exhibit A to the Custodian
Agreement
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President/
Chief Administrative Officer/
Chief Financial Officer
BANKERS TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
EXHIBIT C
To Custodian Agreement dated as of June 1, 1996 between Bankers Trust
Company and Delaware Group of Funds.
CUSTODY FEE SCHEDULE
Monthly Account Maintenance: No Charge
(including segregated accounts)
Regional Annual Asset and Per Transaction Fees:
TIER I International
ANNUAL ASSET FEE RECEIVE AND DELIVER
COUNTRY IN BASIS POINTS TRANSACTION FEES
------- --------------- ----------------
Australia 3.0 $50.00
Austria 5.0 $50.00
Belgium 4.0 $50.00
Canada 1.5 $50.00
Cedel 2.0 $25.00
Denmark 4.0 $50.00
Euroclear 2.0 $25.00
Finland 10.0 $75.00
France 4.0 $50.00
Germany 2.0 $30.00
Greece 35.0 $120.00
Hong Kong 5.0 $35.00
Indonesia 8.0 $35.00
Ireland 5.0 $50.00
Italy 3.0 $50.00
Japan 2.5 $50.00
Korea 15.0 $50.00
Malaysia 7.0 $50.00
Mexico 5.0 $50.00
Netherlands 4.0 $45.00
New Zealand 4.0 $50.00
Norway 5.0 $50.00
Philippines 8.0 $30.00
Singapore 7.0 $50.00
South Africa 5.0 $50.00
Spain 6.0 $50.00
Sweden 4.0 $50.00
Switzerland 3.0 $60.00
United Kingdom 1.5 $20.00
TIER II United States
Annual Asset Fee: 0.25 BASIS POINTS
Transaction Fees:
o DTC-Automated (as defined below) $3.00
o DTC Manual (as defined below) $10.00
o PTC Automated $6.00
o PTC Manual $10.00
o FED Automated $6.00
o FED Manual $10.00
o Physical Automated $15.00
o Physical Manual $19.00
o P&I Payments $2.00
o Redemptions $10.00
o Reorganizations Included in safekeeping charge
o Outgoing Wires $8.00
o Incoming Wires No Charge
o Internal Cash Transfers No Charge
NOTES
1. Fees for investments in countries not listed will be negotiated separately.
2. There is no cost associated with the inward transition of assets, but the
client is responsible for all re-registration charges and stamp duty; i.e. Spain
and Indonesia.
3. The above fees are inclusive of the provision of Globe*View and or Polaris
software, but client is responsible for the provision of a suitable PC, printer
and modem and all associated line charges.
4. Above pricing excludes out-of-pocket (e.g. postage and insurance, transfer
agent fees).
5. Earnings Credits and Overdraft Charges with respect to Accounts containing
Property maintained within the United States:
For each month during which the Custodian holds Property for a
Customer, there shall be an adjustment to the custody fees noted above,
calculated as follows:
(a) the closing cash balances on the days of a month during which
Property is maintained in an Account ("Closing Cash Balance"), other than those
days on which the Closing Cash Balance is an overdraft position in excess of
$1,000,000 ("Excluded Days"), shall be aggregated and that sum shall be divided
by the number of days whose Closing Cash Balances are so added ("Average Monthly
Balance"). If such Average Monthly Balance is more than zero, the Average
Monthly Balance will be multiplied by that number which is the product of
multiplying the Overnight Federal Funds Rate (defined below), minus .50%, by a
fraction, the denominator of which shall be 365 and the numerator of which shall
be the number of days (other than Excluded Days) on which there is a Closing
Cash Balance in that month. If such Average Monthly Balance is less than zero,
the Average Monthly Balance shall be multiplied by that number which is the
product of multiplying the Overnight Federal Funds Rate (defined below), plus
1.00%, by a fraction, the denominator of which shall be 365 and the numerator of
which shall be the number of days (other than Excluded Days) on which there is a
Closing Cash Balance in that month. If the Average Monthly Balance for a
particular month is more than zero, the amount calculated pursuant to this
paragraph (a) shall be deducted from an Account's custody fee for the relevant
month. If the Average Monthly Balance for a particular month is less than zero,
the amount calculated shall be added to such custody fee for such month.
