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Title: |
Mutual Fund Custody Agreement |
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Date: |
2003 |
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Preview shows 24KB of 102KB total |
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$45 |
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ID: |
#1999956 |
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MUTUAL FUND CUSTODY AGREEMENT
1838 BOND-DEBENTURE TRADING FUND
WACHOVIA BANK, NATIONAL ASSOCIATION
Table of Contents
Paragraph Page
1. Definitions 1
2. Appointment 3
3. Delivery of Documents 4
4. Delivery and Registration of the Property 4
5. Voting and Other Rights 4
6. Receipt and Disbursement of Money 5
7. Receipt and Delivery of Securities 6
8. Scope of Responsibilities as Foreign Custody Manager 6
9. Eligible Securities Depositories; Compliance with Rule 17f-7 10
10. Foreign Market Transactions 10
11. Pledge or Encumbrance of Securities or Cash 10
12. Segregated Account 10
13. Foreign Exchange 11
14. Lending of Securities 11
15. Overdrafts or Indebtedness 12
16. Use of Domestic Depository or the Book-Entry System 12
17. Instructions Consistent With The Declaration, etc. 14
18. Transactions Not Requiring Instructions 15
19. Transactions Requiring Instructions 17
20. Purchase and Sale of Securities 18
21. Records 20
22. Cooperation with Accountants 20
23. Reports to Fund by Independent Public Accountants 20
24. Confidentiality 20
25. Equipment 21
26. Right to Receive Advice 21
27. Compensation 21
28. Representations 22
29. Performance of Duties and Standard of Care 22
30. Indemnification 23
31. Effective Period; Termination and Amendment 24
32. Successor Custodian 25
33. Notices 25
34. Further Actions 25
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{PAGE}
35. Additional Portfolios 25
36. Miscellaneous 26
ATTACHMENT A Fees
ATTACHMENT B Authorized Persons
ATTACHMENT C Portfolios of the Fund
EXHIBIT A Provision of Additional Information
EXHIBIT B Eligible Securities Depositories
EXHIBIT C List of Foreign Markets
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{PAGE}
MUTUAL FUND CUSTODY AGREEMENT
THIS AGREEMENT is made as of ___________________, by and between 1838
Bond-Debenture Trading Fund, a Delaware Business Trust (the "Fund"), and
WACHOVIA BANK, NATIONAL ASSOCIATION, a National Bank ("Wachovia").
1. Definitions.
"Authorized Person" means the Fund's President, Vice-President,
Treasurer and any other person, whether or not that person is an officer or
employee of the Fund, duly authorized by the Directors or Trustees of the Fund
to give Proper Instructions on behalf of the Fund and listed on Attachment B
hereto, which may be amended from time to time in writing.
"Board" means the board of trustees or board of directors, as
applicable, of the Fund.
"Book-Entry System" shall mean the Federal Reserve/Treasury book-entry
system for United States and federal agency securities, its successor or
successors and its nominee or nominees.
"Business Day" shall mean any day on which Wachovia, the Book-Entry
System, and relevant Depositories are open for business.
"Country Risks" means the systemic risks arising from holding Foreign
Assets in a particular country, including those arising from a country's
financial infrastructure, prevailing custody and settlement practices;
expropriation, nationalization or other governmental actions; and laws
applicable to the safekeeping and recovery of assets held in custody in such
country.
"Depository" shall include the Book-Entry System, the Depository Trust
Company, any other domestic securities depository, book-entry system or clearing
agency registered with the SEC or its successor or successors and its nominee or
nominees, and any other entity permitted to hold Securities under 1940 Act Rule
17f-4, and shall also mean any other registered clearing agency that acts as a
securities depository, its successor or successors, specially identified in a
certified copy of a resolution of the Fund's Directors or Trustees approving
deposits by Wachovia therein. Wachovia shall hold Securities through a
Depository only if (a) the Depository and any of its creditors may not assert
any right, charge, security interest, lien, encumbrance or other claim of any
kind to Securities except a claim of payment for their safe custody or
administration, and (b) beneficial ownership of Securities may be freely
transferred without the payment of money or value other than for safe custody or
administration.
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{PAGE}
"Eligible Foreign Custodian" means an Eligible Foreign Custodian as
defined in Rule 17f-5(a)(1) under the 1940 Act or any other entity that the SEC
qualifies as such by exemptive order, no-action relief, rule or other
appropriate SEC action.
