CUSTODY AGREEMENT
AGREEMENT, dated as of October 11, 2012 between FIRST TRUST MLP AND ENERGY
INCOME FUND, a business trust organized and existing under the laws of the
State of Massachusetts having its principal office and place of business at 000
Xxxx Xxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxx 00000 (the "Fund") and THE
BANK OF NEW YORK MELLON, a New York corporation authorized to do a banking
business having its principal office and place of business at Xxx Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000 ("Custodian").
W I T N E S S E T H:
that for and in consideration of the mutual promises hereinafter set forth the
Fund and Custodian agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words shall have the meanings
set forth below:
1. "AUTHORIZED PERSON" shall be any person, whether or not an officer or
employee of the Fund, duly authorized by the Fund's board to execute any
Certificate or to give any Oral Instruction with respect to one or more
Accounts, such persons to be designated in a Certificate annexed hereto as
Schedule I hereto or such other Certificate as may be received by Custodian
from time to time.
2. "BNY AFFILIATE" shall mean any office, branch or subsidiary of The Bank
of New York Mellon Corporation.
3. "BOOK-ENTRY SYSTEM" shall mean the Federal Reserve/Treasury book-entry
system for receiving and delivering securities, its successors and nominees.
4. "BUSINESS DAY" shall mean any day on which Custodian and relevant
Depositories are open for business.
5. "CERTIFICATE" shall mean any notice, instruction, or other instrument
in writing, authorized or required by this Agreement to be given to Custodian,
which is actually received by Custodian by letter or facsimile transmission and
signed on behalf of the Fund by an Authorized Person or a person reasonably
believed by Custodian to be an Authorized Person.
6. "COMPOSITE CURRENCY UNIT" shall mean the Euro or any other composite
currency unit consisting of the aggregate of specified amounts of specified
currencies, as such unit may be constituted from time to time.
7. "DEPOSITORY" shall include (a) the Book-Entry System, (b) the
Depository Trust Company, (c) any other clearing agency or securities
depository registered with the Securities and Exchange Commission identified to
the Fund from time to time, and (d) the respective successors and nominees of
the foregoing.
8. "FOREIGN DEPOSITORY" shall mean (a) Euroclear, (b) Clearstream Banking,
societe anonyme, (c) each Eligible Securities Depository as defined in Rule
17f-7 under the Investment Company Act of 1940, as amended, identified to the
Fund from time to time, and (d) the respective successors and nominees of the
foregoing.
9. "INSTRUCTIONS" shall mean communications actually received by Custodian
by S.W.I.F.T., tested telex, letter, facsimile transmission, or other method or
system specified by Custodian as available for use in connection with the
services hereunder.
10. "ORAL INSTRUCTIONS" shall mean verbal instructions received by
Custodian from an Authorized Person or from a person reasonably believed by
Custodian to be an Authorized Person.
11. "SERIES" shall mean the various portfolios, if any, of the Fund listed
on Schedule II hereto, and if none are listed, references to Series shall be
references to the Fund.
12. "SECURITIES" shall include, without limitation, any common stock and
other equity securities, bonds, debentures and other debt securities, notes,
mortgages or other obligations, and any instruments representing rights to
receive, purchase, or subscribe for the same, or representing any other rights
or interests therein (whether represented by a certificate or held in a
Depository or by a Subcustodian).
13. "SUBCUSTODIAN" shall mean a bank (including any branch thereof) or
other financial institution (other than a Foreign Depository) located outside
the U.S. which is utilized by Custodian in connection with the purchase, sale
or custody of Securities hereunder and identified to the Fund from time to
time, and their respective successors and nominees.
ARTICLE II
APPOINTMENT OF CUSTODIAN; ACCOUNTS;
REPRESENTATIONS, WARRANTIES, AND COVENANTS
1. (a) The Fund hereby appoints Custodian as custodian of all Securities and
cash at any time delivered to Custodian during the term of this Agreement, and
authorizes Custodian to hold Securities in registered form in its name or the
name of its nominees. Custodian hereby accepts such appointment and agrees to
establish and maintain one or more securities accounts and cash accounts for
each Series in which Custodian will hold Securities and cash as provided
herein. Custodian shall maintain books and records segregating the assets of
each Series from the assets of any other Series. Such accounts (each, an
"Account"; collectively, the "Accounts") shall be in the name of the Fund.
(b) Custodian may from time to time establish on its books and
records such sub-accounts within each Account as the Fund and Custodian may
agree upon (each a "Special Account"), and Custodian shall reflect therein such
assets as the Fund may specify in a Certificate or Instructions.
(c) Custodian may from time to time establish pursuant to a written
agreement with and for the benefit of a broker, dealer, future commission
merchant or other third party identified in a Certificate or Instructions such
accounts on such terms and conditions as the Fund and Custodian shall agree,
and Custodian shall transfer to such account such Securities and money as the
Fund may specify in a Certificate or Instructions.
2. The Fund hereby represents and warrants, which representations and
warranties shall be continuing and shall be deemed to be reaffirmed upon each
delivery of a Certificate or each giving of Oral Instructions or Instructions
by the Fund, that:
(a) It is duly organized and existing under the laws of the
jurisdiction of its organization, with full power to carry on its business as
now conducted, to enter into this Agreement, and to perform its obligations
hereunder;
(b) This Agreement has been duly authorized, executed and delivered
by the Fund, approved by a resolution of its board, constitutes a valid and
legally binding obligation of the Fund, enforceable in accordance with its
terms, and there is no statute, regulation, rule, order or judgment binding on
it, and no provision of its charter or by-laws, nor of any mortgage, indenture,
credit agreement or other contract binding on it or affecting its property,
which would prohibit its execution or performance of this Agreement;
(c) It is conducting its business in substantial compliance with all
applicable laws and requirements, both state and federal, and has obtained all
regulatory licenses, approvals and consents necessary to carry on its business
as now conducted;
(d) It will not use the services provided by Custodian hereunder in
any manner that is, or will result in, a violation of any law, rule or
regulation applicable to the Fund;
(e) If the Fund's foreign custody manager is not the Custodian or a
BNY Affiliate, the Fund's Board or its foreign custody manager, as defined in
Rule 17f-5 under the Investment Company Act of 1940, as amended (the "'40
Act"), has determined that use of each Subcustodian (including any Replacement
Custodian) which Custodian or Sub-Custodian is authorized to utilize in
accordance with Section 1(a) of Article III hereof satisfies the applicable
requirements of the '40 Act and Rule 17f-5 thereunder;
(f) The Fund or its investment adviser has determined that the
custody arrangements of each Foreign Depository provide reasonable safeguards
against the custody risks associated with maintaining assets with such Foreign
Depository within the meaning of Rule 17f-7 under the '40 Act;
(g) It is fully informed of the protections and risks associated with
various methods of transmitting Instructions and Oral Instructions and
delivering Certificates to Custodian, shall, and shall cause each Authorized
Person, to safeguard and treat with extreme care any user and authorization
codes, passwords and/or authentication keys, understands that there may be more
secure methods of transmitting or delivering the same than the methods selected
by the Fund, agrees that the security procedures (if any) to be followed in
connection
therewith provide a commercially reasonable degree of protection in light of
its particular needs and circumstances, and acknowledges and agrees that
Instructions need not be reviewed by Custodian, may conclusively be presumed by
Custodian to have been given by person(s) duly authorized, and may be acted
upon as given;
(h) It shall manage its borrowings, including, without limitation,
any advance or overdraft (including any day-light overdraft) in the Accounts,
so that the aggregate of its total borrowings for each Series does not exceed
the amount such Series is permitted to borrow under the '40 Act;
(i) Its transmission or giving of, and Custodian acting upon and in
reliance on, Certificates, Instructions, or Oral Instructions pursuant to this
Agreement shall at all times comply with the '40 Act;
(j) It shall impose and maintain restrictions on the destinations to
which cash may be disbursed by Instructions to ensure that each disbursement is
for a proper purpose; and
(k) It has the right to make the pledge and grant the security
interest and security entitlement to Custodian contained in Section 1 of
Article V hereof, free of any right of redemption or prior claim of any other
person or entity, such pledge and such grants shall have a first priority
subject to no setoffs, counterclaims, or other liens or grants prior to or on a
parity therewith, and it shall take such additional steps as Custodian may
require to assure such priority.
3. The Fund hereby covenants that it shall from time to time complete and
execute and deliver to Custodian upon Custodian's request a Form FR U-1 (or
successor form) whenever the Fund borrows from Custodian any money to be used
for the purchase or carrying of margin stock as defined in Federal Reserve
Regulation U.
ARTICLE III
CUSTODY AND RELATED SERVICES
1. (a) Subject to the terms hereof, the Fund hereby authorizes Custodian
to hold any Securities received by it from time to time for the Fund's account.
