Xxxxxxx Target Fund
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
As of December 17, 0000
Xxxxx Xxxxxx Xxxx & Trust Company
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
RE: Custodian Contract between Xxxxxxx Target Fund (the "Fund")
and State Street Bank & Trust Company (the "Custodian")
------------------------------------------------------------
Gentlemen:
The Custodian Contract between the Fund and the Custodian, which is being
entered into as of the above date, contemplates the possibility of the
employment of a special custodian in connection with certain repurchase
transactions, but does not fully set forth the terms under which such special
custodian would be employed. The Fund anticipates that any such special
custodian would be employed by the Fund rather than by the Custodian and that
the terms of such employment would be governed by a special custodian agreement
entered into by the Fund and the special custodian. In this connection, the Fund
agrees not to employ a special custodian until the Fund and the Custodian have
entered into a master repurchase agreement or other agreement which sets forth
the terms governing the relationship, including the method of transfer of
securities and cash, between the Custodian and any special custodian employed by
the Fund.
Very truly yours,
XXXXXXX TARGET FUND
By: /s/ Xxxxx X. Xxx
------------------------------
CUSTODIAN CONTRACT
This Contract between Xxxxxxx Target Fund (the "Fund"), a Massachusetts
business trust created under a Declaration of Trust dated July 24, 1981, as the
same may be amended from time to time (the "Declaration of Trust") and State
Street Bank and Trust Company (the "Custodian"),
WITNESSETH: That in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
I. Employment of Custodian and Property to be Held by It; Application of
Contract
The Fund hereby employs the Custodian as the Custodian of its assets
pursuant to the provisions of the Declaration of Trust and the By-Laws of the
Fund. The Fund agrees to deliver to the Custodian all securities and cash owned
by it, and all payments of income, payments of principal or capital
distributions received by it with respect to all securities owned by the Fund
from time to time, and the cash consideration received by it for such new or
treasury shares of beneficial interest, without par value, ("Shares") of all
series (each a "Portfolio") of the Fund as may be issued or sold from time to
time. The Custodian shall not be responsible for any property of the Fund held
or received by the Fund and not delivered to the Custodian.
The Custodian may from time to time employ one or more sub-custodians, but
only in accordance with an applicable vote by the Trustees of the Fund, and
provided that the Custodian shall have
no more or less responsibility or liability to the Fund on account of any
actions or omissions of any sub-custodian so employed than any such
sub-custodian has to the Custodian.
State Street acknowledges that Portfolios may be terminated, and additional
Portfolios established, from time to time by action of the trustees of the Fund.
If the context requires and unless otherwise specifically provided herein, the
term "Fund" as used in this Contract shall mean in addition each separate
Portfolio.
II. Duties of the Custodian with Respect to Property of the Fund Held by the
Custodian
A. Holding Securities. The Custodian shall hold and physically segregate in a
separate account for each portfolio of the Fund all non-cash property
allocated to such Portfolio, including all securities owned by the Fund and
allocated to such Portfolio, except that securities which are maintained
pursuant to Section L of Article II hereof in a clearing agency which acts
as a securities depository or in a book-entry system authorized by the U.S.
Department of the Treasury, collectively referred to herein as "Securities
Systems", shall be identified as belonging to a specified portfolio.
