Exhibit (j)
FORM OF
CUSTODIAN AGREEMENT
This CUSTODIAN AGREEMENT dated as of this [ ]th day of
November, 2001, by and between The Bank of New York, a New York banking
corporation (the "Custodian"), and Equity Securities Trust II (such trust and
the trustees thereof acting in their capacity as such being referred to herein
as the "Trust"), a statutory business trust organized under the Business Trust
Act of the State of Delaware pursuant to a Declaration of Trust dated as of
October 30, 2001 (as it may be amended and restated from time to time, the
"Trust Agreement").
WITNESSETH
WHEREAS the Trust is a non-diversified, closed-end management
investment company, as defined in the Investment Company Act of 1940 (the
"Investment Company Act"), formed to purchase and hold certain U.S. treasury
securities (the "Treasury Securities"), to enter into and hold forward purchase
contracts with respect to stock of Cablevision System Corporation (the
"Contracts") with certain persons (the "Counterparties"), to hold security for
the performance of such Counterparties of their obligations under the Contracts
pursuant to related collateral agreements (the "Collateral Agreements") and to
issue Equity Trust Securities in accordance with the terms and conditions of the
Trust Agreement;
WHEREAS the Trustees desire to engage the services of the
Custodian to perform certain custodial duties for the Trust; and
WHEREAS the Custodian is qualified and willing to assume such
duties on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, the parties agree as follows:
1. Definitions. Capitalized terms used but not otherwise
defined herein shall have the respective meanings specified in the Trust
Agreement.
2. Appointment of Custodian; Transfer of Assets. The Trust
hereby constitutes and appoints the Custodian, and the Custodian accepts such
appointment, as agent of the Trust and as custodian of all of the property,
including but not limited to, the Contracts, the Treasury Securities, the
Temporary Investments, any cash and any other property at any time owned or held
by the Trust (other than Pledged Items (as defined in the Collateral Agreements)
held by the Collateral Agent thereunder) (collectively, the "Assets"). The Trust
hereby deposits the Assets owned by the Trust on the date hereof with the
Custodian and the Custodian hereby accepts such Assets into its custody, and the
Trust shall deliver to the Custodian all additional Assets, including all
monies, securities and other property, received by the Trust at any time during
the period of this Agreement, subject to the following terms and conditions. The
Custodian hereby agrees that it shall hold the Assets in a segregated custody
account, separate and distinct from all other accounts, in accordance with
Section 17(f) of, and in such manner as shall constitute the segregation and
holding in trust within the meaning of, the Investment Company Act and the rules
and regulations thereunder. The Trust authorizes the Custodian, for any Assets
held hereunder, to use the services of any United States securities depository
permitted to perform such services for registered investment companies and their
custodians
under Rule 17f-4 under the Investment Company Act and which have been approved
by the Trust, including but not limited to, The Depository Trust Company and the
Federal Reserve Book Entry System. The Custodian shall be under no duty or
obligation to inspect, review or examine any Assets to determine that they are
genuine, enforceable, or appropriate for the represented purpose or that they
are other than what they purport to be on their face.
3. Asset Disposition; Examinations. The Custodian shall have
no power or authority to assign, hypothecate, pledge or otherwise dispose of the
Assets, except pursuant to a written direction in accordance with paragraph 4
below and then only for the account of the Trust. The Assets shall be subject to
no lien or charge of any kind in favor of the Custodian for itself or for any
other Person claiming through the Custodian. The Custodian shall permit actual
examination of the Assets by the Trust's independent public accountant at the
end of each annual and semi-annual fiscal period of the Trust and at least one
other time during the fiscal year of the Trust chosen by such independent public
accountant and shall permit the inspection of the Assets by the Commission
through its employees or agents during the normal business hours of the
Custodian upon reasonable request.
4. Authorized Actions. The Custodian shall take such actions
with respect to the Assets as directed in writing by any Trustee or by any
officer of the Administrator as may be received by the Custodian from time to
time.