Custodian shall be entitled to utilize, subject to subsection (c) of this
Section 1, Depositories, Subcustodians (provided if the Fund's foreign custody
manager is not the Custodian or a BNY Affiliate, the Custodian has received
notice of the Subcustodians approved by the Fund's Board or foreign custody
manager), and, subject to subsection (d) of this Section 1, Foreign
Depositories, to the extent possible in connection with its performance
hereunder. Securities and cash held in a Depository or Foreign Depository will
be held subject to the rules, terms and conditions of such entity. Securities
and cash held through Subcustodians shall be held subject to the terms and
conditions of Custodian's agreements with such Subcustodians. Subcustodians may
be authorized to hold Securities in Foreign Depositories in which such
Subcustodians participate. Unless otherwise required by local law or practice
or a particular subcustodian agreement, Securities deposited with a
Subcustodian, a Depositary or a Foreign Depository will be held in a commingled
account, in the name of Custodian, holding only Securities held by Custodian as
custodian for its customers. Custodian shall identify on its books and records
the Securities and cash belonging to the Fund, whether held directly or
indirectly through Depositories, Foreign Depositories, or Subcustodians.
Custodian shall, directly or indirectly through Subcustodians, Depositories, or
Foreign Depositories, endeavor, to the extent feasible, to hold Securities in
the country or other jurisdiction in which the principal trading market for
such Securities is located, where such Securities are to be presented for
cancellation and/or payment and/or registration, or where such Securities are
acquired. Custodian at any time may cease utilizing any Subcustodian and/or may
replace a Subcustodian with a different Subcustodian (the "Replacement
Subcustodian"). In the event Custodian selects a Replacement Subcustodian,
Custodian shall not utilize such Replacement Subcustodian until after the
Fund's board or foreign custody manager has determined that utilization of such
Replacement Subcustodian satisfies the requirements of the '40 Act and Rule
17f-5 thereunder.
(b) In the event that the Fund desires to have the Custodian serve as
foreign custody manager to the Fund, and the Custodian agrees to provide such
services, the Fund and Custodian shall enter into a Foreign Custody Management
Agreement substantially in the form attached as Appendix II.
(c) Unless Custodian has received a Certificate or Instructions to
the contrary, Custodian shall hold Securities indirectly through a Subcustodian
only if (i) the Securities are not subject to any right, charge, security
interest, lien or claim of any kind in favor of such Subcustodian or its
creditors or operators, including a receiver or trustee in bankruptcy or
similar authority, except for a claim of payment for the safe custody or
administration of Securities on behalf of the Fund by such Subcustodian, and
(ii) beneficial ownership of the Securities is freely transferable without the
payment of money or value other than for safe custody or administration.
(d) With respect to each Depository, Custodian (i) shall exercise due
care in accordance with reasonable commercial standards in discharging its
duties as a securities intermediary to obtain and thereafter maintain
Securities or financial assets deposited or held in such Depository, and (ii)
will provide, promptly upon request by the Fund, such reports as are available
concerning the internal accounting controls and financial strength of
Custodian.
(e) With respect to each Foreign Depository, Custodian shall exercise
reasonable care, prudence, and diligence (i) to provide the Fund with an
analysis of the custody risks associated with maintaining assets with the
Foreign Depository in accordance with Rule 17f-7(a)(1)(i)(A) of the '40 Act,
and (ii) to monitor such custody risks on a continuing basis and promptly
notify the Fund of any material change in such risks. The Custodian shall only
utilize a Foreign Depository that it has determined satisfied the requirements
of Rule 17f-7(b)(1) as an "Eligible Securities Depository" (as defined in Rule
17f-7(b)(1)) and has provided the risk analysis required in (i) of this
paragraph (e). In such a manner as Custodian deems reasonable, Custodian shall
give the Fund prompt notice of any material change known to Custodian, that
would adversely affect the Custodian's determination that an entity is an
Eligible Securities Depository. The Fund acknowledges and agrees that such
analysis and monitoring shall be made on the basis of, and limited by,
information gathered from Subcustodians or through publicly available
information otherwise obtained by Custodian, and shall not include any
evaluation of Country Risks. As used herein the term "Country Risks" shall mean
with respect to any Foreign Depository: (a) the financial infrastructure of the
country in which it is organized, (b) such country's prevailing custody and
settlement practices, (c) nationalization, expropriation or other governmental
actions, (d) such country's regulation of the banking or securities industry,
(e) currency controls, restrictions, devaluations or fluctuations, and (f)
market conditions which affect the order execution of securities transactions
or affect the value of securities.
2. Custodian shall furnish the Fund with an advice of daily transactions
(including a confirmation of each transfer of Securities) and a monthly summary
of all transfers to or from the Accounts.
3. With respect to all Securities held hereunder, Custodian shall, unless
otherwise instructed to the contrary:
(a) Receive all income and other payments and advise the Fund as
promptly as practicable of any such amounts due but not paid;
(b) Present for payment and receive the amount paid upon all
Securities which may mature and advise the Fund as promptly as practicable of
any such amounts due but not paid;
(c) Forward to the Fund copies of all information or documents that
it may actually receive from an issuer of Securities which, in the opinion of
Custodian, are intended for the beneficial owner of Securities;
(d) Execute, as custodian, any certificates of ownership, affidavits,
declarations or other certificates under any tax laws now or hereafter in
effect in connection with the collection of bond and note coupons;
(e) Hold directly or through a Depository, a Foreign Depository, or a
Subcustodian all rights and similar Securities issued with respect to any
Securities credited to an Account hereunder; and
(f) Endorse for collection checks, drafts or other negotiable
instruments.
4. (a) Custodian shall notify the Fund of rights or discretionary actions
with respect to Securities held hereunder, and of the date or dates by when
such rights must be exercised or such action must be taken, provided that
Custodian has actually received, from the issuer or the relevant Depository
(with respect to Securities issued in the United States) or from the relevant
Subcustodian, Foreign Depository, or a nationally or internationally recognized
bond or corporate action service to which Custodian subscribes, timely notice
of such rights or discretionary corporate action or of the date or dates such
rights must be exercised or such action must be taken. Absent actual receipt of
such notice, Custodian shall have no liability for failing to so notify the
Fund.
(b) Whenever Securities (including, but not limited to, warrants, options,
tenders, options to tender or non-mandatory puts or calls) confer discretionary
rights on the Fund or provide for discretionary action or alternative courses
of action by the Fund, the Fund shall be responsible for making any decisions
relating thereto and for directing Custodian to act. In order for Custodian to
act, it must receive the Fund's Certificate or Instructions at Custodian's
offices, addressed as Custodian may from time to time request, not later than
noon (New York time) at least two (2) Business Days prior to the last scheduled
date to act with respect to such Securities (or such earlier date or time as
Custodian may specify to the Fund). Absent Custodian's timely receipt of such
Certificate or Instructions, Custodian shall not be liable for failure to take
any action relating to or to exercise any rights conferred by such Securities.
5. All voting rights with respect to Securities, however registered, shall
be exercised by the Fund or its designee. Custodian will make available to the
Fund proxy voting services upon the request of, and for the jurisdictions
selected by, the Fund in accordance with terms and conditions to be mutually
agreed upon by Custodian and the Fund.
6. Custodian shall promptly advise the Fund upon Custodian's actual
receipt of notification of the partial redemption, partial payment or other
action affecting less than all Securities of the relevant class. If Custodian,
any Subcustodian, any Depository, or any Foreign Depository holds any
Securities in which the Fund has an interest as part of a fungible mass,
Custodian, such Subcustodian, Depository, or Foreign Depository may select the
Securities to participate in such partial redemption, partial payment or other
action in any non-discriminatory manner that it customarily uses to make such
selection.
7. Custodian shall not under any circumstances accept bearer interest
coupons which have been stripped from United States federal, state or local
government or agency securities unless explicitly agreed to by Custodian in
writing.
8. The Fund shall be liable for all taxes, assessments, duties and other
governmental charges, including any interest or penalty with respect thereto
("Taxes"), with respect to any cash or Securities held on behalf of the Fund or
any transaction related thereto. The Fund shall indemnify Custodian and each
Subcustodian for the amount of any Tax that Custodian, any such Subcustodian or
any other withholding agent is required under applicable laws (whether by
assessment or otherwise) to pay on behalf of, or in respect of income earned by
or payments or distributions made to or for the account of the Fund (including
any payment of Tax required by reason of an earlier failure to withhold).
