CUSTODY AGREEMENT
AGREEMENT, dated as of September 10, 2001 between each Xxxx Xxxxxxx
Fund listed on Schedule II, each either a business trust organized and existing
under the laws of The Commonwealth of Massachusetts, or a Maryland corporation
organized and existing under the laws of the state of Maryland, having its
principal office and place of business at 000 Xxxxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 (each the "Fund", collectively the "Funds") and The Bank of
New York, a New York corporation authorized to do a banking business having its
principal office and place of business at Xxx Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 ("Custodian").
W I T N E S S E T H:
that for and in consideration of the mutual promises hereinafter set forth the
Fund and Custodian agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words shall have the
meanings set forth below:
1. "Authorized Person" shall be any person, whether or not an officer
or employee of the Fund, duly authorized by the Fund's board to execute any
Certificate or to give any Oral Instruction or other Instruction on behalf of
the Fund and listed in the Certificate annexed hereto as Schedule I hereto or
such other Certificate as may be received by Custodian from time to time.
2. "BNY Affiliate" shall mean any office, branch or subsidiary of The
Bank of New York Company, Inc.
3. "Book-Entry System" shall mean the Federal Reserve/Treasury
book-entry system for receiving and delivering securities, its successors and
nominees.
4. "Business Day" shall mean any day on which the Fund, Custodian and
relevant Depositories are open for business.
5. "Certificate" shall mean any notice, instruction, or other
instrument in writing, authorized or required by this Agreement to be given to
Custodian, which is actually received by Custodian and signed on behalf of the
Fund by an Authorized Person or a person reasonably believed by Custodian to be
an Authorized Person.
6. "Composite Currency Unit" shall mean the Euro or any other composite
currency unit consisting of the aggregate of specified amounts of specified
currencies, as such unit may be constituted from time to time.
7. "Depository" shall include (a) the Book-Entry System, (b) the
Depository Trust Company, (c) any other clearing agency or securities depository
registered with the Securities and Exchange Commission identified to the Fund
from time to time, and (d) the respective successors and nominees of the
foregoing.
8. "Foreign Depository" shall mean (a) Euroclear, (b) Clearstream
Banking, societe anonyme, (c) each Eligible Securities Depository as defined in
Rule 17f-7 under the Investment Company Act of 1940, as amended (the "'40 Act"),
identified to the Fund from time to time, and (d) the respective successors and
nominees of the foregoing.
9. "Instructions" shall mean communications transmitted by electronic
or telecommunications media, including S.W.I.F.T./I.S.I.T.C.,
computer-to-computer interface, facsimile transmissions executed by an
Authorized Person, or dedicated transmission lines.
10. "Oral Instructions" shall mean verbal instructions received by
Custodian from an Authorized Person or from a person reasonably believed by
Custodian to be an Authorized Person.
11. "Securities" shall have the same meaning as when used in the
Securities Act of 1933, including, without limitation, any common stock and
other equity securities, bonds, debentures and other debt securities, notes,
mortgages or other obligations, and any instruments representing rights to
receive, purchase, or subscribe for the same, or representing any other rights
or interests therein (whether represented by a certificate or held in a
Depository or by a Subcustodian).
12. "Subcustodian" shall mean a bank (including any branch thereof) or
other financial institution (other than a Foreign Depository) located outside
the U.S. which is utilized by Custodian in connection with the purchase, sale or
custody of Securities hereunder and identified to the Fund from time to time,
and their respective successors and nominees.
ARTICLE II
APPOINTMENT OF CUSTODIAN; ACCOUNTS
1. (a) The Fund hereby appoints Custodian as custodian of all
Securities and cash at any time delivered to Custodian during the term of this
Agreement, and authorizes Custodian to hold Securities in registered form in its
name or the name of its nominees. Custodian hereby accepts such appointment and
agrees to establish and maintain one or more separate securities accounts and
cash accounts for each Fund in which Custodian will hold Securities and cash as
provided herein. Custodian shall maintain books and records segregating the
assets of each Fund from the assets of any other Fund. Such accounts (each, an
"Account"; collectively, the "Accounts") shall be in the name of the Fund.
(b) Custodian may from time to time establish on its books and records
such sub-accounts within each Account as the Fund and Custodian may agree upon
(each a "Special Account"), and Custodian shall reflect therein such assets as
the Fund may specify in a Certificate or Instructions.
(c) Custodian may from time to time establish pursuant to a written
agreement with and for the benefit of a broker, dealer, futures commission
merchant or other third party identified in a Certificate or Instructions such
accounts on such terms and conditions as the Fund and Custodian shall agree, and
Custodian shall transfer to such account such Securities and money as the Fund
may specify in a Certificate or Instructions.
2
ARTICLE III
CUSTODY AND RELATED SERVICES
1. (a) Subject to the terms hereof, the Fund hereby authorizes
Custodian to hold any Securities received by it from time to time for the Fund's
account. Custodian shall be entitled to utilize Depositories, Subcustodians,
and, subject to subsection(c) of this Section 1, Foreign Depositories, to the
extent possible in connection with its performance hereunder. Securities and
cash held in a Depository or Foreign Depository will be held subject to the
rules, terms and conditions of such entity. Securities and cash held through
Subcustodians shall be held subject to the terms and conditions of Custodian's
agreements with such Subcustodians. Subcustodians may be authorized to hold
Securities in Foreign Depositories in which such Subcustodians participate.
Unless otherwise required by local law or practice or a particular subcustodian
agreement, Securities deposited with a Subcustodian, a Depositary or a Foreign
Depository will be held in a commingled account, in the name of Custodian,
holding only Securities held by Custodian as custodian for its customers.
Custodian shall identify on its books and records the Securities and cash
belonging to the Fund, whether held directly or indirectly through Depositories,
Foreign Depositories, or Subcustodians. Custodian shall, directly or indirectly
through Subcustodians, Depositories, or Foreign Depositories, endeavor, to the
extent feasible, to hold Securities 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 cancellation and/or payment and/or
registration, or where such Securities are acquired. Custodian at any time may
cease utilizing any Subcustodian and/or may replace a Subcustodian with a
different Subcustodian (the "Replacement Subcustodian"). In the event Custodian
selects a Replacement Subcustodian, Custodian shall not utilize such Replacement
Subcustodian until after the Fund's board or foreign custody manager has
determined that utilization of such Replacement Subcustodian satisfies the
requirements of the `40 Act and Rule 17f-5 thereunder.
(b) Unless Custodian has received a Certificate or Instructions to the
contrary, Custodian shall hold Securities indirectly through a Subcustodian only
if (i) the Securities are not subject to any right, charge, security interest,
lien or claim of any kind in favor of such Subcustodian or its creditors or
operators, including a receiver or trustee in bankruptcy or similar authority,
except for a claim of payment for the safe custody or administration of
Securities on behalf of the Fund by such Subcustodian, and (ii) beneficial
ownership of the Securities is freely transferable without the payment of money
or value other than for safe custody or administration.
(c) With respect to each Foreign Depository, Custodian shall exercise
reasonable care, prudence, and diligence (i) to provide the Fund with an
analysis of the custody risks associated with maintaining assets with the
Foreign Depository, and (ii) to monitor such custody risks on a continuing basis
and promptly notify the Fund of any material change in such risks. The Fund
acknowledges and agrees, that such analysis and monitoring shall be made on the
basis of, and limited by, information gathered from Subcustodians, from trade
associations of which Custodian is a member from time to time, or through
publicly available information otherwise obtained by Custodian, and shall not
include any evaluation of Country Risks. As used herein the term "Country Risks"
shall mean with respect to any Foreign Depository: (a) the financial
3
infrastructure of the country in which it is organized, (b) such country's
prevailing custody and settlement practices, (c) nationalization, expropriation
or other governmental actions, (d) such country's regulation of the banking or
securities industry, (e) currency controls, restrictions, devaluations or
fluctuations, and (f) market conditions which affect the orderly execution of
securities transactions or affect the value of securities. Custodian represents
that each Foreign Depository in which a Subcustodian is authorized to maintain
Fund assets is an "Eligible Securities Depository" as defined in Rule 17f-7
under the '40 Act. Custodian agrees to certify to the Fund's board, annually and
upon reasonable request, that each Foreign Depository remains an Eligible
Securities Depository.
2. Custodian shall furnish Fund on-line access to daily transactions on
a real time basis and a monthly summary of all transfers to or from Fund's
account on the first business day after the month end.
3. With respect to all Securities held hereunder, Custodian shall,
unless otherwise instructed to the contrary:
(a) Collect all income, dividends, distributions and other payments due
or payable;
(b) Present for payment and collect the amount paid upon all Securities
which mature;
(c) Forward to the Fund promptly copies of all information or documents
that it may actually receive from an issuer of Securities which, in the
reasonable opinion of Custodian, are intended for the beneficial owner of
Securities;
(d) Execute, as custodian, any certificates of ownership, affidavits,
declarations or other certificates under any tax laws now or hereafter in effect
in connection with the collection of bond and note coupons;
(e) Hold directly or through a Depository, a Foreign Depository, or a
Subcustodian all rights and similar Securities issued with respect to any
Securities credited to an Account hereunder; and
(f) Endorse for collection checks, drafts or other negotiable
instruments.
4. (a) Custodian promptly shall notify the Fund of rights or
discretionary actions with respect to Securities held hereunder, and of the date
or dates by when such rights must be exercised or such action must be taken,
provided that Custodian has actually received, from the issuer or the relevant
Depository (with respect to Securities issued in the United States) or from the
relevant Subcustodian, Foreign Depository, or a nationally or internationally
recognized bond or corporate action service to which Custodian subscribes,
timely notice of such rights or discretionary corporate action or of the date or
dates such rights must be exercised or such action must be taken.
4
(b) Whenever Securities (including, but not limited to, warrants,
options, tenders, options to tender or non-mandatory puts or calls) confer
discretionary rights on the Fund or provide for discretionary action or
alternative courses of action by the Fund, the Fund shall be responsible for
making any decisions relating thereto and for directing Custodian to act
provided that Custodian promptly has notified the Fund of such discretionary
right or action. In order for Custodian to act, it must receive the Fund's
Certificate or Instructions at Custodian's offices, addressed as Custodian may
from time to time request, not later than noon (New York time) at least one (1)
Business Day prior to the last scheduled date to act with respect to such
Securities (or such earlier date or time as Custodian may specify to the Fund).
Custodian shall not be liable for failure to take any action relating to or to
exercise any rights conferred by such Securities, unless Custodian has failed to
timely receive the Fund's Certificate or Instruction and such failure is
attributable to Custodian's negligence or willful misconduct.
5. All voting rights with respect to Securities, however registered,
shall be exercised by the Fund or its designee. For domestic and foreign
securities Custodian will utilize a proxy service for the exercise of such
voting rights.
6. Custodian shall promptly advise the Fund upon Custodian's actual
receipt of notification of the partial redemption, partial payment or other
action affecting less than all Securities of the relevant class. If Custodian,
any Subcustodian, any Depository, or any Foreign Depository holds any Securities
in which the Fund has an interest as part of a fungible mass, Custodian, such
Subcustodian, Depository, or Foreign Depository may select the Securities to
participate in such partial redemption, partial payment or other action in any
non-discriminatory manner that it customarily uses to make such selection.
7. Custodian shall not under any circumstances accept bearer interest
coupons which have been stripped from United States federal, state or local
government or agency securities unless explicitly agreed to by Custodian in
writing.
8. The Fund shall be liable for all taxes, assessments, duties and
other governmental charges, including any interest or penalty with respect
thereto ("Taxes"), with respect to any cash or Securities held on behalf of the
Fund or any transaction related thereto. The Fund shall indemnify Custodian and
each Subcustodian for the amount of any Tax that Custodian, any such
Subcustodian or any other withholding agent is required under applicable laws
(whether by assessment or otherwise) to pay on behalf of, or in respect of
income earned by or payments or distributions made to or for the account of the
Fund (including any payment of Tax required by reason of an earlier failure to
withhold). Custodian shall, or shall instruct the applicable Subcustodian or
other withholding agent to, withhold the amount of any Tax which is required to
be withheld under applicable law upon collection of any dividend, interest or
other distribution made with respect to any Security and any proceeds or income
from the sale, loan or other transfer of any Security. In the event that
Custodian or any Subcustodian is required under applicable law to pay any Tax on
behalf of the Fund, Custodian is hereby authorized to withdraw cash from that
Fund's cash account in the amount required to pay such Tax and to use such cash,
or to remit such cash to the appropriate Subcustodian or other withholding
agent, for the timely payment of such Tax in the manner required by applicable
law. If the aggregate amount of cash in that Fund's cash accounts is not
sufficient to pay such Tax, Custodian shall promptly notify the Fund of the
5
additional amount of cash (in the appropriate currency) required, and the Fund
shall directly deposit such additional amount in the appropriate cash account
promptly after receipt of such notice, for use by Custodian as specified herein.