B. Delivery of Securities. The Custodian shall release and deliver securities
owned by the Fund held by the Custodian or in a Securities Systems account
of the Custodian only upon receipt of proper instructions, which may be
continuing instructions when deemed appropriate by the parties, and only in
the following cases:
-2-
1) Upon sale of such securities for the account of the Fund and
receipt of payment therefor;
2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Fund;
3) In the case of a sale effected through a Securities System, in
accordance with the provisions of Section L hereof;
4) To the depository agent in connection with tender or other
similar offers for portfolio securities of the Fund;
5) To the Issuer thereof or its agent when such securities are
called, redeemed, retired or otherwise become payable; provided
that, in any such case, the cash or other consideration is to be
delivered to the Custodian;
6) To the Issuer thereof, or its agent, for transfer into the name
of the Fund or into the name of any nominee or nominees of the
Custodian or into the name or nominee name of any agent appointed
pursuant to Section K of Article II hereof or into the name or
nominee name of any sub-custodian appointed pursuant to Article I
hereof; or for exchange for a different number of bonds,
certificates or other evidence representing the same aggregate
face amount or number of units; provided that, in any such case,
-3-
the new securities are to be delivered to the Custodian;
7) To the broker selling the same for examination in accordance with
the "street delivery" custom; provided that the Custodian shall
adopt such procedures, as the Fund from time to time shall
approve, to ensure their prompt return to the Custodian by the
broker in the event the broker elects not to accept them;
8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment
of the securities of the Issuer of such securities; or pursuant
to provisions for conversion contained in such securities, or
pursuant to any deposit agreement; provided that, in any such
case, the new securities and cash, if any, are to be delivered to
the Custodian;
9) In the case of warrants, rights or similar securities, for the
surrender thereof in the exercise of such warrants, rights or
similar securities or the surrender of interim receipts or
temporary securities for definitive securities; provided that, in
any such case, the new securities and cash, if any, are to be
delivered to the Custodian;
10) For delivery in connection with any loans of securities made by
the Fund, but only against receipt
-4-
of adequate collateral as agreed upon from time to time by the
Custodian and the Fund, which may be in the form of cash or
obligations issued by the United States government, its agencies
or instrumentalities;
11) For delivery as security in connection with any borrowings by the
Fund requiring a pledge of assets by the Fund, but only against
receipt of amounts borrowed;
12) Upon receipt of instructions from the transfer agent for the Fund
(the "Transfer Agent"), for delivery to the Transfer Agent or to
holders of shares in connection with distributions in kind, as
may be described from time to time in the Fund's currently
effective prospectus, in satisfaction of requests by holders of
Shares for repurchase or redemption; and
13) For any other proper corporate purposes, but only upon receipt
of, in addition to proper instructions a certified copy of a
resolution of the Trustees or of the Executive Committee signed
by an officer of the Fund and certified by the Secretary or an
Assistant Secretary, specifying the securities to be delivered,
setting forth the purpose for which such delivery is to be made,
declaring such purposes to be proper corporate purposes, and
naming
-5-
the person or persons to whom delivery of such securities shall
be made.
C. Registration of Securities. Securities held by the Custodian (other than
bearer securities) shall be registered in the name of the Fund or in the
name of any nominee of the Fund or of any nominee of the Custodian which
nominee shall be assigned exclusively to the Fund, unless the Fund has
authorized in writing the appointment of a nominee to be used in common
with other registered investment companies having the same investment
adviser as the Fund, or in the name or nominee name of any agent appointed
pursuant to Section K of Article II hereof or in the name or nominee name
of any sub-custodian or special custodian appointed pursuant to Article I
hereof. All securities accepted by the Custodian on behalf of the Fund
under the terms of this Contract shall be in "street" or other good
delivery form.
D. Bank Accounts. The Custodian shall open and maintain a separate bank
account or accounts in the name of the Fund, subject only to draft or order
by the Custodian acting pursuant to the terms of this Contract, and shall
hold in such account or accounts, subject to the provisions hereof, all
cash received by it from or for the account of the Fund, other than cash
maintained by the Fund in a bank account established and used in accordance
with Rule 17f-3 under the Investment Company Act of 1940, as amended. Funds
held by the Custodian for the Fund may be deposited by it to its credit as
Custo-
-6-
xxxx in the Banking Department of the Custodian or in such other banks or
trust companies as it may in its discretion deem necessary or desirable;
provided, however, that every such bank or trust company shall be qualified
to act as a custodian under the Investment Company Act of 1940, as amended,
and that each such bank or trust company and the funds to be deposited with
each such bank or trust company shall be approved by vote of a majority of
the Trustees of the Fund. Such funds shall be deposited by the Custodian in
its capacity as Custodian and shall be withdrawable by the Custodian only
in that capacity.
E. Payments for Shares. The Custodian shall receive from the distributor of
the Fund's Shares or from the Transfer Agent and deposit into the Fund's
account such payments as are received for Shares of the Fund issued or sold
from time to time by the Fund. The Custodian will provide timely
notification to the Fund and the Transfer Agent of any receipt by it of
payments for Shares of the Fund.