"Eligible Securities Depository" means an Eligible Securities
Depository as defined in section (b)(1) of Rule 17f-7 under the 1940 Act or that
has otherwise been made exempt pursuant to an SEC exemptive order.
"Wachovia " shall include any office, branch or subsidiary of Wachovia
Bank National Association, and shall include any banking or trust institution
which acquires substantially all of the assets of Wachovia Bank National
Association or into which Wachovia Bank National Association is merged or
consolidated.
"Foreign Assets" means any Portfolio's investments (including foreign
currencies) for which the primary market is outside the United States and such
cash and cash equivalents as are reasonably necessary to effect the Portfolio's
transactions in such investments.
"Foreign Custody Manager" means a Foreign Custody Manager as defined in
Rule 17f-5(a)(3) under the 1940 Act.
"Foreign Market" means each market so identified in Exhibit C hereto.
"Portfolio" means each separate series of shares offered by the Fund
representing interests in a separate portfolio of securities and other assets.
"Proper Instructions" shall mean any notices, instructions or other
instruments in writing Wachovia receives from an Authorized Person or from a
person Wachovia reasonably believes to be an Authorized Person by letter, telex,
facsimile transmission, Wachovia's on-line communication system, or any other
method whereby Wachovia is able to verify with a reasonable degree of certainty
the identity of the sender of the communications or the sender is required to
provide a password or other identification code. Oral instructions will be
considered Proper Instructions if Wachovia reasonably believes that an
Authorized Person has given the oral instructions. The Fund shall cause all oral
instructions to be confirmed in writing. Proper Instructions that conflict with
earlier Proper Instructions will supersede earlier Instructions unless Wachovia
has already acted in reliance on the earlier Instructions.
"Property" shall mean any and all Securities, cash, and other property
of the Fund which the Fund may from time to time deposit, or cause to be
deposited, with Wachovia or which Wachovia may from time to time hold for the
Fund; all income of any Securities or other property; all proceeds of the sales
of any Securities or other property; and all proceeds of the sale of securities
issued by the Fund, which Wachovia receives from time to time from or on behalf
of the Fund.
"Rule 17f-5" means ss.270.17(f)-5 under the 1940 Act, as amended from
time to time.
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{PAGE}
"Rule 17f-7" means ss.270.17(f)-7 under the 1940 Act, as amended from
time to time.
"SEC" means the U.S. Securities and Exchange Commission.
"Securities" shall include, without limitation, any common stock and
other equity securities; bonds, debentures and other debt securities; forwards,
swaps, futures, derivatives, 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 Securities Depository, Eligible Foreign Custodian, or
Eligible Securities Depository).
"Securities Depository" means any securities depository as defined in
Rule 17f-4(c).
"U.S. Bank" means a U.S. bank as defined in Rule 17f-5(a)(7) under the
1940 Act.
"1940 Act" means the Investment Company Act of 1940, as amended.
2. Appointment.
a. Appointment as Custodian. The Fund is registered as an open-end
management investment company under the 1940 Act, and the Fund desires to retain
Wachovia to serve as the Fund's custodian and Wachovia is willing to furnish
these services. The Fund hereby appoints Wachovia to act as custodian of its
Securities, cash and other Property on the terms set forth in this Agreement.
Wachovia accepts this appointment and agrees to furnish the services set forth
below for the compensation as provided in Paragraph 29 of this Agreement.
b. Appointment as Foreign Custody Manager. The Fund hereby appoints
Wachovia as a Foreign Custody Manager to perform the responsibilities set forth
in Paragraph 8 with respect to Foreign Assets, and Wachovia hereby accepts such
appointment as a Foreign Custody Manager of the Fund.
3. Delivery of Documents. The Fund will promptly furnish to Wachovia
copies, properly certified or authenticated, of contracts, documents and other
related information that Wachovia may request or requires to properly discharge
its duties. These documents may include but are not limited to the following:
a. Resolutions of the Fund's Trustees authorizing the appointment of
Wachovia as custodian of the Property of the Fund and approving this Agreement;
b. Incumbency and signature certificates identifying and containing the
signatures of the Fund's Authorized Persons;
c. The Fund's most recent prospectus including all amendments and
supplements thereto (the "Prospectus").