Custodian shall, or shall instruct the applicable Subcustodian or other
withholding agent to, withhold the amount of any Tax which is required to be
withheld under applicable law upon collection of any dividend, interest or
other distribution made with respect to any Security and any proceeds or income
from the sale, loan or other transfer of any Security. In the event that
Custodian or any Subcustodian is required under applicable law to pay any Tax
on behalf of the Fund, Custodian is hereby authorized to withdraw cash from any
cash account in the amount required to pay such Tax and to use such cash, or to
remit such cash to the appropriate Subcustodian or other withholding agent, for
the timely payment of such Tax in the manner required by applicable law. If the
aggregate amount of cash in all cash accounts is not sufficient to pay such
Tax, Custodian shall promptly notify the Fund of the additional amount of cash
(in the appropriate currency) required, and the Fund shall directly deposit
such additional amount in the appropriate cash account promptly after receipt
of such notice, for use by Custodian as specified herein. In the event that
Custodian reasonably believes that Fund is eligible, pursuant to applicable law
or to the provisions of any tax treaty, for a reduced rate of, or exemption
from, any Tax which is otherwise required to be withheld or paid on behalf of
the Fund under any applicable law, Custodian shall, or shall instruct the
applicable Subcustodian or withholding agent to, either withhold or pay such
Tax at such reduced rate or refrain from withholding or paying such Tax, as
appropriate; provided that Custodian shall have received from the Fund all
documentary evidence of residence or other qualification for such reduced rate
or exemption required to be received under such applicable law or treaty. In
the event that Custodian reasonably believes that a reduced rate of, or
exemption from, any Tax is obtainable only by means of an application for
refund, Custodian and the applicable Subcustodian shall have no responsibility
for the accuracy or validity of any forms or documentation provided by the Fund
to Custodian hereunder. The Fund hereby agrees to indemnify and hold harmless
Custodian and each Subcustodian in respect of any liability arising from any
underwithholding or underpayment of any Tax which results from the inaccuracy
or invalidity of any such forms or other documentation, and such obligation to
indemnify shall be a continuing obligation of the Fund, its successors and
assigns notwithstanding the termination of this Agreement.
9. (a) For the purpose of settling Securities and foreign exchange
transactions, the Fund shall provide Custodian with sufficient immediately
available funds for all transactions by such time and date as conditions in the
relevant market dictate. As used herein, "sufficient immediately available
funds" shall mean either (i) sufficient cash denominated in U.S. dollars to
purchase the necessary foreign currency, or (ii) sufficient applicable foreign
currency, to settle the transaction. Custodian shall provide the Fund with
immediately available funds each day which result from the actual settlement of
all sale transactions, based upon advices received by Custodian from
Subcustodians, Depositories, and Foreign Depositories. Such funds shall be in
U.S. dollars or such other currency as the Fund may specify to Custodian.
(b) Any foreign exchange transaction effected by Custodian in
connection with this Agreement may be entered with Custodian or a BNY Affiliate
acting as principal or otherwise through customary banking channels. The Fund
may issue a standing Certificate or Instructions with respect to foreign
exchange transactions, but Custodian may establish rules or limitations
concerning any foreign exchange facility made available to the Fund. The Fund
shall bear all risks of investing in Securities or holding cash denominated in
a foreign currency.
(c) To the extent that Custodian has agreed to provide pricing or
other information services in connection with this Agreement, Custodian is
authorized to utilize any vendor (including brokers and dealers of Securities)
reasonably believed by Custodian to be reliable to provide such information.
The Fund understands that certain pricing information with respect to complex
financial instruments (e.g., derivatives) may be based on calculated amounts
rather than actual market transactions and may not reflect actual market
values, and that the variance between such calculated amounts and actual market
values may or may not be material. Where vendors do not provide information for
particular Securities or other property, an Authorized Person may advise
Custodian in a Certificate regarding the fair market value of, or provide other
information with respect to, such Securities or property as determined by it in
good faith. Custodian shall not be liable for any loss, damage or expense
incurred as a result of errors or omissions with respect to any pricing or
other information utilized by Custodian hereunder.
10. Custodian shall promptly send to the Fund (a) any reports it receives
from a Depository on such Depository's system of internal accounting control,
and (b) such reports on its own system of internal accounting control as the
Fund may reasonably request from time to time.
11. Until such time as Custodian receives a certificate to the contrary
with respect to a particular Security, Custodian may release the identity of
the Fund to an issuer which requests such information pursuant to the
Shareholder Communications Act of 1985 for the specific purpose of direct
communications between such issuer and shareholder.
ARTICLE IV
PURCHASE AND SALE OF SECURITIES; CREDITS TO ACCOUNT
1. Promptly after each purchase or sale of Securities by the Fund, the
Fund shall deliver to Custodian a Certificate or Instructions, or with respect
to a purchase or sale of a Security generally required to be settled on the
same day the purchase or sale is made, Oral Instructions specifying all
information Custodian may reasonably request to settle such purchase or sale.
Custodian shall account for all purchases and sales of Securities on the actual
settlement date unless otherwise agreed by Custodian.
2. The Fund understands that when Custodian is instructed to deliver
Securities against payment, delivery of such Securities and receipt of payment
therefor may not be completed simultaneously. Notwithstanding any provision in
this Agreement to the contrary, settlements, payments and deliveries of
Securities may be effected by Custodian or any Subcustodian in accordance with
the customary or established securities trading or securities processing
practices and procedures in the jurisdiction in which the transaction occurs,
including, without limitation, delivery to a purchaser or dealer therefor (or
agent) against receipt with the expectation of receiving later payment for such
Securities. The Fund assumes full responsibility for all risks, including,
without limitation, credit risks, involved in connection with such deliveries
of Securities.
3. Custodian may, as a matter of bookkeeping convenience or by separate
agreement with the Fund, credit the Account with the proceeds from the sale,
redemption or other disposition of Securities or interest, dividends or other
distributions payable on Securities prior to its actual receipt of final
payment therefor. All such credits shall be conditional until Custodian's
actual receipt of final payment and may be reversed by Custodian to the extent
that final payment is not received. Payment with respect to a transaction will
not be "final" until Custodian shall have received immediately available funds
which under applicable local law, rule and/or practice are irreversible and not
subject to any security interest, levy or other encumbrance, and which are
specifically applicable to such transaction.
ARTICLE V
OVERDRAFTS OR INDEBTEDNESS
1. If Custodian should in its sole discretion advance funds on behalf of
any Series which results in an overdraft (including, without limitation, any
day-light overdraft) because the money held by Custodian in an Account for such
Series shall be insufficient to pay the total amount payable upon a purchase of
Securities specifically allocated to such Series, as set forth in a
Certificate, Instructions or Oral Instructions, or if an overdraft arises in
the separate account of a Series for some other reason, including, without
limitation, because of a reversal of a conditional credit or the purchase of
any currency, or if the Fund is for any other reason indebted to Custodian with
respect to a Series, including any indebtedness to The Bank of New York Mellon
under the Fund's Cash Management and Related Services Agreement, if any,
(except a borrowing for investment or for temporary or emergency purposes using
Securities as collateral pursuant to a separate agreement and subject to the
provisions of Section 2 of this Article), such overdraft or indebtedness shall
be deemed to be a loan made by Custodian to the Fund for such Series payable on
demand and shall bear interest from the date incurred at a rate per annum
ordinarily charged by Custodian to its institutional customers, as such rate
may be adjusted from time to time. In addition, the Fund hereby agrees that
Custodian shall to the maximum extent permitted by law have a continuing lien,
security interest, and security entitlement in and to any property, including,
without limitation, any investment property or any financial asset, of such
Series at any time held by Custodian for the benefit of such Series or in which
such Series may have an interest which is then in Custodian's possession or
control or in possession or control of any third party acting in Custodian's
behalf. The Fund authorizes Custodian, in its sole discretion, at any time to
charge any such overdraft or indebtedness together with interest due thereon
against any balance of account standing to such Series' credit on Custodian's
books.
2. If the Fund borrows money from any bank (including Custodian if the
borrowing is pursuant to a separate agreement) for investment or for temporary
or emergency purposes using Securities held by Custodian hereunder as
collateral for such borrowings, the Fund shall deliver to Custodian a
Certificate specifying with respect to each such borrowing: (a) the Series to
which such borrowing relates; (b) the name of the bank, (c) the amount of the
borrowing, (d) the time and date, if known, on which the loan is to be entered
into, (e) the total amount payable to the Fund on the borrowing date, (f) the
Securities to be delivered as collateral for such loan, including the name of
the issuer, the title and the number of shares or the principal amount of any
particular Securities, and (g) a statement specifying whether such loan is for
investment purposes or for temporary or emergency purposes and that such loan
is in conformance with the '40 Act and the Fund's prospectus. Custodian shall
deliver on the borrowing date specified in a Certificate the specified
collateral against payment by the lending bank of the total amount of the loan
payable, provided that the same conforms to the total amount payable as set
forth in the Certificate. Custodian may, at the option of the lending bank,
keep such collateral in its possession, but such collateral shall be subject to
all rights therein given the lending bank by virtue of any promissory note or
loan agreement. Custodian shall deliver such Securities as additional
collateral as may be specified in a Certificate to collateralize further any
transaction described in this Section. The Fund shall cause all Securities
released from collateral status to be returned directly to Custodian, and
Custodian shall receive from time to time such return of collateral as may be
tendered to it. In the event that the Fund fails to specify in a Certificate
the Series, the name of the issuer, the title and number of shares or the
principal amount of any particular Securities to be delivered as collateral by
Custodian, Custodian shall not be under any obligation to deliver any
Securities.