In the event that Custodian reasonably believes that Fund is eligible, pursuant
to applicable law or to the provisions of any tax treaty, for a reduced rate of,
or exemption from, any Tax which is otherwise required to be withheld or paid on
behalf of the Fund under any applicable law, Custodian shall, or shall instruct
the applicable Subcustodian or withholding agent to, either withhold or pay such
Tax at such reduced rate or refrain from withholding or paying such Tax, as
appropriate; provided that Custodian shall have received from the Fund all
documentary evidence of residence or other qualification for such reduced rate
or exemption required to be received under such applicable law or treaty. In the
event that Custodian reasonably believes that a reduced rate of, or exemption
from, any Tax is obtainable only by means of an application for refund,
Custodian and the applicable Subcustodian shall have responsibility for
providing the Fund with the correct forms and filling them out in a timely and
accurate fashion, but no responsibility for the accuracy or validity of the
Fund's information on any forms or documentation provided solely by the Fund to
Custodian hereunder. The Fund hereby agrees to indemnify and hold harmless
Custodian and each Subcustodian for any liability arising from any
underwithholding or underpayment of any Tax which results from the inaccuracy or
invalidity of any information provided by the Fund for such forms or other
documentation prepared solely by the Fund, and such obligation to indemnify
shall be a continuing obligation of the Fund, its successors and assigns
notwithstanding the termination of this Agreement.
9. (a) For the purpose of settling Securities and foreign exchange
transactions, the Fund shall provide Custodian with sufficient immediately
available funds for all transactions by such time and date as conditions in the
relevant market dictate. As used herein, "sufficient immediately available
funds" shall mean either (i) sufficient cash denominated in U.S. dollars to
purchase the necessary foreign currency, or (ii) sufficient applicable foreign
currency, to settle the transaction. Custodian shall provide the Fund with
immediately available funds each day which result from the contractual
settlement of all sale transactions, based upon advices received by Custodian
from Subcustodians, Depositories, and Foreign Depositories. Such funds shall be
in U.S. dollars or such other currency as the Fund may specify to Custodian.
(b) Any foreign exchange transaction effected by Custodian in
connection with this Agreement may be entered with Custodian or a BNY Affiliate
acting as principal or otherwise through customary banking channels. The Fund
may issue a standing Certificate or Instructions with respect to foreign
exchange transactions, but Custodian may establish rules or limitations
concerning any foreign exchange facility made available to the Fund. The Fund
shall bear all investment risks of investing in Securities or holding cash
denominated in a foreign currency.
10. Custodian shall promptly send to the Fund (a) any reports it
receives from a Depository on such Depository's system of internal accounting
control, and (b) such reports on its own system of internal accounting control
as the Fund may reasonably request from time to time.
6
ARTICLE IV
PURCHASE AND SALE OF SECURITIES;
CREDITS TO ACCOUNT
1. Promptly after each purchase or sale of Securities by the Fund, the
Fund shall deliver to Custodian a Certificate or Instructions, or with respect
to a purchase or sale of a Security generally required to be settled on the same
day the purchase or sale is made, Oral Instructions specifying all information
Custodian may reasonably request to settle such purchase or sale. Custodian
shall account for all purchases and sales of Securities on the actual settlement
date unless otherwise agreed by Custodian.
2. The Fund understands that when Custodian is instructed to deliver
physical Securities against payment, delivery of such Securities and receipt of
payment therefor may not be completed simultaneously. Notwithstanding any
provision in this Agreement to the contrary, settlements, payments and
deliveries of physical Securities may be effected by Custodian or any
Subcustodian in accordance with the customary or established securities trading
or securities processing practices and procedures in the jurisdiction in which
the transaction occurs, including, without limitation, delivery to a purchaser
or dealer therefor (or agent) against receipt with the expectation of receiving
later payment for such Securities
3. Custodian may, as a matter of bookkeeping convenience or by separate
agreement with the Fund, credit the Account with the proceeds from the sale,
redemption or other disposition of Securities or interest, dividends or other
distributions payable on Securities prior to its actual receipt of final payment
therefor. All such credits shall be conditional until Custodian's actual receipt
of final payment and may be reversed by Custodian to the extent that final
payment is not received. Payment with respect to a transaction will not be
"final" until Custodian shall have received immediately available funds which
under applicable local law, rule and/or practice are irreversible and not
subject to any security interest, levy or other encumbrance, and which are
specifically applicable to such transaction.
ARTICLE V
OVERDRAFTS OR INDEBTEDNESS
1. If Custodian should in its sole discretion advance funds on behalf
of any Fund which results in an overdraft because the money held by Custodian in
an Account for such Fund shall be insufficient to pay the total amount payable
upon a purchase of Securities by such Fund, as set forth in a Certificate,
Instructions or Oral Instructions, or if an overdraft arises with respect to a
Fund for some other reason, including, without limitation, because of a reversal
of a conditional credit or the purchase of any currency, or if any Fund is for
any other reason indebted to Custodian (except a borrowing for investment or for
temporary or emergency purposes pursuant to a separate agreement), such
overdraft or indebtedness shall be deemed to be a loan made by Custodian to such
Fund payable on demand and shall bear interest from the date incurred at such
rate per annum as such Fund and Custodian may agree upon from time to time. In
addition, the Fund hereby agrees that Custodian shall to the maximum extent
permitted by law have a continuing lien, security interest, and security
7
entitlement in and to any property, including, without limitation, any
investment property or any financial asset, of such Fund at any time held by
Custodian for the benefit of such Fund or in which such Fund may have an
interest which is then in Custodian's possession or control or in possession or
control of any third party acting in Custodian's behalf. Such Fund authorizes
Custodian, in its sole discretion, at any time to charge any such overdraft or
indebtedness together with interest due thereon against any balance of account
standing to such Fund's credit on Custodian's books. Custodian shall promptly
advise any Fund whenever such Fund has an overdraft or indebtedness bearing
interest as provided in this Article, or whenever Custodian intends to realize
upon its lien, security interest or security entitlement.
2. If the Fund borrows money from any bank (including Custodian if the
borrowing is pursuant to a separate agreement) for investment or for temporary
or emergency purposes using Securities held by Custodian hereunder as collateral
for such borrowings, the Fund shall deliver to Custodian a Certificate
specifying with respect to each such borrowing: (a) the Series to which such
borrowing relates; (b) the name of the bank, (c) the amount of the borrowing,
(d) the time and date, if known, on which the loan is to be entered into, (e)
the total amount payable to the Fund on the borrowing date, (f) the Securities
to be delivered as collateral for such loan, including the name of the issuer,
the title and the number of shares or the principal amount of any particular
Securities, and (g) a statement specifying whether such loan is for investment
purposes or for temporary or emergency purposes and that such loan is in
conformance with the `40 Act and the Fund's prospectus. Custodian shall deliver
on the borrowing date specified in a Certificate the specified collateral
against payment by the lending bank of the total amount of the loan payable,
provided that the same conforms to the total amount payable as set forth in the
Certificate. Custodian may, at the option of the lending bank, keep such
collateral in its possession, but such collateral shall be subject to all rights
therein given the lending bank by virtue of any promissory note or loan
agreement. Custodian shall deliver such Securities as additional collateral as
may be specified in a Certificate to collateralize further any transaction
described in this Section. The Fund shall cause all Securities released from
collateral status to be the name of the Series for which such money was
received.
ARTICLE VI
SALE AND REDEMPTION OF SHARES
1. Whenever the Fund shall sell any shares issued by the Fund
("Shares") it shall deliver to Custodian a Certificate or Instructions
specifying the amount of money and/or Securities to be received by Custodian for
the sale of such Shares and specifically allocated to an Account for such
Series.
2. Upon receipt of such money, Custodian shall credit such money to an
Account in the name of the Series for which such money was received.
3. Except as provided hereinafter, whenever the Fund desires Custodian
to make payment out of the money held by Custodian hereunder in connection with
a redemption of any Shares, it shall furnish to Custodian a Certificate or
Instructions specifying the total amount to be paid for such Shares. Custodian
shall make payment of such total amount to the transfer agent specified in such
Certificate or Instructions out of the money held in an Account of the
appropriate Series.
8
ARTICLE VII
PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
1. Whenever the Fund shall determine to pay a dividend or distribution
on Shares it shall furnish to Custodian Instructions or a Certificate setting
forth with respect to the Series specified therein the date of the declaration
of such dividend or distribution, the total amount payable, and the payment
date.
2. Upon the payment date specified in such Instructions or Certificate,
Custodian shall pay out of the money held for the account of such Series the
total amount payable to the dividend agent of the Fund specified therein.
ARTICLE VIII
CONCERNING CUSTODIAN
1. (a) Except as otherwise expressly provided herein, Custodian shall
not be liable for any costs, expenses, damages, liabilities or claims, including
attorneys' and accountants' fees (collectively, "Losses"), incurred by or
asserted against the Fund, except those Losses arising out of Custodian's own
negligence or willful misconduct. Custodian shall have no liability whatsoever
for the action or inaction of any Depositories or any Foreign Depositories. With
respect to any Losses incurred by the Fund as a result of the acts or failures
to act by a Subcustodian which is either a BNY Affiliate or listed on Appendix A
hereto, Custodian shall be liable to the Fund for such Losses, but only to the
extent such Losses arise out of or are caused by acts or failures to act by such
Subcustodian which are contrary to the prevailing practices or standard of care
in the relevant market in which such Subcustodian operates. With respect to any
Losses incurred by the Fund as a result of the acts or failures to act by a
Subcustodian which is not a BNY Affiliate and is not listed on Appendix A
hereto, Custodian shall take appropriate action to recover such Losses from such
Subcustodian, and Custodian's sole responsibility and liability to the Fund
shall be limited to amounts so received from such Subcustodians (exclusive of
costs and expenses incurred by Custodian). In no event shall Custodian be liable
9
to the Fund or any third party for special, indirect or consequential damages,
or lost profits or loss of business, arising in connection with this Agreement,
nor shall BNY or any Subcustodian be liable: (i) for acting in accordance with
any Certificate or Oral Instructions actually received by Custodian; (ii) for
acting in accordance with Instructions; (iii) for conclusively presuming that
all Instructions other than Oral Instructions are given only by person(s) duly
authorized; (iv) for any Losses due to forces beyond the control of Custodian,
including without limitation strikes, work stoppages, acts of war or terrorism,
insurrection, revolution, nuclear or natural catastrophes or acts of God,
interruption, loss or malfunction of utilities or communication services, or,
but only to the extent beyond Custodian's reasonable control, and only if
Custodian is maintaining the same and appropriate back-up system(s) in
accordance with industry standards and practices, interruption, loss, or
malfunction of computers (hardware or software); or (v) for any Losses arising
from the applicability of any law or regulation now or hereafter in effect, or
from the occurrence of any event, including, without limitation, implementation
or adoption of any rules or procedures of a Foreign Depository, which may
affect, limit, prevent or impose costs or burdens on, the transferability,
convertibility, or availability of any currency or Composite Currency Unit in
any country or on the transfer of any Securities, and in no event shall
Custodian be obligated to substitute another currency for a currency (including
a currency that is a component of a Composite Currency Unit) whose
transferability, convertibility or availability has been affected, limited, or
prevented by such law, regulation or event, and to the extent that any such law,
regulation or event imposes a cost or charge upon Custodian in relation to the
transferability, convertibility, or availability of any cash currency or
Composite Currency Unit, such cost or charge shall be for the account of the
Fund, and Custodian may treat any account denominated in an affected currency as
a group of separate accounts denominated in the relevant component currencies.