F. Investment and Availability of Federal Funds. Upon mutual agreement between
the Fund and the Custodian, the Custodian shall, upon the receipt of proper
instructions, which may be continuing instructions when deemed appropriate
by the parties,
1) invest in such instruments as may be set forth n such
instructions on the same day as received all federal funds
received after a time agreed upon between the Custodian and the
Fund; and
-7-
2) make federal funds available to the Fund as of specified times
agreed upon from time to time by the Fund and the Custodian in
the amount of checks received in payment for Shares of the Fund
which are deposited into the Fund's account.
G. Collection of Income. The Custodian shall collect on a timely basis all
income and other payments with respect to registered securities held
hereunder to which the Fund shall be entitled either by law or pursuant to
custom in the securities business, and shall collect on a timely basis all
income and other payments with respect to bearer securities if, on the date
of payment by the Issuer, such securities are held by the Custodian or
agent thereof and shall credit such income, as collected, to the Fund's
custodian account. Without limiting the generality of the foregoing, the
Custodian shall detach and present for payment all coupons and other income
items requiring presentation as and when they become due and shall collect
interest when due on securities held hereunder.
H. Payment of Fund Moneys. Upon receipt of proper instructions, which may be
continuing instructions when deemed appropriate by the parties, the
Custodian shall pay out moneys of the Fund in the following cases only:
1) Upon the purchase of securities for the account of the Fund but
only (a) against the delivery of such securities to the Custodian
(or any bank, banking firm or trust company doing business in the
United
-8-
States or abroad which is qualified under the Investment Company
Act of 1940, as amended, or is permitted by a rule under such
Act, to act as a custodian and has been designated by the
Custodian as its agent for this purpose) or sub-custodian or
special custodian registered in the name of the Fund or in the
name of a nominee of the Custodian referred to in Section C of
Article II hereof or in proper form for transfer; (b) in the case
of a purchase effected through a Securities System, in accordance
with the conditions set forth in Section L of Article II hereof
or (c) in the case of repurchase agreements entered into between
the Fund and the Custodian, or another bank, (i) against delivery
of the securities either in certificate form or through an entry
crediting the Custodian's, sub-custodian's or special custodian's
account at the Federal Reserve Bank with such securities or (ii)
against delivery of the receipt evidencing purchase by the Fund
of securities owned by the Custodian or other bank along with
written evidence of the agreement by the Custodian or other bank
to repurchase such securities from the Fund;
2) In connection with conversion, exchange or surrender of
securities owned by the Fund as set forth in Section B of Article
II hereof;
-9-
3) For the redemption or repurchase of Shares issued by the Fund as
set forth in Section J of Article II hereof;
4) For the payment of any expense or liability incurred by the Fund,
including but not limited to the following payments for the
account of the Fund: interest, taxes, management, accounting,
transfer agent and legal fees, and operating expenses of the Fund
whether or not such expenses are to be in whole or part
capitalized or treated as deferred expenses;
5) For the payment of any dividends declared pursuant to the
governing documents of the Fund;
6) For any other proper purposes, but only upon receipt of, in
addition to proper instructions, a certified copy of a resolution
of the Trustees or of the Executive Committee of the Fund signed
by an officer of the Fund and certified by its Secretary or an
Assistant Secretary, specifying the amount of such payment,
setting forth the purpose for which such payment is to be made,
declaring such purpose to be a proper purpose, and naming the
person or persons to whom such payment is to be made.
I. Liability for Payment in Advance of Receipt of Securities Purchased. In any
and every case where payment for purchase of securities for the account of
the Fund is made by the Custodian in advance of receipt of the securities
purchased in the absence of specific written instructions from the Fund
-10-
to so pay in advance, the Custodian shall be absolutely liable to the Fund
for such securities to the same extent as if the securities had been
received by the Custodian, except that in the case of repurchase agreements
entered into by the Fund with a bank which is a member of the Federal
Reserve System, the Custodian may transfer funds to the account of such
bank prior to the receipt of written evidence that the securities subject
to such repurchase agreement have been transferred by book-entry into a
segregated non-proprietary account of the Custodian maintained with the
Federal Reserve Bank of Boston or of the safe-keeping receipt, provided
that such securities have in fact been so transferred by book-entry.