ARTICLE VI
SALE AND REDEMPTION OF SHARES
1. Whenever the Fund shall sell any shares issued by the Fund ("Shares")
it shall deliver to Custodian a Certificate or Instructions specifying the
amount of money and/or Securities to be received by Custodian for the sale of
such Shares and specifically allocated to an Account for such Series.
2. Upon receipt of such money, Custodian shall credit such money to an
Account in the name of the Series for which such money was received.
3. Except as provided hereinafter, whenever the Fund desires Custodian to
make payment out of the money held by Custodian hereunder in connection with a
redemption of any Shares, it shall furnish to Custodian (a) a resolution of the
Fund's board directing the Fund's transfer agent to redeem the Shares, and (b)
a Certificate or Instructions specifying the total amount to be paid for such
Shares. Custodian shall make payment of such total amount to the transfer agent
specified in such Certificate or Instructions out of the money held in an
Account of the appropriate Series.
ARTICLE VII
PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
1. Whenever the Fund shall determine to pay a dividend or distribution on
Shares it shall furnish to Custodian Instructions or a Certificate setting
forth with respect to the Series specified therein the date of the declaration
of such dividend or distribution, the total amount payable, and the payment
date.
2. Upon the payment date specified in such Instructions or Certificate,
Custodian shall pay out of the money held for the account of such Series the
total amount payable to the dividend agent of the Fund specified therein.
ARTICLE VIII
CONCERNING CUSTODIAN
1. (a) Except as otherwise expressly provided herein, Custodian shall not
be liable for any costs, expenses, damages, liabilities or claims, including
attorneys' and accountants' fees (collectively, "Losses"), incurred by or
asserted against the Fund, except those Losses arising out of Custodian's own
negligence or willful misconduct. Custodian shall have no liability whatsoever
for the action or inaction of any Depositories or of any Foreign Depositories,
except in each case to the extent such action or inaction is a direct result of
the Custodian's failure to fulfill its duties hereunder. With respect to any
Losses incurred by the Fund as a result of the acts or any failures to act by
any Subcustodian (other than a BNY Affiliate), Custodian shall take appropriate
action to recover such Losses from such Subcustodian; and Custodian's sole
responsibility and liability to the Fund shall be limited to amounts so
received from such Subcustodian (exclusive of costs and expenses incurred by
Custodian). In no event shall Custodian be liable to the Fund or any third
party for special, indirect or consequential damages, or lost profits or loss
of business, arising in connection with this Agreement, except Custodian shall
be liable to the Fund for direct money damages caused by Custodian's own
negligence or willful misconduct, nor shall BNY or any Subcustodian be liable:
(i) for acting in accordance with any Certificate or Oral Instructions actually
received by Custodian and reasonably believed by Custodian to be given by an
Authorized Person; (ii) for acting in accordance with Instructions without
reviewing the same; (iii) for conclusively presuming that all Instructions are
given only by person(s) duly authorized; (iv) for conclusively presuming that
all disbursements of cash directed by the Fund, whether by a Certificate, an
Oral Instruction, or an Instruction, are in accordance with Section 2(i) of
Article II hereof; (v) for holding property in any particular country,
including, but not limited to, Losses resulting from nationalization,
expropriation or other governmental actions; regulation of the banking or
securities industry; exchange or currency controls or restrictions,
devaluations or fluctuations; availability of cash or Securities or market
conditions which prevent the transfer of property or execution of Securities
transactions or affect the value of property; (vi) for any Losses due to forces
beyond the control of Custodian, including without limitation strikes, work
stoppages, acts of war or terrorism, insurrection, revolution, nuclear or
natural catastrophes or acts of God, or interruptions, loss or malfunctions of
utilities, communications or computer (software and hardware) services; (vii)
for the insolvency of any Subcustodian (other than a BNY Affiliate), any
Depository, or, except to the extent such action or inaction is a direct result
of the Custodian's failure to fulfill its duties hereunder, any Foreign
Depository; or (viii) for any Losses arising from the applicability of any law
or regulation now or hereafter in effect, or from the occurrence of any event,
including, without limitation, implementation or adoption of any rules or
procedures of a Foreign Depository, which may affect, limit, prevent or impose
costs or burdens on, the transferability, convertibility, or availability of
any currency or Composite Currency Unit in any country or on the transfer of
any Securities, and in no event shall Custodian be obligated to substitute
another currency for a currency (including a currency that is a component of a
Composite Currency Unit) whose transferability, convertibility or availability
has been affected, limited, or prevented by such law, regulation or event, and
to the extent that any such law, regulation or event imposes a cost or charge
upon Custodian in relation to the transferability, convertibility, or
availability of any cash currency or Composite Currency Unit, such cost or
charge shall be for the account of the Fund, and Custodian may treat any
account denominated in an affected currency as a group of separate accounts
denominated in the relevant component currencies; or (ix) for any action or
inaction taken or omitted to by Custodian in good faith in accordance with the
advice or opinion of counsel for the Fund or its own outside counsel.
(b) Custodian may enter into subcontracts, agreements and
understandings with any BNY Affiliate, whenever and on such terms and
conditions as it deems necessary or appropriate to perform its services
hereunder. No such subcontract, agreement or understanding shall discharge
Custodian from its obligations hereunder.
(c) The Fund agrees to indemnify Custodian and hold Custodian
harmless from and against any and all Losses sustained or incurred by or
asserted against Custodian by reason of or as a result of any action or
inaction, or arising out of Custodian's performance hereunder, including
reasonable fees and expenses of counsel incurred by Custodian in a successful
defense of claims by the Fund; provided however, that the Fund shall not
indemnify Custodian for those Losses arising out of Custodian's own negligence
or willful misconduct. This indemnity shall be a continuing obligation of the
Fund, its successors and assigns, notwithstanding the termination of this
Agreement.
2. Without limiting the generality of the foregoing, Custodian shall be
under no obligation to inquire into, and shall not be liable for:
(a) Any Losses incurred by the Fund or any other person as a result
of the receipt or acceptance of fraudulent, forged or invalid Securities, or
Securities which are otherwise not freely transferable or deliverable without
encumbrance in any relevant market;
(b) The validity of the issue of any Securities purchased, sold, or
written by or for the Fund, the legality of the purchase, sale or writing
thereof, or the propriety of the amount paid or received therefor;
(c) The legality of the sale or redemption of any Shares, or the
propriety of the amount to be received or paid therefor;
(d) The legality of the declaration or payment of any dividend or
distribution by the Fund;
(e) The legality of any borrowing by the Fund;
(f) The legality of any loan of portfolio Securities, nor shall
Custodian be under any duty or obligation to see to it that any cash or
collateral delivered to it by a broker, dealer or financial institution or held
by it at any time as a result of such loan of portfolio Securities is adequate
security for the Fund against any loss it might sustain as a result of such
loan, which duty or obligation shall be the sole responsibility of the Fund. In
addition, Custodian shall be under no duty or obligation to see that any
broker, dealer or financial institution to which portfolio Securities of the
Fund are lent makes payment to it of any dividends or interest which are
payable to or for the account of the Fund during the period of such loan or at
the termination of such loan, provided, however that Custodian shall promptly
notify the Fund in the event that such dividends or interest are not paid and
received when due;
(g) The sufficiency or value of any amounts of money and/or
Securities held in any Special Account in connection with transactions by the
Fund; whether any broker, dealer, futures commission merchant or clearing
member makes payment to the Fund of any variation margin payment or similar
payment which the Fund may be entitled to receive from such broker, dealer,
futures commission merchant or clearing member, or whether any payment received
by Custodian from any broker, dealer, futures commission merchant or clearing
member is the amount the Fund is entitled to receive, or to notify the Fund of
Custodian's receipt or non-receipt of any such payment; or
(h) Whether any Securities at any time delivered to, or held by it or
by any Subcustodian, for the account of the Fund and specifically allocated to
a Series are such as properly may be held by the Fund or such Series under the
provisions of its then current prospectus and statement of additional
information, or to ascertain whether any transactions by the Fund, whether or
not involving Custodian, are such transactions as may properly be engaged in by
the Fund.
3. Custodian may, with respect to questions of law specifically regarding
an Account, obtain the advice of counsel and shall be fully protected with
respect to anything done or omitted by it in good faith in conformity with such
advice.
4. Custodian shall be under no obligation to take action to collect any
amount payable on Securities in default, or if payment is refused after due
demand and presentment.
5. Custodian shall have no duty or responsibility to inquire into, make
recommendations, supervise, or determine the suitability of any transactions
affecting any Account.
6. The Fund shall pay to Custodian the fees and charges as may be
specifically agreed upon from time to time and such other fees and charges at
Custodian's standard rates for such services as may be applicable. The Fund
shall reimburse Custodian for all costs associated with the conversion of the
Fund's Securities hereunder and the transfer of Securities and records kept in
connection with this Agreement. The Fund shall also reimburse Custodian for
out-of-pocket expenses which are a normal incident of the services provided
hereunder.