(b) for an Excluded Day, the amount of the closing overdraft position
for such day shall be multiplied by the fraction, the numerator of which shall
be the Overnight Federal Funds Rate, plus 1.00% and the denominator of which
shall be 365. The amount so calculated will be added to the custody fee payable
by the Account for the relevant month.
(c) for purposes of paragraphs (a) and (b)above, the term "Overnight
Federal Funds Rate" shall mean, for any month, the average of daily Federal
funds rates for a given month; in turn, the daily Federal funds rate shall mean,
for any day, the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the business day next succeeding such day.
6. Earnings Credits earned in a calendar year are valid for only that year and
the immediately succeeding calendar quarter. Any accumulation not used up by the
end of the 1st quarter of the immediately following year will be forfeited.
7. Earnings Credit and Overdraft Rates with respect to Accounts containing
Property maintained in foreign markets, where applicable, will vary by market.
As part of the monthly reporting package, the Custodian provides a Statement of
Earnings that details by currency account the daily balance maintained and the
interest or debit rate earned on that particular day. The net negative (or
positive) interest is accrued and reflected at the bottom the statement; this
amount is credited on the third business day following the month end.
8. A manual transaction is an instruction, which is sent to Bankers Trust
outside of Globe*View, Polaris or CPU transmissions, i.e. facsimile.
9. Transactional fees will be incurred in the Master Repo account. Account
maintenance and asset fees will be waived for the Master Repo Account.
10. New pricing is effective June 1, 1996 and will not be modified before June
1, 1999.
11. Fees for FX trades executed with BTCo. will be waived. Third party FX fees
are $50.00 per transaction.
12. Fees are billed monthly.
13. "DTC-Automated" shall mean those trades which are settled automatically at
DTC or through Polaris or another sucessor electronic system without manual
intervention of an employee of the Custodian; and "DTC-Manual" shall mean those
trades which are settled through Polaris or another sucessor electronic system
with the manual intervention of an employee of the Custodian.
DELAWARE GROUP OF FUNDS,
on behalf of each Customer and Portfolio
listed on Exhibit A to the Custodian Agreement BANKERS TRUST COMPANY
ACCEPTED BY: PREPARED BY:
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxx Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President/Chief Administrative Title: Managing Director
Officer /Chief Financial Officer (DATE) June 1, 1996
(DATE) June 1, 1996
Except as set forth above, this Exhibit C shall be amended upon delivery by the
Custodian of a new Exhibit C to the Customer and acceptance thereof by the
Customer and shall be effective as of the date of acceptance by the Customer or
a date agreed upon between the Custodian and the Customer.
EXHIBIT D
To Custodian Agreement dated as of June 1, 1996 between Bankers Trust
Company and Delaware Group of Funds.
TAX RECLAIMS
Pursuant to Section 18 of the above referred to Custodian Agreement,
the Custodian shall perform the following services with respect to withholding
taxes imposed or which may be imposed on income from Property in the Account.
Defined terms shall, unless otherwise noted, have the meanings ascribed to them
in the above referenced Custodian Agreement.
(a) When withholding tax has been deducted with respect to income from
any Property in an Account, the Custodian will post the tax reclaim in the
relevant currency to the Account on the earlier of the date of receipt of the
tax reclaim payment or the Contractual Reclaim Posting Date (as defined in the
columnar heading below) in accordance with the following schedule (subject to
the provisions of paragraphs (b) and (c) below):
Market Contractual Reclaim Posting Date
------ --------------------------------
(unless otherwise noted in paragraph (b),
the number of days subsequent to the receipt
by Custodian of the dividend/interest
payment from which tax has been withheld)
Austria 000
Xxxxxxx 270
Denmark 100
France 270
Germany 000
Xxxxx 90
Spain 260
Switzerland 250
UK 100
This service shall be provided by the Custodian with regard to other countries
in which Customer may invest as the Custodian and Customer shall mutually agree.
In the event of a change in tax laws, regulations, or treaties, or the
re-interpretation by a relevant governmental authority of any of the foregoing,
which change causes a material modification to the tax reclaim process in such
market, the Custodian and the Customer shall enter into good faith negotiations
to modify this Exhibit D as appropriate.