J. Payments for Repurchases or Redemptions of Shares of the Fund. From such
funds as may be available for the purpose but subject to the limitations of
the Declaration of Trust and any applicable votes of the Trustees of the
Fund pursuant thereto, the Custodian shall, upon receipt of instructions
from the Transfer Agent, make funds available for payment to holders of
Shares who have delivered to the Transfer Agent a request for redemption or
repurchase of their Shares. In connection with the redemption or repurchase
of Shares of the Fund, the Custodian is authorized upon receipt of
instructions from the Transfer Agent to wire funds to or through a
commercial bank designated by the redeeming shareholders. In connection
with the redemption or repurchase of
-11-
Shares of the Fund, the Custodian shall honor checks drawn on the
Custodian by a holder of Shares, which checks have been furnished by the
Fund to the holder of Shares, when presented to the Custodian in
accordance with such procedures and controls as are mutually agreed upon
from time to time between the Fund and the Custodian.
K. Appointment of Agents. The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the Investment Company Act of 1940,
as amended, to act as a custodian, as its agent to carry out such of the
provisions of this Article II as the Custodian may from time to time
direct; provided, however, that the appointment of any agent shall not
relieve the Custodian of any of its responsibilities or liabilities
hereunder.
L. Deposit of Fund Assets in Securities Systems. The Custodian may deposit
and/or maintain securities owned by the Fund in a clearing agency
registered with the Securities and Exchange Commission under Section 17A of
the Securities Exchange Act of 1934, which acts as a securities depository,
or in the book-entry system authorized by the U.S. Department of the
Treasury and certain federal agencies, collectively referred to herein as
"Securities Systems" in accordance with applicable Federal Reserve Board
and Securities and Exchange Commission rules and regulations, if any, and
subject to the following provisions:
-12-
1) The Custodian may keep securities of the Fund in a Securities
System provided that such securities are represented in an
account ("Account") of the Custodian in the Securities System
which shall not include any assets of the Custodian other than
assets held as a fiduciary, custodian, or otherwise for
customers.
2) The records of the Custodian with respect to securities of the
Fund which are maintained in a Securities System shall identify
by Portfolio by book-entry those securities belonging to the
Fund.
3) The Custodian shall pay for securities purchased for the account
of the 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 the Fund.
The Custodian shall transfer securities sold for the account of
the Fund upon (i) receipt of advice from the Securities System
that payment for such securities has been transferred to the
Account1 and (ii) the making of an entry on the records of the
Custodian to reflect such transfer and payment for the account of
the Fund. Copies of all advices from the Securities System of
transfers of securities for the
-13-
account of the Fund shall identify the Fund, be maintained for
the Fund by the Custodian and be provided to the Fund at its
request. The Custodian shall furnish the Fund confirmation of
each transfer to or from the account of the Fund in the form of a
written advice or notice and shall furnish to the Fund copies of
daily transaction sheets reflecting each day's transactions in
the Securities System for the account of the Fund on the next
business day.
4) The Custodian shall provide the Fund with any report obtained by
the Custodian on the Securities System's accounting system,
internal accounting control and procedures for safeguarding
securities deposited in the Securities System.
5) The Custodian shall have received the initial or annual
certificate, as the case may be, required by Article IX hereof.
6) Anything to the contrary in this Contract notwithstanding, the
Custodian shall be liable to the Fund for any loss or damage to
the Fund resulting from use of the Securities System by reason of
any negligence, misfeasance or misconduct of the Custodian or any
of its agents or of any of its or their employees or from any
failure of the Custodian or any such agent to enforce effectively
-14-
such rights as it may have against the Securities System; at the
election of the Fund, it shall be entitled to be subrogated to
the rights of the Custodian with respect to any claim against the
Securities System or any other person which the Custodian may
have as a consequence of any such loss or damage if and to the
extent that the Fund has not been made whole for any such loss or
damage.
