CUSTODIAN AGREEMENT
This Agreement is made as of January 15, 2003 by and between EVERGREEN
INCOME ADVANTAGE FUND a statutory trust organized and existing under the laws of
Delaware (the "Fund"), and STATE STREET BANK and TRUST COMPANY, a Massachusetts
trust company (the "Custodian"),
WITNESSETH:
WHEREAS, the Fund is authorized to issue shares of common stock or
shares of beneficial interest in separate series ("Shares"), with each such
series representing interests in a separate portfolio of securities and other
assets; and
WHEREAS, the Fund intends that this Agreement be applicable to one (1)
series, Evergreen Income Advantage Fund (such series together with any other
series of the Fund made subject to this Agreement in accordance with Section
18.5 or any other series subsequently established by the Fund, and made subject
to this Agreement in accordance with Section 18.5, be referred to herein as the
"Portfolio(s)").
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
SECTION 1. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT
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The Fund hereby employs the Custodian as a custodian of assets of the
Portfolios, including securities which the Fund, on behalf of the applicable
Portfolio, desires to be held in places within the United States ("domestic
securities") and securities it desires to be held outside the United States
("foreign securities"). The Custodian shall not be responsible for any property
of a Portfolio which is not received by it or which is delivered out in
accordance with Proper Instructions (as such term is defined in Section 7
hereof) including, without limitation, Portfolio property (i) held by brokers,
private bankers or other entities on behalf of the Portfolio (each a "Local
Agent"), (ii) held by Special Sub-Custodians (as such term is defined in Section
5 hereof), (iii) held by entities which have advanced monies to or on behalf of
the Portfolio and which have received Portfolio property as security for such
advance(s) (each a "Pledgee"), or (iv) delivered or otherwise removed from the
custody of the Custodian (a) in connection with any Free Trade (as such term is
hereinafter defined) or (b) pursuant to Special Instructions (as such term is
defined in Section 7 hereof). With respect to uncertificated shares (the
"Underlying Shares") of registered "investment companies" (as defined in Section
3(a)(1) of the Investment Company Act of 1940, as amended (the "1940 Act")),
whether in the same "group of investment companies" (as defined in Section
12(d)(1)(G)(ii) of the 0000 Xxx) or otherwise, including pursuant to Section
12(d)(1)(F) of the 1940 Act (hereinafter sometimes referred to as the
"Underlying Portfolios") the holding of confirmation statements that identify
the shares as being recorded in the Custodian's name on behalf of the Portfolios
will be deemed custody for purposes hereof.
Upon receipt of Proper Instructions, the Custodian shall on behalf of the
applicable Portfolio(s) from time to time employ one or more sub-custodians
located in the United States, but only in accordance with an applicable vote by
the Board of Trustees of the Fund (the "Board") on behalf of the applicable
Portfolio(s), 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. The Custodian may employ as sub-custodian for the Fund's foreign
securities on behalf of the applicable Portfolio(s) the foreign banking
institutions and foreign securities depositories designated in Schedules A and B
hereto, but only in accordance with the applicable provisions of Sections 3 and
4 hereof.
SECTION 2. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE
PORTFOLIOS TO BE HELD IN THE UNITED STATES
SECTION 2.1 HOLDING SECURITIES. The Custodian shall hold and physically
segregate for the account of each Portfolio all non-cash property, to be held by
it in the United States, including all domestic securities owned by such
Portfolio other than (a) securities which are maintained pursuant to Section 2.8
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 (each, a "U.S.
Securities System") and (b) Underlying Shares owned by the Fund which are
maintained pursuant to Section 2.10 hereof in an account with State Street Bank
and Trust Company or such other entity which may from time to time act as a
transfer agent for the Underlying Portfolios and with respect to which the
Custodian is provided with Proper Instructions (the "Underlying Transfer
Agent").
SECTION 2.2 DELIVERY OF SECURITIES. The Custodian shall release and
deliver domestic securities owned by a Portfolio held by the Custodian, in a
U.S. Securities System account of the Custodian or in an account at the
Underlying Transfer Agent, only upon receipt of Proper Instructions on behalf of
the applicable Portfolio, which may be continuing instructions when deemed
appropriate by the parties, and only in the following cases:
1) Upon sale of such securities for the account of the Portfolio 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 Portfolio;
3) In the case of a sale effected through a U.S. Securities System, in
accordance with the provisions of Section 2.8 hereof;
4) To the depository agent in connection with tender or other similar offers
for securities of the Portfolio;
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
Portfolio 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
2.7 or into the name or nominee name of any sub-custodian appointed
pursuant to Section 1; 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, the new securities are
to be delivered to the Custodian;
7) Upon the sale of such securities for the account of the Portfolio, to the
broker or its clearing agent, against a receipt, for examination in
accordance with "street delivery" custom; provided that in any such case,
the Custodian shall have no responsibility or liability for any loss
arising from the delivery of such securities prior to receiving payment for
such securities except as may arise from the Custodian's own negligence or
willful misconduct;
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, 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
Portfolio (a) against receipt of collateral as agreed from time to time by
the Fund on behalf of the Portfolio, except that in connection with any
loans for which collateral is to be credited to the Custodian's account in
the book-entry system authorized by the U.S. Department of the Treasury,
the Custodian will not be held liable or responsible for the delivery of
securities owned by the Portfolio prior to the receipt of such collateral
or (b) to the lending agent, or the lending agent's custodian, in
accordance with written Proper Instructions (which may not provide for the
receipt by the Custodian of collateral therefor) agreed upon from time to
time by the Custodian and the Fund;
11) For delivery as security in connection with any borrowing by the Fund on
behalf of a Portfolio requiring a pledge of assets by the Fund on behalf of
such Portfolio;
12) For delivery in accordance with the provisions of any agreement among the
Fund on behalf of the Portfolio, the Custodian and a broker-dealer
registered under the Securities Exchange Act of 1934 (the "Exchange Act")
and a member of The National Association of Securities Dealers, Inc. (the
"NASD"), relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange, or of any
similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Fund on behalf of a
Portfolio;
13) For delivery in accordance with the provisions of any agreement among the
Fund on behalf of the Portfolio, the Custodian, and a futures commission
merchant registered under the Commodity Exchange Act, relating to
compliance with the rules of the Commodity Futures Trading Commission (the
"CFTC") and/or any contract market, or any similar organization or
organizations, regarding account deposits in connection with transactions
by the Fund on behalf of a Portfolio;
14) Upon the sale or other delivery of such investments (including, without
limitation, to one or more (a) Special Sub-Custodians or (b) additional
custodians appointed by the Fund, and communicated to the Custodian from
time to time via a writing duly executed by an authorized officer of the
Fund, for the purpose of engaging in repurchase agreement transactions(s),
each a "Repo Custodian"), and prior to receipt of payment therefor, as set
forth in written Proper Instructions (such delivery in advance of payment,
along with payment in advance of delivery made in accordance with Section
2.6(7), as applicable, shall each be referred to herein as a "Free Trade"),
provided that such Proper Instructions shall set forth (a) the securities
of the Portfolio to be delivered and (b) the person(s) to whom delivery of
such securities shall be made;
15) Upon receipt of instructions from the Fund's transfer agent (the "Transfer
Agent") for delivery to such Transfer Agent or to the holders of Shares in
connection with distributions in kind, as may be described from time to
time in the currently effective prospectus and statement of additional
information of the Fund related to the Portfolio (the "Prospectus"), in
satisfaction of requests by holders of Shares for repurchase or redemption;
16) In the case of a sale processed through the Underlying Transfer Agent or
Underlying Shares, in accordance with Section 2.10 hereof; and
17) For any other purpose, but only upon receipt of Proper Instructions from
the Fund on behalf of the applicable Portfolio specifying (a) the
securities of the Portfolio to be delivered and (b) the person(s) to whom
delivery of such securities shall be made.
SECTION 2.3 REGISTRATION OF SECURITIES. Domestic securities held by the
Custodian (other than bearer securities) shall be registered in the name of the
Portfolio or in the name of any nominee of the Fund on behalf of the Portfolio
or of any nominee of the Custodian which nominee shall be assigned exclusively
to the Portfolio, unless the Fund has authorized in writing the appointment of a
nominee to be used in common with other registered management investment
companies having the same investment adviser as the Portfolio, or in the name or
nominee name of any agent appointed pursuant to Section 2.7 or in the name or
nominee name of any sub-custodian appointed pursuant to Section 1. All
securities accepted by the Custodian on behalf of the Portfolio under the terms
of this Agreement shall be in "street name" or other good delivery form. If,
however, the Fund directs the Custodian to maintain securities in "street name",
the Custodian shall utilize its best efforts only to timely collect income due
the Fund on such securities and to notify the Fund on a best efforts basis only
of relevant corporate actions including, without limitation, pendency of calls,
maturities, tender or exchange offers.
SECTION 2.4 BANK ACCOUNTS. The Custodian shall open and maintain a
separate bank account or accounts in the United States in the name of each
Portfolio of the Fund, subject only to draft or order by the Custodian acting
pursuant to the terms of this Agreement, 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 Portfolio, other than cash maintained by the Portfolio in a
bank account established and used in accordance with Rule 17f-3 under the 1940
Act. Funds held by the Custodian for a Portfolio may be deposited by it to its
credit as Custodian 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 1940 Act and that each such bank or
trust company and the funds to be deposited with each such bank or trust company
shall on behalf of each applicable Portfolio be approved by vote of a majority
of the Board. Such funds shall be deposited by the Custodian in its capacity as
Custodian and shall be withdrawable by the Custodian only in that capacity.
SECTION 2.5 COLLECTION OF INCOME. Except with respect to Portfolio
property released and delivered pursuant to Section 2.2(14) or purchased
pursuant to Section 2.6(7), and subject to the provisions of Section 2.3, the
Custodian shall collect on a timely basis all income and other payments with
respect to registered domestic securities held hereunder to which each Portfolio
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 domestic securities if, on the date of payment by the issuer,
such securities are held by the Custodian or its agent thereof and shall credit
such income, as collected, to such Portfolio'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. Income due each Portfolio on securities loaned pursuant to the
provisions of Section 2.2 (10) shall be the responsibility of the Fund. The
Custodian will have no duty or responsibility in connection therewith, other
than to provide the Fund with such information or data as may be necessary to
assist the Fund in arranging for the timely delivery to the Custodian of the
income to which the Portfolio is properly entitled.
