DEPOSITORY AGREEMENT
DEPOSITORY AGREEMENT, dated as of _______________, 199_, by and
between _________________________, a _____________________________
organized under the laws of the State of __________, (the "Depositor") and
REPUBLIC NATIONAL BANK OF NEW YORK, a national banking association
organized under the laws of the United States of America (the "Depository").
Section 1
Appointment of Depository
Section 1.1. The Depositor hereby appoints the Depository as custodian
of the metals described in each Safekeeping Advice (the "Precious Metals") which
the Depository will issue from time to time in accordance with Section 2.2
hereof during the term of this Agreement.
Section 1.2. The Depository hereby accepts appointment as such
custodian of the Precious Metals and agrees to perform its duties in respect
thereof pursuant to the provisions of this Agreement.
Section 2
Control, Receipt and Storage of the Precious Metals
Section 2.1. Control over the Precious Metals shall be and shall remain
vested in the Depositor.
Section 2.2. Each delivery of Precious Metals to the Depository shall
be evidenced by a completed Safekeeping Advice, substantially in the form of
Exhibit A attached hereto; and delivery of the Precious Metals by the Depository
to the Depositor, or to a party designated by the Depositor pursuant to Section
VII hereof, shall be evidenced by a completed Safekeeping Withdrawal Advice
substantially in the form of Exhibit B attached hereto.
Section 2.3. The Depository shall receive, hold and keep the Precious
Metals in the Depository's custody at its premises located at 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx or at 00 Xxxx 00xx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx. The
Depository will not be responsible for the Precious Metals until they are
actually delivered to and received by the Depository at its premises.
Section 3
Responsibilities of Depository
Section 3.1. The Depository shall be responsible for the safekeeping of
the Precious Metals in the form and condition in which they are delivered to the
Depository while they are in the possession or under the control of the
Depository. The Depository shall keep the Precious Metals separately identified
and segregated and shall xxxx in an appropriate manner the Precious Metals held
for the Depositor. The Depository shall, at all times during its business hours,
permit any person designated on Schedule I ("Designated Persons Schedule")
attached hereto or any other person designated by the written request of the
Depositor (collectively, "Designated Persons") to have access to the Precious
Metals for the purpose of inspection and taking inventory thereof.
Section 3.2. The Depository shall send to the Depositor monthly (i) a
statement summarizing each receipt and each delivery of the Precious Metals held
by it for the Depositor during such year, and (ii) a detailed statement of the
Precious Metals held by the Depository pursuant to this Agreement during the
period covered by such statement certified by an officer of the Depository.
Unless the Depositor objects by written notice to the Depository which is
received by the Depository within 10 days after such statement is sent to the
Depositor, such statement in absence of manifest error,shall be conclusive and
binding on the Depositor. The books, accounts and records of the Depository
pertaining to its actions pursuant to this Agreement shall be kept open to
inspection and audit during reasonable business hours by Designated Persons.
Section 3.3. The Depository shall, as warehouseman, acknowledge receipt
from the Depositor of the Precious Metals and may, at its option, record certain
specifications indicated on the Precious Metals. The Depository is not
responsible for the authenticity of markings on or for the weight, fineness or
contents of any of the Precious Metals, packages or sealed containers delivered
to Depository by the Depositor.
Section 3.4. Delivery of the Precious Metals to the Depository will be
at the Depositor's expense except in the case of Metals transferred on the
Depository's initiative to its New York facility from its Wilmington facility.
The Depositor shall pay or reimburse the Depository from time to time for any
taxes or other governmental charges payable, and actually paid, by the
Depository upon storage or transfers of the Precious Metals made hereunder, and
for all other usual, necessary and proper disbursements and expenses made or
incurred by the Depository in its performance of this Agreement.
Section 3.5. The Depositor agrees to indemnify and hold harmless the
Depository from and against any loss, damage, taxes, charges, expenses,
assessments, claims or liabilities, including counsel fees, incurred by it as a
result of its performance of this Agreement, except such as may arise from its
own gross negligence or wilful misconduct.
Section 3.6. Upon the request of the Depositor and at the Depositors'
expense, the Depository will undertake to do the following:
3.6(a) Weigh and incise bars not marked to a Depositor's
standard and produce authorized bar and weight listings for
corresponding material.
3.6(b) Assay sample bars from a Depositor's inventory by an
approved assayer or transport such bars to a refinery in order
to verify content.
3.6(c) Segregate a client's Precious Metals according to
collateral requirements and confirm such action with a lending
bank or financial institution. Timely release of the Precious
Metals will be effected once the loan agreement is completed.
Section 3.7. Neither Depository nor Depositor shall be responsible for
delays or failures in performance resulting from acts beyond the control of such
party. Such acts shall include but not be limited to acts such as God, strikes,
lockouts, riots, acts of war, epidemics, governmental regulations superimposed
after the fact, fire, communication line failures, power failures, earthquakes
or other disasters.