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{PAGE}
The Fund will furnish Wachovia from time to time with copies of all
amendments of or supplements to the foregoing, if any. The Fund also will
furnish Wachovia with a copy of the opinion of counsel for the Fund on the
validity of the shares of common stock or units of beneficial interest (the
"Shares") of the Fund and the status of the Shares under the 1933 Act, and under
any other applicable federal law or regulation.
4. Delivery and Registration of the Property. The Fund will deliver or
cause to be delivered to Wachovia all Property it owns, including cash received
for the issuance of its Shares, at any time during the period of this Agreement,
except for Securities and monies to be delivered to any subcustodian appointed
pursuant to Paragraph 7. Wachovia will not be responsible for Securities and
monies until Wachovia or any subcustodian actually receives them. All Securities
delivered to Wachovia or to any subcustodian, Eligible Foreign Custodian, or
Eligible Securities Depository (other than in bearer form) shall be registered
in the name of the Fund or in the name of a nominee of the Fund, in the name of
Wachovia or any nominee of Wachovia (with or without indication of fiduciary
status), in the name of any subcustodian or any nominee of a subcustodian
appointed pursuant to Paragraph 7, any Eligible Foreign Custodian used pursuant
to Paragraph 8, or any Eligible Securities Depository used pursuant to Paragraph
9, or shall be properly endorsed and in form for transfer satisfactory to
Wachovia .
5. Voting and Other Rights.
a. The Fund shall exercise voting and other rights and powers for all
Securities, however registered. Wachovia's only duty shall be to mail for
delivery on the next Business Day to the Fund any documents received, including
proxy statements and offering circulars, with any proxies executed by the
nominee for Securities registered in a nominee name. Wachovia reserves the right
to provide any documents received, or parts thereof, in the language received.
The Fund acknowledges that in certain countries Wachovia may be unable to vote
individual proxies but be able only to vote proxies on a net basis. Wachovia
shall vote or cause proxies to be voted only as expressly directed in writing
pursuant to Proper Instructions of the Fund's Authorized Person. In the absence
of Proper Instructions, neither Wachovia nor any subcustodian shall vote or
cause proxies to be voted, and they shall expire without liability to Wachovia.
Wachovia will not advise the Fund or act for the Fund in any legal proceedings,
including bankruptcies, involving Securities the Fund holds or previously held
or the issuers of these Securities, except as the Fund and Wachovia expressly
agree upon in writing.
b. Wachovia shall transmit promptly to the Fund all written information
(including, without limitation, pendency of calls and maturities of Securities
and expirations of rights in connection therewith and notices of exercise of
call and put options the Fund writes and the maturity of futures contracts the
Fund purchases or sells) Wachovia receives from issuers of the Securities the
Fund holds, or from an Eligible Foreign Custodian or Eligible Securities
Depository holding Foreign Assets of the Fund. For tender or exchange offers,
Wachovia shall transmit promptly by facsimile to the Fund all written
information Wachovia receives from issuers of the Securities whose tender or
exchange is sought and from the party (or his agents) making the tender or
exchange offer, or from an Eligible Foreign Custodian or Eligible Securities
Depository holding Foreign Assets of the Fund. If the Fund desires to take
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{PAGE}
action on any tender offer, exchange offer or any other similar transaction, the
Fund shall notify Wachovia at least three business days before the date on which
Wachovia is to take action [five business days if the tender offer, exchange
offer, or other similar transaction involves a Foreign Asset] or upon the date
the Fund first receives the notification, if later. Absent Wachovia's failure to
promptly transmit such written information that it has received to the Fund, or
absent Wachovia's timely receipt of Proper Instructions, Wachovia shall not be
liable for failure to take any action relating to or to exercise any rights the
Securities confer.
c. Wachovia shall promptly notify the Fund of any rights or
discretionary actions or of the date or dates by when the rights must be
exercised or action must be taken provided that Wachovia has received, from the
issuer, from persons making a tender or exchange offer, or from an Eligible
Foreign Custodian or Eligible Securities Depository, or otherwise, timely notice
of rights, discretionary corporate action, or dates. Absent actual receipt of
this notice, Wachovia shall have no liability for failing to so notify the Fund.
d. Wachovia shall retain shares with respect to tender offers for less
than 5% of outstanding shares at less than 99% of the current market value,
without obligation to provide notice of such offers.