SECTION 2.6 PAYMENT OF FUND MONIES. Upon receipt of Proper Instructions
on behalf of the applicable Portfolio, which may be continuing instructions when
deemed appropriate by the parties, the Custodian shall pay out monies of a
Portfolio in the following cases only:
1) Upon the purchase of domestic securities, options, futures contracts or
options on futures contracts for the account of the Portfolio but only (a)
against the delivery of such securities or evidence of title to such
options, futures contracts or options on futures contracts to the Custodian
(or any bank, banking firm or trust company doing business in the United
States or abroad which is qualified under the 1940 Act to act as a
custodian and has been designated by the Custodian as its agent for this
purpose) registered in the name of the Portfolio or in the name of a
nominee of the Custodian referred to in Section 2.3 hereof or in proper
form for transfer; (b) in the case of a purchase effected through a U.S.
Securities System, in accordance with the conditions set forth in Section
2.8 hereof; (c) in the case of a purchase of Underlying Shares, in
accordance with the conditions set forth in Section 2.10 hereof; (d) in the
case of repurchase agreements entered into between the Fund on behalf of
the Portfolio and the Custodian, or another bank, or a broker-dealer which
is a member of NASD, (i) against delivery of the securities either in
certificate form or through an entry crediting the Custodian's account at
the Federal Reserve Bank with such securities or (ii) against delivery of
the receipt evidencing purchase by the Portfolio of securities owned by the
Custodian along with written evidence of the agreement by the Custodian to
repurchase such securities from the Portfolio; or (e) for transfer to a
time deposit account of the Fund in any bank, whether domestic or foreign;
such transfer may be effected prior to receipt of a confirmation from a
broker and/or the applicable bank pursuant to Proper Instructions from the
Fund as defined herein;
2) In connection with conversion, exchange or surrender of securities owned by
the Portfolio as set forth in Section 2.2 hereof;
3) For the redemption or repurchase of Shares issued as set forth in Section 6
hereof;
4) For the payment of any expense or liability incurred by the Portfolio,
including but not limited to the following payments for the account of the
Portfolio: 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 on Shares declared pursuant to the Fund's
articles of incorporation or organization and by-laws or agreement or
declaration of trust, as applicable, and Prospectus (collectively, the
"Governing Documents");
6) For payment of the amount of dividends received in respect of securities
sold short;
7) Upon the purchase of domestic investments including, without limitation,
repurchase agreement transactions involving delivery of Portfolio monies to
Repo Custodian(s), and prior to receipt of such investments, as set forth
in written Proper Instructions (such payment in advance of delivery, along
with delivery in advance of payment made in accordance with Section
2.2(14), as applicable, shall each be referred to herein as a "Free
Trade"), provided that such Proper Instructions shall also set forth (a)
the amount of such payment and (b) the person(s) to whom such payment is
made; and
8) For any other purpose, but only upon receipt of Proper Instructions from
the Fund on behalf of the Portfolio specifying (a) the amount of such
payment and (b) the person(s) to whom such payment is to be made.
SECTION 2.7 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 1940 Act to act as a
custodian, as its agent to carry out such of the provisions of this Section 2 as
the Custodian may from time to time direct; provided, however, that the
appointment of any agent shall not relieve the Custodian of its responsibilities
or liabilities hereunder. The Underlying Transfer Agent shall not be deemed an
agent or subcustodian of the Custodian for purposes of this Section 2.7 or any
other provision of this Agreement.
SECTION 2.8 DEPOSIT OF FUND ASSETS IN U.S. SECURITIES SYSTEMS. The Custodian may
deposit and/or maintain securities owned by a Portfolio in a U.S.
Securities System subject to the following provisions:
1) The Custodian may keep securities of the Portfolio in a U.S. Securities
System provided that such securities are represented in an account of the
Custodian in the U.S. Securities System (the "U.S. Securities System
Account") which account 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 Portfolio
which are maintained in a U.S. Securities System shall identify by
book-entry those securities belonging to the Portfolio;
3) The Custodian shall pay for securities purchased for the account of the
Portfolio upon (a) receipt of advice from the U.S. Securities System that
such securities have been transferred to the U.S. Securities System Account
and (b) the making of an entry on the records of the Custodian to reflect
such payment and transfer for the account of the Portfolio. The Custodian
shall transfer securities sold for the account of the Portfolio upon (i)
receipt of advice from the U.S. Securities System that payment for such
securities has been transferred to the U.S. Securities System Account and
(ii) the making of an entry on the records of the Custodian to reflect such
transfer and payment for the account of the Portfolio. Copies of all
advices from the U.S. Securities System of transfers of securities for the
account of the Portfolio shall identify the Portfolio, be maintained for
the Portfolio by the Custodian and be provided to the Fund at its request.
Upon request, the Custodian shall furnish the Fund confirmation of each
transfer to or from the account of the Portfolio 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 U.S. Securities System for
the account of the Portfolio;
4) The Custodian shall provide the Fund with any report obtained by the
Custodian on the U.S. Securities System's accounting system, internal
accounting control and procedures for safeguarding securities deposited in
the U.S. Securities System; and
5) Anything to the contrary in this Agreement notwithstanding, the Custodian
shall be liable to the Fund for the benefit of the Portfolio for any loss
or damage to the Portfolio resulting from use of the U.S. 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 failure of
the Custodian or any such agent to enforce effectively such rights as it
may have against the U.S. 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 U.S. 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 Portfolio has not been made whole for any such
loss or damage.
SECTION 2.9 SEGREGATED ACCOUNT. The Custodian shall upon receipt of
Proper Instructions on behalf of each applicable Portfolio, establish and
maintain a segregated account or accounts for and on behalf of each such
Portfolio, into which account or accounts may be transferred cash and/or
securities, including securities maintained in an account by the Custodian
pursuant to Section 2.8 hereof, (a) in accordance with the provisions of any
agreement among the Fund on behalf of the Portfolio, the Custodian and a
broker-dealer registered under the Exchange Act and a member of the NASD (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 CFTC or any registered
contract market), or of any similar organization or organizations, regarding
escrow or other arrangements in connection with transactions by the Portfolio,
(b) for purposes of segregating cash or government securities in connection with
options purchased, sold or written by the Portfolio or commodity futures
contracts or options thereon purchased or sold by the Portfolio, (c) for the
purposes of compliance by the Portfolio with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release of the U.S.
Securities and Exchange Commission (the "SEC"), or interpretative opinion of the
staff of the SEC, relating to the maintenance of segregated accounts by
registered management investment companies, and (d) for any other purpose in
accordance with Proper Instructions.
SECTION 2.10 DEPOSIT OF FUND ASSETS WITH THE UNDERLYING TRANSFER AGENT.
Underlying Shares shall be deposited and/or maintained in an account or accounts
maintained with the Underlying Transfer Agent. The Underlying Transfer Agent
shall be deemed to be acting as if it is a "securities depository" for purposes
of Rule 17f-4 under the 1940 Act. The Fund hereby directs the Custodian to
deposit and/or maintain such securities with the Underlying Transfer Agent,
subject to the following provisions:
1) The Custodian shall keep Underlying Shares owned by a
Portfolio with the Underlying Transfer Agent provided that
such securities are maintained in an account or accounts on
the books and records of the Underlying Transfer Agent in the
name of the Custodian as custodian for the Portfolio.
2) The records of the Custodian with respect to Underlying
Shares which are maintained with the Underlying Transfer Agent
shall identify by book-entry those Underlying Shares belonging
to each Portfolio;
3) The Custodian shall pay for Underlying Shares purchased for
the account of a Portfolio upon (a) receipt of advice from the
Portfolio's investment adviser that such Underlying Shares
have been purchased and will be transferred to the account of
the Custodian, on behalf of the Portfolio, on the books and
records of the Underlying Transfer Agent and (b) the making of
an entry on the records of the Custodian to reflect such
payment and transfer for the account of the Portfolio. The
Custodian shall receive confirmation from the Underlying
Transfer Agent of the purchase of such securities and the
transfer of such securities to the Custodian's account with
the Underlying Transfer Agent only after such payment is made.
The Custodian shall transfer Underlying Shares redeemed for
the account of a Portfolio (i) upon receipt of an advice from
the Portfolio's investment adviser that such securities have
been redeemed and that payment for such securities will be
transferred to the Custodian and (ii) the making of an entry
on the records of the Custodian to reflect such transfer and
payment for the account of the Portfolio. The Custodian will
receive confirmation from the Underlying Transfer Agent of the
redemption of such securities and payment therefor only after
such securities are redeemed. Copies of all advices from the
Portfolio's investment adviser of purchases and sales of
Underlying Shares for the account of the Portfolio shall
identify the Portfolio, be maintained for the Portfolio by the
Custodian, and be provided to the Portfolio's investment
adviser at its request; and
4) The Custodian shall be not be liable to the Fund or any
Portfolio for any loss or damage to the Fund or any Portfolio
resulting from maintenance of Underlying Shares with
Underlying Transfer Agent except for losses resulting directly
from the negligence, misfeasance or misconduct of the
Custodian or any of its agents or of any of its or their
employees.
SECTION 2.11 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 domestic securities of each Portfolio held by it and in
connection with transfers of securities.
SECTION 2.12 PROXIES. Except with respect to Portfolio property
released and delivered pursuant to Section 2.2(14), or purchased pursuant to
Section 2.6(7), the Custodian shall, with respect to the domestic 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
Portfolio or a nominee of the Portfolio, 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.
SECTION 2.13 COMMUNICATIONS RELATING TO PORTFOLIO SECURITIES. Except
with respect to Portfolio property released and delivered pursuant to Section
2.2(14), or purchased pursuant to Section 2.6(7), and subject to the provisions
of Section 2.3, the Custodian shall transmit promptly to the Fund for each
Portfolio all written information (including, without limitation, pendency of
calls and maturities of domestic securities and expirations of rights in
connection therewith and notices of exercise of call and put options written by
the Fund on behalf of the Portfolio and the maturity of futures contracts
purchased or sold by the Fund on behalf of the Portfolio) received by the
Custodian from issuers of the securities being held for the Portfolio. 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 its 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.
SECTION 3. PROVISIONS RELATING TO RULES 17F-5 AND 17F-7
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SECTION 3.1. DEFINITIONS. As used throughout this Agreement, the capitalized
terms set forth below shall have the indicated meanings:
"Country Risk" means all factors reasonably related to the systemic risk of
holding Foreign Assets in a particular country including, but not limited to,
such country's political environment, economic and financial infrastructure
(including any Eligible Securities Depository operating in the country),
prevailing or developing custody and settlement practices, and laws and
regulations applicable to the safekeeping and recovery of Foreign Assets held in
custody in that country.
"Eligible Foreign Custodian" has the meaning set forth in section (a)(1) of Rule
17f-5, including a majority-owned or indirect subsidiary of a U.S. Bank (as
defined in Rule 17f-5), a bank holding company meeting the requirements of an
Eligible Foreign Custodian (as set forth in Rule 17f-5 or by other appropriate
action of the SEC, or a foreign branch of a Bank (as defined in Section 2(a)(5)
of the 0000 Xxx) meeting the requirements of a custodian under Section 17(f) of
the 1940 Act; the term does not include any Eligible Securities Depository.