5. Custodian's Actions Taken In Good Faith; Force Majeure. In connection with
the performance of its duties under this Agreement, the Custodian shall have no
duties or obligations other than those specifically set forth herein or in the
Trust Agreement or as may subsequently be agreed in writing by the parties
hereto. The Custodian shall be under no liability to the Trust or any Holder for
(i) any action taken in good faith in reliance on any paper, order,
certification, list, demand request, consent, affidavit, notice, opinion,
direction, endorsement, assignment, resolution, draft or other document, prima
facie properly executed, or for the disposition of the Assets pursuant to the
Trust Agreement or in respect of any action taken or suffered under the Trust
Agreement in good faith, in accordance with an opinion of counsel or at the
direction of the Trustees pursuant hereto, or (ii) for any claims, losses,
liabilities, damages or expenses (including attorneys' fees and expenses) due to
forces beyond the reasonable control of the Custodian, including without
limitation strikes, work stoppages, acts of war or terrorism, insurrection,
revolution, nuclear or natural catastrophes or acts of God, and interruptions,
loss or malfunctions of utilities, communications or computer (software and
hardware) services; provided that this provision shall not protect the Custodian
against any liability to which it would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties
hereunder. Notwithstanding any other provision of this Agreement, the Custodian
shall under no circumstances be liable for any punitive, exemplary, indirect or
consequential damages.
6. Trust Agreement Validity. The Custodian shall not be
responsible for the validity or sufficiency of the Trust Agreement or the due
execution thereof, or for the form, character, genuineness, sufficiency, value
or validity of any of the Assets and the Custodian shall in no event assume or
incur any liability, duty or obligation to any Holder or to the Trustees, other
than as expressly provided herein. The Custodian shall not be responsible for or
in respect of the validity of any signature by or on behalf of the Trustees.
7. Litigation Obligations, Costs and Indemnity. The Custodian
shall not be under any obligation to appear in, prosecute or defend any action
which in its opinion may
involve it in expense or liability, unless it shall be furnished with such
reasonable security and indemnity against such expense or liability as it may
require, and any pecuniary costs of the Custodian from such actions shall be
expenses which are reimbursable pursuant to paragraph 13 hereof.
8. Taxes; Trust Expenses. In no event shall the Custodian be
personally liable for any taxes or other governmental charges imposed upon or in
respect of the Assets or upon the monies, securities or other properties
included therein. The Custodian shall be reimbursed and indemnified by the Trust
for all such taxes and charges, for any tax or charge imposed against the Trust
and for any expenses, including counsel fees, interest, penalties and additions
to tax which the Custodian may sustain or incur with respect to such taxes or
charges.
9. Custodian Resignation, Succession. (a) The Custodian may
resign by executing an instrument in writing resigning as Custodian and
delivering the same to the Trustees, not less than 60 days before the date
specified in such instrument when, subject to clause (b) of this paragraph 9,
such resignation is to take effect. Upon receiving such notice of resignation,
the Trustees shall use their reasonable efforts promptly to appoint a successor
Custodian in the manner and meeting the qualifications provided in the Trust
Agreement, by written instrument or instruments delivered to the resigning
Custodian and the successor Custodian.
(b) In case no successor Custodian shall have been appointed
within 30 days after notice of resignation has been received by the Trustees,
the resigning Custodian may forthwith apply to a court of competent jurisdiction
for the appointment of a successor Custodian. Such court may thereupon, after
such notice, if any, as it may deem proper and prescribed, appoint a successor
Custodian.
10. Custodian Removal. The Trust may remove the Custodian upon
60 days' prior written notice to the Custodian and appoint a successor
Custodian. In case at any time the Custodian shall not meet the requirements set
forth in the Trust Agreement or shall become incapable of acting or if a court
having jurisdiction shall enter a decree or order for relief in respect of the
Custodian in an involuntary case, or the Custodian shall commence a voluntary
case, under any applicable bankruptcy, insolvency, or other similar law now or
hereafter in effect, or any receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) for the Custodian or for any substantial part
of its property shall be appointed, or the Custodian shall make any general
assignment for the benefit of creditors, or shall generally fail to pay its
debts as they become due, the Trust may remove the Custodian immediately and
appoint a successor Custodian. The termination of the Administration Agreement
or the Paying Agent Agreement shall cause the removal of the Custodian
simultaneously therewith.