(b) Custodian may enter into subcontracts, agreements and
understandings with any BNY Affiliate, whenever and on such terms and conditions
as it deems necessary or appropriate to perform its services hereunder. No such
subcontract, agreement or understanding shall discharge Custodian from its
obligations hereunder.
(c) The Fund agrees to indemnify and hold Custodian harmless from and
against any and all Losses sustained or incurred by or asserted against
Custodian by reason of or as a result of any action or inaction, or arising out
of Custodian performance hereunder, including reasonable fees and expenses of
counsel, provided however, that the Fund shall not indemnify Custodian for those
Losses arising out of Custodian's own negligence or willful misconduct, nor for
any Losses which constitute indirect, special, or consequential damages, or lost
profits or loss of business. Custodian agrees to indemnify and hold the Fund
harmless from and against any and all Losses, including reasonable fees and
expenses of counsel, sustained or incurred by or asserted against the Fund
arising out of Custodian's own negligence or willful misconduct, provided,
however, that Custodian shall not indemnify the Fund for any Losses which
constitute indirect, special, or consequential damages, or lost profits or loss
of business. This indemnity shall be a continuing obligation of Fund and
Custodian, their successors and assigns, notwithstanding the termination of this
Agreement.
2. Without limiting the generality of the foregoing, Custodian shall be
under no obligation to inquire into, and shall not be liable for:
(a) The validity of the issue of any Securities purchased, sold, or
written by or for the Fund, the legality of the purchase, sale or writing
thereof, or the propriety of the amount paid or received therefor;
(b) The legality of the sale or redemption of any Shares, or the
propriety of the amount to be received or paid therefor;
(c) The legality of the declaration or payment of any dividend or
distribution by the Fund;
(d) The legality of any borrowing by the Fund;
(e) Whether any Securities at any time delivered to, or held by
Custodian or by any Subcustodian, for the account of the Fund are such as
properly may be held by the Fund under the provisions of its then current
prospectus and statement of additional information, or to ascertain whether any
transactions by the Fund, whether or not involving Custodian, are such
transactions as may properly be engaged in by the Fund.
10
3. Custodian may, with respect to questions of law specifically
regarding an Account, obtain the advice of counsel at its own expense and shall
be fully protected with respect to anything done or omitted by it in good faith
in conformity with such advice.
4. Custodian shall have no duty or responsibility to inquire into, make
recommendations, supervise, or determine the suitability of any Securities
transactions effected for a Fund.
5. The Fund shall pay to Custodian the fees and charges as may be
specifically agreed upon from time to time and such other fees and charges at
Custodian's standard rates for such services as may be applicable. The Fund
shall also reimburse Custodian for out-of-pocket expenses which are a normal
incident of the services provided hereunder.
6. With instructions from an Authorized Person of the Fund, the
Custodian has the right to debit any cash account for any amount payable by the
Fund in connection with any and all obligations of the Fund to Custodian.
Custodian will use its bet efforts to consult with Fund's investment advisor
about the selection of securities used to offset that Fund's obligations to
Custodian. Any such asset of, or obligation to the Fund may be transferred to
Custodian and any BNY Affiliate in order to effect the above rights.
7. The Fund will make its best efforts to forward to Custodian a
Certificate or Instructions confirming Oral Instructions by the close of
business of the same day that such Oral Instructions are given to Custodian.
Fund and Custodian agree that the fact that such confirming Certificate or
Instructions are not received or that a contrary Certificate or contrary
Instructions are received by Custodian shall affect the validity and
enforceability of transactions authorized by such Oral Instructions and effected
by Custodian. If the Fund elects to transmit Instructions through an on-line
communications system offered by Custodian, the Fund's use thereof shall be
subject to the Terms and Conditions attached as Appendix I hereto, and Custodian
shall provide user and authorization codes, passwords and authentication keys
only to an Authorized Person.
8. The books and records pertaining to the Fund which are in possession
of Custodian shall be the property of the Fund. Such books and records shall be
prepared and maintained as required by the `40 Act and the rules thereunder. The
Fund, or its authorized representatives, shall have access to such books and
records during Custodian's normal business hours. Upon the reasonable request of
the Fund, copies of any such books and records shall be provided by Custodian to
the Fund or its authorized representative. Upon the reasonable request of the
Fund, Custodian shall provide in hard copy or on computer disc any records
included in any such delivery which are maintained by Custodian on a computer
disc, or are similarly maintained.
9. It is understood that Custodian is authorized to supply any
information regarding the Accounts which is required by any law, regulation or
rule now or hereafter in effect. Custodian shall provide the Fund with any
report obtained by Custodian on the system of internal accounting control of a
Depository, and with such reports on its own system of internal accounting
control as the Fund may reasonably request from time to time.
11
ARTICLE IX
TERMINATION
1. Either of the parties hereto may terminate this Agreement by giving
to the other party a notice in writing specifying the date of such termination,
which shall be not less than sixty (60) days after the date of giving of such
notice. In the event such notice is given by the Fund, it shall be accompanied
by a copy of a resolution of the board of the Fund, certified by the Fund's
Secretary or any Assistant Secretary, electing to terminate this Agreement and
designating a successor custodian or custodians, each of which shall be a bank
or trust company having not less than $2,000,000 aggregate capital, surplus and
undivided profits. In the event such notice is given by Custodian, the Fund
shall, on or before the termination date, deliver to Custodian a copy of a
resolution of the board of the Fund, certified by the Secretary or any Assistant
Secretary, designating a successor custodian or custodians. In the absence of
such designation by the Fund, Custodian may designate a successor custodian
which shall be a bank or trust company having not less than $2,000,000 aggregate
capital, surplus and undivided profits. Upon the date set forth in such notice
this Agreement shall terminate, and Custodian shall upon receipt of a notice of
acceptance by the successor custodian on that date deliver directly to the
successor custodian all Securities and money then owned by the Fund and held by
it as Custodian, after deducting all fees, expenses and other amounts for the
payment or reimbursement of which it shall then be entitled.
2. If a successor custodian is not designated by the Fund or Custodian
in accordance with the preceding Section, the Fund shall upon the date specified
in the notice of termination of this Agreement and upon the delivery by
Custodian of all Securities (other than Securities which cannot be delivered to
the Fund) and money then owned by the Fund be deemed to be its own custodian and
Custodian shall thereby be relieved of all duties and responsibilities pursuant
to this Agreement, other than the duty with respect to Securities which cannot
be delivered to the Fund to hold such Securities hereunder in accordance with
this Agreement.
ARTICLE X
MISCELLANEOUS
1. The Fund agrees to furnish to Custodian a new Certificate of
Authorized Persons in the event of any change in the then present Authorized
Persons. Until such new Certificate is received, Custodian shall be fully
protected in acting upon Certificates or Oral Instructions of such present
Authorized Persons.
2. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to Custodian, shall be sufficiently given if
addressed to Custodian and received by it at its offices at 000 Xxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, or at such other place as Custodian may from time to
time designate in writing.
12
3. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Fund shall be sufficiently given if addressed
to the Fund and received by it at its offices at 000 Xxxxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, or at such other place as the Fund may from time to time
designate in writing.
4. Each and every right granted to either party hereunder or under any
other document delivered hereunder or in connection herewith, or allowed it by
law or equity, shall be cumulative and may be exercised from time to time. No
failure on the part of either party to exercise, and no delay in exercising, any
right will operate as a waiver thereof, nor will any single or partial exercise
by either party of any right preclude any other or future exercise thereof or
the exercise of any other right.
5. In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any exclusive jurisdiction, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected thereby. This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties, except that any
amendment to the Schedule I hereto need be signed only by the Fund and any
amendment to Appendix I hereto need be signed only by Custodian. This Agreement
shall extend to and shall be binding upon the parties hereto, and their
respective successors and assigns; provided, however, that this Agreement shall
not be assignable by either party without the written consent of the other.
6. This Agreement shall be construed in accordance with the substantive
laws of The Commonwealth of Massachusetts, without regard to conflicts of laws
principles thereof. The Fund and Custodian each hereby irrevocably waives any
and all rights to trial by jury in any legal proceeding arising out of or
relating to this Agreement.
7. This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original, but such counterparts shall,
together, constitute only one instrument.
8. Fund and Custodian agree that the obligations of each Fund are not
binding upon any of the Trustees/Directors, officers or shareholders of the Fund
individually, but are binding only upon that Fund and its assets. Each Fund
shall be severally, not jointly, liable only for its own obligations under this
Agreement.
13
IN WITNESS WHEREOF, the Fund and Custodian have caused this Agreement
to be executed by their respective officers, thereunto duly authorized, as of
the day and year first above written.
Each Xxxx Xxxxxxx Fund listed on Schedule II
By: /s/Xxxxxxx X. Xxxxx
-------------------
Title: SeniorVice President & CFO
THE BANK OF NEW YORK
By: /s/Xxxxx X. Xxxxxxx
-------------------
Title: Senior Vice President
14
SCHEDULE II
Xxxx Xxxxxxx Funds
(As of September 10, 2001)
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx 500 Index Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Active Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Balanced Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Bank & Thrift Opportunity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Biotechnology Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Xxxx Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx California Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Xxxx Reserve, Inc.
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Communications Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Consumer Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Dividend Performers Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx European Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Financial Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Financial Trends, Inc.
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Focused Relative Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Focused Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Fundamental Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Global Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Government Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Growth Trends Fund (add Class I eff 11/15/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Health Sciences Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Yield Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Yield Tax-Free Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Income Securities Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Balanced Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Diversified Core Equity Fund II
(terminate Class P 9/13/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Medium Capitalization Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Intermediate Government Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Investors Trust
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Large Cap Growth Fund
--------------------------------------------------------------------------------
N/A Xxxx Xxxxxxx Large Cap Spectrum Fund (eff (9/24/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Large Cap Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Massachusetts Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Medium Capitalization Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Mid Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Money Market Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Multi-Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx New York Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Pacific Basin Equities Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Global Dividend Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Preferred Dividend Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Premium Dividend Fund I
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Premium Dividend Fund II
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Select Dividend Trust
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Real Estate Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Regional Bank Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Cap Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Capitalization Value Fund (name change
eff 9/30/01 to Xxxx Xxxxxxx Small Cap Equity Fund)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Sovereign Investors Fund
--------------------------------------------------------------------------------
N/A Xxxx Xxxxxxx Strategic Growth Fund (eff 12/01/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Strategic Income Fund
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Tax-Free Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Technology Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx U.S. Government Cash Reserve
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx U.S. Global Leaders Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Financial Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. High Yield Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Regional Bank Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Relative Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Sovereign Investors Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Strategic Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Technology Fund
--------------------------------------------------------------------------------
Agreement/custodian/BNYScheduleII
APPENDIX I
THE BANK OF NEW YORK
ON-LINE COMMUNICATIONS SYSTEM (THE "SYSTEM")
TERMS AND CONDITIONS
1. License; Use. Upon delivery to an Authorized Person or a person
reasonably believed by Custodian to be an Authorized Person of the Fund of
software enabling the Fund to obtain access to the System (the "Software"),
Custodian grants to the Fund a personal, nontransferable and nonexclusive
license to use the Software solely for the purpose of transmitting Written
Instructions, receiving reports, making inquiries or otherwise communicating
with Custodian in connection with the Account(s). The Fund shall use the
Software solely for its own internal and proper business purposes and not in the
operation of a service bureau. Except as set forth herein, no license or right
of any kind is granted to the Fund with respect to the Software. The Fund
acknowledges that Custodian and its suppliers retain and have title and
exclusive proprietary rights to the Software, including any trade secrets or
other ideas, concepts, know-how, methodologies, or information incorporated
therein and the exclusive rights to any copyrights, trademarks and patents
(including registrations and applications for registration of either), or other
statutory or legal protections available in respect thereof. The Fund further
acknowledges that all or a part of the Software may be copyrighted or
trademarked (or a registration or claim made therefor) by Custodian or its
suppliers. The Fund shall not take any action with respect to the Software
inconsistent with the foregoing acknowledgments, nor shall you attempt to
decompile, reverse engineer or modify the Software. The Fund may not copy, sell,
lease or provide, directly or indirectly, any of the Software or any portion
thereof to any other person or entity without Custodian's prior written consent.
