AGREEMENT BETWEEN
XXXXX BROTHERS XXXXXXXX & CO.
AND
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TABLE OF CONTENTS
1. Employment of Custodian 1
2. Powers and Duties of the Custodian
with respect to Property of Each Fund
held by the Custodian 1
2.l Safekeeping 2
2.2 Manner of Holding Securities 2
2.3 Registration 2
2.4 Purchases 2
2.5 Exchanges 3
2.6 Sales of Securities 4
2.7 Depositary Receipts 5
2.8 Exercise of Rights; Tender Offers 6
2.9 Stock Dividends, Rights, Etc. 6
2.l0 Options 6
2.ll Borrowings 7
2.l2 Demand Deposit Bank Accounts 7
2.l3 Interest Bearing Call or Time Deposits 10
2.l4 Futures Contracts 11
2.15 Foreign Exchange Transactions 12
2.16 Stock Loans 13
2.l7 Collections 14
2.l8 Dividends, Distributions and Redemptions 15
2.l9 Proxies, Notices, Etc. 15
2.20 Nondiscretionary Details 16
2.2l Bills 16
2.22 Deposit of Fund Assets in Securities Systems 16
2.23 Other Transfers 19
2.24 Investment Limitations 19
2.25 Custodian Advances 20
2.26 Restricted Securities 21
2.27 Proper Instructions 22
2.28 Segregated Account 24
3. Powers and Duties of the Custodian with
Respect to the Appointment of Subcustodians 24
4. Assistance by the Custodian as to Certain Matters 29
5. Powers and Duties of the Custodian with
Respect to its Role as Recordkeeping Agent 30
5.1 Records 30
5.2 Access to Records 30
5.3 Calculation of Net Asset Value 30
-2-
6. Standard of Care and Related Matters 35
6.1 Liability of the Custodian with
Respect to Proper Instructions;
Evidence of Authority; Etc. 35
6.2 Liability of the Custodian with
Respect to Use of Securities Systems
and Foreign Depositories 36
6.3 Standard of Care; Liability;
Indemnification 37
6.4 Reimbursement of Disbursements, Etc. 39
6.5 Security for Obligations to Custodian 39
6.6 Appointment of Agents 40
6.7 Powers of Attorney 40
7. Compensation of the Custodian 40
8. Termination; Successor Custodian 41
9. Amendment 41
10. Governing Law 42
ll. Notices 42
12. Binding Effect 43
13. Counterparts 43
CUSTODIAN AGREEMENT
AGREEMENT made this ___________ day of _______________, 2000 between
______________________________________________and Xxxxx Brothers Xxxxxxxx & Co.
(the "Custodian");
WITNESSETH: That in consideration of the mutual covenants and agreements herein
contained, the parties hereto agree as follows:
1. EMPLOYMENT OF CUSTODIAN: Each Fund hereby employs and appoints the Custodian
as a custodian for the term and subject to the provisions of this Agreement. The
Custodian shall not be under any duty or obligation to require each Fund to
deliver to it any securities or funds owned by each Fund and shall have no
responsibility or liability for or on account of securities or funds not so
delivered. Each Fund will deposit with the Custodian copies of the Declaration
of Trust or Certificate of Incorporation and By-Laws (or comparable documents)
of each Fund and all amendments thereto, and copies of such votes and other
proceedings of each Fund as may be necessary for or convenient to the Custodian
in the performance of its duties.
2. POWERS AND DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF EACH FUND HELD
BY THE CUSTODIAN: Except for securities and funds held by any Subcustodians
appointed pursuant to the provisions of Section 3 hereof or held by any Foreign
Depositories (as said term is defined in Section 3) utilized by a Subcustodian,
the Custodian shall have and perform the following powers and duties:
2.1 SAFEKEEPING - To keep safely the securities and other assets of each Fund
that have been delivered to the Custodian and, on behalf of each Fund, from time
to time to receive delivery of securities for safekeeping.
2.2 MANNER OF HOLDING SECURITIES - To hold securities of each Fund (1) by
physical possession of the share certificates or other instruments representing
such securities in registered or bearer form, or (2) in book-
entry form by a Securities System (as said term is defined in Section 2,22) or
a Foreign Depository.
2.3 REGISTRATION - To hold registered securities of each Fund, with or without
any indication of fiduciary capacity, provided that securities are held in an
account of the Custodian containing only assets of each Fund or only assets held
as fiduciary or custodian for customers; provided that the records of the
Custodian shall at all times reflect the Fund or other customer for which such
securities and other property are held in such accounts and the respective
interest therein.
2.4 PURCHASES - Upon receipt of proper instructions, as defined in Section 2.27,
insofar as funds are available or as funds are otherwise provided by the
Custodian at its discretion pursuant to Section 2.25 (Advances) below for the
purpose, to pay for and receive securities purchased for the account of each
Fund, payment being made only upon receipt of the securities (1) by the
Custodian, or (2) by a clearing corporation of a national securities exchange of
which the Custodian is a member, or (3) by a Securities System or a Foreign
Depository. HOWEVER, NOTWITHSTANDING THE FOREGOING, (i) in the case of
repurchase agreements entered into by each Fund, the Custodian (as well as an
Agent) may release funds to a Securities System, a Foreign Depository or a
Subcustodian prior to the receipt of advice from the Securities System, Foreign
Depository or Subcustodian that the securities underlying such repurchase
agreement have been transferred by book entry into the Account (as defined in
Section 2.22) of the Custodian (or such Agent) maintained with such Securities
System or to the Foreign Depository or Subcustodian, so long as such payment
instructions to the Securities System, Foreign Depository or Subcustodian
include a requirement that delivery is only against payment for securities, (ii)
in the case of foreign exchange contracts, options, time deposits, call account
deposits, currency deposits, and other deposits, contracts or options pursuant
to Sections 2.10, 2.12, 2.13, 2.14 and 2.15, the Custodian may make payment
therefor without receiving an instrument evidencing said deposit, contract or
option so long as such payment instructions detail specific securities to be
acquired, and (iii) the Custodian may make payment for securities prior to
receipt thereof in accordance with (A) governmental regulations, (B) rules of
Securities Systems,
Foreign Depositories or other U.S. or foreign clearing agencies, (C) generally
accepted trade practice in the applicable local market, (D) the terms of the
instrument representing the security, or (E) proper instructions.
2.5 EXCHANGES - Upon receipt of proper instructions, to exchange securities held
by it for the account of each Fund for other securities in connection with any
reorganization, recapitalization, split-up of shares, change of par value,
conversion or other event relating to the securities or the issuer of such
securities and to deposit any such securities in accordance with the terms of
any reorganization or protective plan, Without proper instructions, the
Custodian may surrender securities in temporary form for definitive securities,
may surrender securities for transfer into an account as permitted in Section
2.3. and may surrender securities for a different number of certificates or
instruments representing the same number of shares or same principal amount of
indebtedness, provided the securities to be issued are to be delivered to the
Custodian.