"Eligible Securities Depository" has the meaning set forth in section (b)(1) of
Rule 17f-7.
"Foreign Assets" means any of the Portfolios' investments (including foreign
currencies) for which the primary market is outside the United States and such
cash and cash equivalents as are reasonably necessary to effect the Portfolios'
transactions in such investments.
"Foreign Custody Manager" has the meaning set forth in section (a)(3) of Rule
17f-5.
"Rule 17f-5" means Rule 17f-5 promulgated under the 1940 Act.
"Rule 17f-7" means Rule 17f-7 promulgated under the 1940 Act.
SECTION 3.2. THE CUSTODIAN AS FOREIGN CUSTODY MANAGER.
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3.2.1 DELEGATION TO THE CUSTODIAN AS FOREIGN CUSTODY MANAGER.
The Fund, by resolution adopted by the Board, hereby delegates to the Custodian,
subject to Section (b) of Rule 17f-5, the responsibilities set forth in this
Section 3.2 with respect to Foreign Assets of the Portfolios held outside the
United States, and the Custodian hereby accepts such delegation as Foreign
Custody Manager with respect to the Portfolios.
3.2.2 COUNTRIES COVERED. The Foreign Custody Manager shall be
responsible for performing the delegated responsibilities defined below only
with respect to the countries and custody arrangements for each such country
listed on Schedule A to this Agreement, which list of countries may be amended
from time to time by the Fund with the agreement of the Foreign Custody Manager.
The Foreign Custody Manager shall list on Schedule A the Eligible Foreign
Custodians selected by the Foreign Custody Manager to maintain the assets of the
Portfolios, which list of Eligible Foreign Custodians may be amended from time
to time in the sole discretion of the Foreign Custody Manager. The Foreign
Custody Manager will provide amended versions of Schedule A in accordance with
Section 3.2.5 hereof.
Upon the receipt by the Foreign Custody Manager of Proper Instructions to open
an account or to place or maintain Foreign Assets in a country listed on
Schedule A, and the fulfillment by the Fund, on behalf of the applicable
Portfolio(s), of the applicable account opening requirements for such country,
the Foreign Custody Manager shall be deemed to have been delegated by the Board
on behalf of such Portfolio(s) responsibility as Foreign Custody Manager with
respect to that country and to have accepted such delegation. Execution of this
Agreement by the Fund shall be deemed to be a Proper Instruction to open an
account, or to place or maintain Foreign Assets, in each country listed on
Schedule A. Following the receipt of Proper Instructions directing the Foreign
Custody Manager to close the account of a Portfolio with the Eligible Foreign
Custodian selected by the Foreign Custody Manager in a designated country, the
delegation by the Board on behalf of such Portfolio to the Custodian as Foreign
Custody Manager for that country shall be deemed to have been withdrawn and the
Custodian shall immediately cease to be the Foreign Custody Manager with respect
to such Portfolio with respect to that country.
The Foreign Custody Manager may withdraw its acceptance of delegated
responsibilities with respect to a designated country upon written notice to the
Fund. Thirty days (or such longer period to which the parties agree in writing)
after receipt of any such notice by the Fund, the Custodian shall have no
further responsibility in its capacity as Foreign Custody Manager to the Fund
with respect to the country as to which the Custodian's acceptance of delegation
is withdrawn.
3.2.3 SCOPE OF DELEGATED RESPONSIBILITIES:
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(a) SELECTION OF ELIGIBLE FOREIGN CUSTODIANS. Subject to the provisions
of this Section 3.2, the Foreign Custody Manager may place and maintain the
Foreign Assets in the care of the Eligible Foreign Custodian selected by the
Foreign Custody Manager in each country listed on Schedule A, as amended from
time to time. In performing its delegated responsibilities as Foreign Custody
Manager to place or maintain Foreign Assets with an Eligible Foreign Custodian,
the Foreign Custody Manager shall determine that the Foreign Assets will be
subject to reasonable care, based on the standards applicable to custodians in
the country in which the Foreign Assets will be held by that Eligible Foreign
Custodian, after considering all factors relevant to the safekeeping of such
assets, including, without limitation the factors specified in Rule 17f-5(c)(1).
(b) CONTRACTS WITH ELIGIBLE FOREIGN CUSTODIANS. The Foreign Custody
Manager shall determine that the contract governing the foreign custody
arrangements with each Eligible Foreign Custodian selected by the Foreign
Custody Manager will satisfy the requirements of Rule 17f-5(c)(2).
(c) MONITORING. In each case in which the Foreign Custody Manager
maintains Foreign Assets with an Eligible Foreign Custodian selected by the
Foreign Custody Manager, the Foreign Custody Manager shall establish a system to
monitor (i) the appropriateness of maintaining the Foreign Assets with such
Eligible Foreign Custodian and (ii) the contract governing the custody
arrangements established by the Foreign Custody Manager with the Eligible
Foreign Custodian. In the event the Foreign Custody Manager determines that the
custody arrangements with an Eligible Foreign Custodian it has selected are no
longer appropriate, the Foreign Custody Manager shall notify the Board in
accordance with Section 3.2.5 hereunder.
3.2.4 GUIDELINES FOR THE EXERCISE OF DELEGATED AUTHORITY. For
purposes of this Section 3.2, the Board shall be deemed to have considered and
determined to accept such Country Risk as is incurred by placing and maintaining
the Foreign Assets in each country for which the Custodian is serving as Foreign
Custody Manager of the Portfolios.
3.2.5 REPORTING REQUIREMENTS. The Foreign Custody Manager
shall report the withdrawal of the Foreign Assets from an Eligible Foreign
Custodian and the placement of such Foreign Assets with another Eligible Foreign
Custodian by providing to the Board an amended Schedule A at the end of the
calendar quarter in which an amendment to such Schedule has occurred. The
Foreign Custody Manager shall make written reports notifying the Board of any
other material change in the foreign custody arrangements of the Portfolios
described in this Section 3.2 after the occurrence of the material change.
3.2.6 STANDARD OF CARE AS FOREIGN CUSTODY MANAGER OF A
PORTFOLIO. In performing the responsibilities delegated to it, the Foreign
Custody Manager agrees to exercise reasonable care, prudence and diligence such
as a person having responsibility for the safekeeping of assets of management
investment companies registered under the 1940 Act would exercise.
3.2.7 REPRESENTATIONS WITH RESPECT TO RULE 17F-5. The Foreign
Custody Manager represents to the Fund that it is a U.S. Bank as defined in
section (a)(7) of Rule 17f-5. The Fund represents to the Custodian that the
Board has determined that it is reasonable for the Board to rely on the
Custodian to perform the responsibilities delegated pursuant to this Agreement
to the Custodian as the Foreign Custody Manager of the Portfolios.
3.2.8 EFFECTIVE DATE AND TERMINATION OF THE CUSTODIAN AS
FOREIGN CUSTODY MANAGER. The Board's delegation to the Custodian as Foreign
Custody Manager of the Portfolios shall be effective as of the date hereof and
shall remain in effect until terminated at any time, without penalty, by written
notice from the terminating party to the non-terminating party. Termination will
become effective thirty (30) days after receipt by the non-terminating party of
such notice. The provisions of Section 3.2.2 hereof shall govern the delegation
to and termination of the Custodian as Foreign Custody Manager of the Portfolios
with respect to designated countries.
SECTION 3.3 ELIGIBLE SECURITIES DEPOSITORIES.
--------------------------------
3.3.1 ANALYSIS AND MONITORING. The Custodian shall (a) provide
the Fund (or its duly-authorized investment manager or investment adviser) with
an analysis of the custody risks associated with maintaining assets with the
Eligible Securities Depositories set forth on Schedule B hereto in accordance
with section (a)(1)(i)(A) of Rule 17f-7, and (b) monitor such risks on a
continuing basis, and promptly notify the Fund (or its duly-authorized
investment manager or investment adviser) of any material change in such risks,
in accordance with section (a)(1)(i)(B) of Rule 17f-7.
3.3.2 STANDARD OF CARE. The Custodian agrees to exercise
reasonable care, prudence and diligence in performing the duties set forth in
Section 3.3.1.
SECTION 4. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE PORTFOLIOS TO
BE HELD OUTSIDE THE UNITED STATES
SECTION 4.1 DEFINITIONS. As used throughout this Agreement, the capitalized
terms set
forth below shall have the indicated meanings:
"Foreign Securities System" means an Eligible Securities Depository listed on
Schedule B hereto.
"Foreign Sub-Custodian" means a foreign banking institution serving as an
Eligible Foreign Custodian.
SECTION 4.2. HOLDING SECURITIES. The Custodian shall identify on its
books as belonging to the Portfolios the foreign securities held by each Foreign
Sub-Custodian or Foreign Securities System. The Custodian may hold foreign
securities for all of its customers, including the Portfolios, with any Foreign
Sub-Custodian in an account that is identified as belonging to the Custodian for
the benefit of its customers, provided however, that (i) the records of the
Custodian with respect to foreign securities of the Portfolios which are
maintained in such account shall identify those securities as belonging to the
Portfolios and (ii), to the extent permitted and customary in the market in
which the account is maintained, the Custodian shall require that securities so
held by the Foreign Sub-Custodian be held separately from any assets of such
Foreign Sub-Custodian or of other customers of such Foreign Sub-Custodian.
SECTION 4.3. FOREIGN SECURITIES SYSTEMS. Foreign securities shall be
maintained in a Foreign Securities System in a
designated country through arrangements implemented by the Custodian or a
Foreign Sub-Custodian, as applicable, in such country.
SECTION 4.4. TRANSACTIONS IN FOREIGN CUSTODY ACCOUNT.