7. Custodian has the right to debit any cash account for any amount
payable by the Fund in connection with any and all obligations of the Fund to
Custodian. In addition to the rights of Custodian under applicable law and
other agreements, at any time when the Fund shall not have honored any of its
obligations to Custodian, Custodian shall have the right without notice to the
Fund to retain or set-off, against such obligations of the Fund, any Securities
or cash Custodian or a BNY Affiliate may directly or indirectly hold for the
account of the Fund, and any obligations (whether matured or unmatured) that
Custodian or a BNY Affiliate may have to the Fund in any currency or Composite
Currency Unit. Any such asset of, or obligation to, the Fund may be transferred
to Custodian and any BNY Affiliate in order to effect the above rights.
8. The Fund agrees to forward to Custodian a Certificate or Instructions
confirming Oral Instructions by the close of business of the same day that such
Oral Instructions are given to Custodian. The Fund agrees that the fact that
such confirming Certificate or Instructions are not received or that a contrary
Certificate or contrary Instructions are received by Custodian shall in no way
affect the validity or enforceability of transactions authorized by such Oral
Instructions and effected by Custodian. If the Fund elects to transmit
Instructions through an on-line communications system offered by Custodian, the
Fund's use thereof shall be subject to the Terms and Conditions attached as
Appendix I hereto. If Custodian receives Instructions which appear on their
face to have been transmitted by an Authorized Person via (i) computer
facsimile, email, the Internet or other insecure electronic method, or (ii)
secure electronic transmission containing applicable authorization codes,
passwords and/or authentication keys, the Fund understands and agrees that
Custodian cannot determine the identity of the actual sender of such
Instructions and that Custodian shall conclusively presume that such Written
Instructions have been sent by an Authorized Person, and the Fund shall be
responsible for ensuring that only Authorized Persons transmit such
Instructions to Custodian. If the Fund elects (with Custodian's prior consent)
to transmit Instructions through an on-line communications service owned or
operated by a third party, the Fund agrees that Custodian shall not be
responsible or liable for the reliability or availability of any such service.
9. The books and records pertaining to the Fund which are in possession of
Custodian shall be the property of the Fund. Such books and records shall be
prepared and maintained as required by the '40 Act and the rules thereunder.
The Fund, or its authorized representatives, shall have access to such books
and records during Custodian's normal business hours. Upon the reasonable
request of the Fund, copies of any such books and records shall be provided by
Custodian to the Fund or its authorized representative. Upon the reasonable
request of the Fund, Custodian shall provide in hard copy or on computer disc
any records included in any such delivery which are maintained by Custodian on
a computer disc, or are similarly maintained.
10. It is understood that Custodian is authorized to supply any
information regarding the Accounts which is required by any law, regulation or
rule now or hereafter in effect. The Custodian shall provide the Fund with any
report obtained by the Custodian on the system of internal accounting control
of a Depository, and with such reports on its own system of internal accounting
control as the Fund may reasonably request from time to time.
11. Custodian shall have no duties or responsibilities whatsoever except
such duties and responsibilities as are specifically set forth in this
Agreement, and no covenant or obligation shall be implied against Custodian in
connection with this Agreement.
12. From time to time as requested by the Fund, the Custodian shall
provide to the Fund such certifications and sub-certifications, in the form
agreed to by the Fund and the Custodian, with respect to Form N-Qs, Form
N-CSRs, compliance policies and procedures under Rule 38a-1 under the
Investment Company Act of 1940, as amended, and such other matters that may be
reasonably requested by the Fund or the Fund's Chief Compliance Officer from
time to time. In addition, the Custodian will, from time to time, provide a
written assessment of its compliance program in conformity with current
industry standards that is reasonably acceptable to the Fund to enable the Fund
to fulfill its obligations under Rule 38a-1 of the Investment Company Act of
1940, as amended.
ARTICLE IX
TERMINATION
1. Either of the parties hereto may terminate this Agreement by giving to
the other party a notice in writing specifying the date of such termination,
which shall be not less than ninety (90) days after the date of giving of such
notice. In the event such notice is given by the Fund, it shall be accompanied
by a copy of a resolution of the board of the Fund, certified by the Secretary
or any Assistant Secretary, electing to terminate this Agreement and
designating a successor custodian or custodians, each of which shall be a bank
or trust company eligible to serve as a custodian of a closed-end fund under
the Investment Company Act of 1940, as amended. In the event such notice is
given by Custodian, the Fund shall, on or before the termination date, deliver
to Custodian a copy of a resolution of the board of the Fund, certified by the
Secretary or any Assistant Secretary, designating a successor custodian or
custodians. In the absence of such designation by the Fund, Custodian may
designate a successor custodian which shall be a bank or trust company eligible
to serve as custodian for a closed-end fund under the Investment Company Act of
1940, as amended. Upon the date set forth in such notice this Agreement shall
terminate, and Custodian shall upon receipt of a notice of acceptance by the
successor custodian on that date deliver directly to the successor custodian
all Securities and money then owned by the Fund and held by it as Custodian,
after deducting all fees, expenses and other amounts for the payment or
reimbursement of which it shall then be entitled.
2. If a successor custodian is not designated by the Fund or Custodian in
accordance with the preceding Section, the Fund shall upon the date specified
in the notice of termination of this Agreement and upon the delivery by
Custodian of all Securities (other than Securities which cannot be delivered to
the Fund) and money then owned by the Fund be deemed to be its own custodian
and Custodian shall thereby be relieved of all duties and responsibilities
pursuant to this Agreement, other than the duty with respect to Securities
which cannot be delivered to the Fund to hold such Securities hereunder in
accordance with this Agreement.
ARTICLE X
MISCELLANEOUS
1. Each party shall keep confidential any information relating to the
other party's business ("Confidential Information"). Confidential Information
shall include (a) any data or information that is competitively sensitive
material, and not generally known to the public, including, but not limited to,
information about product plans, marketing strategies, finances, operations,
customer relationships, customer profiles, customer lists, sales estimates,
business plans, and internal performance results relating to the past, present
or future business activities of the Fund or Custodian and their respective
subsidiaries and affiliated companies; (b) any scientific or technical
information, design, process, procedure, formula, or improvement that is
commercially valuable and secret in the sense that its confidentiality affords
the Fund or Custodian a competitive advantage over its competitors; (c) all
confidential or proprietary concepts, documentation, reports, data,
specifications, computer software, source code, object code, flow charts,
databases, inventions, know-how, and trade secrets, whether or not patentable
or copyrightable; and (d) anything designated as confidential. Notwithstanding
the foregoing, information shall not be Confidential Information and shall not
be subject to such confidentiality obligations if: (a) it is necessary for
Custodian to release such information in connection with the provision of
services under this Agreement; (b) it is already known to the receiving party
at the time it is obtained; (c) it is or becomes publicly known or available
through no wrongful act of the receiving party; (d) it is rightfully received
from a third party who, to the best of the receiving party's knowledge, is not
under a duty of confidentiality; (e) it is released by the protected party to a
third party without restriction; (f) it is requested or required to be
disclosed by the receiving party pursuant to a court order, subpoena,
governmental or regulatory agency request or law (provided the receiving party
will provide the other party written notice of the same, to the extent such
notice is permitted); (g) it is relevant to the defense of any claim or cause
of action asserted against the receiving party; (h) it has been or is
independently developed or obtained by the receiving party; or (i) it is
necessary for Custodian to release such information to Custodian's internal or
external accountants or legal counsel who are subject to a duty of
confidentiality. Custodian acknowledges and agrees that in connection with its
services under this Agreement it receives non-public confidential portfolio
holdings information ("Portfolio Information") with respect to the Fund.
Custodian agrees that, subject to the foregoing provisions of and the
exceptions set forth in this Article X Section 1 (other than the exception set
forth above in this Article X Section 1 as sub-item (a), which exception set
forth in sub-item (a) shall not be applicable to the Fund's Portfolio
Information), Custodian will keep confidential the Fund's Portfolio Information
and will not disclose the Fund's Portfolio Information other than pursuant to a
written Certificate or Instructions; provided that without the need for such a
written Certification or Instructions and notwithstanding any other provision
of this Article X Section 1 to the contrary, the Fund's Portfolio Information
may be disclosed to third party pricing services which are engaged by Custodian
in connection with the provision of services under this Agreement and which
shall be subject to a duty of confidentiality with respect to such Portfolio
Information.
2. The Fund agrees to furnish to Custodian a new Certificate of Authorized
Persons in the event of any change in the then present Authorized Persons.
Until such new Certificate is received, Custodian shall be fully protected in
acting upon Certificates or Oral Instructions of such present Authorized
Persons.
3. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to Custodian, shall be sufficiently given if
addressed to Custodian and received by it at its offices at Xxx Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, or at such other place as Custodian may from time to
time designate in writing.
4. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Fund shall be sufficiently given if addressed
to the Fund and received by it at its offices at 000 Xxxx Xxxxxxx Xxxxx, Xxxxx
000, Xxxxxxx, Xxxxxxxx 00000, attention: General Counsel, or at such other
place as the Fund may from time to time designate in writing.
5. Each and every right granted to either party hereunder or under any
other document delivered hereunder or in connection herewith, or allowed it by
law or equity, shall be cumulative and may be exercised from time to time. No
failure on the part of either party to exercise, and no delay in exercising,
any right will operate as a waiver thereof, nor will any single or partial
exercise by either party of any right preclude any other or future exercise
thereof or the exercise of any other right.
6. In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any exclusive jurisdiction, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected thereby. This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties, except that any
amendment to the Schedule I hereto need be signed only by the Fund and any
amendment to Appendix I hereto need be signed only by Custodian. This Agreement
shall extend to and shall be binding upon the parties hereto, and their
respective successors and assigns; provided, however, that this Agreement shall
not be assignable by either party without the written consent of the other.
7. This Agreement shall be construed in accordance with the substantive
laws of the State of New York, without regard to conflicts of laws principles
thereof. The Fund and Custodian hereby consent to the jurisdiction of a state
or federal court situated in New York City, New York in connection with any
dispute arising hereunder. The Fund hereby irrevocably waives, to the fullest
extent permitted by applicable law, any objection which it may now or hereafter
have to the laying of venue of any such proceeding brought in such a court and
any claim that such proceeding brought in such a court has been brought in an
inconvenient forum. The Fund and Custodian each hereby irrevocably waives any
and all rights to trial by jury in any legal proceeding arising out of or
relating to this Agreement.
8. It is expressly acknowledged and agreed that the obligations of the
Fund hereunder shall not be binding upon any of the shareholders, Trustees,
officers, employees or agents of the Fund personally, but shall bind only the
trust property of the Fund as provided in the Fund's Declaration of Trust. The
execution and delivery of this Agreement have been authorized by the Trustees
of the Fund and signed by an officer of the Fund, acting as such, and neither
such authorization by such Trustees nor such execution and delivery by such
officer shall be deemed to have been made by any of them individually or to
impose any liability on any of them personally, but shall bind only the trust
property of the Fund as provided in the Fund's Declaration of Trust.
9. The Fund hereby acknowledges that Custodian is subject to federal laws,
including its Customer Identification Program (CIP) requirements under the USA
PATRIOT Act and its implementing regulations, pursuant to which Custodian must
obtain, verify and record information that allows Custodian to identify the
Fund. Accordingly, prior to opening an Account hereunder Custodian will ask the
Fund to provide certain information including, but not limited to, the Fund's
name, physical address, tax identification number and other information that
will help Custodian to identify and verify the Fund's identity such as
organizational documents, certificate of good standing, license to do business,
or other pertinent identifying information. The Fund agrees that Custodian
cannot open an Account hereunder unless and until Custodian verifies the Fund's
identity in accordance with its CIP.
10. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
IN WITNESS WHEREOF, the Fund and Custodian have caused this Agreement to be
executed by their respective officers, thereunto duly authorized, as of the day
and year first above written.
FIRST TRUST MLP AND ENERGY INCOME FUND
By: __________________________________
Title: _______________________________
Tax Identification No: _______________
THE BANK OF NEW YORK MELLON
By: __________________________________
Title: _______________________________
SCHEDULE I
CERTIFICATE OF AUTHORIZED PERSONS
(THE FUND - ORAL AND WRITTEN INSTRUCTIONS)
The undersigned hereby certifies that he/she is the duly elected and acting
________________________ of First Trust MLP and Energy Income Fund, (the
"Fund"), and further certifies that the following officers or employees of the
Fund have been duly authorized in conformity with the Fund's Declaration of
Trust and By-Laws to deliver Certificates and Oral Instructions to The Bank of
New York Mellon ("Custodian") pursuant to the Custody Agreement between the
Fund and Custodian dated _______________, and that the signatures appearing
opposite their names are true and correct:
_______________________ _______________________ _______________________
Name Title Signature
_______________________ _______________________ _______________________
Name Title Signature
_______________________ _______________________ _______________________
Name Title Signature
_______________________ _______________________ _______________________
Name Title Signature
_______________________ _______________________ _______________________
Name Title Signature
_______________________ _______________________ _______________________
Name Title Signature
This certificate supersedes any certificate of Authorized Persons you may
currently have on file.
[seal] By: ________________________________
Title:
Date:
SCHEDULE II
SERIES
SCHEDULE III
FOREIGN DEPOSITORIES
APPENDIX I
THE BANK OF NEW YORK MELLON
ON-LINE COMMUNICATIONS SYSTEM (THE "SYSTEM")
TERMS AND CONDITIONS
1. License; Use. Upon delivery to an Authorized Person or a person reasonably
believed by Custodian to be an Authorized Person, Fund of software enabling the
Fund to obtain access to the System (the "Software"), Custodian grants to the
Fund a personal, nontransferable and nonexclusive license to use the Software
solely for the purpose of transmitting Written Instructions, receiving reports,
making inquiries or otherwise communicating with Custodian in connection with
the Account(s). The Fund shall use the Software solely for its own internal and
proper business purposes and not in the operation of a service bureau. Except
as set forth herein, no license or right of any kind is granted to the Fund
with respect to the Software. The Fund acknowledges that Custodian and its
suppliers retain and have title and exclusive proprietary rights to the
Software, including any trade secrets or other ideas, concepts, know-how,
methodologies, or information incorporated therein and the exclusive rights to
any copyrights, trademarks and patents (including registrations and
applications for registration of either), or other statutory or legal
protections available in respect thereof. The Fund further acknowledges that
all or a part of the Software may be copyrighted or trademarked (or a
registration or claim made therefor) by Custodian or its suppliers. The Fund
shall not take any action with respect to the Software inconsistent with the
foregoing acknowledgments, nor shall the Fund attempt to decompile, reverse
engineer or modify the Software. The Fund may not copy, sell, lease or provide,
directly or indirectly, any of the Software or any portion thereof to any other
person or entity without Custodian's prior written consent. The Fund may not
remove any statutory copyright notice or other notice included in the Software
or on any media containing the Software. The Fund shall reproduce any such
notice on any reproduction of the Software and shall add any statutory
copyright notice or other notice to the Software or media upon Custodian's
request.
2. Equipment. The Fund shall obtain and maintain at its own cost and expense
all equipment and services, including but not limited to communications
services, necessary for it to utilize the Software and obtain access to the
System, and Custodian shall not be responsible for the reliability or
availability of any such equipment or services.
3. Proprietary Information. The Software, any data base and any proprietary
data, processes, information and documentation made available to the Fund
(other than which are or become part of the public domain or are legally
required to be made available to the public) (collectively, the "Information"),
are the exclusive and confidential property of Custodian or its suppliers. The
Fund shall keep the Information confidential by using the same care and
discretion that the Fund uses with respect to its own confidential property and
trade secrets, but not less than reasonable care. Upon termination of the
Agreement or the Software license granted herein for any reason, the Fund shall
return to Custodian any and all copies of the Information which are in its
possession or under its control.
4. Modifications. Custodian reserves the right to modify the Software from time
to time and the Fund shall install new releases of the Software as Custodian
may direct. The Fund agrees not to modify or attempt to modify the Software
without Custodian's prior written consent. The Fund acknowledges that any
modifications to the Software, whether by the Fund or Custodian and whether
with or without Custodian's consent, shall become the property of Custodian.
5. NO REPRESENTATIONS OR WARRANTIES. CUSTODIAN AND ITS MANUFACTURERS AND
SUPPLIERS MAKE NO WARRANTIES OR REPRESENTATIONS WITH RESPECT TO THE SOFTWARE,
SERVICES OR ANY DATABASE, EXPRESS OR IMPLIED, IN FACT OR IN LAW, INCLUDING BUT
NOT LIMITED TO WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE. THE FUND ACKNOWLEDGES THAT THE SOFTWARE, SERVICES AND ANY DATABASE ARE
PROVIDED "AS IS." IN NO EVENT SHALL CUSTODIAN OR ANY SUPPLIER BE LIABLE FOR ANY
DAMAGES, WHETHER DIRECT, INDIRECT SPECIAL, OR CONSEQUENTIAL, WHICH THE FUND MAY
INCUR IN CONNECTION WITH THE SOFTWARE, SERVICES OR ANY DATABASE, EVEN IF
CUSTODIAN OR SUCH SUPPLIER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
IN NO EVENT SHALL CUSTODIAN OR ANY SUPPLIER BE LIABLE FOR ACTS OF GOD, MACHINE
OR COMPUTER BREAKDOWN OR MALFUNCTION, INTERRUPTION OR MALFUNCTION OF
COMMUNICATION FACILITIES, LABOR DIFFICULTIES OR ANY OTHER SIMILAR OR DISSIMILAR
CAUSE BEYOND THEIR REASONABLE CONTROL.