2.6 SALES OF SECURITIES - Upon receipt of proper instructions, to make delivery
of securities which have been sold for the account of each Fund, but only
against payment therefor (1) in cash, by a certified check, bank cashier's
check, bank credit, or bank wire transfer, or (2) by credit to the account of
the Custodian with a clearing corporation of a national securities exchange of
which the Custodian is a member, or (3) by credit to the account of the
Custodian or an Agent of the Custodian with a Securities System or a Foreign
Depository. HOWEVER, NOTWITHSTANDING THE FOREGOING, (i) in the case of delivery
of physical certificates or instruments representing securities, the Custodian
may make delivery to the broker buying the securities, against receipt therefor,
for examination in accordance with "street delivery" custom, provided that the
payment therefor is to be made to the Custodian (which payment may be made by a
broker's check) or that such securities are to be returned to the Custodian, and
(ii) the Custodian may make settlement of securities sold, including with
respect to the form of payment, in accordance with (A) governmental regulations,
(B) rules of Securities Systems, Foreign Depositories or other U.S. or foreign
clearing agencies, (C) generally accepted trade practice in the applicable local
market,
(D) the terms of the instrument representing the security or (E) proper
instructions.
2.7 DEPOSITARY RECEIPTS - Upon receipt of proper instructions, to instruct a
Subcustodian or an Agent to surrender securities to the depositary used by an
issuer of American Depositary Receipts or International Depositary Receipts
(hereinafter collectively referred to as "ADRs") for such securities against a
written receipt therefor adequately describing such securities and written
evidence satisfactory to the Subcustodian or Agent that the depositary has
acknowledged receipt of instructions to issue with respect to such securities
ADRs in the name of the Custodian, or a nominee of the Custodian, for delivery
to the Custodian in Boston, Massachusetts, or at such other place as the
Custodian may from time to time designate.
Upon receipt of proper instructions, to surrender ADRs to the issuer thereof
against a written receipt therefor adequately describing the ADRs surrendered
and written evidence satisfactory to the Custodian that the issuer of the ADRs
has acknowledged receipt of instructions to cause its depositary to deliver the
securities underlying such ADRs to a Subcustodian or an Agent.
2.8 EXERCISE OF RIGHTS; TENDER OFFERS - Upon timely receipt of proper
instructions, to deliver to the issuer or trustee thereof, or to the agent of
either, warrants, puts, calls, rights or similar securities for the purpose of
being exercised or sold, provided that the new securities and cash, if any,
acquired by such action are to be delivered to the Custodian, and, upon receipt
of proper instructions, to deposit securities upon invitations for tenders of
securities, provided that the consideration is to be paid or delivered or the
tendered securities are to be returned to the Custodian.
2.9 STOCK DIVIDENDS, RIGHTS, ETC. - To receive and collect all stock dividends,
rights and other items of like nature; and to deal with the same pursuant to
proper instructions relative thereto.
2.l0 OPTIONS - Upon receipt of proper instructions or upon receipt of
instructions given pursuant to any agreement relating to an option or as
otherwise provided in any such
agreement to (i) receive and retain, to the extent provided to the Custodian,
confirmations or other documents evidencing the purchase, sale or writing of an
option of any type on or in respect of a security, securities index or similar
form of property by each Fund; (ii) deposit and maintain in a segregated
account, either physically or by book-entry in a Securities System or Foreign
Depository or with a broker, dealer or other entity, securities, cash or other
assets in connection with options transactions entered into by each Fund; (iii)
transfer securities, cash or other assets to a Securities System, Foreign
Depository, broker, dealer or other entity, as margin (including variation
margin) or other security for each Fund's obligations in respect of any option;
and (iv) pay, release and/or transfer such securities, cash or other assets in
accordance with a notice or other communication evidencing the expiration,
termination or exercise of or default under any such option furnished by The
Options Clearing Corporation, by the securities or options exchange on which
such option is traded or by such broker, dealer or other entity as may be
responsible for handling such options transaction or have authority to give such
notice or communication. The Custodian shall not be responsible for the
sufficiency of assets held in any segregated account established in compliance
with applicable margin maintenance requirements or the performance of the other
terms of any agreement relating to an option. Notwithstanding the foregoing,
options on futures contracts and options to purchase and sell foreign currencies
shall be governed by Sections 2.14 and 2.15.
2.11 BORROWINGS - Upon receipt of proper instructions to deliver securities of
each Fund to lenders or their agents as collateral for borrowings effected by
each Fund, provided that such borrowed money is payable to or upon the
Custodian's order as Custodian for each Fund.
2.12 DEMAND DEPOSIT BANK ACCOUNTS - To open and operate an account or accounts
in the name of each Fund, subject only to draft or order by each Fund, and to
hold in such account or accounts deposits accepted on the Custodian's books
denominated in U.S. and foreign currency, received for the account of each Fund,
other than deposits with Banking Institutions held in accordance with the last
paragraph of this Section 2.12. The obligation of the Custodian for
deposits accepted on the Custodian's books and denominated in U.S. currency
shall be that of a U.S. bank for a similar deposit. The obligation of the
Custodian for deposits denominated in any foreign currency shall have the
benefit of and be subject to the provisions of the last paragraph of Section 6.3
hereof, and accordingly in the event and to the extent the Custodian shall be
unable to obtain payment due to a Sovereign Risk or other factor described in
the first sentence of said paragraph from any bank, trust company or similar
institution with which the Custodian has in turn deposited funds denominated in
a foreign currency by reason of the Custodian's foreign currency deposit
obligation to each Fund, the Custodian's obligation to pay each Fund in respect
of such foreign currency obligation shall similarly be deferred or relieved
until and to the extent the Custodian is able to obtain payment in respect of
the Custodian's foreign deposit from such bank, trust company or similar
institution and accordingly shall not be payable on demand in U.S. currency.
If and when authorized by proper instructions, the Custodian may open and
operate an additional account(s) in such other banks, trust companies or similar
institutions as may be designated by each Fund in such instructions (any such
bank, trust company or similar institution so designated by each Fund being
referred to hereafter as a "Banking Institution"), and may hold in such account
or accounts deposits of each Fund denominated in U.S. or foreign currency,
provided that such account(s) (hereinafter collectively referred to as "demand
deposit bank accounts") shall be in the name of the Custodian or a nominee of
the Custodian for the account of each Fund or for the account of the Custodian's
customers generally and shall be subject only to the Custodian's draft or order;
provided that any such demand deposit bank account shall contain only assets
held by the Custodian as a fiduciary or custodian for each Fund and/or other
customers and that the records of the Custodian shall indicate at all times each
Fund and/or other customers for which such funds are held in such account and
the respective interests therein. Such demand deposit accounts may be opened
with Banking Institutions in the United States and in other countries and may be
denominated in either U. S. Dollars or other currencies as each Fund may
determine. The records for each such account will be maintained by the Custodian
but the deposits in any such
account shall not constitute a deposit liability of the Custodian. All such
deposits, including with Subcustodians, shall be deemed to be portfolio
securities of each Fund and accordingly the responsibility of the Custodian
therefor shall be the same as and no greater than the Custodian's responsibility
in respect of other portfolio securities of each Fund. The authorization by each
Fund to appoint a Subcustodian as such shall also constitute a proper
instruction to open a demand deposit bank account subject to the revisions of
this paragraph with such Subcustodian.