(b) In instances where a tax reclaim payment has not been received and
the Custodian's obligation is therefore to post a reclaim on a particular
Contractual Reclaim Posting Date, that obligation is conditioned upon the
Custodian's receipt from the Customer of all necessary documentation completed
accurately as to all material terms within a reasonable time prior to such
Contractual Reclaim Posting Date. If a Customer fails to so deliver the
necessary documentation to Custodian within such time, the day from which the
Contractual Reclaim Posting Date is measured shall be the date on which such
documentation is supplied to Custodian, not the date on which the
dividend/interest payment from which the tax is withheld is paid to Custodian.
The two previous sentences notwithstanding, if Customer's failure to deliver
such documentation within such time results from Custodian's failure to: (i)
notify Customer of any deadlines for delivery of documentation; (ii) deliver all
necessary documentation to Customer within a reasonable time prior to the date
on which the completed documentation must be delivered to Custodian or (iii)
promptly notify Customer of any deficiency in the required documentation
provided to Custodian, the Contractual Reclaim Posting Date shall be measured
from the date the Custodian receives the dividend/interest payment from which
the tax has been withheld.
(c) The Custodian shall not be obligated to post tax reclaims with
regard to a particular country, if (i) the government of such country ceases to
honor tax reclaims generally or (ii) imposes regulatory changes, delays or
currency restrictions which materially adversely affect or preclude the payment
of tax reclaims or (iii) the tax authority in such country from which a reclaim
is being sought declares a claim to be invalid or after appropriate and timely
inquiry by the Custodian, otherwise fails to confirm the validity of a claim
within a reasonable period of time. If the tax reclaim has been posted
previously to the Account, the Custodian shall have the right following advance
notice to the Customer to reverse any such credits (provided that with respect
to the events referred to in clause (ii) above, the Custodian's right to reverse
such credits shall be subject to approval by the Customer, which approval shall
not unreasonably be withheld); and the Customer, exclusively out of the Property
held in such Account, agrees to hold the Custodian harmless from Custodian's
actual losses, damages, costs and expenses (including the reasonable fees and
expenses of counsel) arising therefrom, except that in no event shall Customer
be liable for consequential or special damages of the Custodian. If,
notwithstanding the circumstances described in this paragraph (c), Custodian
actually receives a tax reclaim payment, Custodian shall promptly post such tax
reclaim in the relevant currency to the Account.
(d) The Custodian will provide fully detailed advices/vouchers to
support reclaims submitted to the local authorities by the Custodian or its
designee. In all cases of withholding, the Custodian will provide full details
to the Customer. If exemption from withholding at the source can be obtained in
the future, the Custodian will notify the Customer and advise what
documentation, if any, is required to obtain the exemption. Upon receipt of such
documentation from the Customer, the Custodian will file for exemption on the
Customer's behalf and notify the Customer when it has been obtained.
(e) In connection with providing the foregoing service, the Custodian
shall be entitled to apply categorical treatment of the Customer according to
the Customer's nationality, the particulars of its organization and other
relevant details that shall be supplied by the Customer. It shall be the duty of
the Customer to inform the Custodian of any change in the organization, domicile
or other material fact previously communicated to Custodian in writing
concerning tax treatment of the Customer and further to inform the Custodian if
the Customer is or becomes the beneficiary of any special ruling or treatment
not applicable to the general nationality and category or entity of which the
Customer is a part under general laws and treaty provisions. The Custodian may
reasonably rely on any such information provided by the Customer.
(f) In connection with providing the foregoing service, the Custodian
may, at its own expense, consult and reasonably rely on the advice of counsel or
other professional tax advisers in such jurisdictions. So long as the Custodian
shall have used reasonable care in selecting such advisers, the Custodian is
entitled to reasonably rely, and may act, on advice received from counsel or
other professional tax advisers and shall be without liability to the Customer
for any action reasonably taken or omitted pursuant to information contained in
such advice.
(g) Subject to the provisions set forth above, the Custodian shall
perform the services provided in this Exhibit D in accordance with the standard
of care described in Section 15 of the Custodian Agreement.
Dated as of: June 1, 1996 DELAWARE GROUP OF FUNDS,
on behalf of each Customer and
Portfolio listed on Exhibit A to the
Custodian Agreement
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President/
Chief Administrative Officer/
Chief Financial Officer
BANKERS TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