6. Receipt and Disbursement of Money.
a. Wachovia shall open and maintain a custody account for the Fund (the
"Account") subject only to draft or order by Wachovia acting pursuant to the
terms of this Agreement, and shall hold in the Account, subject to the
provisions in this Paragraph 6, all cash it receives by or for the Fund, other
than cash the Fund maintains in a bank account established and used in
accordance with Rule 17f-3 under the 1940 Act. Wachovia shall make payments of
cash to, or for the account of, the Fund from cash only (i) for the purchase of
Securities against delivery of such Securities except as provided in Paragraph
10; (ii) in the case of a purchase of Securities effected through a Book-Entry
System or Securities Depository, in accordance with the conditions set forth in
Paragraph 18; (iii) in the case of repurchase agreements entered into between
the Fund and Wachovia, or another bank, or a broker-dealer which is a member of
The National Association of Securities Dealers, Inc. ("NASD"), either (a)
against delivery of the Securities either in certificate form or through an
entry crediting Wachovia's account at the Federal Reserve Bank with the
Securities or (b) against delivery of the receipt evidencing the Fund's purchase
of Securities Wachovia owns along with written evidence of Wachovia's agreement
to repurchase the Securities from the Fund; (iv) for transfer to a time deposit
account of the Fund in any bank, whether domestic or foreign; the transfer may
be effected before receipt of a confirmation from a broker and/or the applicable
bank pursuant to Proper Instructions from the Fund; (v) for the payment of
dividends or other distributions on shares declared pursuant to the governing
documents of the Fund, or for the payment of interest, taxes, administration,
distribution or advisory fees or expenses which the Fund is to bear under the
terms of this Agreement, any Advisory Agreement, or any distribution or
administration agreement; (vi) for payments in connection with the conversion,
exchange or surrender of Securities the Fund owns or subscribes to and Wachovia
holds or is to deliver ; (vii) to a subcustodian pursuant to Paragraph 7; (viii)
for common expenses the Fund incurs in the ordinary course of its business,
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{PAGE}
including but not limited to printing and mailing expenses, legal fees,
accountants' fees, exchange fees; or (ix) for any other proper purpose, but only
upon receipt of, in addition to Proper Instructions, a certified copy of a
resolution of the Board or of the Executive Committee of the Fund signed by an
officer of the Fund and certified by its Secretary or an Assistant Secretary,
specifying the amount of the payment, setting forth the purpose for which the
payment is to be made, declaring the purpose to be a proper purpose, and naming
the person or persons to whom the payment is to be made.
b. Wachovia is hereby authorized to endorse and collect all checks,
drafts or other orders for the payment of money received as custodian for the
Fund.
7. Receipt and Delivery of Securities.
a. Except as provided in this Paragraph 7 and Paragraphs 8 and 9,
Wachovia shall hold and segregate (physically, where Securities are held in
certificate form) all Securities and non-cash Property it receives for the Fund.
Wachovia will hold or dispose of all Securities and non-cash Property for the
Fund pursuant to the terms of this Agreement. In the absence of Proper
Instructions accompanied by a certified resolution of the Fund's Board
authorizing the specific transaction, Wachovia shall have no power or authority
to withdraw, deliver, assign, hypothecate, pledge or otherwise dispose of any
Securities and other Property, except in accordance with this Agreement. In no
case may any director, trustee, officer, employee or agent of the Fund withdraw
any Securities. Wachovia may, at its own expense, employ subcustodians for the
receipt of certain non-Foreign Assets Wachovia is to hold for the account of the
Fund pursuant to this Agreement; provided that each subcustodian has an
aggregate capital, surplus and undivided profits, as shown by its last published
report, of not less than twenty million dollars ($20,000,000) and that such
subcustodian agrees with Wachovia to comply with all relevant provisions of the
1940 Act and applicable rules and regulations thereunder. Wachovia will be
liable for acts or omissions of any subcustodian to the same extent that
Wachovia is liable to the Fund under this Agreement. Wachovia shall employ
subcustodians upon receipt of Proper Instructions, but only in accordance with
an applicable vote of the Board of the Fund.
b. When requested, Wachovia shall furnish the Fund with confirmations
and a summary of all transfers to or from the account of the Fund during said
day. Where Securities are transferred to the account of the Fund established at
a Securities Depository or Book-Entry System, Wachovia shall also by book-entry
or otherwise identify as belonging to the Fund (and a Portfolio) the quantity of
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