2.13 INTEREST BEARING CALL OR TIME DEPOSITS - To place interest bearing fixed
term and call deposits with such banks and in such amounts as each Fund may
authorize pursuant to proper instructions. Such deposits may be placed with the
Custodian or with Subcustodians or other Banking Institutions as each Fund may
determine, in the name of the Custodian or a nominee of the Custodian for the
account of each Fund or the account of the Custodian's customers generally and
subject only to the Custodian's draft or order; provided that any such deposit
shall be held in an account containing only assets held by the Custodian as a
fiduciary or custodian for each Fund and/or other customers and that the records
of the Custodian shall indicate at all times each Fund and/or other customers
for which such funds are held in such account and the respective interests
therein. Deposits may be denominated in U. S. Dollars or other currencies and
need not be evidenced by the issuance or delivery of a certificate to the
Custodian, provided that the Custodian shall include in its records with respect
to the assets of each Fund appropriate notation as to the amount and currency of
each such deposit, the accepting Banking Institution and other appropriate
details, and shall retain such forms of advice or receipt evidencing the
deposit, if any, as may be forwarded to the Custodian by the Banking
Institution. Funds, other than those accepted on the Custodian's books as a
deposit, but including those placed with Subcustodians, shall be deemed
portfolio securities of each Fund and the responsibilities of the Custodian
therefor shall be the same as those for demand deposit bank accounts placed with
other banks, as described in the second paragraph of Section 2.12 of this
Agreement. The responsibility of the Custodian for funds accepted on the
Custodian's books as a deposit shall be that of a U. S. bank for a similar
deposit.
2.l4 FUTURES CONTRACTS. Upon receipt of proper instructions or upon receipt of
instructions given pursuant to any agreement relating to a futures contract or
an option thereon or as otherwise provided in any such agreement, to (i) receive
and retain, to the extent provided to the Custodian, confirmations or other
documents evidencing the purchase or sale of a futures contract or an option on
a futures contract by each Fund; (ii) deposit and maintain in a segregated
account, either physically or by book-entry in a Securities System or Foreign
Depository, for the benefit of any futures commission merchant, or pay to such
futures commission merchant, securities, cash or other assets designated by each
Fund as initial, maintenance or variation "margin" deposits intended to secure
each Fund's performance of its obligations under any futures contract purchased
or sold or any option on a futures contract written, purchased or sold by each
Fund, in accordance with the provisions of any agreement relating thereto or the
rules of the Commodity Futures Trading Commission and/or any contract market or
any similar organization on which such contract or option is traded; and (iii)
pay, release and/or transfer securities, cash or other assets into or out of
such margin accounts only in accordance with any such agreement or rules. The
Custodian shall not be responsible for the sufficiency of assets held in any
segregated account established in compliance with applicable margin maintenance
requirements or the performance of the other terms of any agreement relating to
a futures contract or an option thereon.
2.l5 FOREIGN EXCHANGE TRANSACTIONS - Pursuant to proper instructions, to settle
foreign exchange contracts or options to purchase and sell foreign currencies
for spot and future delivery on behalf and for the account of each Fund with
such currency brokers or Banking Institutions, including Subcustodians, as each
Fund may direct pursuant to proper instructions. The Custodian shall be
responsible for the transmission of cash and instructions to and from the
currency broker or Banking Institution with which the contract or option is
made, the safekeeping of all certificates and other documents and agreements
evidencing or relating to such foreign exchange transactions as the Custodian
may receive and the maintenance of proper records as set forth in Section 5.1.
In connection with such transactions, the Custodian is authorized to make free
outgoing payments of cash in the form of U.S. Dollars or
foreign currency without receiving confirmation of a foreign exchange contract
or option or confirmation that the countervalue currency completing the foreign
exchange contract has been delivered or received or that the option has been
delivered or received. The Fund accepts full responsibility for its use of
third-party foreign exchange dealers and for execution of said foreign exchange
contracts and options and understands that each Fund shall be responsible for
any and all costs and interest charges which may be incurred by each Fund or the
Custodian as a result of the failure or delay of third parties to deliver
foreign exchange.
Alternatively, such transactions may be undertaken by the Custodian as
principal, if instructed by each Fund.
Foreign exchange contracts and options, other than those executed with the
Custodian as principal, but including those executed with Subcustodians, shall
be deemed to be portfolio securities of each Fund and the responsibility of the
Custodian therefor shall be the same as and no greater than the Custodian's
responsibility in respect of other portfolio securities of each Fund. The
responsibility of the Custodian with respect to foreign exchange contracts and
options executed with the Custodian as principal shall be that of a U. S. bank
with respect to a similar contract or option.
2.16 STOCK LOANS - Upon receipt of proper instructions, to deliver securities of
each Fund, in connection with loans of securities by each Fund, to the borrower
thereof prior to receipt of the collateral, if any, for such borrowing, provided
that for stock loans secured by cash collateral the Custodian's instructions to
any Securities System holding such securities require that the Securities System
may deliver the securities to the borrower thereof only upon receipt of the
collateral for such borrowing.
2.l7 COLLECTIONS - (i) To collect and receive all income, payments of principal
and other payments with respect to the securities held hereunder, and in
connection therewith to deliver the certificates or other instruments
representing the securities to the issuer thereof or its agent when securities
are called, redeemed, retired or otherwise become payable; provided, that the
payment is to
be made in such form and manner and at such time, which may be after delivery by
the Custodian of the instrument representing the security, as is in accordance
with the terms of the instrument representing the security, or such proper
instructions as the Custodian may receive, or governmental regulations, the
rules of Securities Systems, Foreign Depositories or other U.S. or foreign
securities depositories and clearing agencies or, with respect to securities
referred to in clause (iii) of the last sentence of Section 2.4, in accordance
with generally accepted trade practice; (ii) to execute ownership and other
certificates and affidavits for all federal and state tax purposes in connection
with receipt of income, principal or other payments with respect to securities
of each Fund or in connection with transfer of securities; and (iii) pursuant to
proper instructions to take such other actions with respect to collection or
receipt of funds or transfer of securities which involve an investment decision.
2.18 DIVIDENDS, DISTRIBUTIONS AND REDEMPTIONS - Upon receipt of proper
instructions from each Fund, or upon receipt of instructions from each Fund's
shareholder servicing agent or agent with comparable duties (the "Shareholder
Servicing Agent") (given by such person or persons and in such manner on behalf
of the Shareholder Servicing Agent as each Fund shall have authorized), the
Custodian shall release funds or securities to the Shareholder Servicing Agent
or otherwise apply funds or securities, insofar as available, for the payment of
dividends or other distributions to Fund shareholders. Upon receipt of proper
instructions from each Fund, or upon receipt of instructions from the
Shareholder Servicing Agent (given by such person or persons and in such manner
on behalf of the Shareholder Servicing Agent as each Fund shall have
authorized), the Custodian shall release funds or securities, insofar as
available, to the Shareholder Servicing Agent or as such Agent shall otherwise
instruct for payment to Fund shareholders who have delivered to such Agent a
request for repurchase or redemption of their shares of each Fund.
2.l9 PROXIES, NOTICES, ETC. - Promptly to deliver or mail to each Fund all forms
of proxies and all notices of meetings and any other notices or announcements
affecting or relating to securities owned by each Fund that are received
by the Custodian, and upon receipt of proper instructions, to execute and
deliver or cause its nominee to execute and deliver such proxies or other
authorizations as may be required. Neither the Custodian nor its nominee shall
vote upon any of such securities or execute any proxy to vote thereon or give
any consent or take any other action with respect thereto (except as otherwise
herein provided) unless ordered to do so by proper instructions.