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4.4.1. DELIVERY OF FOREIGN ASSETS. The Custodian or a Foreign
Sub-Custodian shall release and deliver foreign securities of the Portfolios
held by the Custodian or such Foreign Sub-Custodian, or in a Foreign Securities
System account, only upon receipt of Proper Instructions, which may be
continuing instructions when deemed appropriate by the parties, and only in the
following cases:
(i) Upon the sale of such foreign securities for the Portfolio in accordance
with commercially reasonable market practice in the country where such
foreign securities are held or traded, including, without limitation: (A)
delivery against expectation of receiving later payment; or (B) in the case
of a sale effected through a Foreign Securities System, in accordance with
the rules governing the operation of the Foreign Securities System;
(ii) In connection with any repurchase agreement related to foreign securities;
(iii)To the depository agent in connection with tender or other similar offers
for foreign securities of the Portfolios;
(iv) To the issuer thereof or its agent when such foreign securities are called,
redeemed, retired or otherwise become payable;
(v) To the issuer thereof, or its agent, for transfer into the name of the
Custodian (or the name of the respective Foreign Sub-Custodian or of any
nominee of the Custodian or such Foreign Sub-Custodian) or for exchange for
a different number of bonds, certificates or other evidence representing
the same aggregate face amount or number of units;
(vi) To brokers, clearing banks or other clearing agents for examination or
trade execution in accordance with market custom; provided that in any such
case, the Foreign Sub-Custodian shall have no responsibility or liability
for any loss arising from the delivery of such foreign securities prior to
receiving payment for such foreign securities except as may arise from the
Foreign Sub-Custodian's own negligence or willful misconduct;
(vii)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;
(viii) In the case of warrants, rights or similar foreign securities, 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;
(ix) For delivery as security in connection with any borrowing by the Fund on
behalf of a Portfolio requiring a pledge of assets by the Fund on behalf of
such Portfolio;
(x) In connection with trading in options and futures contracts, including
delivery as original margin and variation margin;
(xi) Upon the sale or other delivery of such foreign securities (including,
without limitation, to one or more Special Sub-Custodians or Repo
Custodians) as a Free Trade, provided that applicable Proper Instructions
shall set forth (A) the foreign securities to be delivered and (B) the
person(s) to whom delivery shall be made;
(xii) In connection with the lending of foreign securities; and
(xiii) For any other purpose, but only upon receipt of Proper Instructions
specifying (A) the foreign securities to be delivered and (B) the person or
persons to whom delivery of such securities shall be made.
4.4.2. PAYMENT OF PORTFOLIO MONIES. Upon receipt of Proper Instructions,
which may be continuing instructions when deemed appropriate by the parties, the
Custodian shall pay out, or direct the respective Foreign Sub-Custodian or the
respective Foreign Securities System to pay out, monies of a Portfolio in the
following cases only:
(i) Upon the purchase of foreign securities for the Portfolio, unless otherwise
directed by Proper Instructions, by (A) delivering money to the seller
thereof or to a dealer therefor (or an agent for such seller or dealer)
against expectation of receiving later delivery of such foreign securities;
or (B) in the case of a purchase effected through a Foreign Securities
System, in accordance with the rules governing the operation of such
Foreign Securities System;
(ii) In connection with the conversion, exchange or surrender of foreign
securities of the Portfolio;
(iii)For the payment of any expense or liability of the Portfolio, including
but not limited to the following payments: interest, taxes, investment
advisory fees, transfer agency fees, fees under this Agreement, legal fees,
accounting fees, and other operating expenses;
(iv) For the purchase or sale of foreign exchange or foreign exchange contracts
for the Portfolio, including transactions executed with or through the
Custodian or its Foreign Sub-Custodians;
(v) In connection with trading in options and futures contracts, including
delivery as original margin and variation margin;
(vi) Upon the purchase of foreign investments including, without limitation,
repurchase agreement transactions involving delivery of Portfolio monies to
Repo Custodian(s), as a Free Trade, provided that applicable Proper
Instructions shall set forth (A) the amount of such payment and (B) the
person(s) to whom payment shall be made;
(vii)For payment of part or all of the dividends received in respect of
securities sold short;
(viii) In connection with the borrowing or lending of foreign securities; and
(ix) For any other purpose, but only upon receipt of Proper Instructions
specifying (A) the amount of such payment and (B) the person(s) to whom
such payment is to be made.
4.4.3. MARKET CONDITIONS. Notwithstanding any provision of
this Agreement to the contrary, settlement and payment for Foreign Assets
received for the account of the Portfolios and delivery of Foreign Assets
maintained for the account of the Portfolios may be effected in accordance with
the customary established securities trading or processing practices and
procedures in the country or market in which the transaction occurs, including,
without limitation, delivering Foreign Assets to the purchaser thereof or to a
dealer therefor (or an agent for such purchaser or dealer) with the expectation
of receiving later payment for such Foreign Assets from such purchaser or
dealer.
The Custodian shall provide to the Board the information with respect to custody
and settlement practices in countries in which the Custodian employs a Foreign
Sub-Custodian described on Schedule C hereto at the time or times set forth on
such Schedule. The Custodian may revise Schedule C from time to time, provided
that no such revision shall result in the Board being provided with
substantively less information than had been previously provided hereunder.
SECTION 4.5. REGISTRATION OF FOREIGN SECURITIES. The foreign securities
maintained in the custody of a Foreign Sub-Custodian (other than bearer
securities) shall be registered in the name of the applicable Portfolio or in
the name of the Custodian or in the name of any Foreign Sub-Custodian or in the
name of any nominee of the foregoing, and the Fund on behalf of such Portfolio
agrees to hold any such nominee harmless from any liability as a holder of
record of such foreign securities. The Custodian or a Foreign Sub-Custodian
shall not be obligated to accept securities on behalf of a Portfolio under the
terms of this Agreement unless the form of such securities and the manner in
which they are delivered are in accordance with reasonable market practice.
SECTION 4.6 BANK ACCOUNTS. The Custodian shall identify on its books as
belonging to the Fund cash (including cash denominated in foreign currencies)
deposited with the Custodian. Where the Custodian is unable to maintain, or
market practice does not facilitate the maintenance of, cash on the books of the
Custodian, a bank account or bank accounts shall be opened and maintained
outside the United States on behalf of a Portfolio with a Foreign Sub-Custodian.
All accounts referred to in this Section shall be subject only to draft or order
by the Custodian (or, if applicable, such Foreign Sub-Custodian) acting pursuant
to the terms of this Agreement to hold cash received by or from or for the
account of the Portfolio. Cash maintained on the books of the Custodian
(including its branches, subsidiaries and affiliates), regardless of currency
denomination, is maintained in bank accounts established under, and subject to
the laws of, The Commonwealth of Massachusetts.
SECTION 4.7. COLLECTION OF INCOME. The Custodian shall use reasonable
commercial efforts to collect all income and other payments with respect to the
Foreign Assets held hereunder to which the Portfolios shall be entitled and
shall credit such income, as collected, to the applicable Portfolio. In the
event that extraordinary measures are required to collect such income, the Fund
and the Custodian shall consult as to such measures and as to the compensation
and expenses of the Custodian relating to such measures.
SECTION 4.8 SHAREHOLDER RIGHTS. With respect to the foreign securities
held pursuant to this Section 4, the Custodian shall use reasonable commercial
efforts to facilitate the exercise of voting and other shareholder rights,
subject always to the laws, regulations and practical constraints that may exist
in the country where such securities are issued. The Fund acknowledges that
local conditions, including lack of regulation, onerous procedural obligations,
lack of notice and other factors may have the effect of severely limiting the
ability of the Fund to exercise shareholder rights.
SECTION 4.9. COMMUNICATIONS RELATING TO FOREIGN SECURITIES. The
Custodian shall transmit promptly to the Fund written information with respect
to materials received by the Custodian via the Foreign Sub-Custodians from
issuers of the foreign securities being held for the account of the Portfolios
(including, without limitation, pendency of calls and maturities of foreign
securities and expirations of rights in connection therewith). With respect to
tender or exchange offers, the Custodian shall transmit promptly to the Fund
written information with respect to materials so received by the Custodian from
issuers of the foreign securities whose tender or exchange is sought or from the
party (or its agents) making the tender or exchange offer. The Custodian shall
not be liable for any untimely exercise of any tender, exchange or other right
or power in connection with foreign securities or other property of the
Portfolios at any time held by it unless (i) the Custodian or the respective
Foreign Sub-Custodian is in actual possession of such foreign securities or
property and (ii) the Custodian receives Proper Instructions with regard to the
exercise of any such right or power, and both (i) and (ii) occur at least three
business days prior to the date on which the Custodian is to take action to
exercise such right or power.
SECTION 4.10. LIABILITY OF FOREIGN SUB-CUSTODIANS. Each agreement
pursuant to which the Custodian employs a Foreign Sub-Custodian shall, to the
extent possible, require the Foreign Sub-Custodian to exercise reasonable care
in the performance of its duties, and to indemnify, and hold harmless, the
Custodian from and against any loss, damage, cost, expense, liability or claim
arising out of or in connection with the Foreign Sub-Custodian's performance of
such obligations. At the Fund's election, the Portfolios shall be entitled to be
subrogated to the rights of the Custodian with respect to any claims against a
Foreign Sub-Custodian as a consequence of any such loss, damage, cost, expense,
liability or claim if and to the extent that the Portfolios have not been made
whole for any such loss, damage, cost, expense, liability or claim.
SECTION 4.11 TAX LAW. The Custodian shall have no responsibility or
liability for any obligations now or hereafter imposed on the Fund, the
Portfolios or the Custodian as custodian of the Portfolios by the tax law of the
United States or of any state or political subdivision thereof. It shall be the
responsibility of the Fund to notify the Custodian of the obligations imposed on
the Fund with respect to the Portfolios or the Custodian as custodian of the
Portfolios by the tax law of countries other than those mentioned in the above
sentence, including responsibility for withholding and other taxes, assessments
or other governmental charges, certifications and governmental reporting. The
sole responsibility of the Custodian with regard to such tax law shall be to use
reasonable efforts to assist the Fund with respect to any claim for exemption or
refund under the tax law of countries for which the Fund has provided such
information.
SECTION 4.12. LIABILITY OF CUSTODIAN. The Custodian shall be liable for
the acts or omissions of a Foreign Sub-Custodian to the same extent as set forth
with respect to sub-custodians generally in this Agreement and, regardless of
whether assets are maintained in the custody of a Foreign Sub-Custodian or a
Foreign Securities System, the Custodian shall not be liable for any loss,
damage, cost, expense, liability or claim resulting from nationalization,
expropriation, currency restrictions, or acts of war or terrorism, or any other
loss where the Sub-Custodian has otherwise acted with reasonable care.
SECTION 5. SPECIAL SUB-CUSTODIANS
Upon receipt of Special Instructions (as such term is defined in Section 7
hereof), the Custodian shall, on behalf of one or more Portfolios, appoint one
or more banks, trust companies or other entities designated in such Special
Instructions to act as a sub-custodian for the purposes of effecting such
transaction as may be designated by a Fund in Special Instructions. Each such
designated sub-custodian is referred to herein as a "Special Sub-Custodian."
Each such duly appointed Special Sub-Custodian shall be listed on Schedule D
hereto, as it may be amended from time to time by the Fund, with the
acknowledgment of the Custodian. In connection with the appointment of any
Special Sub-Custodian, and in accordance with Special Instructions, the
Custodian shall enter into a sub-custodian agreement with the Fund and the
Special Sub-Custodian in form and substance approved by the Fund, provided that
such agreement shall in all events comply with the provisions of the 1940 Act
and the rules and regulations thereunder and the terms and provisions of this
Agreement.