The Fund may not remove any statutory copyright notice or other notice included
in the Software or on any media containing the Software. The Fund shall
reproduce any such notice on any reproduction of the Software and shall add any
statutory copyright notice or other notice to the Software or media upon
Custodian's request.
2. Equipment. The Fund shall obtain and maintain at its own cost and
expense all equipment and services, including but not limited to communications
services, necessary for it to utilize the Software and obtain access to the
System, and Custodian shall not be responsible for the reliability or
availability of any such equipment or services.
3. Proprietary Information. The Software, any data base and any
proprietary data, processes, information and documentation made available to the
Fund (other than which are or become part of the public domain or are legally
required to be made available to the public) (collectively, the "Information"),
are the exclusive and confidential property of Custodian or its suppliers. The
Fund shall keep the Information confidential by using the same care and
discretion that the Fund uses with respect to its own confidential property and
trade secrets, but not less than reasonable care. Upon termination of the
Agreement or the Software license granted herein for any reason, the Fund shall
return to Custodian any and all copies of the Information which are in its
possession or under its control.
4. Modifications. Custodian reserves the right to modify the Software
from time to time and the Fund shall install new releases of the Software as
Custodian may direct. The Fund agrees not to modify or attempt to modify the
Software without Custodian's prior written consent. The Fund acknowledges that
any modifications to the Software, whether by the Fund or Custodian and whether
with or without Custodian's consent, shall become the property of Custodian.
5. NO REPRESENTATIONS OR WARRANTIES. CUSTODIAN AND ITS MANUFACTURERS
AND SUPPLIERS MAKE NO WARRANTIES OR REPRESENTATIONS WITH RESPECT TO THE
SOFTWARE, SERVICES OR ANY DATABASE, EXPRESS OR IMPLIED, IN FACT OR IN LAW,
INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE. THE FUND ACKNOWLEDGES THAT THE SOFTWARE, SERVICES AND ANY
DATABASE ARE PROVIDED "AS IS." IN NO EVENT SHALL CUSTODIAN OR ANY SUPPLIER BE
LIABLE FOR ANY DAMAGES, WHETHER DIRECT, INDIRECT SPECIAL, OR CONSEQUENTIAL,
WHICH THE FUND MAY INCUR IN CONNECTION WITH THE SOFTWARE, SERVICES OR ANY
DATABASE, UNLESS CUSTODIAN OR SUCH SUPPLIER KNOWS OR SHOULD HAVE KNOWN OF THE
POSSIBILITY OF SUCH DAMAGES. IN NO EVENT SHALL CUSTODIAN OR ANY SUPPLIER BE
LIABLE FOR ACTS OF GOD, MACHINE OR COMPUTER BREAKDOWN OR MALFUNCTION,
INTERRUPTION OR MALFUNCTION OF COMMUNICATION FACILITIES, LABOR DIFFICULTIES OR
ANY OTHER SIMILAR OR DISSIMILAR CAUSE BEYOND THEIR REASONABLE CONTROL.
6. Security; Reliance; Unauthorized Use. The Fund will cause all
persons utilizing the Software and System to treat all applicable user and
authorization codes, passwords and authentication keys with extreme care, and it
will establish internal control and safekeeping procedures to restrict the
availability of the same to persons duly authorized to give Instructions.
Custodian is hereby irrevocably authorized to act in accordance with and rely on
Instructions received by it through the System. The Fund acknowledges that it is
its sole responsibility to assure that only persons duly authorized use the
System and that Custodian shall not be responsible nor liable for any
unauthorized use thereof.
7. System Acknowledgments. Custodian shall acknowledge through the
System its receipt of each transmission communicated through the System. In the
absence of such acknowledgment Custodian shall not be liable for any failure to
act in accordance with such transmission however, Custodian will be liable for
all transmissions where the Fund shows that such transmission was received by
Custodian.
8. EXPORT RESTRICTIONS. EXPORT OF THE SOFTWARE IS PROHIBITED BY UNITED
STATES LAW. THE FUND MAY NOT UNDER ANY CIRCUMSTANCES RESELL, DIVERT, TRANSFER,
TRANSSHIP OR OTHERWISE DISPOSE OF THE SOFTWARE (IN ANY FORM) IN OR TO ANY OTHER
COUNTRY. IF CUSTODIAN DELIVERED THE SOFTWARE TO THE FUND OUTSIDE OF THE UNITED
STATES, THE SOFTWARE WAS EXPORTED FROM THE UNITED STATES IN ACCORDANCE WITH THE
EXPORTER ADMINISTRATION REGULATIONS. DIVERSION CONTRARY TO U.S. LAW IS
PROHIBITED. The Fund hereby authorizes Custodian to report its name and address
to government agencies to which Custodian is required to provide such
information by law.
9. ENCRYPTION. The Fund acknowledges and agrees that encryption may not
be available for every communication through the System, or for all data. The
Fund agrees that Custodian may deactivate any encryption features at any time,
with notice to the Fund, for the purpose of maintaining, repairing or
troubleshooting the System or the Software.
The Fund and the bank agree that the obligations of each Fund are not
binding upon any of the Trustees/Directors. Officers or shareholders of the Fund
individually, but are binding only upon that Fund and its assets. Each Fund
shall be severally, not jointly, liable for its own obligations under this
Agreement.
S:\Corporate Secretary\AGRCONT\AGREEMNT\CUSTODIA\BNYcustody01.DOC
SCHEDULE II
Xxxx Xxxxxxx Funds
(As of September 10, 2001)
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx 500 Index Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Active Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Balanced Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Bank & Thrift Opportunity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Biotechnology Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Xxxx Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx California Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Xxxx Reserve, Inc.
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Communications Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Consumer Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Dividend Performers Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx European Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Financial Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Financial Trends, Inc.
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Focused Relative Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Focused Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Fundamental Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Global Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Government Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Growth Trends Fund (add Class I eff 11/15/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Health Sciences Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Yield Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Yield Tax-Free Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Income Securities Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Balanced Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Diversified Core Equity Fund II
(terminate Class P 9/13/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Medium Capitalization Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Intermediate Government Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Investors Trust
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Large Cap Growth Fund
--------------------------------------------------------------------------------
N/A Xxxx Xxxxxxx Large Cap Spectrum Fund (eff (9/24/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Large Cap Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Massachusetts Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Medium Capitalization Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Mid Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Money Market Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Multi-Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx New York Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Pacific Basin Equities Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Global Dividend Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Preferred Dividend Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Premium Dividend Fund I
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Premium Dividend Fund II
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Select Dividend Trust
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Real Estate Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Regional Bank Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Cap Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Capitalization Value Fund (name change
eff 9/30/01 to Xxxx Xxxxxxx Small Cap Equity Fund)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Sovereign Investors Fund
--------------------------------------------------------------------------------
N/A Xxxx Xxxxxxx Strategic Growth Fund (eff 12/01/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Strategic Income Fund
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Tax-Free Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Technology Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx U.S. Government Cash Reserve
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx U.S. Global Leaders Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Financial Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. High Yield Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Regional Bank Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Relative Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Sovereign Investors Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Strategic Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Technology Fund
--------------------------------------------------------------------------------
Agreement/custodian/BNYScheduleII
FUND ACCOUNTING AGREEMENT
-------------------------
AGREEMENT made as of this 10th day of September, 2001 by and between
each Xxxx Xxxxxxx Fund listed on Schedule II, each either a business trust
organized and existing under the laws of The Commonwealth of Massachusetts or a
Maryland corporation organized and existing under the laws of the state of
Maryland, having its principal place of business at 000 Xxxxxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000 (each a "Fund") and The Bank of New York, a New York
corporation authorized to do a banking business, having its principal place of
business at Xxx Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (hereinafter called the
"Bank").
W I T N E S S E T H:
- - - - - - - - - -
In consideration of the mutual agreements herein contained, the Fund
and the Bank hereby agree as follows:
1. The Fund hereby appoints the Bank to perform the duties hereinafter
set forth.
2. The Bank hereby accepts appointment and agrees to perform the duties
hereinafter set forth.
3. Subject to the provisions of paragraphs 4 and 5 below, the Bank
shall compute the net asset value per share of each Fund listed on Schedule II
and shall value the securities held by the Fund (the "Securities") at such times
and dates and in the manner specified in the then currently effective Prospectus
of the Fund.
4. To the extent valuation of Securities or computation of a Fund's net
asset value as specified in the Fund's then currently effective Prospectus is at
any time inconsistent with any applicable laws or regulations, the Fund shall
immediately so notify the Bank in writing and thereafter shall either furnish
the Bank at all appropriate times with the values of such Securities and each
Fund's net asset value, or subject to the prior approval of the Bank, instruct
the Bank in writing to value Securities and compute each Fund's net asset value
in a manner which the Fund then represents in writing to be consistent with all
applicable laws and regulations. The Fund may also from time to time, subject to
the prior approval of the Bank, instruct the Bank in writing to compute the
value of the Securities or a Fund's net asset value in a manner other than as
specified in paragraph 3 of this Agreement. By giving such instruction, the Fund
shall be deemed to have represented that such instruction is consistent with all
applicable laws and regulations and the then currently effective Prospectus of
the Fund. The Fund shall have sole responsibility for determining the method of
valuation of Securities and the method of computing each Fund's net asset value.
5. The Fund shall furnish the Bank with any and all instructions,
explanations, information, specifications and documentation deemed necessary by
the Bank in the performance of its duties hereunder, including, without
limitation, the amounts or written formula for calculating the amounts and times
of accrual of Fund liabilities and expenses. The Bank shall not be required to
include as Fund liabilities and expenses, nor as a reduction of net asset value,
any accrual for any federal, state, or foreign income taxes unless the Fund
shall have specified to the Bank the precise amount of the same to be included
in liabilities and expenses or used to reduce net asset value. The Fund shall
also furnish the Bank with bid, offer, or market values of Securities if the
Bank notifies the Fund that same are not available to the Bank from a security
pricing or similar service utilized, or subscribed to, by the Bank which the
Bank in its judgment deems reliable at the time such information is required for
calculations hereunder. At any time and from time to time, the Fund also may
furnish the Bank with bid, offer, or market values of Securities and instruct
the Bank to use such information in its calculations hereunder.
6. The Bank as Fund Accounting agent shall advise the Fund and the
Fund's transfer agent of the Fund's net asset value upon completion of the
computations required to be made by the Bank pursuant to this Agreement.
2
7. The Bank shall, as agent for the Fund, maintain and keep current the
books, accounts and other documents, if any, listed in Appendix A hereto and
made a part hereof, as such Appendix A may be amended from time to time, and
preserve any such books, accounts and other documents in accordance with the
applicable provisions of Rule 31a-2 of the General Rules and Regulations under
the Investment Company Act of 1940, as amended (the "Rules"). Such books,
accounts and other documents shall be made available upon reasonable request for
inspection by officers, employees and auditors of the Fund.
8. All records maintained and preserved by the Bank pursuant to this
Agreement which the Fund is required to maintain and preserve in accordance with
the above-mentioned Rules shall be and remain the property of the Fund and shall
be surrendered to the Fund promptly upon request in the that the Fund requests.
Upon reasonable request of the Fund, the Bank shall provide in hard copy, on
micro-film or electronically, whichever the Fund shall elect, any records
included in any such delivery.
9. The Bank, in performing the services required of it under the terms
of this Agreement, shall be entitled to rely fully on the accuracy and validity
of any and all instructions, explanations, information, specifications and
documentation furnished to it by the Fund and shall have no duty or obligation
to review the accuracy, validity or propriety of such instructions,
explanations, information, specifications or documentation, including, without
limitation, evaluations of Securities; the amounts or formula for calculating
the amounts and times of accrual of Fund's liabilities and expenses; the amounts
receivable and the amounts payable on the sale or purchase of Securities; and
amounts receivable or amounts payable for the sale or redemption of Fund shares
effected by or on behalf of the Fund. In the event the Bank's computations
hereunder rely, in whole or in part, upon information, including, without
limitation, bid, offer or market values of Securities or other assets, or
accruals of interest or earnings thereon, from a pricing or similar service
utilized, or subscribed to, by the Bank which the Bank in its judgment deems
reliable, the Bank shall not be responsible for, deemed to make any assurances
with respect to, nor under any duty to inquire into, the accuracy and
completeness of such information, except that if any such information contains
manifest error, the Bank shall in accordance with its then standard practices
attempt to have such manifest error corrected, and shall notify the Fund if such
attempt is unsuccessful.