2.20 NONDISCRETIONARY DETAILS - Without the necessity of express authorization
from each Fund, (1) to attend to all nondiscretionary details in connection with
the sale, exchange, substitution, purchase, transfer or other dealings with
securities, funds or other property of each Fund held by the Custodian except as
otherwise directed from time to time by the Directors or Trustees of each Fund,
and (2) to make payments to itself or others for minor expenses of handling
securities or other similar items relating to the Custodian's duties under this
Agreement, provided that all such payments shall be accounted for to each Fund.
2.21 BILLS - Upon receipt of proper instructions, to pay or cause to be paid,
insofar as funds are available for the purpose, bills, statements and other
obligations of each Fund (including but not limited to interest charges, taxes,
management fees, compensation to Fund officers and employees and other operating
expenses of each Fund).
2.22 DEPOSIT OF FUND ASSETS IN SECURITIES SYSTEMS - The Custodian may deposit
and/or maintain securities owned by each Fund in (i) The Depository Trust
Company, (ii) the Participants Trust Company, (iii) any book-entry system as
provided in Subpart O of Treasury Circular Xx. 000, 00 XXX 000, Xxxxxxx X of 31
CFR Part 350, or the book-entry regulations of federal agencies substantially in
the form of Subpart O, or (iv) any other domestic clearing agency registered
with the Securities and Exchange Commission under Section 17A of the Securities
Exchange Act of 1934 which acts as a securities depository and whose use each
Fund has previously approved in writing (each of the foregoing being referred to
in this Agreement as a "Securities System"). Utilization of a Securities System
shall be in accordance with applicable Federal Reserve Board and Securities and
Exchange Commission rules and regulations, if any, and subject to the following
provisions:
1) The Custodian may deposit and/or maintain Fund securities, either directly or
through one or more Agents appointed by the Custodian (provided that any such
agent shall be qualified to act as a custodian of each Fund pursuant to the
Investment Company Act of 1940 and the rules and regulations thereunder), in a
Securities System provided that such securities are represented in an account
("Account") of the Custodian or such Agent in the Securities System which shall
not include any assets of the Custodian or Agent other than assets held as a
fiduciary, custodian, or otherwise for customers;
2) The records of the Custodian with respect to securities of each Fund which
are maintained in a Securities System shall identify by book-entry those
securities belonging to each Fund;
3) The Custodian shall pay for securities purchased for the account of each Fund
upon (i) receipt of advice from the Securities System that such securities have
been transferred to the Account, and (ii) the making of an entry on the records
of the Custodian to reflect such payment and transfer for the account of each
Fund. The Custodian shall transfer securities sold for the account of each Fund
upon (i) receipt of advice from the Securities System that payment for such
securities has been transferred to the Account, and (ii) the making of an entry
on the records of the Custodian to reflect such transfer and payment for the
account of each Fund. Copies of all advices from the Securities System of
transfers of securities for the account of each Fund shall identify each Fund,
be maintained for each Fund by the Custodian or an Agent as referred to above,
and be provided to each Fund at its request. The Custodian shall furnish each
Fund confirmation of each transfer to or from the account of each Fund in the
form of a written advice or notice and shall furnish to each Fund copies of
daily transaction sheets reflecting each day's transactions in the Securities
System for the account of each Fund on the next business day;
4) The Custodian shall provide each Fund with any report obtained by the
Custodian or any Agent as referred to above on the Securities System's
accounting system, internal accounting control and procedures for safeguarding
securities deposited in the Securities System; and the
Custodian and such Agents shall send to each Fund such reports on their own
systems of internal accounting control as each Fund may reasonably request from
time to time.
5) At the written request of each Fund, the Custodian will terminate the use of
any such Securities System on behalf of each Fund as promptly as practicable.
2.23 OTHER TRANSFERS - To deliver securities, funds and other property of each
Fund to a Subcustodian or another custodian as necessary to effect transactions
authorized by proper instructions and upon receipt of proper instructions, to
deliver securities, funds and other property of each Fund to a Subcustodian or
another custodian of each Fund; and, upon receipt of proper instructions, to
make such other disposition of securities, funds or other property of each Fund
in a manner other than or for purposes other than as enumerated elsewhere in
this Agreement, provided that the instructions relating to such disposition
shall state the amount of securities to be delivered and the name of the person
or persons to whom delivery is to be made.
2.24 INVESTMENT LIMITATIONS - In performing its duties generally, and more
particularly in connection with the purchase, sale and exchange of securities
made by or for each Fund, the Custodian may assume unless and until notified in
writing to the contrary that proper instructions received by it are not in
conflict with or in any way contrary to any provisions of each Fund's
Declaration of Trust or Certificate of Incorporation or By-Laws (or comparable
documents) or votes or proceedings of the shareholders or Trustees or Directors
of each Fund. The Custodian shall in no event be liable to each Fund and shall
be indemnified by each Fund for any violation which occurs in the course of
carrying out instructions given by each Fund of any investment limitations to
which each Fund is subject or other limitations with respect to each Fund's
powers to make expenditures, encumber securities, borrow or take similar actions
affecting each Fund.
2.25 CUSTODIAN ADVANCES. - In the event that the Custodian is directed by proper
instructions to make any payment or transfer of funds on behalf of each Fund for
which there would be, at the close of business on the date of such payment or
transfer, insufficient funds held by the
Custodian on behalf of each Fund, the Custodian may, in its discretion without
further proper instructions, provide an advance ("Advance") to each Fund in an
amount sufficient to allow the completion of the transaction by reason of which
such payment or transfer of funds is to be made.
In addition, in the event the Custodian is directed by proper instructions to
make any payment or transfer of funds on behalf of each Fund as to which it is
subsequently determined that each Fund has overdrawn its cash account with the
Custodian as of the close of business on the date of such payment or transfer,
said overdraft shall constitute an Advance. Any Advance shall be payable on
demand by Custodian, unless otherwise agreed by each Fund and the Custodian, and
shall accrue interest from the date of the Advance to the date of payment by
each Fund at a rate agreed upon from time to time by the Custodian and each
Fund. It is understood that any transaction in respect of which the Custodian
shall have made an Advance, including but not limited to a foreign exchange
contract or transaction in respect of which the Custodian is not acting as a
principal, is for the account of and at the risk of each Fund, and not, by
reason of such Advance, deemed to be a transaction undertaken by the Custodian
for its own account and risk. The Custodian and each Fund acknowledge that the
purpose of Advances is to finance temporarily the purchase or sale of securities
for prompt delivery in accordance with the settlement terms of such transactions
or to meet emergency expenses not reasonably foreseeable by each Fund.
2.26 RESTRICTED SECURITIES. - In the case of a "restricted security", each Fund
shall have the responsibility to provide to or obtain for the Custodian, the
issuer of the security or other appropriate third party any necessary
documentation, including without limitation, legal opinions or consents, and to
take any necessary actions required in connection with the registration of
restricted securities in the manner provided in Section 2.3 upon acquisition
thereof by each Fund or required in connection with any sale or other
disposition thereof by each Fund. Upon acquisition and until so registered, the
Custodian shall have no duty to service such restricted securities, including
without limitation, the receipt and collection of cash and stock dividends,
rights and other items of like nature, nor shall the Custodian have
responsibility for the inability of each Fund to exercise in a timely manner any
right in respect of any restricted security or to take any action in a timely
manner in respect of any other type of corporate action relating to a restricted
security. Similarly, the Custodian shall not have responsibility for the
inability of each Fund to sell or otherwise transfer in a timely manner any
restricted security in the absence of any such documentation or action to be
provided, obtained or taken by each Fund. At such time as the Custodian shall
receive, on behalf of each Fund, any restricted security, regardless of when it
shall be registered as aforesaid, each Fund shall also deliver to the Custodian
a term sheet summarizing those rights, restrictions or other matters of which
the Custodian should have knowledge, such as exercise periods, expiration dates
and payment dates, in order to assist the Custodian in servicing such
securities. As used herein, the term "restricted security" shall mean a security
which is subject to restrictions on transfer, whether by reason of contractual
restrictions or federal, state or foreign securities or similar laws, or a
security which has special rights or contractual features which do not apply to
publicly-traded shares of, or comparable interests representing, such security.