SECTION 6. PAYMENTS FOR SALES OR REPURCHASES OR REDEMPTIONS OF SHARES
----------------------------------------------------------
The Custodian shall receive from the distributor of the Shares or from the
Transfer Agent and deposit into the account of the appropriate Portfolio such
payments as are received for Shares thereof issued or sold from time to time by
the Fund. The Custodian will provide timely notification to the Fund on behalf
of each such Portfolio and the Transfer Agent of any receipt by it of payments
for Shares of such Portfolio.
From such funds as may be available for the purpose, 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, 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 Shares, 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.
SECTION 7. PROPER INSTRUCTIONS AND SPECIAL INSTRUCTIONS
"Proper Instructions," as such term is used throughout this Agreement, means a
writing signed or initialed by one or more person or persons as the Board shall
have from time to time authorized. Each such writing shall set forth the
specific transaction or type of transaction involved. 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. Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the Fund and the
Custodian agree to security procedures including, but not limited to, the
security procedures selected by the Fund via the form of Funds Transfer Addendum
hereto. For purposes of this Section, Proper Instructions shall include
instructions received by the Custodian pursuant to any three-party agreement
which requires a segregated asset account in accordance with Section 2.9 hereof.
"Special Instructions," as such term is used throughout this Agreement, means
Proper Instructions countersigned or confirmed in writing by the Treasurer or
any Assistant Treasurer of the Fund or any other person designated in writing by
the Treasurer of the Fund, which countersignature or confirmation shall be (a)
included on the same instrument containing the Proper Instructions or on a
separate instrument clearly relating thereto and (b) delivered by hand, by
facsimile transmission, or in such other manner as the Fund and the Custodian
agree in writing.
Concurrently with the execution of this Agreement, and from time to time
thereafter, as appropriate, the Fund shall deliver to the Custodian, duly
certified by the Fund's Treasurer or Assistant Treasurer, a certificate setting
forth: (i) the names, titles, signatures and scope of authority of all persons
authorized to give Proper Instructions or any other notice, request, direction,
instruction, certificate or instrument on behalf of the Fund and (ii) the names,
titles and signatures of those persons authorized to give Special Instructions.
Such certificate may be accepted and relied upon by the Custodian as conclusive
evidence of the facts set forth therein and shall be considered to be in full
force and effect until receipt by the Custodian of a similar certificate to the
contrary.
SECTION 8. 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
genuine and to have been properly executed by or on behalf of the Fund. The
Custodian may receive and accept a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Fund as conclusive evidence (a) of
the authority of any person to act in accordance with such resolution or (b) of
any determination or of any action by the Board as described in such resolution,
and such resolution may be considered as in full force and effect until receipt
by the Custodian of written notice to the contrary.
SECTION 9. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY
The Custodian may in its discretion, without express authority from the Fund on
behalf of each applicable Portfolio:
1) Make payments to itself or others for minor expenses of handling securities
or other similar items relating to its duties under this Agreement;
provided that all such payments shall be accounted for to the Fund on
behalf of the Portfolio;
2) Surrender securities in temporary form for securities in definitive form;
3) Endorse for collection, in the name of the Portfolio, 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 Portfolio except as otherwise directed
by the Board.
SECTION 10. DUTIES OF CUSTODIAN WITH RESPECT TO THE 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 Board to keep the books of account of each
Portfolio and/or compute the net asset value per Share of the outstanding Shares
or, if directed in writing to do so by the Fund on behalf of a Portfolio, shall
itself keep such books of account and/or compute such net asset value per Share.
If so directed, the Custodian shall also calculate [daily/weekly] the net income
of the Portfolio as described in the Prospectus and shall advise the Fund and
the Transfer Agent [daily/weekly] of the total amounts of such net income 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 Fund acknowledges and agrees that, with respect to investments
maintained with the Underlying Transfer Agent, the Underlying Transfer Agent is
the sole source of information on the number of shares of a fund held by it on
behalf of a Portfolio and that the Custodian has the right to rely on holdings
information furnished by the Underlying Transfer Agent to the Custodian in
performing its duties under this Agreement, including without limitation, the
duties set forth in this Section 10 and in Section 11 hereof; provided, however,
that the Custodian shall be obligated to reconcile information as to purchases
and sales of Underlying Shares contained in trade instructions and confirmations
received by the Custodian and to report promptly any discrepancies to the
Underlying Transfer Agent. The calculations of the net asset value per Share and
the [daily/weekly] income of each Portfolio shall be made at the time or times
described from time to time in the Prospectus. The Fund acknowledges that, in
keeping the books of account of the Portfolio and/or making the calculations
described herein with respect to Portfolio property released and delivered
pursuant to Section 2.2(14), or purchased pursuant to Section 2.6(7) hereof, the
Custodian is authorized and instructed to rely upon information provided to it
by the Fund, the Fund's counterparty(ies), or the agents of either of them.
SECTION 11. RECORDS
The Custodian shall with respect to each Portfolio create and maintain all
records relating to its activities and obligations under this Agreement in such
manner as will meet the obligations of the Fund under the 1940 Act, with
particular attention to section 31 thereof and Rules 31a-1 and 31a-2 thereunder.
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 SEC. The Custodian shall, at the Fund's request, supply the Fund with a
tabulation of securities owned by each Portfolio 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. The Fund acknowledges that, in creating and maintaining the
records as set forth herein with respect to Portfolio property released and
delivered pursuant to Section 2.2(14), or purchased pursuant to Section 2.6(7)
hereof, the Custodian is authorized and instructed to rely upon information
provided to it by the Fund, the Fund's counterparty(ies), or the agents of
either of them.
SECTION 12. OPINION OF FUND'S INDEPENDENT ACCOUNTANT
The Custodian shall take all reasonable action, as the Fund with respect to a
Portfolio 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-2, and Form
N-SAR or other annual reports to the SEC and with respect to any other
requirements thereof.
SECTION 13. REPORTS TO FUND BY INDEPENDENT PUBLIC ACCOUNTANTS
The Custodian shall provide the Fund, on behalf of each of the Portfolios 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, futures contracts and options on futures
contracts, including securities deposited and/or maintained in a U.S. Securities
System or a Foreign Securities System, relating to the services provided by the
Custodian under this Agreement; such reports, 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 by such
examination, and, if there are no such inadequacies, the reports shall so state.
SECTION 14. 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 on
behalf of each applicable Portfolio and the Custodian.
SECTION 15. 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 Agreement 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, including any futures
commission merchant acting pursuant to the terms of a three-party futures or
options agreement. The Custodian shall be held to the exercise of reasonable
care in carrying out the provisions of this Agreement, 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, including, without
limitation, acting in accordance with any Proper Instruction. 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. The Custodian shall be
without liability to the Fund and the Portfolios for any loss, liability, claim
or expense resulting from or caused by anything which is part of Country Risk
(as defined in Section 3 hereof), including without limitation nationalization,
expropriation, currency restrictions, or acts of war, revolution, riots or
terrorism.
Except as may arise from the Custodian's own negligence or willful misconduct or
the negligence or willful misconduct of a sub-custodian or agent, the Custodian
shall be without liability to the Fund for any loss, liability, claim or expense
resulting from or caused by; (i) events or circumstances beyond the reasonable
control of the Custodian or any sub-custodian or Securities System or any agent
or nominee of any of the foregoing, including, without limitation, the
interruption, suspension or restriction of trading on or the closure of any
securities market, power or other mechanical or technological failures or
interruptions, computer viruses or communications disruptions, work stoppages,
natural disasters, or other similar events or acts; (ii) errors by the Fund or
its duly authorized investment manager or investment adviser in their
instructions to the Custodian provided such instructions have been in accordance
with this Agreement; (iii) the insolvency of or acts or omissions by a
Securities System; (iv) any act or omission of a Special Sub-Custodian
including, without limitation, reliance on reports prepared by a Special
Sub-Custodian; (v) any delay or failure of any broker, agent or intermediary,
central bank or other commercially prevalent payment or clearing system to
deliver to the Custodian's sub-custodian or agent securities purchased or in the
remittance or payment made in connection with securities sold; (vi) any delay or
failure of any company, corporation, or other body in charge of registering or
transferring securities in the name of the Custodian, the Fund, the Custodian's
sub-custodians, nominees or agents or any consequential losses arising out of
such delay or failure to transfer such securities including non-receipt of
bonus, dividends and rights and other accretions or benefits; (vii) delays or
inability to perform its duties due to any disorder in market infrastructure
with respect to any particular security or Securities System; and (viii) any
provision of any present or future law or regulation or order of the United
States of America, or any state thereof, or any other country, or political
subdivision thereof or of any court of competent jurisdiction.
The Custodian shall be liable for the acts or omissions of a Foreign
Sub-Custodian (as such term is defined in Section 4 hereof) to the same extent
as set forth with respect to sub-custodians generally in this Agreement.
If the Fund on behalf of a Portfolio 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 or the Portfolio being liable for the payment of
money or incurring liability of some other form, the Fund on behalf of the
Portfolio, as a prerequisite to requiring the Custodian to take such action,
shall provide indemnity to the Custodian in an amount and form satisfactory to
it.
If the Fund requires the Custodian, its affiliates, subsidiaries or agents, to
advance cash or securities for any purpose (including but not limited to
securities settlements, foreign exchange contracts and assumed settlement) or in
the event that the Custodian or its nominee shall incur or be assessed any
taxes, charges, expenses, assessments, claims or liabilities in connection with
the performance of this Agreement, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the applicable Portfolio shall
be security therefor and should the Fund fail to repay the Custodian promptly,
the Custodian shall be entitled to utilize available cash and to dispose of such
Portfolio's assets to the extent necessary to obtain reimbursement.
Except as may arise from the Custodian's own negligence or willful misconduct,
the Fund shall indemnify and hold the Custodian harmless from and against any
and all costs, expenses, losses, damages, charges, counsel fees, payments and
liabilities which may be asserted against the Custodian (a) acting in accordance
with any Proper Instruction or Special Instruction including, without
limitation, any Proper Instruction with respect to Free Trades including, but
not limited to, cost, expense, loss, damage, liability, tax, charge, assessment
or claim resulting from (i) the failure of the Fund to receive income with
respect to purchased investments, (ii) the failure of the Fund to recover
amounts invested on maturity of purchased investments, (iii) the failure of the
Custodian to respond to or be aware of notices or other corporate communications
with respect to purchased investments, or (iv) the Custodian's reliance upon
information provided by the Fund, the Fund's counterparty(ies) or the agents of
either of them with respect to Fund property released, delivered or purchased
pursuant to either of Section 2.2(14) or Section 2.6(7) hereof; (b) for the acts
or omissions of any Special Sub-Custodian; or (c) for the acts or omissions of
any Local Agent or Pledgee.