M. Ownership Certificates for Tax Purposes. The Custodian shall execute
ownership and other certificates and affidavits for all federal and state
tax purposes in connection with receipt of income or other payments with
respect to securities of the Fund held by it and in connection with
transfers of securities.
N. Proxies. The Custodian shall, with respect to the securities held
hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name of
the Fund or a nominee of the Fund, all proxies, without indication of the
manner in which such proxies are to be voted, and shall promptly deliver to
the Fund such proxies, all proxy soliciting materials and all notices
relating to such securities.
O. Communications Relating to Fund Portfolio Securities. The Custodian shall
transmit promptly to the Fund all written information (including, without
limitation, pendency of calls
-15-
and maturities of securities and expirations of rights in connection
therewith) received by the Custodian from issuers of the securities being
held for the Fund. With respect to tender or exchange offers, the Custodian
shall transmit promptly to the Fund all written information received by the
Custodian from issuers of the securities whose tender or exchange is sought
and from the party (or his agents) making the tender or exchange offer. If
the Fund desires to take action with respect to any tender offer, exchange
offer or any other similar transaction, the Fund shall notify the Custodian
at least three business days prior to the date on which the Custodian is to
take such action.
P. Proper Instructions. "Proper instructions" as used throughout this Article
II means a writing signed or initialled by one or more person or persons as
the Trustees shall have from time to time authorized. Each such writing
shall set forth the specific transaction or type of transaction involved,
including a specific statement of the purpose for which such action is
requested. Oral instructions will be considered proper instructions if the
Custodian reasonably believes them to have been given by a person
authorized to give such instructions with respect to the transaction
involved. The Fund shall cause all oral instructions to be confirmed in
writing. Upon receipt of a certificate of the Secretary or an Assistant
Secretary as to the authorization by the Trustees of the Fund accompanied
by a detailed de-
-16-
scription of procedures approved by the Trustees, "proper instructions" may
include communications effected directly between electro-mechanical or
electronic devices provided that the Trustees and the Custodian are
satisfied that such procedures afford adequate safeguards for the Fund's
assets.
Q. Actions Permitted without Express Authority. The Custodian may in its
discretion, without express authority from the Fund:
1) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under
this contract, provided that all such payments shall be accounted
for to the Fund;
2) surrender securities in temporary form for securities in
definitive form;
3) endorse for collection, in the name of the Fund, checks, drafts
and other negotiable instruments; and
4) in general, attend to all non-discretionary details in connection
with the sale, exchange, substitution, purchase, transfer and
other dealings with the securities and property of the Fund
except as otherwise directed by the Trustees of the Fund.
R. Evidence of Authority. The Custodian shall be protected in acting upon any
instructions, notice, request, consent, certificate or other instrument or
paper believed by it to be
-17-
genuine and to have been properly executed by or on behalf of the Fund. The
Custodian may receive and accept a certified copy of a vote of the Trustees
of the Fund as conclusive evidence (a) of the authority of any person to
act in accordance with such vote or (b) of any determination or of any
action by the Trustees pursuant to the Declaration of Trust as described in
such vote, and such vote may be considered as in full force and effect
until receipt by the Custodian of written notice to the contrary.
III. Duties of Custodian with Respect to Books of Account and Calculation of Net
Asset Value and Net Income
The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the Trustees of the Fund to keep the books of
account of the Fund and/or compute the net asset value per share of the
outstanding shares of each Portfolio of the Fund or, if directed in writing to
do so by the Fund, shall itself keep such books of account and/or compute such
net asset value per share. The Custodian shall also upon request calculate the
net income of each Portfolio of the Fund and, if instructed in writing by an
officer of the Fund to do so, shall advise the Transfer Agent periodically of
the division of such net income among its various components. The calculations
of the net asset value per share and the income of the Fund shall be made at the
time or times described from time to time in the Fund's currently effective
prospectus.