Section 4
Delivery of Precious Metals by Depository
Section 4.1. From time to time during the term of this Agreement and in
accordance with instructions of the Depositor and at the Depositor's expense,
the Depository will deliver, or cause to be delivered, Precious Metals to the
persons named and by the method of shipment or delivery set forth in such
instructions subject to the following terms:
4.1(a) Upon Depositor's request for a withdrawal, Depository
will assign the earliest available date.
4.1(b) Requests for withdrawals of small shipments (10 items
or less) may be made by telephone followed by written request.
All other preliminary requests must be made in writing,
containing the information stipulated in Section 4.1(c) hereof
and received by the Depository signed by at least 2 duly
authorized Designated Person, or by tested telex or facsimile
transmission.
If a withdrawal involves receipted material, receipts must be properly
endorsed and delivered to the Depository at least one full day
prior to the shipment date for small shipments, at least five
full days prior to shipment date for shipments involving more
than 100 items (100 receipts for COMEX Silver).
4.1(c) The following information will be required for releasing materials:
a. Bar list, receipt list or proper
identification of material
x. Xxxxx weight of each item (if applicable)
c. Total number of items
d. Total gross weight of shipment
e. Date agreed to by Depository for shipment
f. Carrier to be used (if applicable)
g. Any special packaging instructions
4.1(d) Depository will prepare and deliver material to the
United States Post Office for delivery through the U.S. Postal
System pursuant to the rules and regulations thereof.
Fees for this service will be specified on Schedule II hereto
(the "Fee Schedule").
4.1(e) Given one full business day's notification, Depository
will pick up or deliver any reasonably sized shipment between
our vault and any point within the borough of Manhattan via
armored carrier. Fees for this service are available upon
request.
Section 4.2. The Depository will prepare and complete all shipping
documents and, upon delivery of the Precious Metals, send a complete set of such
documents to the Depositor.
4.2(a) Upon notification of an incoming overseas shipment by
the client, Depository will arrange for customs clearance, entry
fees and bonding, and insured transportation from Port of Entry
to Depository's vault. Charges for the Customs Entry Service are
available upon request.
4.2(b) The rates quoted for Customs Entry Service are for
arrivals between the hours of 8 AM and 6 PM. Shipments arriving
between the hours of 6 PM and 8 AM will be subject to premiums
and are available upon request.
Section 5
Fees
Section 5.1. The Depository's fees for performing services pursuant to
this Agreement will be in accordance with the attached Fee Schedule and shall be
due and payable upon receipt of invoice.
Section 5.2. Rates for storage and withdrawal of commodities traded on
exchange receipts for which Depository is a licensed depository cannot be
offered at a discount. These rates are on file with each licensing exchange.
Depository has the right to change any or all of these rates by giving 90 days
prior notice to the appropriate exchange. In the event of a rate change, the
exchange will inform its clearing members of the new rates and effective dates.
Section 5.3. Withdrawal charges quoted are for preparation and release
of shipments only. Charges for pallets, strapping, special packing or other
materials required will be added to the fees in the basic agreement.
Section 5.4. Depositor giving authorization to transfer funds from a
demand deposit account will have its account debited within three business days
of invoice date.
Section 5.5. In the event that payment has not been received within
thirty (30) days of the invoice date, Depository reserves the right to review
the credit status of Depositor and to institute an interest charge on any
outstanding balance from the billing date at a rate of 1.5% per month (18% per
year).
Section 5.6. Depositor must notify Depository of any billing errors or
disputed charges within sixty (60) days of the invoice date or will thereby
assume responsibility for charges including interest, until notification of
error is given.
Section 5.7. The Depositor hereby agrees that Depository shall have a
lien upon the Precious Metals held for Depositor in an amount equal to any fees
owed to Depository by Depositor.
Section 6
Termination
Section 6.1. This Agreement may be terminated by the Depositor by
giving written notice to the Depository specifying the date of such termination,
which shall be not less than thirty days after the date of such notice, or by
the Depository by
giving written notice to the Depositor specifying the date of such termination,
which shall not be less than ninety days after the date of such notice. In the
event notice of termination is given by the Depositor, the Depositor shall
designate therein a successor depository, and the Depository shall follow the
directions of the Depositor to deliver the Precious Metals to such successor
depository at Depositor's expense. In the event such notice is given by the
Depository the Depositor shall, on or before the termination date, deliver to
the Depository a designation of a successor depository and instructions to
deliver the Precious Metals to such successor depository.
Section 6.2. Upon the date set forth in any notice of termination given
pursuant to Section 6.1 above, this Agreement shall terminate. On such date, the
Depository shall deliver directly to the successor depository (or, if there is
no successor depository, the Depositor) all of the Precious Metals held by it as
Depository, and the Depositor shall pay Depository all fees, expenses and other
amounts to which it is entitled pursuant to the terms of this Agreement.