In no event shall the Custodian be liable for indirect, special or consequential
damages.
SECTION 16. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT
This Agreement 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 sixty (60) days
after the date of such delivery or mailing; provided, however, that the Fund
shall not amend or terminate this Agreement in contravention of any applicable
federal or state regulations, or any provision of the Fund's Governing
Documents, and further provided, that the Fund on behalf of one or more of the
Portfolios may at any time by action of its Board (i) substitute another bank or
trust company for the Custodian by giving notice as described above to the
Custodian, or (ii) immediately terminate this Agreement in the event of the
appointment of a conservator or receiver for the Custodian by the Comptroller of
the Currency 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 Agreement, the Fund on behalf of each applicable
Portfolio 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.
SECTION 17. SUCCESSOR CUSTODIAN
If a successor custodian for one or more Portfolios shall be appointed by the
Board, the Custodian shall, upon termination and receipt of Proper Instructions,
deliver to such successor custodian at the office of the Custodian, duly
endorsed and in the form for transfer, all securities of each applicable
Portfolio then held by it hereunder and shall transfer to an account of the
successor custodian all of the securities of each such Portfolio held in a
Securities System or at the Underlying Transfer Agent.
If no such successor custodian shall be appointed, the Custodian shall, in like
manner, upon receipt of Proper Instructions, deliver at the office of the
Custodian and transfer such securities, funds and other properties in accordance
with such resolution.
In the event that no Proper Instructions designating a successor custodian or
alternative arrangements 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 1940 Act, doing business in Boston, Massachusetts or New York,
New York, 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 on
behalf of each applicable Portfolio and all instruments held by the Custodian
relative thereto and all other property held by it under this Agreement on
behalf of each applicable Portfolio, and to transfer to an account of such
successor custodian all of the securities of each such Portfolio held in any
Securities System or at the Underlying Transfer Agent. Thereafter, such bank or
trust company shall be the successor of the Custodian under this Agreement.
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 provide Proper Instructions as aforesaid, 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 Agreement relating to the duties and obligations of
the Custodian shall remain in full force and effect.
SECTION 18. GENERAL
SECTION 18.1 MASSACHUSETTS LAW TO APPLY. This Agreement shall be
construed and the provisions thereof interpreted under and in accordance with
laws of The Commonwealth of Massachusetts.
SECTION 18.2 PRIOR AGREEMENTS. This Agreement supersedes and
terminates, as of the date hereof, all prior Agreements between the Fund on
behalf of each of the Portfolios and the Custodian relating to the custody of
the Fund's assets.
SECTION 18.3 ASSIGNMENT. This Agreement may not be assigned by either party
without the written consent of the other.
SECTION 18.4 INTERPRETIVE AND ADDITIONAL PROVISIONS. In connection with
the operation of this Agreement, the Custodian and the Fund on behalf of each of
the Portfolios, may from time to time agree on such provisions interpretive 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. 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 or any provision of
the Fund's Governing Documents. No interpretive or additional provisions made as
provided in the preceding sentence shall be deemed to be an amendment of this
Agreement.
SECTION 18.5 ADDITIONAL FUNDS. In the event that the Fund establishes
one or more series of Shares in addition to Evergreen Income Advantage Fund with
respect to which it desires to have the Custodian render services as custodian
under the terms hereof or otherwise desires the Custodian to render services as
custodian under the terms hereof to any other of its present series, if any, it
shall so notify the Custodian in writing, and if the Custodian agrees in writing
to provide such services, such series of Shares shall become a Portfolio
hereunder.
SECTION 18.6 NOTICES. Any notice, instruction or other instrument
required to be given hereunder may be delivered in person to the offices of the
parties as set forth herein during normal business hours or delivered prepaid
registered mail or by telex, cable or telecopy to the parties at the following
addresses or such other addresses as may be notified by any party from time to
time.
To the Fund: EVERGREEN INCOME ADVANTAGE FUND
c/o Evergreen Investment Management Company - Legal Division
000 Xxxxxxxx Xxxxxx, XX0000
Xxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxx, Secretary
Telephone: 000-000-0000
Telecopy: 000-000-0000
To the Custodian: STATE STREET BANK AND TRUST COMPANY
Lafayette Corporate Center
0 Xxxxxx xx Xxxxxxxxx, XXX/0XX
Xxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxxxx, XX, Vice President
Telephone: 000-000-0000
Telecopy: 000-000-0000
Such notice, instruction or other instrument shall be deemed to have been served
in the case of a registered letter at the expiration of five business days after
posting, in the case of cable twenty-four hours after dispatch and, in the case
of telex, immediately on dispatch and if delivered outside normal business hours
it shall be deemed to have been received at the next time after delivery when
normal business hours commence and in the case of cable, telex or telecopy on
the business day after the receipt thereof. Evidence that the notice was
properly addressed, stamped and put into the post shall be conclusive evidence
of posting.
SECTION 18.7 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original, and all such
counterparts taken together shall constitute one and the same Agreement.
SECTION 18.8 SEVERABILITY. If any provision or provisions of this
Agreement shall be held to be invalid, unlawful or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired.
SECTION 18.9 REPRODUCTION OF DOCUMENTS. This Agreement and all
schedules, addenda, exhibits, attachments and amendments hereto may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties hereto all/each agree that
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
SECTION 18.10 REMOTE ACCESS SERVICES ADDENDUM. The Custodian and the
Fund agree to be bound by the terms of the Remote Access Services Addendum
hereto.
SECTION 18.11 SHAREHOLDER COMMUNICATIONS ELECTION. SEC Rule 14b-2
requires banks which hold securities for the account of customers to respond to
requests by issuers of securities for the names, addresses and holdings of
beneficial owners of securities of that issuer held by the bank unless the
beneficial owner has expressly objected to disclosure of this information. In
order to comply with the rule, the Custodian needs the Fund to indicate whether
it authorizes the Custodian to provide the Fund's name, address, and share
position to requesting companies whose securities the Fund owns. If the Fund
tells the Custodian "no," the Custodian will not provide this information to
requesting companies. If the Fund tells the Custodian "yes" or does not check
either "yes" or "no" below, the Custodian is required by the rule to treat the
Fund as consenting to disclosure of this information for all securities owned by
the Fund or any funds or accounts established by the Fund. For the Fund's
protection, the Rule prohibits the requesting company from using the Fund's name
and address for any purpose other than corporate communications. Please indicate
below whether the Fund consents or objects by checking one of the alternatives
below.
YES [ ] The Custodian is authorized to release the Fund's name, address, and
share positions.
NO [X] The Custodian is not authorized to release the Fund's name, address, and
share positions.
SIGNATURE PAGE
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the date first above-written.
FUND SIGNATURE ATTESTED TO BY: EVERGREEN INCOME ADVANTAGE FUND
_______________________ By:____________________________
Name: Name:
Title: Title:
SIGNATURE ATTESTED TO BY: STATE STREET BANK AND TRUST COMPANY
____________________ By:________________________________
Xxxxxxxxx X. Poster Xxxxxx X. Xxxxxx
Vice President Executive Vice President
SCHEDULE D
TO
CUSTODIAN AGREEMENT
SPECIAL SUB-CUSTODIANS
None
STATE STREET SCHEDULE A
GLOBAL CUSTODY NETWORK
SUBCUSTODIANS
Country Subcustodian
12/31/02
Argentina Citibank, N.A.
Australia Westpac Banking Corporation
Austria Erste Bank der Osterreichischen Sparkassen AG
Bahrain HSBC Bank Middle East
(as delegate of the Hongkong and Shanghai Banking
Corporation Limited)
Bangladesh Standard Chartered Bank
Belgium Fortis Bank nv-sa
Benin via Societe Generale de Banques en Cote d'Ivoire,
Abidjan, Ivory Coast
Bermuda The Bank of Bermuda Limited
Bolivia Citibank, N. A.
Botswana Barclays Bank of Botswana Limited
Brazil Citibank, N.A.
Bulgaria ING Bank N.V.
Burkina Faso via Societe Generale de Banques en Cote d'Ivoire,
Abidjan, Ivory Coast
Canada State Street Trust Company Canada
Cayman Islands Bank of Nova Scotia Trust Company (Cayman) Ltd.
Chile BankBoston, N.A.
People's Republic The Hongkong and Shanghai Banking Corporation
Limited,
of China Shanghai and Shenzhen branches
Colombia Cititrust Colombia S.A. Sociedad Fiduciaria
Costa Rica Banco BCT S.A.
Croatia Privredna Banka Zagreb d.d
Cyprus Cyprus Popular Bank Ltd.
Czech Republic Eeskoslovenska Obchodni Banka, A.S.
Denmark Danske Bank A/S
Ecuador Citibank, N.A.
Egypt HSBC Bank Egypt S.A.E.
(as delegate of The Hongkong and Shanghai Banking
Corporation Limited)
Estonia Hansabank
Finland Nordea Bank Finland Plc.
France BNP Paribas Securities Services, S.A.
Germany Dresdner Bank AG
Ghana Barclays Bank of Ghana Limited
Greece National Bank of Greece S.A.
Guinea-Bissau via Societe Generale de Banques en Cote d'Ivoire,
Abidjan, Ivory Coast
Hong Kong Standard Chartered Bank
Hungary HVB Bank Hungary Rt.
Iceland Icebank Ltd.
India Deutsche Bank AG
The Hongkong and Shanghai Banking Corporation Limited
Indonesia Standard Chartered Bank
Ireland Bank of Ireland
Israel Bank Hapoalim B.M.
Italy BNP Paribas Securities Services, S.A.
Ivory Coast Societe Generale de Banques en Cote d'Ivoire
Jamaica Scotiabank Jamaica Trust and Merchant Bank Ltd.
Japan Mizuho Corporate Bank Ltd.
Sumitomo Mitsui Banking Corporation
Jordan HSBC Bank Middle East
(as delegate of the Hongkong and Shanghai Banking
Corporation Limited)
Kazakhstan HSBC Bank Kazakhstan
(as delegate of the Hongkong and Shanghai Banking
Corporation Limited)
Kenya Barclays Bank of Kenya Limited
Republic of Korea The Hongkong and Shanghai Banking Corporation Limited
Latvia A/s Hansabanka
Lebanon HSBC Bank Middle East
(as delegate of The Hongkong and Shanghai Banking
Corporation Limited)
Lithuania Vilniaus Bankas AB
Malaysia Standard Chartered Bank Malaysia Berhad
Mali via Societe Generale de Banques en Cote d'Ivoire,
Abidjan, Ivory Coast
Mauritius The Hongkong and Shanghai Banking Corporation Limited
Mexico Banco Nacional de Mexico S.A.