2.27 PROPER INSTRUCTIONS - Proper instructions shall mean a tested telex from
each Fund or a written request, direction, instruction or certification signed
or initialled on behalf of each Fund by two or more person or persons as the
Board of Trustees or Directors of each Fund shall have from time to time
authorized, provided, however, that no such instructions directing the delivery
of securities or the payment of funds to an authorized signatory of each Fund
shall be signed by such person. Those persons authorized to give proper
instructions may be identified by the Board of Trustees or Directors by name,
title or position and will include at least one officer empowered by the Board
to name other individuals who are authorized to give proper instructions on
behalf of each Fund. Telephonic or other oral instructions or instructions given
by facsimile transmission may be given by any one of the above persons and will
be considered proper instructions if the Custodian reasonably believes them to
have been given by a person authorized to give such instructions with respect to
the transaction involved. Oral instructions will be confirmed
by tested telex or in writing in the manner set forth above but the lack of such
confirmation shall in no way affect any action taken by the Custodian in
reliance upon such oral instructions. Each Fund authorizes the Custodian to tape
record any and all telephonic or other oral instructions given to the Custodian
by or on behalf of each Fund (including any of its officers, Directors,
Trustees, employees or agents or any investment manager or adviser or person or
entity with similar responsibilities which is authorized to give proper
instructions on behalf of each Fund to the Custodian). Proper instructions may
relate to specific transactions or to types or classes of transactions, and may
be in the form of standing instructions.
Proper instructions may include communications effected directly between
electro-mechanical or electronic devices or systems, in addition to tested
telex, provided that each Fund and the Custodian agree to the use of such device
or system.
2.28 SEGREGATED ACCOUNT - The Custodian shall upon receipt of proper
instructions establish and maintain on its books a segregated account or
accounts for and on behalf of each Fund, into which account or accounts may be
transferred cash and/or securities of each Fund, including securities maintained
by the Custodian pursuant to Section 2.22 hereof, (i) in accordance with the
provisions of any agreement among each Fund, the Custodian and a broker-dealer
registered under the Securities Exchange Act of 1934 and a member of the
National Association of Securities Dealers, Inc. (or any futures commission
merchant registered under the Commodity Exchange Act) relating to compliance
with the rules of the Options Clearing Corporation and of any registered
national securities exchange (or the Commodity Futures Trading Commission or any
registered contract market), or any similar organization or organizations,
regarding escrow or other arrangements in connection with transactions by each
Fund, (ii) for purposes of segregating cash or securities in connection with
options purchased, sold or written by each Fund or commodity futures contracts
or options thereon purchased or sold by each Fund, (iii) for the purposes of
compliance by each Fund with the procedures required by Investment Company Act
Release No. 10666, or any subsequent release or releases of the Securities and
Exchange
Commission relating to the maintenance of segregated accounts by registered
investment companies, and (iv) as mutually agreed from time to time between each
Fund and the Custodian.
3. POWERS AND DUTIES OF THE CUSTODIAN WITH RESPECT TO THE APPOINTMENT OF
SUBCUSTODIANS: Each Fund hereby authorizes and instructs the Custodian to hold
securities, funds and other property of each Fund which are maintained outside
the United States at subcustodians appointed pursuant to the provisions of this
Section 3 (a "Subcustodian"). Each Fund shall approve in writing (1) the
appointment of each Subcustodian and the subcustodian agreement to be entered
into between such Subcustodian and the Custodian, and (2) if the Subcustodian is
organized under the laws of a country other than the United States, the country
or countries in which the Subcustodian is authorized to hold securities, cash
and other property of each Fund. Each Fund hereby further authorizes and
instructs the Custodian and any Subcustodian to utilize such securities
depositories located outside the United States which are approved in writing by
each Fund to hold securities, cash and other property of each Fund (a "Foreign
Depository"). Upon such approval by each Fund, the Custodian is authorized on
behalf of each Fund to notify each Subcustodian of its appointment as such.
Those Subcustodians, and the countries where and the Foreign Depositories
through which they or the Custodian may hold securities, cash and other property
of each Fund which each Fund has approved to date are set forth on Appendix A
hereto. Such Appendix shall be amended from time to time as Subcustodians,
and/or countries and/or Foreign Depositories are changed, added or deleted. Each
Fund shall be responsible for informing the Custodian sufficiently in advance of
a proposed investment which is to be held in a country not listed on Appendix A,
in order that there shall be sufficient time for each Fund to give the approval
required by the preceding paragraph and for the Custodian to put the appropriate
arrangements in place with such Subcustodian, including negotiation of a
subcustodian agreement and submission of such subcustodian agreement to each
Fund for approval.
Notwithstanding the provisions of the foregoing two paragraphs, approval by each
Fund of a change in a Subcustodian shall be assumed if the Custodian shall
advise each Fund in writing of a change in a Subcustodian (the "original
Subcustodian") in a particular country where (i) the new Subcustodian has the
same ultimate parent as the original Subcustodian or is a subsidiary or parent
of the original Subcustodian, or (ii) the original Subcustodian shall cease to
provide custodial services and the Custodian is accordingly required to select a
successor Subcustodian, unless within fifteen days of notification by the
Custodian of the identity of the new Subcustodian and submission to each Fund of
the subcustodian agreement between the Custodian and the new Subcustodian, each
Fund shall in writing advise the Custodian that each Fund does not approve the
appointment of such new Subcustodian.
If each Fund shall have invested in a security to be held in a country before
the foregoing procedures have been completed, such security shall be held by
such agent as the Custodian may appoint. In any event, the Custodian shall be
liable to each Fund for the actions of such agent if and only to the extent the
Custodian shall have recovered from such agent for any damages caused each Fund
by such agent. At the request of each Fund, Custodian agrees to remove any
securities held on behalf of each Fund by such agent, if practical, to an
approved Subcustodian. Under such circumstances the Custodian will collect
income and respond to corporate actions on a best efforts basis.
With respect to securities and funds held by a Subcustodian, either directly or
indirectly (including by a Foreign Depository or foreign clearing agency) or by
a Foreign Depository or foreign clearing agency utilized by the Custodian,
notwithstanding any provision of this Agreement to the contrary, payment for
securities purchased and delivery of securities sold may be made prior to
receipt of the securities or payment, respectively, and securities or payment
may be received in a form, in accordance with (A) governmental regulations, (B)
rules of Foreign Depositories or foreign clearing agencies, (C) generally
accepted trade practice in the applicable local market, (D) the terms of the
instrument representing the security, or (E) proper instructions.
