Exhibit (g)(2)
FOREIGN CUSTODY MANAGER AGREEMENT
AGREEMENT made as of January 6, 2003 between each entity listed on
Schedule 1 attached hereto (each a "Fund" and collectively, "Funds") and The
Bank of New York ("BNY").
W I T N E S S E T H:
WHEREAS, the Fund and BNY have entered into a Custody Agreement (the
"Custody Agreement");
WHEREAS, the Fund is authorized to issue shares in separate series, with
each such series representing interests in a separate portfolio of securities
and other assets, and the Fund has made each of its current series listed on
Schedule 1 hereto (the "Series"), as may be amended from time to time, subject
to this Agreement;
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; and
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 on June 12, 2000.
6. "SPECIFIED COUNTRY" shall mean each country listed on Schedule 2
attached hereto (as amended from time to time) and each country, other than the
United States, constituting the primary market for a security with respect to
which the Fund has given, or may give, settlement instructions to The Bank of
New York as custodian (the "Custodian") under its Custody Agreement with the
Fund.
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 and the Fund's investment adviser at
such times as the Board deems reasonable and appropriate based on the
circumstances of the Fund's foreign custody arrangements (but in no event less
frequently than quarterly) written reports notifying the Board and the Fund's
investment adviser of the placement of assets of the Fund with a particular
Eligible Foreign Custodian within a Specified Country and shall promptly notify
the Board and the Fund's investment adviser of any material change in the
arrangements (including the contract governing such arrangements) with respect
to assets of the Fund with any such 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;
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and (e) advise the Fund and the Fund's investment adviser, as soon as reasonably
possible, 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 the 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 (but not the custody and
settlement practices of any Eligible Foreign Custodian whose custody and
settlement practices are not such prevailing 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: (a) 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, to
the Fund's knowledge, no statute, regulation, rule, order, judgment or contract
binding on the Fund prohibits the Fund's execution or performance of this
Agreement; (b) this Agreement has been approved and ratified by the Board at a
meeting duly called and at which a quorum was at all times present; and (c) the
Board or the Fund's Investment Adviser has considered the Country Risks
associated with investment in each Specified Country and will have considered
such risks prior to any settlement instructions being given to the Custodian
with respect to any other country.
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, to BNY's knowledge, no statute,
regulation, rule, order, judgment or contract binding on BNY prohibits BNY's
execution or performance of this Agreement; (c) BNY has established and will
maintain the Monitoring System, and (d) BNY is a U.S. Bank as defined in
paragraph (a)(7) of the Rule.
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ARTICLE V.
CONCERNING BNY
1. BNY shall not be liable under this Agreement 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, nor shall the Fund be liable to BNY or any
third party for 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.
ARTICLE VI.
MISCELLANEOUS
1. This Agreement constitutes the entire agreement between the Fund and
BNY as a foreign custody manager, and no provision in the Custody Agreement
between the Fund and the Custodian shall affect the duties and obligations of
BNY hereunder, nor shall any provision in this Agreement affect the duties or
obligations of the Custodian under the Custody 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 0000 X. Xxxxxxxxxx Xxxxx Xxxx, Xxxxxxxxxx, XX 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
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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.
5. This Agreement shall be construed in accordance with the substantive
laws of the State of New York, without regard to conflicts of laws principles
thereof. The Fund and BNY hereby consent to the jurisdiction of a state or
federal court situated in New York City, New York in connection with any dispute
arising hereunder. The Fund and BNY each hereby irrevocably waives, to the
fullest extent permitted by applicable law, any objection which it may now or
hereafter have to the laying of venue of any such proceeding brought in such a
court and any claim that such proceeding brought in such a court has been
brought in an inconvenient forum. 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.
6. 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.
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. 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.
9. A copy of the Declaration of Trust of the each Fund that is a
Massachusetts Business Trust is on file with the Secretary of the Commonwealth
of Massachusetts, and notice is hereby given that this instrument is executed on
behalf of the Board of Trustees of the Fund as Trustees and not individually and
that the obligations of this instrument are not binding upon any of the Trustees
or shareholders individually but are binding only upon the assets and property
of the Fund; provided, however, that the Declaration of Trust of the Fund
provides that the assets of a particular Series of the Fund shall under no
circumstances be charged with liabilities attributable to any other Series of
the Fund and that all persons extending credit to, or contracting with or having
any claim against a particular Series of the Fund shall look only to the assets
of that particular Series for payment of such credit, contract or claim.
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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.
By:
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on behalf of each Fund identified
on Schedule 1 hereto
THE BANK OF NEW YORK
By:
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Title:
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SCHEDULE 1
Name of Fund Name of Series
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SCHEDULE 2
Specified Countries
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Argentina Lithuania
Australia Luxembourg
Austria Malaysia
Bahrain Mauritius
Bangladesh Mexico
Belgium Morocco
Bermuda Namibia
Bolivia Netherlands
Botswana New Zealand
Brazil Nigeria
Bulgaria Norway
Canada Xxxx
Xxxxx Xxxxxxxx
Xxxxx Xxxxxx
Xxxxxxxx Xxxx
Costa Rica Philippines
Croatia Poland
Cyprus Portugal
Czech Republic Romania
Denmark Russia
Ecuador Singapore
Egypt Slovakia
Estonia Slovenia
Finland South Africa
France South Korea
Germany Spain
Ghana Sri Lanka
Greece Swaziland
Hong Kong Sweden
Hungary Switzerland
India Taiwan
Indonesia Thailand
Ireland Transnational
Israel Turkey
Italy Ukraine
Ivory Coast United Kingdom
Japan Uruguay
Jordan Venezuela
Kenya Zambia
Latvia Zimbabwe
Lebanon