6. Security; Reliance; Unauthorized Use. The Fund will cause all persons
utilizing the Software and System to treat all applicable user and
authorization codes, passwords and authentication keys with extreme care, and
it will establish internal control and safekeeping procedures to restrict the
availability of the same to persons duly authorized to give Instructions.
Custodian is hereby irrevocably authorized to act in accordance with and rely
on Instructions received by it through the System. The Fund acknowledges that
it is its sole responsibility to assure that only persons duly authorized use
the System and that Custodian shall not be responsible nor liable for any
unauthorized use thereof.
7. System Acknowledgments. Custodian shall acknowledge through the System its
receipt of each transmission communicated through the System, and in the
absence of such acknowledgment Custodian shall not be liable for any failure to
act in accordance with such transmission and the Fund may not claim that such
transmission was received by Custodian.
8. EXPORT RESTRICTIONS. EXPORT OF THE SOFTWARE IS PROHIBITED BY UNITED STATES
LAW. THE FUND MAY NOT UNDER ANY CIRCUMSTANCES RESELL, DIVERT, TRANSFER,
TRANSSHIP OR OTHERWISE DISPOSE OF THE SOFTWARE (IN ANY FORM) IN OR TO ANY OTHER
COUNTRY. IF CUSTODIAN DELIVERED THE SOFTWARE TO THE FUND OUTSIDE OF THE UNITED
STATES, THE SOFTWARE WAS EXPORTED FROM THE UNITED STATES IN ACCORDANCE WITH THE
EXPORTER ADMINISTRATION REGULATIONS. DIVERSION CONTRARY TO U.S. LAW IS
PROHIBITED. The Fund hereby authorizes Custodian to report its name and address
to government agencies to which Custodian is required to provide such
information by law.
9. ENCRYPTION. The Fund acknowledges and agrees that encryption may not be
available for every communication through the System, or for all data. The Fund
agrees that Custodian may deactivate any encryption features at any time,
without notice or liability to the Fund, for the purpose of maintaining,
repairing or troubleshooting the System or the Software.
APPENDIX II
FOREIGN CUSTODY MANAGER AGREEMENT
AGREEMENT between First Trust MLP and Energy Income Fund, a business trust
organized and existing under the laws of the state of Massachusetts having its
principal office and place of business at 000 Xxxx Xxxxxxx Xxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxxx 00000 (the "Fund") and The Bank of New York Mellon ("BNY").
W I T N E S S E T H:
WHEREAS, the Fund desires to appoint BNY as a Foreign Custody Manager as
defined in the Rule (as such term is defined below) on the terms and conditions
contained herein;
WHEREAS, BNY desires to serve as a Foreign Custody Manager and perform the
duties set forth herein on the terms and conditions contained herein with
respect to the Fund (as such term is defined below);
NOW THEREFORE, in consideration of the mutual promises hereinafter contained in
this Agreement, the Fund and BNY hereby agree as follows:
ARTICLE XI
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless the
context otherwise requires, shall have the following meanings:
1. "BOARD" shall mean the board of directors or board of trustees, as the
case may be, of the Fund.
2. "ELIGIBLE FOREIGN CUSTODIAN" shall have the meaning provided in the
Rule.
3. "MONITORING SYSTEM" shall mean a system established by BNY to fulfill
the Responsibilities specified in clauses (d) and (e) of Section 1 of Article
III of this Agreement.
4. "RESPONSIBILITIES" shall mean the responsibilities delegated to BNY
under the Rule as a Foreign Custody Manager to a Fund with respect to each
Specified Country and each Eligible Foreign Custodian selected by BNY, as such
responsibilities are more fully described in Article III of this Agreement.
5. "RULE" shall mean Rule 17f-5 under the Investment Company Act of 1940,
as amended effective June 12, 2000.
6. "FUND" shall mean the respective portfolios, if any, of the Fund listed
on Schedule I hereto, and if none are listed, references to Fund shall be
references to the Trust.
7. "SPECIFIED COUNTRY" shall mean each country listed on Schedule II
attached hereto and each country, other than the United States, constituting
the primary market for a security with respect to which the Fund has given
settlement instructions to The Bank of New York Mellon as custodian (the
"Custodian") under its Custody Agreement with the Fund.
ARTICLE XII
BNY AS A FOREIGN CUSTODY MANAGER
1. The Fund on behalf of its Board hereby delegates to BNY with respect to
each Specified Country the Responsibilities to be performed for the Fund.
2. BNY accepts the Board's delegation of Responsibilities with respect to
each Specified Country and agrees in performing the Responsibilities as a
Foreign Custody Manager to exercise reasonable care, prudence and diligence
such as a person having responsibility for the safekeeping of the Fund's assets
would exercise.
3. BNY shall provide to the Board at such times as the Board deems
reasonable and appropriate based on the circumstances of the Fund's foreign
custody arrangements written reports notifying the Board of the placement of
assets of the Fund with a particular Eligible Foreign Custodian within a
Specified Country and of any material change in the arrangements (including the
contract governing such arrangements) with respect to assets of the Fund with
any such Eligible Foreign Custodian.
ARTICLE XIII
RESPONSIBILITIES
1. Subject to the provisions of this Agreement, BNY shall with respect to
each Specified Country select an Eligible Foreign Custodian. In connection
therewith, BNY shall: (a) determine that assets of the Fund held by such
Eligible Foreign Custodian will be subject to reasonable care, based on the
standards applicable to custodians in the relevant market in which such
Eligible Foreign Custodian operates, after considering all factors relevant to
the safekeeping of such assets, including, without limitation, those contained
in paragraph (c)(1) of the Rule; (b) determine that the Fund's foreign custody
arrangements with each Eligible Foreign Custodian are governed by a written
contract with the Custodian which will provide reasonable care for the Fund's
assets based on the standards specified in paragraph (c)(1) of the Rule; (c)
determine that each contract with an Eligible Foreign Custodian shall include
the provisions specified in paragraph (c)(2)(i)(A) through (F) of the Rule or,
alternatively, in lieu of any or all of such (c)(2)(i)(A) through (F)
provisions, such other provisions as BNY determines will provide, in their
entirety, the same or a greater level of care and protection for the assets of
the Fund as such specified provisions; (d) monitor pursuant to the Monitoring
System the appropriateness of maintaining the assets of the Fund with a
particular Eligible Foreign Custodian pursuant to paragraph (c)(1) of the Rule
and the performance of the contract governing such arrangement; and (e) advise
the Fund whenever BNY determines under the Monitoring System that an
arrangement (including, any material change in the contract governing such
arrangement) described in preceding clause (d) no longer meets the requirements
of the Rule.
2. For purposes of preceding Section 1 of this Article, BNY's
determination of appropriateness shall not include, nor be deemed to include,
any evaluation of Country Risks associated with investment in a particular
country. For purposes hereof, "Country Risks" shall mean systemic risks of
holding assets in a particular country including but not limited to (a) an
Eligible Foreign Custodian's use of any depositories that act as or operate a
system or a transnational system for the central handling of securities or any
equivalent book-entries; (b) such country's financial infrastructure; (c) such
country's prevailing custody and settlement practices; (d) nationalization,
expropriation or other governmental actions; (e) regulation of the banking or
securities industry; (f) currency controls, restrictions, devaluations or
fluctuations; and (g) market conditions which affect the orderly execution of
securities transactions or affect the value of securities.
ARTICLE XIV
REPRESENTATIONS
1. The Fund hereby represents that: (a) this Agreement has been duly
authorized, executed and delivered by the Fund, constitutes a valid and legally
binding obligation of the Fund enforceable in accordance with its terms, and no
statute, regulation, rule, order, judgment or contract binding on the Fund
prohibits the Fund's execution or performance of this Agreement; (b) this
Agreement has been approved and ratified by the Board at a meeting duly called
and at which a quorum was at all times present, and (c) the Board or the Fund's
investment advisor has considered the Country Risks associated with investment
in each Specified Country and will have considered such risks prior to any
settlement instructions being given to the Custodian with respect to any other
country.
2. BNY hereby represents that: (a) BNY is duly organized and existing
under the laws of the State of New York, with full power to carry on its
businesses as now conducted, and to enter into this Agreement and to perform
its obligations hereunder; (b) this Agreement has been duly authorized,
executed and delivered by BNY, constitutes a valid and legally binding
obligation of BNY enforceable in accordance with its terms, and no statute,
regulation, rule, order, judgment or contract binding on BNY prohibits BNY's
execution or performance of this Agreement; and (c) BNY has established the
Monitoring System.
ARTICLE XV
CONCERNING BNY
1. BNY shall not be liable for any costs, expenses, damages, liabilities
or claims, including attorneys' and accountants' fees, sustained or incurred
by, or asserted against, the Fund except to the extent the same arises out of
the failure of BNY to exercise the care, prudence and diligence required by
Section 2 of Article II hereof. In no event shall BNY be liable to the Fund,
the Board, or any third party for special, indirect or consequential damages,
or for lost profits or loss of business, arising in connection with this
Agreement.