Morocco Banque Commerciale du Maroc
Namibia Standard Bank Namibia Limited -
Netherlands KAS BANK N.V.
New Zealand Westpac Banking Corporation
Niger via Societe Generale de Banques en Cote d'Ivoire,
Abidjan, Ivory Coast
Nigeria Stanbic Bank Nigeria Limited
Norway Nordea Bank Norge ASA
Oman HSBC Bank Middle East
(as delegate of The Hongkong and Shanghai Banking
Corporation Limited)
Pakistan Deutsche Bank AG
Palestine HSBC Bank Middle East
(as delegate of The Hongkong and Shanghai Banking
Corporation Limited)
Panama BankBoston, N.A.
Peru Citibank, N.A.
Philippines Standard Chartered Bank
Poland Bank Handlowy w Warszawie S.A.
Portugal Banco Comercial Portugues
Puerto Rico Citibank N.A.
Qatar HSBC Bank Middle East
(as delegate of The Hongkong and Shanghai Banking
Corporation Limited)
Romania ING Bank N.V.
Russia ING Bank (Eurasia) ZAO, Moscow
Senegal via Societe Generale de Banques en Cote d'Ivoire,
Abidjan, Ivory Coast
Singapore The Development Bank of Singapore Limited
Slovak Republic Ceskoslovenska Obchodni Banka, A.S., pobocka
zahranicnej banky v SR
Slovenia Bank Austria Creditanstalt d.d. - Ljubljana
South Africa Nedcor Bank Limited
Standard Bank of South Africa Limited
Spain Banco Santander Central Hispano S.A.
Sri Lanka The Hongkong and Shanghai Banking Corporation Limited
Swaziland Standard Bank Swaziland Limited
Sweden Skandinaviska Enskilda Xxxxxx XX
Switzerland UBS AG
Taiwan - R.O.C. Central Trust of China
Thailand Standard Chartered Bank
Togo via Societe Generale de Banques en Cote d'Ivoire,
Abidjan, Ivory Coast
Trinidad & Tobago Republic Bank Limited
Tunisia Banque Internationale Arabe de Tunisie
Turkey Citibank, N.A.
Uganda Barclays Bank of Uganda Limited
Ukraine ING Bank Ukraine
United Arab Emirates HSBC Bank Middle East
(as delegate of The Hongkong and Shanghai Banking
Corporation Limited)
United Kingdom State Street Bank and Trust Company, London Branch
Uruguay BankBoston, N.A.
Venezuela Citibank, N.A.
Vietnam The Hongkong and Shanghai Banking Corporation Limited
Zambia Barclays Bank of Zambia Limited
Zimbabwe Barclays Bank of Zimbabwe Limited
STATE STREET SCHEDULE B
GLOBAL CUSTODY NETWORK
DEPOSITORIES OPERATING IN NETWORK MARKETS
Country Depositories
8
Argentina Caja de Valores S.A.
Australia Austraclear Limited
Austria Oesterreichische Kontrollbank AG
(Wertpapiersammelbank Division)
Bahrain Clearing, Settlement, and Depository
System of the Bahrain Stock Exchange
Belgium Caisse Interprofessionnelle de
Depots et de Virements de Titres,
S.A.
Banque Nationale de Belgique
Benin Depositaire Central - Banque de
Reglement
Bermuda Bermuda Securities Depository
Brazil Central de Custodia e de Liquidacao
Financeira de Titulos Privados(CETIP)
Companhia Brasileira de Liquidacao
e Custodia
Sistema Especial de Liquidacao e de
Custodia (SELIC)
Bulgaria Bulgarian National Bank
Central Depository AD
Burkina Faso Depositaire Central - Banque de
Reglement
Canada Canadian Depository for Securities
Limited
Chile Deposito Central de Valores S.A.
People's Republic China Securities Depository and
Clearing Corporation Limited
of China Shanghai Branch
China Securities Depository and
Clearing Corporation Limited
Shenzhen Branch
Colombia Deposito Central de Valores
Deposito Centralizado de Valores de
Colombia S..A. (DECEVAL)
Costa Rica Central de Valores S.A.
Croatia Ministry of Finance
Sredisnja Depozitarna Agencija d.d.
Cyprus Central Depository and Central
Registry
Czech Republic Czech National Bank
Stredisko cennych papiru - Ceska
republika
Denmark Vaerdipapircentralen (Danish
Securities Center)
Egypt Misr for Clearing, Settlement, and
Depository S.A.E.
Estonia Eesti Vaartpaberikeskus
Finland Suomen Arvopaperikeskus
France Euroclear France
Germany Clearstream Banking AG, Frankfurt
Greece Apothetirion Titlon AE - Central
Securities Depository
Bank of Greece,
System for Monitoring Transactions
in Securities in Book-Entry Form
Guinea-Bissau Depositaire Central - Banque de
Reglement
Hong Xxxx Xxxxxxx Xxxxxxxxxxxx Xxxx
Xxxx Xxxx Securities Clearing Company Limited
Hungary Kozponti Elszamolohaz es Ertektar (Budapest)
Rt. (KELER)
Iceland Iceland Securities Depository Limited
India Central Depository Services India Limited
National Securities Depository Limited
Reserve Bank of India
Indonesia Bank Indonesia
PT Kustodian Sentral Efek Indonesia
Israel Tel Aviv Stock Exchange Clearing House Ltd.
(TASE Clearinghouse)
Italy Monte Titoli S.p.A.
Ivory Coast Depositaire Central - Banque de Reglement
Jamaica Jamaica Central Securities Depository
Japan Bank of Japan - Net System
Japan Securities Depository Center (JASDEC)
Incorporated
Kazakhstan Central Depository of Securities
Kenya Central Bank of Kenya
Republic of Korea Korea Securities Depository
Latvia Latvian Central Depository
Lebanon Banque du Liban
Custodian and Clearing Center of
Financial Instruments for Lebanon
and the Middle East (Midclear)
X.X.X.
Lithuania Central Securities Depository of Lithuania
Malaysia Bank Negara Malaysia
Malaysian Central Depository Sdn. Bhd.
Mali Depositaire Central - Banque de Reglement
Mauritius Bank of Mauritius
Central Depository and Settlement Co. Ltd.
Mexico S.D. Indeval, S.A. de C.V.
Morocco Maroclear
Netherlands Euroclear Nederlands
New Zealand New Zealand Central Securities Depository
Limited
Niger Depositaire Central - Banque de Reglement
Nigeria Central Securities Clearing System Limited
Norway Verdipapirsentralen (Norwegian Central
Securities Depository)
Oman Muscat Depository & Securities Registration
Company, SAOC
Pakistan Central Depository Company of Pakistan
Limited
State Bank of Pakistan
Palestine Clearing Depository and Settlement, a
department of the Palestine Stock Exchange
Panama Central Latinoamericana de Valores, S.A.
(LatinClear)
Peru Caja de Valores y Liquidaciones, Institucion
de Compensacion y Liquidacion de Valores S.A
Philippines Philippine Central Depository, Inc.
Registry of Scripless Securities (XXXX) of
the Bureau of Treasury
Poland Central Treasury Bills Registrar
Krajowy Depozyt Papierow Wartosciowych S.A.
(National Depository of Securities)
Portugal INTERBOLSA - Sociedade Gestora de Sistemas
de Liquidacao e de Sistemas Centralizados de
Valores Mobiliarios, S.A.
Qatar Central Clearing and Registration (CCR), a
department of the Doha Securities Market
Romania Bucharest Stock Exchange Registry Division
National Bank of Romania
National Securities Clearing, Settlement
and Depository Company
Russia Vneshtorgbank, Bank for Foreign Trade of
the Russian Federation
Senegal Depositaire Central - Banque de Reglement
Singapore The Central Depository (Pte) Limited
Monetary Authority of Singapore
Slovak Republic National Bank of Slovakia
Stredisko cennych papierov SR, a.s.
Slovenia KDD - Centralna klirinsko depotna xxxxxx x.x.
South Africa The Central Depository Limited
Share Transactions Totally Electronic
(STRATE) Ltd.
Spain Banco de Espana
Servicio de Compensacion y
Liquidacion de Valores, S.A.
Sri Lanka Central Depository System (Pvt) Limited
Sweden Vardepapperscentralen VPC AB
(Swedish Central Securities Depository)
Switzerland SegaIntersettle AG (SIS)
Taiwan - R.O.C. Taiwan Securities Central Depository
Company Limited
Thailand Bank of Thailand
Thailand Securities Depository Company
Limited
Togo Depositaire Central - Banque de Reglement
Trinidad and Tobago Trinidad and Tobago Central Bank
Tunisia Societe Tunisienne Interprofessionelle pour
la Compensation et de Depots des Valeurs
Mobilieres (STICODEVAM)
Turkey Central Bank of Turkey
Takas ve Saklama Bankasi A.S. (TAKASBANK)
Uganda Bank of Uganda
Ukraine Mizhregionalny Fondovy Souz
National Bank of Ukraine
United Arab Emirates Clearing and Depository System,
a department of theDubai Financial Market
Venezuela Banco Central de Venezuela
Vietnam Securities Registration, Clearing and
Settlement,
Depository Department of the Securities
Trading Center
Zambia Bank of Zambia
XxXX Central Shares Depository Limited
TRANSNATIONAL
Euroclear
Clearstream Banking AG
SCHEDULE C
MARKET INFORMATION
Publication/Type of Information Brief Description
(scheduled frequency)
The Guide to Custody in World Markets An overview of settlement and
safekeeping procedures, (hardcopy
annually and regular custody
practices and foreign investor
considerations for the website
updates) markets in which State
Street offers custodial services.
Global Custody Network Review Information relating to Foreign Sub-
Custodians in State Street's
-----------------------------
(annually) Global Custody Network. The Review
stands as an integral part of the
materials that State Street provides
to its U.S. mutual fund clients to
assist them in complying with SEC
Rule 17f-5. The Review also gives
insight into State Street's market
expansion and Foreign Sub-Custodian
selection processes, as well as the
procedures and controls used to
monitor the financial condition and
performance of our Foreign
Sub-Custodian banks.
Securities Depository Review Custody risk analyses of the Foreign
Securities Depositories presently
----------------------------
(annually) operating in Network markets.
This publication is an integral part
of the materials that State Street
provides to its U.S. mutual fund
clients to meet informational
obligations created by SEC Rule
17f-7.