-18-
IV. Records
The Custodian shall create and maintain all records relating to its
activities and obligations under this Contract in such manner as will meet the
obligations of the Fund under the Investment Company Act of 1940, as amended,
with particular attention to Section 31 thereof and Rules 31a-1 and 31a-2
thereunder, applicable federal and state tax laws and any other law or
administrative rules or procedures which may be applicable to the Fund. All such
records shall be the property of the Fund and shall at all times during the
regular business hours of the Custodian be open for inspection by duly
authorized officers, employees or agents of the Fund and employees and agents of
the Securities and Exchange Commission. The Custodian shall, at the Fund's
request, supply the Fund with a tabulation of securities owned by the Fund and
held by the Custodian and shall, when requested to do so by the Fund and for
such compensation as shall be agreed upon between the Fund and the Custodian,
include certificate numbers in such tabulations.
V. Opinion of Fund's Independent Accountant
The Custodian shall take all reasonable action, as the Fund may from time
to time request, to obtain from year to year favorable opinions from the Fund's
independent accountants with respect to its activities hereunder in connection
with the preparation of the Fund's Form N-l, and Form N-lR or other annual
reports to the Securities and Exchange Commission and with respect to any other
requirements of such Commission.
-19-
VI. Reports to Fund by Independent Public Accountants
The Custodian shall provide the Fund, at such times as the Fund may
reasonably require, with reports by independent public accountants on the
accounting system, internal accounting control and procedures for safeguarding
securities, including securities deposited and/or maintained in a Securities
System, relating to the services provided by the Custodian under this Contract;
such reports, which shall be of sufficient scope and in sufficient detail, as
may reasonably be required by the Fund, to provide reasonable assurance that any
material inadequacies would be disclosed, shall state in detail material
inadequacies disclosed by such examination, and, if there are no such
inadequacies, shall so state.
VII. Compensation of Custodian
The Custodian shall be entitled to reasonable compensation for its services
and expenses as Custodian, as agreed upon from time to time between the Fund and
the Custodian.
VIII. Responsibility of Custodian
So long as and to the extent that it is in the exercise of reasonable care
the Custodian shall not be responsible for the title, validity or genuineness of
any property or evidence of title thereto received by it or delivered by it
pursuant to this Contract and shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably believed by it to
be genuine and to be signed by the proper party or parties. The Custodian shall
be held to the exercise of rea-
-20-
sonable care in carrying out the provisions of this Contract, but shall be kept
indemnified by and shall be without liability to the Fund for any action taken
or omitted by it in good faith without negligence. It shall be entitled to rely
on and may act upon advice of counsel (who may be counsel for the Fund) on all
matters, and shall be without liability for any action reasonably taken or
omitted pursuant to such advice. Notwithstanding the foregoing, the
responsibility of the Custodian with respect to redemptions effected by check
shall be in accordance with a separate Agreement entered into between the
Custodian and the Fund.
If the Fund requires the Custodian to take any action with respect to
securities, which action involves the payment of money or which action may, in
the opinion of the Custodian, result in the Custodian or its nominee assigned to
the Fund being liable for the payment of money or incurring liability of some
other form, the Fund, as a prerequisite to requiring the Custodian to take such
action1 shall provide indemnity to the Custodian in an amount and form
satisfactory to it.
IX. Effective Period, Termination and Amendment
This Contract shall become effective as of its execution, shall continue in
full force and effect until terminated as hereinafter provided, may be amended
at any time by mutual agreement of the parties hereto and may be terminated by
either party by an instrument in writing delivered or mailed, postage prepaid to
the other party, such termination to take effect not sooner than thirty (30)
days after the date of such delivery or mailing;
-21-
provided, however that the Custodian shall not act under Section L of Article II
hereof in the absence of receipt of an initial certificate of the Secretary or
an Assistant Secretary that the Trustees of the Fund have approved the initial
use of a particular Securities System and the receipt of an annual certificate
of the Secretary or an Assistant Secretary that the Trustees have reviewed the
use by the Fund of such Securities System, as required in each case by Rule
17f-4 under the Investment Company Act of 1940, as amended; provided further,
however, that the Fund shall not amend or terminate this Contract in
contravention of any applicable federal or state regulations, or any provision
of the Declaration of Trust or the Fund's By-Laws, and further provided, that
the Fund may at any time by action of its Trustees (i) substitute another bank
or trust company for the Custodian by giving notice as described above to the
Custodian, or (ii) immediately terminate this Contract in the event of the
appointment of a conservator or receiver for the Custodian by the Federal
Deposit Insurance Corporation or Commissioner of Banks for the Commonwealth of
Massachusetts or upon the happening of a like event at the direction of an
appropriate regulatory agency or court of competent jurisdiction.