3
10. The Bank shall not be required to inquire into any valuation of
Securities or other assets by the Fund or any third party described in preceding
paragraph 9 hereof, even though the Bank in performing services similar to the
services provided pursuant to this Agreement for others may receive different
valuations of the same or different securities of the same issuers.
11. The Bank, in performing the services required of it under the terms
of this Agreement, shall not be responsible for determining whether any interest
accruable to the Fund is or will be actually paid, but will accrue such interest
until otherwise instructed by the Fund.
12. The Bank shall not be responsible for delays or errors which occur
by reason of circumstances beyond its control in the performance of its duties
under this Agreement, including, without limitation, mechanical breakdowns,
flood or catastrophe, acts of God, failures of transportation, communication or
power supply, or other similar circumstances. Nor shall the Bank be responsible
for delays or failures to supply the information or services specified in this
Agreement where such delays or failures are caused by the failure of any
person(s) other than the Bank to supply any instructions, explanations,
information, specifications or documentation deemed necessary by the Bank in the
performance of its duties under this Agreement.
13. No provision of this Agreement shall prevent the Bank from offering
services similar or identical to those covered by this Agreement to any other
corporations, associations or entities of any kind. Any and all operational
procedures, techniques and devices developed by the Bank in connection with the
performance of its duties and obligations under this Agreement, including those
developed in conjunction with the Fund, shall be and remain the property of the
Bank, and the Bank shall be free to employ such procedures, techniques and
devices in connection with the performance of any other contract with any other
person whether or not such contract is similar or identical to this Agreement.
4
14. The Bank may, with respect to questions of law, apply to and obtain
the advice and opinion of counsel to the Fund or its own counsel and shall be
entitled to rely on the advice or opinion of such counsel.
15. The Bank shall be entitled to rely upon any oral instructions
received by the Bank and reasonably believed by the Bank to be given by or on
behalf of the Fund, unless the Bank subsequently receives written instructions
contradicting such oral instructions.
16. Notwithstanding any other provision contained in this Agreement,
the Bank shall have no duty or obligation with respect to, including, without
limitation, any duty or obligation to determine, or advise or notify the Fund
of: (a) the taxable nature of any distribution or amount received or deemed
received by, or payable to, the Fund; (b) the taxable nature or effect on the
Fund or its shareholders of any corporate actions, class actions, tax reclaims,
tax refunds, or similar events; (c) the taxable nature or taxable amount of any
distribution or dividend paid, payable or deemed paid, by the Fund to its
shareholders; or (d) the effect under any federal, state, or foreign income tax
laws of the Fund making or not making any distribution or dividend payment, or
any election with respect thereto.
17. The Bank shall not be liable for any loss, damage or expense
resulting from, arising out of, or in connection with its performance hereunder,
including its actions or omissions, the incompleteness or inaccuracy of any
specifications or other information furnished by the Fund, or for delays caused
by circumstances beyond the Bank's control, unless such loss, damage or expense
arises out of the negligence or willful misconduct of the Bank. In no event
shall the Bank be liable for special, indirect, or consequential damages, or for
lost profits or loss of business, arising under or in connection with this
Agreement, even if previously informed of the possibility of such damages and
regardless of the form of action. For purposes of this provision, if as a result
of the negligence or willful misconduct of the Bank there is a material error in
the net asset value per share of the Fund, the material losses of the Fund on
the sale and issuance, or the redemption, of its shares attributable to such
material error shall be direct money damages.
5
18. Without limiting the generality of the foregoing, (i) the Bank
shall indemnify the Fund against any loss, damage or expense, including
reasonable counsel fees and other costs and expenses of a defense against any
claim or liability, arising out of the negligence or willful misconduct of the
Bank, except that in no event shall the Bank be liable for special, indirect, or
consequential damages, or for lost profits or loss of business, and (ii) the
Fund shall indemnify the Bank against any loss, damage or expense, including
reasonable counsel fees and other costs and expenses of a defense against any
claim or liability, arising from any one or more of the following, except that
in no event shall the Fund be liable for special, indirect, or consequential
damages, or for lost profits or loss of business:
(a) Errors in records or instructions, explanations, information,
specifications or documentation of any kind, as the case may be, supplied to the
Bank by the Fund, or, subject to the provisions of paragraph 9, by a pricing or
similar service which the Bank in its judgment deems reliable;
(b) Action or inaction taken or omitted to be taken by the Bank
pursuant to written or oral instructions of the Fund without negligence or
willful misconduct;
(c) Any action taken or omitted to be taken by the Bank in good faith
and with notice to the Fund, in accordance with the advice or opinion of counsel
for the Fund or Bank counsel;
(d) Any improper use by the Fund or its agents, distributor or
investment advisor of any valuations or computations supplied by the Bank
pursuant to this Agreement;
6
(e) The method of valuation of the Securities and the method of
computing each Fund's net asset value; or
(f) Any valuations of Securities or net asset value provided by the
Fund.
19. In consideration for all of the services to be performed by the
Bank as set forth herein the Bank shall be entitled to receive reimbursement for
all out-of-pocket expenses and such compensation as may be agreed upon in
writing from time to time between the Bank and the Fund.
20. Attached hereto as Appendix B is a list of persons duly authorized
by the Fund's Declaration of Trust and By-Laws to execute this Agreement and
give any written, electronic or oral instructions, or written, electronic or
oral specifications, by or on behalf of the Fund. From time to time the Fund may
deliver a new Appendix B to add or delete any person and the Bank shall be
entitled to rely on the last Appendix B actually received by the Bank.
21. The Fund represents and warrants to the Bank that it has all
requisite power to execute and deliver this Agreement, to give any written,
electronic or oral instructions contemplated hereby, and to perform the actions
or obligations contemplated to be performed by it hereunder, and has taken all
necessary action to authorize such execution, delivery, and performance.
22. This Agreement shall not be assignable by the Fund without the
prior written consent of the Bank, or by the Bank without the prior written
consent of the Fund, which consents shall not be unreasonably withheld.
23. Either of the parties hereto may terminate this Agreement by giving
the other party a notice in writing specifying the date of such termination,
which shall not be less than sixty (60) days after the date of giving of such
notice. Upon the date set forth in such notice, the Bank shall deliver to the
Fund all its records.
7
24. This Agreement may not be amended or modified in any manner except
by written agreement executed by both parties hereto.
25. This Agreement shall be construed in accordance with the
substantive laws of The Commonwealth of Massachusetts without regard to
conflicts of laws principals. The Fund and the Bank each hereby irrevocably
waives any and all rights to trial by jury in any legal proceeding arising out
of or relating to this Agreement.
26. The performance and provisions of this Agreement are intended to
benefit only the Bank and the Fund, and no rights shall be granted to any other
person by virtue of this Agreement.
27. The Fund and the Bank agree that the obligations of each Fund are
not binding upon any of the Trustees/Directors, officers or shareholders of the
Fund individually, but are binding only upon that Fund and its assets. Each Fund
shall be severally, not jointly, liable for its own obligations under this
Agreement.
8
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.
Each Xxxx Xxxxxxx Fund listed on Schedule II
By: /s/Xxxxxxx X. Xxxxx, SVP & CFO
------------------------------
Attest:
/s/Xxxx X. Xxxxxx
-----------------
THE BANK OF NEW YORK
By: /s/Xxxxx X. Xxxxxxx, SVP
------------------------
Attest:
/s/Xxxx X. Xxxxxx
-----------------
9
APPENDIX A TO FUND ACCOUNTING AGREEMENT
BETWEEN
THE BANK OF NEW YORK
AND
The Xxxx Xxxxxxx Funds listed on Schedule II
I._______The Bank of New York (the "Bank"), as agent for each Xxxx
Xxxxxxx Fund listed on Schedule II (each a "Fund"), shall maintain the following
records on a daily basis for each Fund.
1. Report of priced portfolio securities
2. Statement of net asset value per share
II. The Bank shall maintain the following records on a monthly basis
for each Fund:
1. General Ledger
2. General Journal
3. Cash Receipts Journal
4. Cash Disbursements Journal
5. Subscriptions Journal
6. Redemptions Journal
7. Accounts Receivable Reports
8. Accounts Payable Reports
9. Open Subscriptions/Redemption Reports
10. Transaction (Securities) Journal
11. Broker Net Trades Reports
III. The Bank shall prepare a Holdings Ledger on a quarterly basis, and
a Buy-Sell Ledger (Broker's Ledger) on a semiannual basis for each Fund.
Schedule D shall be produced on an annual basis for each Fund.
The above reports may be printed according to any other required
frequency to meet the requirements of the Internal Revenue Service, the
Securities and Exchange Commission and the Fund's Auditors.
IV. For internal control purposes, the Bank uses the Account Journals
produced by The Bank of New York Custody System to record daily settlements of
the following for each Fund:
1. Securities bought
2. Securities sold
3. Interest received
4. Dividends received
5. Capital stock sold
6. Capital stock redeemed
7. Other income and expenses
All portfolio purchases for the Fund are recorded to reflect expected
maturity value and total cost including any prepaid interest.
2
SCHEDULE II
Xxxx Xxxxxxx Funds
(As of September 10, 2001)
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx 500 Index Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Active Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Balanced Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Bank & Thrift Opportunity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Biotechnology Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Xxxx Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx California Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Xxxx Reserve, Inc.
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Communications Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Consumer Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Dividend Performers Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx European Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Financial Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Financial Trends, Inc.
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Focused Relative Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Focused Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Fundamental Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Global Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Government Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Growth Trends Fund (add Class I eff 11/15/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Health Sciences Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Yield Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Yield Tax-Free Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Income Securities Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Balanced Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Diversified Core Equity Fund II
(terminate Class P 9/13/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Medium Capitalization Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Intermediate Government Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Investors Trust
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Large Cap Growth Fund
--------------------------------------------------------------------------------
N/A Xxxx Xxxxxxx Large Cap Spectrum Fund (eff (9/24/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Large Cap Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Massachusetts Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Medium Capitalization Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Mid Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Money Market Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Multi-Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx New York Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Pacific Basin Equities Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Global Dividend Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Preferred Dividend Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Premium Dividend Fund I
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Premium Dividend Fund II
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Select Dividend Trust
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Real Estate Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Regional Bank Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Cap Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Capitalization Value Fund (name change
eff 9/30/01 to Xxxx Xxxxxxx Small Cap Equity Fund)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Sovereign Investors Fund
--------------------------------------------------------------------------------
N/A Xxxx Xxxxxxx Strategic Growth Fund (eff 12/01/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Strategic Income Fund
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Tax-Free Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Technology Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx U.S. Government Cash Reserve
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx U.S. Global Leaders Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Financial Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. High Yield Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Regional Bank Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Relative Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Sovereign Investors Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Strategic Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Technology Fund
--------------------------------------------------------------------------------
Agreement/custodian/BNYScheduleII
APPENDIX B
I, Xxxxxxx X. Xxxx, Treasurer, of each Xxxx Xxxxxxx Fund listed on
Schedule II, (each a "Fund"), do hereby certify that:
The following individuals serve in the following positions with the
Fund, and each has been duly elected or appointed by the Board of Trustees of
the Fund to each such position and qualified therefor in conformity with the
Fund's Declaration of Trust and By-Laws, and the signatures set forth opposite
their respective names are their true and correct signatures. Each such person
is authorized to give written or oral instructions or written or oral
specifications by or on behalf of the Fund to the Bank.
Xxxxxxx X. Xxxx Treasurer /s/Xxxxxxx X. Xxxx
--------------- --------- ------------------
Name Position Signature
Xxxxxx X. Xxxxxx Associate Treasurer /s/Xxxxxx X. Xxxxxx
---------------- ------------------- -------------------
Name Position Signature
Xxxxxxx X. Xxxxx Associate Treasurer /s/Xxxxxxx X. Xxxxx
---------------- ------------------- -------------------
Name Position Signature
Xxxxxx X. Xxxx Assistant Treasurer /s/Xxxxxx X. Xxxx
------------------ ------------------- -----------------
Name Position Signature
Xxxx X. XxXxxxxxx Assistant Treasurer /s/Xxxx X. XxXxxxxxx
----------------- ------------------- --------------------
Name Position Signature
Xxxxxx X. Xxxxxxxx Assistant Treasurer /s/Xxxxxx X. Xxxxxxxx
------------------ ------------------- ---------------------
Name Position Signature
S:\general\funds\authorizedsignersfundmoney
FOREIGN CUSTODY MANAGER AGREEMENT
AGREEMENT made as of September 10, 2001 between each Xxxx Xxxxxxx Fund
listed on Schedule II (each a "Fund") and The Bank of New York ("BNY").