Global Legal Survey With respect to each market in which
State Street offers custodial
(annually) services, opinions relating to
whether local law restricts
(i) access of a fund's independent
public accountants to books and
records of a Foreign Sub-Custodian
or Foreign Securities System,
(ii) a fund's ability to recover in
the event of
bankruptcy or insolvency of a
Foreign Sub-Custodian or Foreign
Securities System, (iii) a fund's
ability to recover in the event of a
loss by a Foreign Sub-Custodian or
Foreign Securities System, and (iv)
the ability of a foreign investor to
convert cash and cash equivalents to
U.S. dollars.
Subcustodian Agreements Copies of the contracts that State
Street has entered into with each
-----------------------
(annually) Foreign Sub-Custodian that maintains
U.S. mutual fund assets in the
markets in which State Street
offers custodial services.
Global Market Bulletin Information on changing settlement
and custody conditions in
(daily or as necessary) markets where State Street offers
custodial services. Includes changes
in market and tax regulations,
depository developments,
dematerialization Information,
as well as other market
changes that may impact State
Street's clients.
Foreign Custody Advisories For those markets where State Street
offers custodial
(as necessary) services that exhibit special risks
or infrastructures impacting
custody, State Street issues market
advisories to highlight those unique
market factors which might impact
our ability to offer recognized
custody service levels.
Material Change Notices Informational letters and
accompanying materials confirming
(presently on a quarterly State Street's foreign custody
arrangements, including a
basis or as otherwise necessary) summary of material changes with
Foreign Sub-Custodians that have
occurred during the previous
quarter. The notices also identify
any material changes in the
custodial risks associated with
maintaining assets with Foreign
Securities Depositories.
REMOTE ACCESS SERVICES ADDENDUM TO CUSTODIAN AGREEMENT
ADDENDUM to that certain Custodian Agreement dated as of January 15,
2003 (the "Custodian Agreement") between Evergreen Income Advantage Fund (the
"Customer") and State Street Bank and Trust Company, including its subsidiaries
and affiliates ("State Street").
State Street has developed and utilizes proprietary accounting and
other systems in conjunction with the custodian services which State Street
provides to the Customer. In this regard, State Street maintains certain
information in databases under its control and ownership which it makes
available to its customers (the "Remote Access Services").
THE SERVICES
State Street agrees to provide the Customer, and its designated investment
advisors, consultants or other third parties authorized by State Street
("Authorized Designees") with access to In~SightSM as described in Exhibit A or
such other systems as may be offered from time to time (the "System") on a
remote basis.
SECURITY PROCEDURES
The Customer agrees to comply, and to cause its Authorized Designees to comply,
with remote access operating standards and procedures and with user
identification or other password control requirements and other security
procedures as may be issued from time to time by State Street for use of the
System and access to the Remote Access Services. The Customer agrees to advise
State Street immediately in the event that it learns or has reason to believe
that any person to whom it has given access to the System or the Remote Access
Services has violated or intends to violate the terms of this Addendum and the
Customer will cooperate with State Street in seeking injunctive or other
equitable relief. The Customer agrees to discontinue use of the System and
Remote Access Services, if requested, for any security reasons cited by State
Street.
FEES
Fees and charges for the use of the System and the Remote Access Services and
related payment terms shall be as set forth in the custody fee schedule in
effect from time to time between the parties. The Customer shall be responsible
for any tariffs, duties or taxes imposed or levied by any government or
governmental agency by reason of the transactions contemplated by this Addendum,
including, without limitation, federal, state and local taxes, use, value added
and personal property taxes (other than income, franchise or similar taxes which
may be imposed or assessed against State Street). Any claimed exemption from
such tariffs, duties or taxes shall be supported by proper documentary evidence
delivered to State Street.
Proprietary Information/Injunctive Relief
The System and Remote Access Services described herein and the databases,
computer programs, screen formats, report formats, interactive design
techniques, formulae, processes, systems, software, know- how, algorithms,
programs, training aids, printed materials, methods, books, records, files,
documentation and other information made available to the Customer by State
Street as part of the Remote Access Services and through the use of the System
and all copyrights, patents, trade secrets and other proprietary rights of State
Street related thereto are the exclusive, valuable and confidential property of
State Street and its relevant licensors (the "Proprietary Information"). The
Customer agrees on behalf of itself and its Authorized Designees to keep the
Proprietary Information confidential and to limit access to its employees and
Authorized Designees (under a similar duty of confidentiality) who require
access to the System for the purposes intended. The foregoing shall not apply to
Proprietary Information in the public domain or required by law to be made
public.
The Customer agrees to use the Remote Access Services only in connection with
the proper purposes of this Addendum. The Customer will not, and will cause its
employees and Authorized Designees not to, (i) permit any third party to use the
System or the Remote Access Services, (ii) sell, rent, license or otherwise use
the System or the Remote Access Services in the operation of a service bureau or
for any purpose other than as expressly authorized under this Addendum, (iii)
use the System or the Remote Access Services for any fund, trust or other
investment vehicle without the prior written consent of State Street, or (iv)
allow or cause any information transmitted from State Street's databases,
including data from third party sources, available through use of the System or
the Remote Access Services, to be published, redistributed or retransmitted for
other than use for or on behalf of the Customer, as State Street's customer.
The Customer agrees that neither it nor its Authorized Designees will modify the
System in any way; enhance or otherwise create derivative works based upon the
System, nor will your or your Authorized Designees reverse engineer, decompile
or otherwise attempt to secure the source code for all or any part of the
System.
The Customer acknowledges that the disclosure of any Proprietary Information, or
of any information which at law or equity ought to remain confidential, will
immediately give rise to continuing irreparable injury to State Street
inadequately compensable in damages at law and that State Street shall be
entitled to obtain immediate injunctive relief against the breach or threatened
breach of any of the foregoing undertakings, in addition to any other legal
remedies which may be available.
Limited Warranties
State Street represents and warrants that it is the owner of and has the right
to grant access to the System and to provide the Remote Access Services
contemplated herein. Because of the nature of computer information technology
including, but not limited to, the use of the Internet, and the necessity of
relying upon third party sources, and data and pricing information obtained from
third parties, the System and Remote Access Services are provided "AS IS", and
the Customer and its Authorized Designees shall be solely responsible for the
investment decisions, results obtained, regulatory reports and statements
produced using the Remote Access Services. State Street and its relevant
licensors will not be liable to the Customer or its Authorized Designees for any
direct or indirect, special, incidental, punitive or consequential damages
arising out of or in any way connected with the System or the Remote Access
Services, nor shall either party be responsible for delays or nonperformance
under this Addendum arising out of any cause or event beyond such party's
control.
State Street will take reasonable steps to ensure that its products (and those
of its third-party suppliers) reflect the available state of the art technology
to offer products that are Year 2000 compliant, including, but not limited to,
century recognition of dates, calculations that correctly compute same century
and multi century formulas and date values, and interface values that reflect
the date issues arising between now and December 31, 2099, and if any changes
are required, State Street will make the changes to its products at no cost to
you and in a commercially reasonable time frame and will require third-party
suppliers to do likewise. The Customer will do likewise for its systems.
EXCEPT AS EXPRESSLY SET FORTH IN THIS ADDENDUM, STATE STREET, FOR ITSELF AND ITS
RELEVANT LICENSORS, EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES CONCERNING THE
SYSTEM AND THE SERVICES TO BE RENDERED HEREUNDER, WHETHER EXPRESS OR IMPLIED
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTIBILITY OR FITNESS FOR A
PARTICULAR PURPOSE.
Infringement
State Street will defend or, at our option, settle any claim or action brought
against the Customer to the extent that it is based upon an assertion that
access to the System or use of the Remote Access Services by the Customer under
this Addendum constitutes direct infringement of any patent or copyright or
misappropriation of a trade secret, provided that the Customer notifies State
Street promptly in writing of any such claim or proceeding and cooperates with
State Street in the defense of such claim or proceeding. Should the System or
the Remote Access Services or any part thereof become, or in State Street's
opinion be likely to become, the subject of a claim of infringement or the like
under any applicable patent or copyright or trade secret laws, State Street
shall have the right, at State Street's sole option, to (i) procure for the
Customer the right to continue using the System or the Remote Access Services,
(ii) replace or modify the System or the Remote Access Services so that the
System or the Remote Access Services becomes noninfringing, or (iii) terminate
this Addendum without further obligation.
Termination
Either party to the Custodian Agreement may terminate this Addendum (i) for any
reason by giving the other party at least one-hundred and eighty (180) days
prior written notice in the case of notice of termination by State Street to the
Customer or thirty (30) days notice in the case of notice from the Customer to
State Street of termination, or (ii) immediately for failure of the other party
to comply with any material term and condition of the Addendum by giving the
other party written notice of termination. This Addendum shall in any event
terminate within ninety (90) days after the termination of the Custodian
Agreement. In the event of termination, the Customer will return to State Street
all copies of documentation and other confidential information in its possession
or in the possession of its Authorized Designees. The foregoing provisions with
respect to confidentiality and infringement will survive termination for a
period of three (3) years.
Miscellaneous
This Addendum and the exhibit hereto constitute the entire understanding of the
parties to the Custodian Agreement with respect to access to the System and the
Remote Access Services. This Addendum cannot be modified or altered except in a
writing duly executed by each of State Street and the Customer and shall be
governed by and construed in accordance with the laws of The Commonwealth of
Massachusetts.
By its execution of the Custodian Agreement, the Customer (a) confirms to State
Street that it informs all Authorized Designees of the terms of this Addendum;
(b) accepts responsibility for its and its Authorized Designees' compliance with
the terms of this Addendum; and (c) indemnifies and holds State Street harmless
from and against any and all costs, expenses, losses, damages, charges, counsel
fees, payments and liabilities arising from any failure of the Customer or any
of its Authorized Designees to abide by the terms of this Addendum.
EXHIBIT A
to
REMOTE ACCESS SERVICES ADDENDUM TO CUSTODIAN AGREEMENT
IN~SIGHTSM
System Product Description
In~SightSM provides bilateral information delivery, interoperability, and
on-line access to State Street. In~SightSM allows users a single point of entry
into State Street's diverse systems and applications. Reports and data from
systems such as Investment Policy MonitorSM, Multicurrency HorizonSM, Securities
Lending, Performance & Analytics and Electronic Trade Delivery can be accessed
through In~SightSM. This Internet-enabled application is designed to run from a
Web browser and perform across low-speed data lines or corporate high-speed
backbones. In~SightSM also offers users a flexible toolset, including an ad-hoc
query function, a custom graphics package, a report designer, and a scheduling
capability. Data and reports offered through In~SightSM will continue to
increase in direct proportion with the customer roll out, as it is viewed as the
information delivery system will grow with State Street's customers.