With respect to the securities and funds held by a Subcustodian, either directly
or indirectly, (including by a securities depository or a clearing agency)
including demand and interest bearing deposits, currencies or other deposits and
foreign exchange contracts as referred to in Sections 2.12, 2.13, 2.14 or 2.15,
the Custodian shall be liable to each Fund for any loss or damage to each Fund
caused by or resulting from the acts and omissions of any Subcustodian to the
extent that under the terms set forth in the subcustodian agreement between the
Custodian and the Subcustodian (or in the subcustodian agreement between a
Subcustodian and any secondary Subcustodian), the Subcustodian (or secondary
Subcustodian) has failed to perform in accordance with the standard of conduct
imposed under such subcustodian agreement as determined in accordance with the
law which is adjudicated to govern such agreement and in accordance with any
determination of any court as to the duties of said Subcustodian pursuant to
said agreement. The Custodian shall nevertheless be liable to each Fund for its
own negligence in transmitting any instructions received by it from each Fund
and for its own negligence in connection with the delivery of any securities or
funds held by it to any such Subcustodian.
In the event that any Subcustodian appointed pursuant to the provisions of this
Section 3 fails to perform any of its obligations under the terms and conditions
of the applicable subcustodian agreement, the Custodian shall use its best
efforts to cause such Subcustodian to perform such obligations. In the event
that the Custodian is unable to cause such Subcustodian to perform fully its
obligations thereunder, the Custodian shall forthwith upon each Fund's request
terminate such Subcustodian in accordance with the termination provisions under
the applicable subcustodian agreement and, if necessary or desirable, appoint
another subcustodian in accordance with the provisions of this Section 3. At the
election of each Fund, it shall have the right to enforce, to the extent
permitted by the subcustodian agreement and applicable law, the Custodian's
rights against any such Subcustodian for loss or damage caused each Fund by such
Subcustodian.
The Custodian will not amend any subcustodian agreement or agree to change or
permit any changes thereunder except upon the prior written approval of each
Fund.
The Custodian may, at any time in its discretion upon notification to each Fund,
terminate any Subcustodian of each Fund in accordance with the termination
provisions under the applicable Subcustodian Agreement, and at the written
request of each Fund, the Custodian will terminate any Subcustodian in
accordance with the termination provisions under the applicable Subcustodian
Agreement.
If necessary or desirable, the Custodian may appoint another subcustodian to
replace a Subcustodian terminated pursuant to the foregoing provisions of this
Section 3, such appointment to be made upon approval of the successor
subcustodian by each Fund's Board of Directors or Trustees in accordance with
the provisions of this Section 3.
In the event the Custodian receives a claim from a Subcustodian under the
indemnification provisions of any subcustodian agreement, the Custodian shall
promptly give written notice to each Fund of such claim. No more than thirty
days after written notice to each Fund of the Custodian's intention to make such
payment, each Fund will reimburse the Custodian the amount of such payment
except in respect of any negligence or misconduct of the Custodian.
4. ASSISTANCE BY THE CUSTODIAN AS TO CERTAIN MATTERS: The Custodian may assist
generally in the preparation of reports to Fund shareholders and others, audits
of accounts, and other ministerial matters of like nature.
5. POWERS AND DUTIES OF THE CUSTODIAN WITH RESPECT TO ITS ROLE AS RECORDKEEPING
AGENT: The Custodian shall have and perform the following duties with respect to
recordkeeping; PROVIDED HOWEVER, that the duties delineated in Section 5.3 shall
apply only to each Funds now or hereafter listed on Appendix C hereto:
5.1 RECORDS - To create, maintain and retain such records relating to its
activities and obligations under this Agreement as are required under the
Investment Company Act of 1940 and the rules and regulations thereunder
(including Section 31 thereof and Rules 31a-1 and 31a-2 thereunder) and under
applicable Federal and State tax laws. All such records will be the property of
each Fund and in the event of termination of this Agreement shall be delivered
to the successor Custodian.
5.2 ACCESS TO RECORDS The books and records maintained by the Custodian pursuant
to Section 5.1 shall at all times during the Custodian's regular business hours
be open to inspection and audit by officers of, attorneys for and auditors
employed by each Fund and by employees and agents of the Securities and Exchange
Commission, provided that all such individuals shall observe all security
requirements of the Custodian applicable to its own employees having access to
similar records within the Custodian and such regulations as may be reasonably
imposed by the Custodian.
5.3 CALCULATION OF NET ASSET VALUE - To compute and determine the net asset
value per share of each Fund as of the close of business on the New York Stock
Exchange on each day on which such Exchange is open, unless otherwise directed
by proper instructions. Such computation and determination shall be made in
accordance with (1) the provisions of each Fund's Declaration of Trust or
Certificate of Incorporation and By-Laws, as they may from time to time be
amended and delivered to the Custodian, (2) the votes of the Board of Trustees
or Directors of each Fund at the time in force and applicable, as they may from
time to time be delivered to the Custodian, and (3) proper instructions from
such officers of each Fund or other persons as are from time to time authorized
by the Board of Trustees or Directors of each Fund to give instructions with
respect to computation and determination of the net asset value. On each day
that the Custodian shall compute the net asset value per share of each Fund, the
Custodian shall provide each Fund with written reports which permit each Fund to
Verify that portfolio transactions have been recorded in accordance with each
Fund's instructions and are reconciled with each Fund's trading records.
In computing the net asset value, the Custodian may rely upon any information
furnished by proper instructions, including without limitation any information
(1) as to accrual of liabilities of each Fund and as to liabilities of each Fund
not appearing on the books of account kept by the Custodian, (2) as to the
existence, status and proper treatment of reserves, if any, authorized by each
Fund, (3) as to the sources of quotations to be used in computing the net asset
value, including those listed in Appendix D, (4) as to the fair value to be
assigned to any securities or
other property for which price quotations are not readily available, and (5) as
to the sources of information with respect to "corporate actions" affecting
portfolio securities of each Fund, including those listed in Appendix D.
(Information as to "corporate actions" shall include information as to
dividends, distributions, stock splits, stock dividends, rights offerings,
conversions, exchanges, recapitalizations, mergers, redemptions, calls, maturity
dates and similar transactions, including the ex- and record dates and the
amounts or other terms thereof.)
In like manner, the Custodian shall compute and determine the net asset value as
of such other times as the Board of Trustees or Directors of each Fund from time
to time may reasonably request.
Notwithstanding any other provisions of this Agreement, including Section 6.3.
the following provisions shall apply with respect to the Custodian's foregoing
responsibilities in this Section 5.4: The Custodian shall be held to the
exercise of reasonable care in computing and determining net asset value as
provided in this Section 5.4. but shall not be held accountable or liable for
any losses, damages or expenses each Fund or any shareholder or former
shareholder of each Fund or any other person may suffer or incur arising from or
based upon errors or delays in the determination of such net asset value unless
such error or delay was due to the Custodian's negligence, gross negligence or
reckless or willful misconduct in determination of such net asset value. (The
parties hereto acknowledge, however, that the Custodian's causing an error or
delay in the determination of net asset value may, but does not in and of
itself, constitute negligence, gross negligence or reckless or willful
misconduct.) In no event shall the Custodian be liable or responsible to each
Fund, any present or former shareholder of each Fund or any other person for any
error or delay which continued or was undetected after the date of an audit
performed by the certified public accountants employed by each Fund if, in the
exercise of reasonable care in accordance with generally accepted accounting
standards, such accountants should have become aware of such error or delay in
the course of performing such audit. The Custodian's liability for any such
negligence, gross negligence or reckless or willful misconduct which results in
an error in determination of such net asset value shall
be limited to the direct, out-of-pocket loss each Fund, shareholder or former
shareholder shall actually incur, measured by the difference between the actual
and the erroneously computed net asset value, and any expenses each Fund shall
incur in connection with correcting the records of each Fund affected by such
error (including charges made by each Fund's registrar and transfer agent for
making such corrections) or communicating with shareholders or former
shareholders of each Fund affected by such error.