11. Transfers to Successor Custodian. Upon the request of any
successor Custodian, the Custodian hereunder shall, upon payment of all amounts
due it, execute and deliver an instrument acknowledged by it transferring to
such successor Custodian all the rights and powers of the retiring Custodian;
and the retiring Custodian shall transfer, deliver and pay over to the successor
Custodian the Assets at the time held by it hereunder, if any, together with all
necessary instruments of transfer and assignment or other documents properly
executed necessary to effect such transfer and such of the records or copies
thereof maintained by the retiring Custodian in the administration hereof as may
be requested by the successor Custodian, and shall thereupon be discharged from
all duties and responsibilities hereunder. Any resignation or removal of the
Custodian shall become effective upon such acceptance of
appointment by the successor Custodian. The indemnification of the resigning
Custodian provided for hereunder shall survive any resignation, discharge or
removal of the Custodian hereunder.
12. Custodian Merger, Consolidation. Any corporation into
which the Custodian may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Custodian shall be a party, shall be the successor
Custodian hereunder and under the Trust Agreement without the execution or
filing of any paper, instrument or further act to be done on the part of the
parties hereto or thereto, provided that such corporation meets the requirements
set forth in the Trust Agreement.
13. Compensation; Expenses. The Custodian shall receive
compensation for performing the usual, ordinary, normal and recurring services
under this Custodian Agreement and, with the prior written approval of the
Trust, reimbursement for any and all expenses and disbursements incurred
hereunder, as provided in Section 3.1 of the Administration Agreement.
14. Section 17(f) Qualification. The Custodian hereby
represents that it is qualified to act as a custodian under Section 17(f) of the
Investment Company Act.
15. Custodian's Limited Liability. The Trust shall indemnify
and hold the Custodian harmless from and against any loss, damages, cost or
expense (including the costs of investigation, preparation for and defense of
legal and/or administrative proceedings related to a claim against it and
reasonable attorneys' fees and disbursements), liability or claim incurred by
reason of any inaccuracy in information furnished to the Custodian by the
Trustees, or any act or omission in the course of, connected with or arising out
of any services to be rendered hereunder, provided that the Custodian shall not
be indemnified and held harmless from and against any such loss, damages, cost,
expense, liability or claim arising from its willful misfeasance, bad faith or
gross negligence in the performance of its duties, or its reckless disregard of
its duties and obligations hereunder. Neither the Federal Reserve Book Entry
System nor the Depository Trust Company shall be deemed to be agents of the
Custodian.
16. Rights of Set-Off; Banker's Lien. The Custodian hereby
waives all rights of set-off or banker's lien it may have with respect to the
Assets held by it as Custodian hereunder.
17. Termination. This Agreement shall terminate upon the
earlier of the termination of the Trust or the appointment of a successor
Custodian.
18. Choice of Law. This Agreement is executed and delivered in
the State of New York, and all laws or rules of construction of the State of New
York shall govern the right of the parties hereto and the interpretation of the
provisions hereof.
19. Notices. Any notice to be given to the Trust hereunder
shall be in writing and shall be duly given if mailed or delivered to Equity
Securities Trust II, c/o Puglisi & Associates, 000 Xxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxx, XX 00000, Tel.: (000) 000-0000, Fax: (000) 000-0000, and to the
Custodian if mailed or delivered to The Bank of New York, 0 Xxxx Xxxxx, 00xx
xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxxxxx, or at such other
address as shall be specified by the addressee to the other party hereto in
writing.
20. No Third Party Beneficiaries. Nothing herein, express or
implied, shall give to any Person, other than the Trust, the Custodian and their
respective successors and assigns, any benefit of any legal or equitable right,
remedy or claim hereunder.
21. Amendments; Trust Agreement Changes; Waiver. This
Agreement shall not be deemed or construed to be modified, amended, rescinded,
canceled or waived, in whole or in part, except by a written instrument signed
by a duly authorized representative of the party to be charged. The Trustees
shall notify the Custodian of any change in the Trust Agreement prior to the
effective date of any such change. Failure of either party hereto to exercise
any right or remedy hereunder in the event of a breach hereof by the other party
shall not constitute a waiver of any such right or remedy with respect to any
subsequent breach.
22. Counterparts. This Agreement may be signed in any number
of counterparts with all counterparts constituting one and the same instrument.