Section 6.3. In the event that the Depository shall become incapable of
performing as custodian pursuant hereto, or shall be dissolved, adjudged a
bankrupt or insolvent or a trustee, receiver or conservator of the Depository or
its property shall be appointed or an application for any of the foregoing is
filed, or if control of the Depository or its officers or directors be taken
over by any governmental or other public authority or officer, then this
Agreement shall automatically terminate and the Depository or any trustee,
receiver or conservator shall deliver to the Depositor or a successor depository
all of the Precious Metals held by the Depository pursuant hereto upon payment
by the Depositor of all fees, expenses and other amounts as to which the
Depository is entitled pursuant to the terms of this Agreement.
Section 6.4. A successor depository resulting from the provisions of
Section 6.1, 6.2 or 6.3 shall be vested with all the powers, duties and
obligations of its predecessor under this Agreement and any amendments thereof,
and shall succeed to all exemptions and privileges of its predecessor under this
Agreement and any amendments thereof.
Section 6.5. The termination of this Agreement shall not affect the
obligations of either party to the other party which arise or accrue prior to
the date of termination hereof.
Section 7
Designated Persons
Section 7.1. Depositor will deliver to Depository an incumbency
certificate setting forth the individuals ( the "Designated Persons " )
authorized to transact business involving materials held by Depository. .
Section 7.2. The Depository shall be entitled to rely upon any notice
or other instrument in writing received by the Depository,signed by any two
Designated Persons and reasonably believed by the Depository in good faith to be
genuine.
Section 7.3. Depositor will hold harmless and indemnify Depository for
any transaction made by Depository upon the instructions whether written or by
facsimile transmission of Designated Persons as to which Depository has not
received timely notice of the termination of their authority previously
delivered pursuant to Section 7.1.
Section 8
Confidentiality
Section 8.1. Depositor agrees that it will not divulge to third
parties, without the written consent of Depository, any confidential information
of Depository attained from or through same in connection with the performance
of this Agreement.
Section 8.2. In all cases, Depository maintains a degree of
confidentiality with respect to client records and transactions commensurate
with exchange requirements and with the standards applicable to Depository's own
confidential information.
Section 8.3. It is further agreed that Depositor will not use the name
of Republic National Bank of New York or any affiliate in its advertising or in
its public relations with third parties without prior written consent of the
Depository, although such use is hereby permitted in Depositor's prospectus and
statement of additional information as filed with the U.S. Securities and
Exchange Commission and in such sales literature as filed with the National
Association of Securities Dealers, Inc.
Section 9
Miscellaneous
Section 9.1. Any notice, demand or instruction authorized or required
by, or given pursuant to, this Agreement shall be in writing and be deemed given
if sent by first class airmail or by tested telex or delivered to a party at its
principal place of business set forth on Schedule III hereto.
Section 9.2. This Agreement may not be amended or modified in any
manner except by a written agreement executed by both parties with the same
formality as this Agreement.
Section 9.3. This Agreement shall inure to the benefit of and shall be
binding upon the parties hereto and their respective successors and assigns;
provided, however, that, except as provided herein, this Agreement shall not be
assignable by either party without the written consent of the other party.
Section 9.4. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
Section 9.5. If any term or provision of this Agreement should be
declared invalid by a court of competent jurisdiction, the remaining terms and
provisions of this Agreement shall be unimpaired.
Section 9.6. This Agreement, together with all the Schedules and
Exhibits attached hereto, constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes in all respects all
prior proposals, negotiations, conversations, discussions, and agreements made
between the parties concerning the subject matter hereof.
IN WITNESS WHEREOF the Parties hereto have caused this Agreement to be
executed as of the date first above written by their respective officers
thereunto duly authorized.
REPUBLIC NATIONAL BANK OF NEW YORK
By: ________________________ By: ____________________________
Name: Name:
Title: Title:
By: _____________________________
Name:
Title:
EXHIBIT A
Deposit In Receipt
EXHIBIT B
Deposit Out Receipt
Schedule I
Designated Persons
Schedule II
Fee Schedule
Schedule III
NOTICE INFORMATION
ALL COMMUNICATION TO DEPOSITORY TO BE ADDRESSED TO:
REPUBLIC NATIONAL BANK OF NEW YORK
XXX XXXX 00XX XXXXXX
XXX XXXX, XXX XXXX 00000
ATTN: PRECIOUS METALS DEPOSITORY SERVICES
LEVEL SC-2
XXXXXXXXX XXXXXXXX MANAGER 000-000-0000
XXXXX XXXXXX ASST. MANAGER 000-000-0000
XXXXXXX XXXXX ASST. MANAGER 000-000-0000
XXXXXXX X. XXXXXXXX XX. MKT. REP. 000-000-0000
FAX NO.: 000-000-0000