W I T N E S S E T H:
WHEREAS, the Fund desires to appoint BNY as a Foreign Custody Manager
on the terms and conditions contained herein;
WHEREAS, BNY desires to serve as a Foreign Custody Manager and perform
the duties set forth herein on the terms and conditions contained herein;
NOW THEREFORE, in consideration of the mutual promises hereinafter
contained in this Agreement, the Fund and BNY hereby agree as follows:
ARTICLE I.
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
1. "Board" shall mean the board of directors or board of trustees, as
the case may be, of the Fund.
2. "Eligible Foreign Custodian" shall have the meaning provided in the
Rule.
3. "Monitoring System" shall mean a system established by BNY to
fulfill the Responsibilities specified in clauses (d) and (e) of Section 1 of
Article III of this Agreement.
4. "Responsibilities" shall mean the responsibilities delegated to BNY
under the Rule as a Foreign Custody Manager with respect to each Specified
Country and each Eligible Foreign Custodian selected by BNY, as such
responsibilities are more fully described in Article III of this Agreement.
5. "Rule" shall mean Rule 17f-5 under the Investment Company Act of
1940, as amended (the "1940 Act"). Specific references to Sections of the Rule
(or of Rule 17f-7) in this Agreement shall mean those Sections as in effect as
of the date of this Agreement.
6. "Risk Analysis" shall mean the analysis required under Rule
17f-7(a)(1)(A) under the 0000 Xxx.
7. "Securities Depository" shall mean a system for the central handling
of securities as defined in Rule 17f-4 under the 0000 Xxx.
8. "Specified Country" shall mean each country listed on Schedule I
attached hereto and each country, other than the United States, constituting the
primary market for a security with respect to which the Fund has given
settlement instructions to The Bank of New York as custodian (the "Custodian")
under its Custody Agreement with the Fund. BNY agrees to notify immediately the
Fund and the Fund's investment adviser if, at any time, BNY believes that it
cannot perform, in accordance with the foregoing standard of care, its duties
hereunder with respect to any Eligible Foreign Custodian.
ARTICLE II.
BNY AS A FOREIGN CUSTODY MANAGER
1. The Fund on behalf of its Board hereby delegates to BNY with respect
to each Specified Country the Responsibilities.
2. BNY accepts the Board's delegation of Responsibilities with respect
to each Specified Country and agrees in performing the Responsibilities as a
Foreign Custody Manager to exercise reasonable care, prudence and diligence such
as a person having responsibility for the safekeeping of the Fund's assets would
exercise.
3. BNY shall provide to the Board at least annually and at such other
times as the Board deems reasonable and appropriate based on the circumstances
of the Fund's foreign custody arrangements written reports, which shall include
the following:
(a) Information relating to Eligible Foreign Custodians. Such written reports
shall include a list of all Eligible Foreign Custodians with which assets of the
Fund are maintained, and notification of any material changes in the
arrangements with such Eligible Foreign Custodians (including without
limitation, adding a new Eligible Foreign Custodian, replacing an Eligible
Foreign Custodian, changes in the capital structure of an existing Eligible
Foreign Custodian and changes in the contract governing an arrangement with an
Eligible Foreign Custodian).
(b) Information relating to Securities Depositories. Such written report shall
include a Risk Analysis with respect to each Securities Depository in each
Specified Country. If a new Securities Depository commences operations in a
Specified Country (or in the case of a new Specified Country), BNY shall
promptly notify the Board and the Fund's investment adviser of such commencement
and shall provide a Risk Analysis for such Securities Depository (or in the case
of a new Specified Country, all Securities Depositories in such country) as soon
as reasonably practicable after such Securities Depository becomes operational
(or in the case of a new Specified Country, after such country becomes a
Specified Country) but in any event prior to maintaining a Fund's assets with
such Securities Depository. BNY shall also include in such written report a
representation that each Securities Depository in which the Fund maintains
assets is an "Eligible Foreign Custodian" as defined in Rule 17f-7 under the
1940 Act.
(c) Information relating to Country Risk. Notwithstanding anything to the
contrary in this Agreement or in the Custody Agreement between the Fund and BNY,
with respect to each Specified Country, BNY shall promptly provide to the Board
and to the Fund's investment adviser such information with respect to Country
Risk (as defined in Section 2 of Article III hereof) as may be sent to, and
received by, BNY from any Eligible Foreign Custodian.
ARTICLE III.
RESPONSIBILITIES
1. Subject to the provisions of this Agreement, BNY shall with respect
to each Specified Country select an Eligible Foreign Custodian. In connection
therewith, BNY shall: (a) determine that assets of the Fund held by such
Eligible Foreign Custodian will be subject to reasonable care, based on the
standards applicable to custodians in the relevant market in which such Eligible
Foreign Custodian operates, after considering all factors relevant to the
safekeeping of such assets, including, without limitation, those contained in
paragraph (c)(1) of the Rule; (b) determine that the Fund's foreign custody
arrangements with each Eligible Foreign Custodian are governed by a written
contract with the Custodian which will provide reasonable care for the Fund's
assets based on the standards specified in paragraph (c)(1) of the Rule; (c)
determine that each contract with an Eligible Foreign Custodian shall include
the provisions specified in paragraph (c)(2)(i)(A) through (F) of the Rule or,
alternatively, in lieu of any or all of such (c)(2)(i)(A) through (F)
provisions, such other provisions as BNY determines will provide, in their
entirety, the same or a greater level of care and protection for the assets of
the Fund as such specified provisions; (d) monitor pursuant to the Monitoring
System the appropriateness of maintaining the assets of the Fund with a
particular Eligible Foreign Custodian pursuant to paragraph (c)(1) of the Rule
and the performance of the contract governing such arrangement; and (e) advise
the Fund whenever BNY determines under the Monitoring System that an arrangement
(including, any material change in the contract governing such arrangement)
described in preceding clause (d) no longer meets the requirements of the Rule.
2. For purposes of clause (d) of preceding Section 1 of this Article,
BNY's determination of appropriateness shall not include, nor be deemed to
include, any evaluation of Country Risks associated with investment in a
particular country. For purposes hereof, "Country Risks" shall mean systemic
risks of holding assets in a particular country including but not limited to (a)
an Eligible Foreign Custodian's use of any depositories that act as or operate a
system or a transnational system for the central handling of securities or any
equivalent book-entries; (b) such country's financial infrastructure; (c) such
country's prevailing custody and settlement practices; (d) nationalization,
expropriation or other governmental actions; (e) regulation of the banking or
securities industry; (f) currency controls, restrictions, devaluations or
fluctuations; and (g) market conditions which affect the orderly execution of
securities transactions or affect the value of securities.
ARTICLE IV.
REPRESENTATIONS
1. The Fund hereby represents that this Agreement has been duly
authorized, executed and delivered by the Fund, constitutes a valid and legally
binding obligation of the Fund enforceable in accordance with its terms, and no
statute, regulation, rule, order, judgment or contract binding on the Fund
prohibits the Fund's execution or performance of this Agreement; and this
Agreement has been approved by the Board at a meeting duly called and at which a
quorum was at all times present.
2. BNY hereby represents that: (a) BNY is duly organized and existing
under the laws of the State of New York, with full power to carry on its
businesses as now conducted, and to enter into this Agreement and to perform its
obligations hereunder; (b) this Agreement has been duly authorized, executed and
delivered by BNY, constitutes a valid and legally binding obligation of BNY
enforceable in accordance with its terms, and no statute, regulation, rule,
order, judgment or contract binding on BNY prohibits BNY's execution or
performance of this Agreement; and (c) BNY has established the Monitoring
System.
ARTICLE V.
CONCERNING BNY
1. BNY shall not be liable for any costs, expenses, damages,
liabilities or claims, including attorneys' and accountants' fees, sustained or
incurred by, or asserted against, the Fund except to the extent the same arises
out of the failure of BNY to exercise the care, prudence and diligence required
by Section 2 of Article II hereof. In no event shall BNY be liable to the Fund,
the Board, or any third party for special, indirect or consequential damages, or
for lost profits or loss of business, arising in connection with this Agreement.
2. The Fund shall indemnify BNY and hold it harmless from and against
any and all costs, expenses, damages, liabilities or claims, including
attorneys' and accountants' fees, sustained or incurred by, or asserted against,
BNY by reason or as a result of any action or inaction, or arising out of BNY's
performance hereunder, provided that the Fund shall not indemnify BNY to the
extent any such costs, expenses, damages, liabilities or claims arises out of
BNY's failure to exercise the reasonable care, prudence and diligence required
by Section 2 of Article II hereof. In no event shall the Fund be liable to BNY
for any special, indirect or consequential damages, or for lost profits or loss
of business, arising in connection with this Agreement. BNY shall indemnify the
Fund and hold it harmless from and against any and all costs, expenses, damages,
liabilities or claims, including attorneys' and accountants' fees, sustained or
incurred by, or asserted against, the Fund by reason or as a result of BNY's
failure to exercise the reasonable care, prudence and diligence required by
Section 2 of Article II hereof; provided, however, that BNY shall not be liable
to the Fund for any special, indirect or consequential damages, or for lost
profits or loss of business, arising in connection with this Agreement.
3. For its services hereunder, the Fund agrees to pay to BNY such
compensation and out-of-pocket expenses as shall be mutually agreed.
4. BNY shall have only such duties as are expressly set forth herein.
In no event shall BNY be liable for any Country Risks associated with
investments in a particular country, except that BNY shall timely forward such
information with respect to Country Risk, if any, as may have been sent to, and
received by, BNY from any Eligible Foreign Custodian.
ARTICLE VI.
MISCELLANEOUS
1. This Agreement sets forth BNY's duties with respect to, among other
things, the selection of Foreign Custodians, the administration of contracts
with Foreign Custodians, the addition and deletion of Foreign Custodians, the
issuance of reports in connection with such duties, the monitoring of such
duties, and the supplying of information with respect to Country Risk. The terms
of the Custody Agreement between the Fund and BNY, as amended from time to time,
shall apply generally as to matters not expressly covered in this Agreement,
including dealings with the Foreign Custodians in the course of discharge of
BNY's obligations under the Custody Agreement. The terms of this Agreement shall
control to the extent of any conflicts between this Agreement and the Custody
Agreement. Except as set forth in this Article, nothing in this Agreement shall
affect the obligations of the parties hereto under any other agreement.
2. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to BNY, shall be sufficiently given if received by it
at its offices at 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at
such other place as BNY may from time to time designate in writing.
3. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Fund shall be sufficiently given if received
by it at its offices at 000 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or
at such other place as the Fund may from time to time designate in writing.
4. In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
thereby. This Agreement may not be amended or modified in any manner except by a
written agreement executed by both parties. This Agreement shall extend to and
shall be binding upon the parties hereto, and their respective successors and
assigns; provided however, that this Agreement shall not be assignable by either
party without the written consent of the other, which consent shall not be
unreasonably withheld.
5. If at any time BNY shall be a party to an agreement to serve as a
Foreign Custody Manager to an investment company that provides for either (i) a
standard of care with respect to the selection of Foreign Custodians in any
jurisdiction higher than that set forth in Article I of this Agreement or (ii) a
standard of care with respect to BNY exercising its duties as Foreign Custody
Manager in any jurisdiction or with regard to its responsibilities under Rule
17f-7 higher than those set forth in Article II, Section 2 of this Agreement,
BNY agrees to notify the Fund of this fact and to raise the applicable standard
of care hereunder in the applicable jurisdiction to the standard specified in
such other agreement.
6. The Fund and BNY agree that the obligations of each Fund are not
binding upon the Trustees/Directors, officers or shareholders of the Fund
individually, but are binding only upon that Fund and its assets. Each Fund
shall be severally, not jointly, liable for its own obligations under this
agreement.