2. The Fund shall indemnify BNY and hold it harmless from and against any
and all costs, expenses, damages, liabilities or claims, including attorneys'
and accountants' fees, sustained or incurred by, or asserted against, BNY by
reason or as a result of any action or inaction, or arising out of BNY's
performance hereunder, provided that the Fund shall not indemnify BNY to the
extent any such costs, expenses, damages, liabilities or claims arises out of
BNY's failure to exercise the reasonable care, prudence and diligence required
by Section 2 of Article II hereof.
3. For its services hereunder, the Fund agrees to pay to BNY such
compensation and out-of-pocket expenses as shall be mutually agreed.
4. BNY shall have only such duties as are expressly set forth herein. In
no event shall BNY be liable for any Country Risks associated with investments
in a particular country.
ARTICLE XVI
MISCELLANEOUS
1. This Agreement constitutes the entire agreement between the Fund and
BNY as a Foreign Custody Manager, and no provision in the Custody Agreement
between the Fund and the Custodian shall affect the duties and obligations of
BNY hereunder, nor shall any provision in this Agreement affect the duties or
obligations of the Custodian under the Custody Agreement.
2. Each notice, request, demand, approval or other communication which may
be or is required to be given under this Agreement shall be in writing in
English and shall be deemed to have been sufficiently given when received by
the intended party, if delivered personally at the address set forth below for
the intended party during normal business hours at such address, if sent by
facsimile transmission to the respective facsimile transmission numbers of the
parties set forth below, or if sent by recognized overnight courier service or
by United States registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:
If to the Fund: First Trust MLP and Energy Income Fund
000 Xxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
Confirm: (000) 000-0000
If to BNY: The Bank of New York Mellon
000 Xxxxxxx Xxxxxx, 00X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxx
Facsimile: 000-000-0000
Confirm: 000-000-0000
Notices shall be given to such other addressee or address, or both, or by way
of such other facsimile transmission number, as a particular party may from
time to time designate by written notice to the other parties hereto given in
accordance with this Section.
3. Each party shall keep confidential any information relating to the
other party's business ("Confidential Information"). Confidential Information
shall include (a) any data or information that is competitively sensitive
material, and not generally known to the public, including, but not limited to,
information about product plans, marketing strategies, finances, operations,
customer relationships, customer profiles, customer lists, sales estimates,
business plans, and internal performance results relating to the past, present
or future business activities of the Fund or BNY and their respective
subsidiaries and affiliated companies; (b) any scientific or technical
information, design, process, procedure, formula, or improvement that is
commercially valuable and secret in the sense that its confidentiality affords
the Fund or BNY a competitive advantage over its competitors; (c) all
confidential or proprietary concepts, documentation, reports, data,
specifications, computer software, source code, object code, flow charts,
databases, inventions, know-how, and trade secrets, whether or not patentable
or copyrightable; and (d) anything designated as confidential. Notwithstanding
the foregoing, information shall not be Confidential Information and shall not
be subject to such confidentiality obligations if: (a) it is necessary for BNY
to release such information in connection with the provision of services under
this Agreement; (b) it is already known to the receiving party at the time it
is obtained; (c) it is or becomes publicly known or available through no
wrongful act of the receiving party; (d) it is rightfully received from a third
party who, to the best of the receiving party's knowledge, is not under a duty
of confidentiality; (e) it is released by the protected party to a third party
without restriction; (f) it is requested or required to be disclosed by the
receiving party pursuant to a court order, subpoena, governmental or regulatory
agency request or law (provided the receiving party will provide the other
party written notice of the same, to the extent such notice is permitted); (g)
it is relevant to the defense of any claim or cause of action asserted against
the receiving party; (h) it has been or is independently developed or obtained
by the receiving party; or (i) it is necessary for BNY to release such
information to BNY's internal or external accountants or legal counsel who are
subject to a duty of confidentiality. BNY acknowledges and agrees that in
connection with its services under this Agreement it receives non-public
confidential portfolio holdings information ("Portfolio Information") with
respect to the Fund. BNY agrees that, subject to the foregoing provisions of
and the exceptions set forth in this Section 3 (other than the exception set
forth above in this Section 3 as sub-item (a), which exception set forth in
sub-item (a) shall not be applicable to the Fund's Portfolio Information), BNY
will keep confidential the Fund's Portfolio Information and will not disclose
the Fund's Portfolio Information other than pursuant to a written instruction
from the Fund; provided that without the need for such a written instruction
and notwithstanding any other provision of this Section 3 to the contrary, the
Fund's Portfolio Information may be disclosed to third party pricing services
which are engaged by BNY in connection with the provision of services under
this Agreement and which shall be subject to a duty of confidentiality with
respect to such Portfolio Information.
4. From time to time as requested by the Fund, BNY shall provide to the
Fund such certifications and sub-certifications, in the form agreed to by the
Fund and BNY, with respect to Form N-Qs, Form N-CSRs, and compliance policies
and procedures under Rule 38a-1 under the 1940 Act, as amended, and such other
matters that may be reasonably requested by the Fund or the Fund's Chief
Compliance Officer from time to time. In addition, BNY will, from time to time,
provide a written assessment of its compliance program in conformity with
current industry standards that is reasonably acceptable to enable the Fund to
fulfill its obligations under Rule 38a-1 of the 1940 Act.
5. In the event that the Fund establishes one or more additional Funds
with respect to which it desires to have BNY serve as Foreign Custody Manager
under the terms hereof, it shall so notify BNY in writing, and if BNY agrees in
writing to provide such services, such Fund will be added to this Agreement.
6. In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
thereby. This Agreement may not be amended or modified in any manner except by
a written agreement executed by both parties. This Agreement shall extend to
and shall be binding upon the parties hereto, and their respective successors
and assigns; provided however, that this Agreement shall not be assignable by
either party without the written consent of the other.
7. This Agreement shall be construed in accordance with the substantive
laws of the State of New York, without regard to conflicts of laws principles
thereof. The Fund and BNY hereby consent to the jurisdiction of a state or
federal court situated in New York City, New York in connection with any
dispute arising hereunder. The Fund hereby irrevocably waives, to the fullest
extent permitted by applicable law, any objection which it may now or hereafter
have to the laying of venue of any such proceeding brought in such a court and
any claim that such proceeding brought in such a court has been brought in an
inconvenient forum. The Fund and BNY each hereby irrevocably waives any and all
rights to trial by jury in any legal proceeding arising out of or relating to
this Agreement.
8. The parties hereto agree that in performing hereunder, BNY is acting
solely on behalf of the Fund and no contractual or service relationship shall
be deemed to be established hereby between BNY and any other person by reason
of this Agreement.
9. (a) It is expressly acknowledged and agreed that the obligations of the
Fund hereunder shall not be binding upon any of the shareholders, Trustees,
officers, employees or agents of the Fund, personally, but shall bind only the
trust property of the Fund, as provided in the Fund's Declaration of Trust. The
execution and delivery of this Agreement have been authorized by the Trustees
of the Fund and signed by an officer of the Fund, acting as such, and neither
such authorization by such Trustees nor such execution and delivery by such
officer shall be deemed to have been by any of them individually or to impose
any liability on any of them personally, but shall bind only the trust property
of the Fund as provided in the Fund's Declaration of Trust.
(b) This Agreement is an agreement entered into between BNY and the Fund.
With respect to any obligation of the Fund arising out of this Agreement, the
BNY shall look for payment of such obligation solely to the assets of the Fund
to which such obligation relates with the same effect as if the BNY had
separately contracted with the Fund by separate written instrument.
(c) As used herein, the "applicable Fund" shall be each fund in respect of
which any costs, expenses, damages, liabilities or claims previously specified
arise in whole or in part, and if any such costs, expenses, damages,
liabilities or claims arise in respect of more than one Fund, the same shall be
allocated by BNY among such Funds in accordance with Section 7 of Article X of
the Custody Agreement between the Fund and BNY. Any amounts due BNY which may
not be allocated in accordance with the preceding sentence shall constitute
General Liabilities as defined in the Fund's Declaration of Trust and allocated
by the Fund and paid in accordance with the provisions thereof.
10. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
11. This Agreement shall terminate simultaneously with the termination of
the Custody Agreement between the Fund and the Custodian, and may otherwise be
terminated by either party giving to the other party a notice in writing
specifying the date of such termination, which shall be not less than thirty
(30) days after the date of such notice.
IN WITNESS WHEREOF, the Fund and BNY have caused this Agreement to be executed
by their respective officers, thereunto duly authorized, as of the date first
above written.
FIRST TRUST MLP AND ENERGY INCOME FUND
By: ________________________________
Title: _____________________________
Tax Identification No: _____________
THE BANK OF NEW YORK MELLON
By: ________________________________
Title: _____________________________