Without limiting the foregoing, the Custodian shall not be held accountable or
liable to each Fund, any shareholder or former shareholder thereof or any other
person for any delays or losses, damages or expenses any of them may suffer or
incur resulting from (1) the Custodian's failure to receive timely and suitable
notification concerning quotations or corporate actions relating to or affecting
portfolio securities of each Fund or (2) any errors in the computation of the
net asset value based upon or arising out of quotations or information as to
corporate actions if received by the Custodian either (i) from a source which
the Custodian was authorized pursuant to the second paragraph of this Section
5.3 to rely upon, or (ii) from a source which in the Custodian's reasonable
judgment was as reliable a source for such quotations or information as the
sources authorized pursuant to that paragraph. Nevertheless, the Custodian will
use its best judgment in determining whether to verify through other sources any
information it has received as to quotations or corporate actions if the
Custodian has reason to believe that any such information might be incorrect.
In the event of any error or delay in the determination of such net asset value
for which the Custodian may be liable, each Fund and the Custodian will consult
and make good faith efforts to reach agreement on what actions should be taken
in order to mitigate any loss suffered by each Fund or its present or former
shareholders, in order that the Custodian's exposure to liability shall be
reduced to the extent possible after taking into account all relevant factors
and alternatives. Such actions might include each Fund or the Custodian taking
reasonable steps to collect from any shareholder or former shareholder who has
received any overpayment upon redemption of shares such overpaid amount or to
collect from any shareholder who has underpaid
upon a purchase of shares the amount of such underpayment or to reduce the
number of shares issued to such shareholder. It is understood that in attempting
to reach agreement on the actions to be taken or the amount of the loss which
should appropriately be borne by the Custodian, each Fund and the Custodian will
consider such relevant factors as the amount of the loss involved, each Fund's
desire to avoid loss of shareholder good will, the fact that other persons or
entities could have been reasonably expected to have detected the error sooner
than the time it was actually discovered the appropriateness of limiting or
eliminating the benefit which shareholders or former
shareholders might have obtained by reason of the error, and the possibility
that other parties providing services to each Fund might be induced to absorb a
portion of the loss incurred.
6. STANDARD OF CARE AND RELATED MATTERS:
6.1 LIABILITY OF THE CUSTODIAN WITH RESPECT TO PROPER INSTRUCTIONS; EVIDENCE OF
AUTHORITY, ETC. The Custodian shall not be liable for any action taken or
omitted in reliance upon proper instructions believed by it to be genuine or
upon any other written notice, request, direction, instruction, certificate or
other instrument believed by it to be genuine and signed by the proper party or
parties.
The Secretary or Assistant Secretary of each Fund shall certify to the Custodian
the names, signatures and scope of authority of all persons authorized to give
proper instructions or any other such notice, request, direction, instruction,
certificate or instrument on behalf of each Fund, the names and signatures of
the officers of each Fund, the name and address of the Shareholder Servicing
Agent, and any resolutions, votes, instructions or directions of each Fund's
Board of Directors or Trustees or shareholders. Such certificate may be accepted
and relied upon by the Custodian as conclusive evidence of the facts set forth
therein and may be considered in full force and effect until receipt of a
similar certificate to the contrary.
So long as and to the extent that it is in the exercise of reasonable care, the
Custodian shall not be responsible for
the title, validity or genuineness of any property or evidence of title thereto
received by it or delivered by it pursuant to this Agreement.
The Custodian shall be entitled, at the expense of each Fund, to receive and act
upon advice of (i) counsel regularly retained by the Custodian in respect of
custodian matters, (ii) counsel for each Fund, or (iii) such other counsel as
each Fund and the Custodian may agree upon, with respect to all matters, and the
Custodian shall be without liability for any action reasonably taken or omitted
pursuant to such advice.
6.2 LIABILITY OF THE CUSTODIAN WITH RESPECT TO USE OF SECURITIES SYSTEMS AND
FOREIGN DEPOSITORIES - With respect to the portfolio securities, cash and other
property of each Fund held by a Securities System or by a Foreign Depository
utilized by the Custodian or any Subcustodian, the Custodian shall be liable to
each Fund only for any loss or damage to each Fund resulting from use of the
Securities System or Foreign Depository if caused by any negligence, misfeasance
or misconduct of the Custodian or any of its Agents (as said term is defined in
Section 6.6) or of any of its or its Agents' employees or from any failure of
the Custodian or any such Agent to enforce effectively such rights as it may
have against the Securities System or Foreign Depository. At the election of
each Fund, it shall be entitled to be subrogated to the rights of the Custodian
with respect to any claim against the Securities System, Foreign Depository or
any other person which the Custodian may have as a consequence of any such loss
or damage to each Fund if and to the extent that each Fund has not been made
whole for any such loss or damage.
6.3 STANDARD OF CARE; LIABILITY; INDEMNIFICATION - The Custodian shall be held
only to the exercise of reasonable care and diligence in carrying out the
provisions of this Agreement, provided that the Custodian shall not thereby be
required to take any action which is in contravention of any applicable law,
rule or regulation or any order or judgment of any court of competent
jurisdiction.
Each Fund agrees to indemnify and hold harmless the Custodian and its nominees
from all claims and liabilities (including counsel fees) incurred or assessed
against it or
its nominees in connection with the performance of this Agreement, except such
as may arise from its or its nominee's breach of the relevant standard of
conduct set forth in this Agreement. Without limiting the foregoing
indemnification obligation of each Fund, each Fund agrees to indemnify the
Custodian and any nominee in whose name portfolio securities or other property
of each Fund is registered against any liability the Custodian or such nominee
may incur by reason of taxes assessed to the Custodian or such nominee or other
costs, liability or expense incurred by the Custodian or such nominee resulting
directly or indirectly from the fact that portfolio securities or other property
of each Fund is registered in the name of the Custodian or such nominee.
In no event shall the Custodian incur liability under this Agreement if the
Custodian or any Subcustodian, Securities System, Foreign Depository, Banking
Institution or any agent or entity utilized by any of them is prevented
forbidden or delayed from performing, or omits to perform, any act or thing
which this Agreement provides shall be performed or omitted to be performed, by
reason of (i) any Sovereign Risk or (ii) any provision of any present or future
law or regulation or order of the United States of America or any state thereof,
or of any foreign country or political subdivision thereof, or of any securities
depository or clearing agency which operates a central system for handling of
securities or equivalent book-entries in a country or which operates a
transnational system for the central handling of securities or equivalent
book-entries, or (iii) any provision of any order or judgment of any court of
competent jurisdiction. A "Sovereign Risk" shall mean nationalization,
expropriation, devaluation, revaluation, confiscation, seizure, cancellation,
destruction or similar action by any governmental authority, de facto or de
jure; or enactment, promulgation, imposition or enforcement by any such
governmental authority of currency restrictions, exchange controls, taxes,
levies or other charges affecting each Fund's property; or acts of war,
terrorism insurrection or revolution; or any other act or event beyond the
Custodian's control.