This Agreement shall be construed in accordance with the substantive laws of The
Commonwealth of Massachusetts, without regard to conflicts of laws principles
thereof. The Fund and BNY each hereby irrevocably waives any and all rights to
trial by jury in any legal proceeding arising out of or relating to this
Agreement.
The parties hereto agree that in performing hereunder, BNY is acting solely on
behalf of the Fund and no contractual or service relationship shall be deemed to
be established hereby between BNY and any other person by reason of this
Agreement.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
This Agreement shall terminate simultaneously with the termination of the
Custody Agreement between the Fund and the Custodian, and may otherwise be
terminated by either party giving to the other party a notice in writing
specifying the date of such termination, which shall be not less than thirty
(30) days after the date of such notice.
IN WITNESS WHEREOF, the Fund and BNY have caused this Agreement to be
executed by their respective officers, thereunto duly authorized, as of the date
first above written.
Each Xxxx Xxxxxxx Fund listed on Schedule II
By:/s/Xxxxxxx X. Xxxxx
-------------------
Title: Senior Vice President & CFO
THE BANK OF NEW YORK
By:/s/Xxxxx X. Xxxxxxx
-------------------
Title: Senior Vice President
SCHEDULE I
Date: July 23, 2001
To: International Markets Committee
From: Xxx Xxxxxxx
Re: Approved Country Listing - Funds
--------------------------------------------------------------------------------
SIPC and the International Market Committee have approved the following
countries for investments by Xxxx Xxxxxxx funds:
Xxxxxxxxx Xxxxxx
Xxxxxxxxx Xxxx Xxxx Xxxx
Xxxxxxx Hungary Philippines
Bangladesh Iceland Poland
Belgium India Portugal
Bermuda Indonesia Romania
Brazil Ireland Russia*
Botswana Israel Singapore
Bulgaria ** Italy Slovak Republic
Canada Japan South Africa
Chile Kenya Spain
China Korea Sweden
Columbia Latvia Switzerland
Costa Rica Lithuania Taiwan
Croatia Luxembourg Thailand
Czech Republic Malaysia Turkey
Denmark Mauritius United Kingdom
Egypt ** Mexico United States
Estonia Netherlands Venezuela
Finland New Zealand Zimbabwe
France Norway
Germany Panama
Ghana Pakistan
* Please note that Russia is restricted to Sovereign Russian and municipal fixed
income securities only and these investments are further restricted to only
certain fixed income accounts. Please consult Operations or Legal for detailed
listing.
Investments in other countries (including ADR & GDR vehicles) are not permitted
-------------------------------------------------------------------------------
without prior approval from the International Markets Committee.
----------------------------------------------------------------
** Addition since 1/1/01
Cc: Xxxxxxx Xxxxx Asset Management
Xxxxxxxx Xxxxxxxxx
American Fund Advisers
SCHEDULE II
Xxxx Xxxxxxx Funds
(As of September 10, 2001)
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx 500 Index Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Active Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Balanced Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Bank & Thrift Opportunity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Biotechnology Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Xxxx Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx California Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Xxxx Reserve, Inc.
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Communications Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Consumer Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Core Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Dividend Performers Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx European Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Financial Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Financial Trends, Inc.
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Focused Relative Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Focused Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Fundamental Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Global Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Government Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Growth Trends Fund (add Class I eff 11/15/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Health Sciences Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Yield Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx High Yield Tax-Free Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Income Securities Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Balanced Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Diversified Core Equity Fund II
(terminate Class P 9/13/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Independence Medium Capitalization Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Intermediate Government Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Equity Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx International Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Investors Trust
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Large Cap Growth Fund
--------------------------------------------------------------------------------
N/A Xxxx Xxxxxxx Large Cap Spectrum Fund (eff (9/24/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Large Cap Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Massachusetts Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Medium Capitalization Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Mid Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Money Market Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Multi-Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx New York Tax-Free Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Pacific Basin Equities Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Global Dividend Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Preferred Dividend Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Premium Dividend Fund I
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Premium Dividend Fund II
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Patriot Select Dividend Trust
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Real Estate Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Regional Bank Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Cap Growth Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Cap Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Small Capitalization Value Fund (name change
eff 9/30/01 to Xxxx Xxxxxxx Small Cap Equity Fund)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Sovereign Investors Fund
--------------------------------------------------------------------------------
N/A Xxxx Xxxxxxx Strategic Growth Fund (eff 12/01/01)
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Strategic Income Fund
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EIN Name
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Tax-Free Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx Technology Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx U.S. Government Cash Reserve
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx U.S. Global Leaders Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Financial Industries Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. High Yield Bond Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Regional Bank Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Relative Value Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Sovereign Investors Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Strategic Income Fund
--------------------------------------------------------------------------------
00-0000000 Xxxx Xxxxxxx V.A. Technology Fund
--------------------------------------------------------------------------------
Agreement/custodian/BNYScheduleII
APPENDIX A
SUB-CUSTODIAN INDEMNIFICATION POLICY
----------------------------- -------------- ----------------- -----------------------------------------------------
Market A B Sub-Custodian
----------------------------- -------------- ----------------- -----------------------------------------------------
Argentina X Banco Rio de la Plata
----------------------------- -------------- ----------------- -----------------------------------------------------
Australia X National Australia Bank Ltd.
X Commonwealth Bank of Australia
----------------------------- -------------- ----------------- -----------------------------------------------------
Austria X Bank Austria AG
----------------------------- -------------- ----------------- -----------------------------------------------------
Bahrain X HSBC Bank Middle East
----------------------------- -------------- ----------------- -----------------------------------------------------
Bangladesh X Standard Chartered Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
Belgium X Banque Bruxelles Xxxxxxx
----------------------------- -------------- ----------------- -----------------------------------------------------
Benin X Societe Generale de Banques en Cote d'Ivoire
----------------------------- -------------- ----------------- -----------------------------------------------------
Bermuda X Bank of Bermuda Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Bolivia X Citibank
----------------------------- -------------- ----------------- -----------------------------------------------------
Botswana X Barclays Bank of Botswana Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Brazil X Bank Boston
----------------------------- -------------- ----------------- -----------------------------------------------------
Bulgaria X ING Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
Burkina Faso X Societe Generale de Banques en Cote d'Ivoire
----------------------------- -------------- ----------------- -----------------------------------------------------
Canada X Royal Bank of Canada
----------------------------- -------------- ----------------- -----------------------------------------------------
Chile X Bank Boston N.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
China X Standard Chartered Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
Colombia X Cititrust Colombia, S.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
Costa Rica X Banco BCT
----------------------------- -------------- ----------------- -----------------------------------------------------
Croatia X Privredna Banka Zqgreb d.d.
----------------------------- -------------- ----------------- -----------------------------------------------------
Cyprus X Bank of Cyprus
----------------------------- -------------- ----------------- -----------------------------------------------------
Czech Republic X Ceskoslovenska Obchodni Banka, A.S.
----------------------------- -------------- ----------------- -----------------------------------------------------
Denmark X Den Danske Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
EASDAQ X Banque Bruxelles Xxxxxxx
----------------------------- -------------- ----------------- -----------------------------------------------------
Ecuador X Citibank, N.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
Egypt X Citibank, N.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
Estonia X Hansabank Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Euromarket - Cedel X Clearstream
Euroclear X Euroclear
----------------------------- -------------- ----------------- -----------------------------------------------------
Finland X Xxxxxx Bank plc
----------------------------- -------------- ----------------- -----------------------------------------------------
France X Paribas
----------------------------- -------------- ----------------- -----------------------------------------------------
Germany X Dresdner Bank AG
----------------------------- -------------- ----------------- -----------------------------------------------------
Ghana X Barclays Bank of Ghana Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Greece X Paribas
----------------------------- -------------- ----------------- -----------------------------------------------------
Guinea Bissau X Societe Generale de Banques en Cote d'Ivoire
----------------------------- -------------- ----------------- -----------------------------------------------------
Hong Kong X HSBC
----------------------------- -------------- ----------------- -----------------------------------------------------
Hungary X Citibank Budapest Rt.
----------------------------- -------------- ----------------- -----------------------------------------------------
Iceland X Landsbanki Islands
----------------------------- -------------- ----------------- -----------------------------------------------------
India X HSBC
X Deutsche Bank AG
----------------------------- -------------- ----------------- -----------------------------------------------------
Indonesia X HSBC
----------------------------- -------------- ----------------- -----------------------------------------------------
Ireland X Allied Irish Banks, plc
----------------------------- -------------- ----------------- -----------------------------------------------------
A= BNY will accept responsibility for negligence and wilful misconduct by the subcustodian.
B= BNY does not guarantee or indemnify but will provide "Pass-Through" for any situations.
APPENDIX A
SUB-CUSTODIAN INDEMNIFICATION POLICY
----------------------------- -------------- ----------------- -----------------------------------------------------
Market A B Sub-Custodian
----------------------------- -------------- ----------------- -----------------------------------------------------
Israel X Bank Leumi LE - Israel B.M.
----------------------------- -------------- ----------------- -----------------------------------------------------
Italy X Banca Commerciale Italiana
X Paribas
----------------------------- -------------- ----------------- -----------------------------------------------------
Ivory Coast X Societe Generale - Abidjan
----------------------------- -------------- ----------------- -----------------------------------------------------
Jamaica X CIBC Trust & Merchant Bank Jamaica Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Japan X The Fuji Bank Ltd.
X The Bank of Tokyo-Mitsubishi Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Jordan X HSBC Bank Middle East
----------------------------- -------------- ----------------- -----------------------------------------------------
Kazakhstan X ABN/AMRO
----------------------------- -------------- ----------------- -----------------------------------------------------
Kenya X Barclays Bank of Kenya Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Latvia X Hansabanka Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Lebanon X HSBC Bank Middle East
----------------------------- -------------- ----------------- -----------------------------------------------------
Lithuania X Vilniaus Bankas
----------------------------- -------------- ----------------- -----------------------------------------------------
Luxembourg X Banque et Caisse d'Espargne de l'Etat
----------------------------- -------------- ----------------- -----------------------------------------------------
Malaysia X HongKong Bank Malaysia Berhad
----------------------------- -------------- ----------------- -----------------------------------------------------
Mali X Societe Generale de Banques en Cote d'Ivoire
----------------------------- -------------- ----------------- -----------------------------------------------------
Malta X HSBC Bank Malta plc
----------------------------- -------------- ----------------- -----------------------------------------------------
Mauritius X HSBC
----------------------------- -------------- ----------------- -----------------------------------------------------
Mexico X Banco Nacional de Mexico
----------------------------- -------------- ----------------- -----------------------------------------------------
Morocco X Banque Commerciale du Maroc
----------------------------- -------------- ----------------- -----------------------------------------------------
Namibia X Stanbic Bank Namibia Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Netherlands X Mees Pierson
----------------------------- -------------- ----------------- -----------------------------------------------------
New Zealand X Australia & New Zealand Banking Group
----------------------------- -------------- ----------------- -----------------------------------------------------
Niger X Societe Generale de Banques en Cote d'Ivoire
----------------------------- -------------- ----------------- -----------------------------------------------------
Nigeria X Stanbic Merchant Bank Nigeria Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Norway X Den Norske Bank ASA
----------------------------- -------------- ----------------- -----------------------------------------------------
Oman X HSBC Bank Middle East
Pakistan X Standard Chartered Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
Panama X BankBoston, N.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
Peru X Citibank, N.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
Philippines X HSBC
----------------------------- -------------- ----------------- -----------------------------------------------------
Poland X Bank Handlowy W Warszawie S.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
Portugal X Banco Comercial Portugues
----------------------------- -------------- ----------------- -----------------------------------------------------
Romania X ING Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
Russia X Vneshtorgbank
X Credit Suisse First Boston AO
----------------------------- -------------- ----------------- -----------------------------------------------------
Senegal X Societe Generale de Banques en Cote d'Ivoire
----------------------------- -------------- ----------------- -----------------------------------------------------
Singapore X United Overseas Bank Ltd.
X The Development. Bank of Singapore Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Slovakia X Ceskoslovenska Obchodni Banka, AS
----------------------------- -------------- ----------------- -----------------------------------------------------
Slovenia X Bank Austria Creditanstalt d.d. Ljublijan
----------------------------- -------------- ----------------- -----------------------------------------------------
South Africa X Societe Generale Johannesburg
X The Standard Bank of South Africa Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
A= BNY will accept responsibility for negligence and wilful misconduct by the subcustodian.