Upon termination of the Contract, the Fund shall pay to the Custodian such
compensation as may be due as of the date of such termination and shall likewise
reimburse the Custodian for its costs, expenses and disbursements.
X. Successor Custodian
If a successor custodian shall be appointed by the Trustees
-22-
of the Fund, the Custodian shall, upon termination, deliver to such successor
custodian at the office of the Custodian, duly endorsed and in the form for
transfer, all securities then held by it hereunder.
If no such successor custodian shall be appointed, the Custodian shall, in
like manner, upon receipt of a certified copy of a vote of the shareholders of
the Fund, deliver at the office of the Custodian such securities, funds and
other properties in accordance with such vote.
In the event that no written order designating a successor custodian or
certified copy of a vote of the Trustees shall have been delivered to the
Custodian on or before the date when such termination shall become effective,
then the Custodian shall have the right to deliver to a bank or trust company,
which is a "bank" as defined in the Investment Company Act of 1940, as amended,
doing business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $25,000,000, all securities, funds and other
properties held by the Custodian and all instruments held by the Custodian
relative thereto and all other property held by it under this Contract.
Thereafter, such bank or trust company shall be the successor of the Custodian
under this Contract.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Fund to" procure the certi-
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fied copy of vote referred to or of the Trustees to appoint a successor
custodian, the Custodian shall be entitled to fair compensation for its services
during such period as the Custodian retains possession of such securities, funds
and other properties and the provisions of this Contract relating to the duties
and obligations of the Custodian shall remain in full force and effect.
XI. Special Provisions Concerning Repurchase Agreements.
Notwithstanding anything to the contrary in this Agreement, upon receipt of
proper instructions, which may be standing instructions, in connection with
repurchase agreements, the Custodian shall transmit, prior to receipt on behalf
of the Fund of any securities or other property, funds from the Fund1s custodian
account to a special custodian approved by the Trustees of the Fund, which funds
shall be used to pay for securities to be purchased by the Fund subject to the
Fund's obligation to sell and the seller's obligation to repurchase such
securities. In such a case, the securities shall be held in the custody of the
special custodian.
XII. Interpretive and Additional Provisions
In connection with the operation of this Contract, the Custodian and the
Fund may from time to time agree on such provisions interpretive of or in
addition to the provisions of this Contract as may in their joint opinion be
consistent with the general tenor of this Contract. Any such interpretive or
additional provisions shall be in a writing signed by both parties and shall be
annexed hereto, provided that no such interpretive or additional provisions
shall contravene any applicable federal or state regulations
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or any provision of the Declaration of Trust or the By-Laws of the Fund. No
interpretive or additional provisions made as provided in the preceding sentence
shall be deemed to be an amendment of this Contract.
XIII. Trustees
All references to actions of or by Trustees herein shall require action by
such Trustees acting as a board or formally constituted group and not
individually.
XIV. Massachusetts Law to Apply
This Contract shall be construed and the provisions thereof interpreted
under and in accordance with the laws of the Commonwealth of Massachusetts.
The name "Xxxxxxx Target Fund" is the designation of the Trustees for the
time being under a Declaration of Trust dated July 24, 1981, as amended, and all
persons dealing with the Fund must look solely to the property of the Fund for
the enforcement of any claim against the Fund as neither the Trustees, officers,
agents or shareholders assume any personal liability for obligations entered
into on behalf of the Fund.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly
-25-
authorized representative and its seal to be hereunder affixed as of the 17th
day of December, 1982.
SEAL XXXXXXX TARGET FUND
By /s/ Xxxxx X. Xxx
---------------------------------------
[Title]
SEAL STATE STREET BANK AND TRUST COMPANY By
By /s/ X.X. Xxxxxx Xx.
---------------------------------------
[Title]
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