The Custodian shall not be responsible for compliance of this Agreement and the
actions to be taken hereunder with
any statute, regulation or rule, including but not limited to the Investment
Company Act of 1940.
6.4 REIMBURSEMENT OF DISBURSEMENTS, ETC. - The Custodian shall be entitled to
receive reimbursement from each Fund on demand, in the manner provided in
Section 7, for its cash disbursements, expenses and charges (including the fees
and expenses of any Subcustodian or any Agent) in connection with this
Agreement, but excluding salaries and usual overhead expenses.
6.5 SECURITY FOR OBLIGATIONS TO CUSTODIAN - If the Custodian or any nominee
thereof shall incur or be assessed any taxes, charges, expenses, assessments,
claims or liabilities in connection with the performance of this Agreement
(collectively a "Liability"), except such as may arise from its or such
nominee's breach of the relevant standard of conduct set forth in this
Agreement, or if the Custodian shall make any Advance to each Fund, then in such
event any property at any time held for the account of each Fund by the
Custodian or a Subcustodian shall be security for such Liability or for such
Advance and the interest thereon, and if each Fund shall fail to pay such
Advance or interest when due or shall fail to reimburse or indemnify the
Custodian promptly in respect of a Liability, the Custodian shall be entitled to
utilize available cash and to dispose of each Fund's property, including
securities, to the extent necessary to obtain repayment, reimbursement or
indemnification.
6.6 APPOINTMENT OF AGENTS - The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust company
as its agent (an "Agent") to carry out such of the provisions of this Agreement
as the Custodian may from time to time direct, provided, however, that the
appointment of such Agent (other than an Agent appointed pursuant to the third
paragraph of Section 3) shall not relieve the Custodian of any of its
responsibilities under this Agreement.
6.7 POWERS OF ATTORNEY - Upon request, each Fund shall deliver to the Custodian
such proxies, powers of attorney or other instruments as may be reasonable and
necessary or desirable in connection with the performance by the Custodian or
any Subcustodian of their respective
obligations under this Agreement or any applicable subcustodian agreement.
7. COMPENSATION OF THE CUSTODIAN: Each Fund shall pay the Custodian a custody
fee based on such fee schedule as may from time to time be agreed upon in
writing by the Custodian and each Fund. Such fee, together with all amounts for
which the Custodian is to be reimbursed in accordance with Section 6.4, shall be
billed to each Fund and be paid in cash to the Custodian.
8. TERMINATION OF AGREEMENT AS TO ONE OR MORE FUNDS: SUCCESSOR CUSTODIAN: With
respect to each Fund, this Agreement shall continue in full force and effect
until the first to occur of: (A) termination by the Custodian by an instrument
in writing delivered or mailed to the such Fund, such termination to take effect
not sooner than ninety (90) days after the date of such delivery; (B)
termination by such Fund by an instrument in writing delivered or mailed to the
Custodian, such termination to take effect not sooner than seventy-five (75)
days after the date of such delivery; or (C) termination by such Fund by written
notice delivered to the Custodian based upon such Fund's determination that
there is a reasonable basis to conclude that the Custodian is insolvent or that
the financial condition of the Custodian is deteriorating in any material
respect, in which case termination shall take effect upon the Custodian's
receipt of such notice or at such later time as such Fund shall designate. In
the event of termination pursuant to this Section 8 by any Fund (a "Terminating
Fund"), each Terminating Fund shall make payment of all accrued fees and
unreimbursed expenses with respect to such Terminating Fund within a reasonable
time following delivery of a statement to the Terminating Fund setting forth
such fees and expenses and in any event prior to delivery of the Securities,
Funds or other property held by the Custodian. Each Terminating Fund shall
identify in any notice of termination a successor custodian or custodians to
which the cash, securities or other assets of its Portfolios shall, upon
termination of this Agreement with respect to such Terminating Fund, be
delivered. In the event that no written notice designating a successor custodian
shall have been delivered to the Custodian on or before the date when
termination of this Agreement as to a Terminating Fund shall become effective,
the Custodian may deliver to a bank or trust company doing
business in Boston, Massachusetts, of its own selection, having an aggregate
capital, surplus, and undivided profits, as shown by its last published report,
of not less than $25,000,000, all securities and other assets of such
Terminating Fund's Portfolios held by the Custodian and all instruments held by
the Custodian relative thereto and all other property of the Terminating Fund's
Portfolios held by the Custodian under this Agreement. Thereafter such bank or
trust company shall be the successor or the Custodian with respect to such
Terminating Fund under this Agreement. In the event that securities and other
assets of such Terminating Fund's Portfolios remain in the possession of the
Custodian after the date of termination hereof with respect to such Terminating
Fund owing to failure of the Terminating Fund to appoint a successor custodian,
the Custodian shall be entitled to compensation for its services in accordance
with the fee schedule most recently in effect, for such period as the Custodian
retains possession of such securities and other assets, and the provisions of
this Agreement relating to the duties and obligations of the Custodian and the
Terminating Fund shall remain in full force and effect. In the event of the
appointment of a successor custodian, it is agreed that the cash, securities and
other property owned by a Terminating Fund and held by the Custodian, any
Subcustodian or nominee shall be delivered to the successor custodian; and the
Custodian agrees to cooperate with such Terminating Fund in the execution of
documents and performance of other actions necessary or desirable in order to
substitute the successor custodian for the Custodian under this Agreement.
9. AMENDMENT: This Agreement constitutes the entire understanding and agreement
of the parties hereto with respect to the subject matter hereof. No provision of
this Agreement may be amended or terminated except by a statement in writing
signed by the party against which enforcement of the amendment or termination is
sought.
In connection with the operation of this Agreement, the Custodian and each Fund
may agree in writing from time to time on such provisions interpretative of or
in addition to the provisions of this Agreement as may in their joint opinion be
consistent with the general tenor of this Agreement. No interpretative or
additional provisions made
as provided in the preceding sentence shall be deemed to be an amendment of this
Agreement.
The section headings in this Agreement are for the convenience of the parties
and in no way alter, amend, limit or restrict the contractual obligations of the
parties set forth in this Agreement.
l0. GOVERNING LAW: This Agreement is executed and delivered in The Commonwealth
of Massachusetts and shall be governed by and construed according to the laws of
said Commonwealth.
11. NOTICES: Notices and other writings delivered or mailed postage prepaid to
each Fund addressed to each Fund at - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - - -or to such other address as each Fund may
have designated to the Custodian in writing, or to the Custodian at 00 Xxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention; Manager, Securities Department,
or to such other address as the Custodian may have designated to each Fund in
writing, shall be deemed to have been properly delivered or given hereunder to
the respective addressee.
12. BINDING EFFECT: This Agreement shall be binding on and shall inure to the
benefit of each Fund and the Custodian and their respective successors and
assigns, provided that neither party hereto may assign this Agreement or any of
its rights or obligations hereunder without the prior written consent of the
other party.
13. COUNTERPARTS: This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original. This Agreement shall become effective
when one or more counterparts have been signed and delivered by each of the
parties.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed
in its name and behalf on the day and year first above written.
[NAME OF FUND]
By:
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By: XXXXX BROTHERS XXXXXXXX & CO.
By:
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