B= BNY does not guarantee or indemnify but will provide "Pass-Through" for any situations.
APPENDIX A
SUB-CUSTODIAN INDEMNIFICATION POLICY
----------------------------- -------------- ----------------- -----------------------------------------------------
Market A B Sub-Custodian
----------------------------- -------------- ----------------- -----------------------------------------------------
South Korea X Standard Chartered Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
Spain X Banco Bilboa Vizcaya Argentaria S.A. (BBVA)
----------------------------- -------------- ----------------- -----------------------------------------------------
Sri Lanka X Standard Chartered Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
Swaziland X Stanbic Bank Swaziland Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Sweden X Skandinaviska Enskilda Banken
----------------------------- -------------- ----------------- -----------------------------------------------------
Switzerland X Credit Suisse First Boston
----------------------------- -------------- ----------------- -----------------------------------------------------
Taiwan X HSBC
----------------------------- -------------- ----------------- -----------------------------------------------------
Thailand X Standard Chartered Bank
X Bangkok Bank Public Company Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Togo X Societe Generale de Banques en Cote d'Ivoire
----------------------------- -------------- ----------------- -----------------------------------------------------
Trinidad & Tobago X Republic Bank Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Tunisia X Banque Internationale Arabe de Tunisie
----------------------------- -------------- ----------------- -----------------------------------------------------
Turkey X Osmanli Bankasi A.S.
----------------------------- -------------- ----------------- -----------------------------------------------------
Ukraine X ING Bank
----------------------------- -------------- ----------------- -----------------------------------------------------
United Kingdom NA NA The Bank of New York
X The Depository & Clearing Centre (DCC)
----------------------------- -------------- ----------------- -----------------------------------------------------
United States NA NA The Bank of New York
----------------------------- -------------- ----------------- -----------------------------------------------------
Uruguay X Bank Boston, N.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
Venezuela X Citibank, N.A.
----------------------------- -------------- ----------------- -----------------------------------------------------
Zambia X Barclays Bank of Zambia Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
Zimbabwe X Barclays Bank of Zimbabwe Ltd.
----------------------------- -------------- ----------------- -----------------------------------------------------
A= BNY will accept responsibility for negligence and wilful misconduct by the subcustodian.
B= BNY does not guarantee or indemnify but will provide "Pass-Through" for any situations.
Fee Schedule
for
XXXX XXXXXXX FUNDS Listed on Schedule II
----------------------------------------
DOMESTIC CUSTODY FEE SCHEDULE
1. Securities Settled and Safekept Within the United States.
The Bank of New York's fee for custody services for each account is as
follows:
Maintenance Charges
Asset Holding Annual Basis Points
--------------------------------------------------------------------------------
0 - $10 billion .25
Excess .15
Transaction Charges
Category Per Transaction
--------------------------------------------------------------------------------
Receive/Delivery - Book Entry $ 5.00
Receive/Delivery - PTC 5.00
Receive/Delivery - Physical 15.00
P & I Payments 5.00
Wires In/Out and official check requests to pay 3.50
Fund related expenses
A transaction is defined as a receipt or delivery versus payment or a free
receipt or deliver.
II. General
- Account Maintenance: Monthly fee of $50.00 per account. (Waived)
- On-Line Services: $200.00 monthly access fee. (Waived)
- Dedicated Line Services: Charged as pass through costs.
1
GLOBAL SECURITIES FEE SCHEDULE
ADMINISTRATION/ INSTRUCTION FEE
SAFEKEEPING FEE (PER INSTRUCTION)
COUNTRY (IN BASIS POINTS)* (U.S. DOLLARS)
--------------------------------------------------------------------------------
Argentina (Equities)..................... 22.0 ............. 60
Argentina (Bonds)........................ 18.0 ............. 60
Australia................................ 3.0 ............. 45
Austria (ATS Securities)................. 4.5 ............. 55
Bahrain.................................. 50.0 ............. 140
Bangladesh............................... 50.0 ............. 000
Xxxxxxx (Equities)....................... 3.5 ............. 00
Xxxxxxx (Bonds).......................... 2.5 ............. 00
Xxxxxxx (T/Bills)........................ 2.0 ............. 50
Bermuda.................................. 22.0 ............. 80
Bolivia.................................. 60.0 ............. 150
Botswana................................. 45.0 ............. 150
Brazil................................... 22.0 ............. 30
Bulgaria................................. 45.0 ............. 95
Canada................................... 2.0 ............. 18
Chile.................................... 22.0 ............. 85
China.................................... 22.0 ............. 80
Colombia................................. 50.0 ............. 115
Costa Rica............................... 22.0 ............. 75
Croatia.................................. 35.0 ............. 85
Cyprus................................... 22.0 ............. 00
Xxxxx Xxxxxxxx (Equities/Bonds).......... 22.0 ............. 00
Xxxxx Xxxxxxxx (T/Bills)................. 18.0 ............. 75
Denmark.................................. 3.5 ............. 55
EASDAQ................................... 5.5 ............. 60
Ecuador.................................. 40.0 ............. 85
Egypt.................................... 45.0 ............. 115
Estonia.................................. 12.0 ............. 45
Euromarkets (Euroclear -
Eurobonds only**)....................... 1.8 ............. 18
Finland.................................. 6.0 ............. 55
France................................... 3.25 ............. 50
Germany.................................. 2.5 ............. 35
Ghana.................................... 45.0 ............. 000
Xxxxxx (Equities)........................ 22.0 ............. 000
Xxxxxx (Bonds)........................... 16.0 ............. 105
Hong Kong (Equities/Bonds)............... 6.0 ............. 70
Hong Kong (CMU Bonds).................... 4.0 ............. 50
Hungary (KELER - Equities)............... 30.0 ............. 85
Hungary (KELER - Bonds).................. 30.0 ............. 65
Iceland ................................. 28.0 ............. 80
2
ADMINISTRATION/ INSTRUCTION FEE
SAFEKEEPING FEE (PER INSTRUCTION)
COUNTRY (IN BASIS POINTS)* (U.S. DOLLARS)
--------------------------------------------------------------------------------
India (Dematerialized Securities)....... 20.0 ............. 160
India (Physical Securities)............. 70.0 ............. 335
Indonesia............................... 13.0 ............. 105
Ireland................................. 3.75 ............. 40
Israel.................................. 22.0 ............. 50
Italy................................... 3.25 ............. 55
Ivory Coast............................. 50.0 ............. 155
Jamaica................................. 45.0 ............. 75
Japan................................... 2.5 ............. 25
Jordan (Equities/Bonds)................. 45.0 ............. 140
Jordan (Gov't Bonds).................... 26.0 ............. 000
Xxxxxxxxxx (Equities)................... 60.0 ............. 000
Xxxxxxxxxx (Bonds)...................... 40.0 ............. 160
Kenya................................... 45.0 ............. 150
Latvia.................................. 55.0 ............. 70
Lebanon (Equities/Bonds)................ 50.0 ............. 140
Lebanon (Gov't Bonds)................... 26.0 ............. 100
Lithuania............................... 22.0 ............. 55
Luxembourg.............................. 5.5 ............. 55
Malaysia................................ 6.0 ............. 65
Malta................................... 22.0 ............. 75
Mauritius............................... 35.0 ............. 135
Mexico.................................. 9.0 ............. 40
Morocco................................. 40.0 ............. 115
Namibia................................. 32.0 ............. 75
Netherlands............................. 4.0 ............. 40
New Zealand............................. 3.5 ............. 50
Nigeria................................. 32.0 ............. 75
Norway.................................. 4.0 ............. 55
Oman.................................... 50.0 ............. 140
Pakistan................................ 35.0 ........... 135
Panama.................................. 65.0 ........... 85
Peru.................................... 40.0 ........... 90
Philippines............................. 10.0 ........... 90
Poland (Equities/Bonds)................. 25.0 ........... 75
Poland (T/Bills) ....................... 12.0 ........... 75
Portugal................................ 10.0 ........... 75
Romania................................. 45.0 ........... 85
Russia (Equities)....................... 65.0 ........... 160
Russia (MinFins)........................ 16.0 ........... 85
Singapore............................... 5.0 ............. 60
Slovak Republic (Equities/Bonds)........ 30.0 ............. 140
Slovak Republic (Promissory Notes)...... 30.0 ............. 260
Slovenia................................ 45.0 ............. 70
South Africa............................ 4.0 ............. 40
South Korea............................. 11.0 ............. 60
Spain (Equities/Bonds).................. 4.5 ............. 60
Spain (Gov't Bonds)..................... 2.5 ............. 60
Sri Lanka............................... 18.0 ............. 90
Swaziland............................... 32.0 ............. 75
3
ADMINISTRATION/ INSTRUCTION FEE
SAFEKEEPING FEE (PER INSTRUCTION)
COUNTRY (IN BASIS POINTS)* (U.S. DOLLARS)
--------------------------------------------------------------------------------
Sweden.............................. 4.0 ............. 50
Switzerland......................... 4.0 ............. 60
Taiwan.............................. 16.0 ............. 90
Thailand............................ 7.0 ............. 75
Trinidad & Tobago................... 30.0 ............. 65
Tunisia (Equities).................. 50.0 ............. 65
Tunisia (Bonds)..................... 35.0 ............. 65
Tunisia (T/Bills)................... 12.0 ............. 65
Turkey (Equities)................... 18.0 ............. 55
Turkey (Bonds)...................... 15.0 ............. 55
UK.................................. 1.5 ............. 30
Ukraine (Equities).................. 70.0 ............. 260
Ukraine (Bonds)..................... 25.0 ............. 85
Uruguay (Equities).................. 60.0 ............. 90
Uruguay (Bonds)..................... 45.0 ............. 90
Venezuela........................... 45.0 ............. 140
Zambia.............................. 45.0 ............. 150
Zimbabwe............................ 45.0 ............. 150
* Fee is expressed in basis points per annum and is calculated based upon
month-end market value. ** For non-Eurobond holdings in Euroclear, surcharges
apply
The above instruction fees are based on an assumption that BNY will receive
instructions via SWIFT, BNY proprietary systems or other electronic medium as
agreed by BNY. Instructions received through other medium (e.g. Facsimile) may
be subject to a surcharge.
Out of Pocket Expenses :
Charges incurred by The Bank of New York for local taxes, stamp duties or other
local duties and assessments, stock exchange fees, postage and insurance for
shipping, facsimile reporting, extraordinary telecommunications fees or other
unusual expenses which are unique to the country of investment, will be passed
along as incurred.
A Foreign Exchange transaction undertaken through a third party will be charged
$35.00 per transaction.
4
FUND ACCOUNTING FEE SCHEDULE
Accounting Fee (Based on market value of all funds at each calendar month-end)
--------------
2.0 basis points, per annum, on the first $5 billion of net assets
1.5 basis points, per annum, on the next $5 billion of net assets
1.0 basis points, per annum, on the next $5 billion of net assets
.75 basis points, per annum, on the excess of net assets
Minimum Fees (Per fund)
------------
(a)$30,000 minimum fee, per annum, per domestic portfolio
(a)$30,000 minimum fee, per annum, per international portfolio
Out-of-Pocket Expenses
----------------------
Out-of-pocket expenses include, but are limited to, the cost of obtaining
prices for security evaluations, the cost associated with attendance at
Board presentations, legal fees, filing fees, miscellaneous printing,
courier and express mail charges, etc.
Billing Cycle
-------------
The above fees will be billed on a monthly basis.
(a) Waived for the first 12 months on any new funds up to a maximum of four
funds in any calendar year. This fee is waived for any fund undergoing
an incubation exercise.
--------------------------------------------------------------------------------
Other
-----
The Bank of New York agrees to rebate the following amount against fees due
for accounting and custody services as follows:
First 12 months @ $29,166.67 per month
Next 12 months @ $20,833.33 per month
Next 12 months @ $12,500.00 per month
These fees are guaranteed for a period of three years from the date of the
Contract.
Agreed to and accepted by:
John Hancock Funds listed on Schedule II The Bank of New York
---------------------------------------- --------------------
Name : Name:
Title: Title:
Date: Date:
5
