Exhibit 8.2
AMENDMENT TO GLOBAL CUSTODY AGREEMENT
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AMENDMENT, dated February 26, 1998 to the September 8, 1997 custody agreement
("Agreement"), between The Analytic Optioned Equity Fund, Inc. ("Customer"),
having a place of business at 000 Xxxxx Xxxxxx Xxxxxx, Xxx Xxxxxxx, XX 00000 and
The Chase Manhattan Bank ("Bank"), having a place of business at 000 Xxxx Xxx.,
Xxx Xxxx, X.X. 00000-0000.
It is hereby agreed as follows:
Section 1. Except as modified hereby, the Agreement is confirmed in all
respects. Capitalized terms used herein without definition shall have the
meanings ascribed to them in the Agreement.
Section 2. The Agreement is amended by deleting the investment company rider
thereto and inserting, in lieu thereof, the following investment company rider:
"A. Add a new Section 15 to the Agreement as follows:
15. Compliance with SEC rule 17f-5.
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(a) Customer's board of directors (or equivalent body) (hereinafter
"Board") hereby delegates to Bank, and, except as to the country or countries
as to which Bank may, from time to time, advise Customer that it does not
accept such delegation, Bank hereby accepts the delegation to it, of the
obligation to perform as Customer's "Foreign Custody Manager" (as the term is
defined in SEC rule 17f-5(a)(2), both for the purpose of selecting Eligible
Foreign Custodians (as that term is defined in SEC rule 17f-5(a)(1), and as
the same may be amended from time to time, or that have otherwise been made
exempt pursuant to an SEC exemptive order) to hold Assets and of evaluating
the contractual arrangements with such Eligible Foreign Custodians (as set
forth in SEC rule 17f-5(c)(2)); provided that, the term Eligible Foreign
Custodian shall not include any "Compulsory Depository." For each Compulsory
Depository used or intended to be used by Customer of which Bank is advised,
Bank shall provide Customer from time to time with information addressing the
factors set forth in SEC Rule 17f-5(c)(1) to the extent reasonably available
to Bank, together with Bank's analysis of the same (as an example of which is
set forth in Appendix 1 hereto) to assist Customer in determining the
appropriateness of
placing Assets therein. A Compulsory Depository shall mean a securities
depository or clearing agency the use of which is compulsory because: (1) its
use is required by law or regulation, (2) securities cannot be withdrawn from
the depository, or (3) maintaining securities outside the depository is not
consistent with prevailing custodial practices in the country which the
depository serves. Compulsory Depositories used by Chase as of the date hereof
are set forth in Appendix 1-A hereto, and as the same may be amended on notice
to Customer from time to time.
(b) In connection with the foregoing, Bank shall:
(i) provide written reports notifying Customer's Board of the placement of
Assets with particular Eligible Foreign Custodians and of any material change
in the arrangements with such Eligible Foreign Custodians, with such reports
to be provided to Customer's Board at such times as the Board deems reasonable
and appropriate based on the circumstances of Customer's foreign custody (and
until further notice from Customer such reports shall be provided not less
than quarterly with respect to the placement of Assets with particular
Eligible Foreign Custodians and with reasonable promptness, but not less than
quarterly, upon the occurrence of any material change in the contracts,
arrangements, procedures or practices with such Eligible Foreign Custodians);
(ii) exercise such reasonable care, prudence and diligence in performing as
Customer's Foreign Custody Manager as a person having responsibility for the
safekeeping of Assets would exercise.
(iii) in selecting an Eligible Foreign Custodian, first have determined
that Assets placed and maintained in the safekeeping of such Eligible Foreign
Custodian shall be subject to reasonable care, based on the standards
applicable to custodians in the relevant market, after having considered all
factors relevant to the safekeeping of such Assets, including, without
limitation, those factors set forth in SEC rule 17f-5(c)(1)(i)-(iv).
(iv) determine that the written contract with the Eligible Foreign
Custodian (or, in the case
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of an Eligible Foreign Custodian that is a securities depository or clearing
agency, such contract, the rules or established practice or procedures of the
depository, or any combination of the foregoing) requires that the Eligible
Foreign Custodian will provide reasonable care for Assets based on the
standards applicable to custodians in the relevant market. In making this
determination, Bank shall consider the provisions of Rule 17f-5(c)(2),
together with whether Bank shall be liable to Customer for any loss which
shall occur as the result of the failure of the Eligible Foreign Custodian to
exercise reasonable care with respect to the safekeeping of such Assets to the
same extent that Bank would be liable to Customer if Bank were holding such
Assets in New York; and
(v) have established a system to monitor the continued appropriateness of
maintaining Assets with particular Eligible Foreign Custodians and of the
governing contractual arrangements; it being understood, however, that in that
event that Bank shall have determined that the existing Eligible Foreign
Custodian in a given country would no longer afford Assets reasonable care and
that no other Eligible Foreign Custodian in that country would afford
reasonable care, Bank shall promptly so advise Customer and shall then act in
accordance with the Instructions of Customer with respect to the disposition
of the affected Assets.
Subject to (b)(i)-(v) above, Bank is hereby authorized to place and maintain
Assets on behalf of Customer with Eligible Foreign Custodians pursuant to a
written contract deemed appropriate by Bank.
(c) Except as expressly provided herein, Customer shall be solely
responsible to assure that the maintenance of Assets hereunder complies with
the rules, regulation, interpretations and exemptive orders promulgated by or
under the authority of the SEC.
(d) Bank represents to Customer that it is a U.S. Bank as defined in Rule
17f-5(a)(7). Customer represents to Bank that: (1) the Assets being placed and
maintained in Bank's custody are subject to the Investment Company Act of
1940, as amended (the "1940 Act"), as the same may be amended from time to
time; (2) its Board: (i)
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has determined that it is reasonable to rely on Bank to perform as Customer's
Foreign Custody Manager (ii) or its Foreign Custody Manager (other than Bank)
shall have determined that Customer may maintain Assets in each country in
which Customer's Assets shall be held hereunder and determined to accept the
risks arising therefrom (including, but not limited to, a country's financial
infrastructure (and including any Compulsory Depository operating in such
country), prevailing custody and settlement practices, laws applicable to the
safekeeping and recovery of Assets held in custody, and the likelihood of
nationalization, currency controls and the like).
B. Add the following after the first sentence of Section 3 of the Agreement:
At the request of Customer, Bank may, but need not, add to Schedule A an
Eligible Foreign Custodian that is either a bank or a non-Compulsory
Depository where Bank has not acted as Foreign Custody Manager with respect to
the selection thereof. Bank shall notify Customer in the event that it elects
not to add any such entity.
C. Add the following language to the end of Section 3 of the Agreement:
(a) a "U.S. Bank," which shall mean a U.S. bank as defined in SEC rule 17f-
5(a)(7); and
(b) an "Eligible Foreign Custodian," which shall mean (i) a banking
institution or trust company, incorporated or organized under the laws of a
country other than the United States, that is regulated as such by that
country's government or an agency thereof, (ii) a majority-owned direct or
indirect subsidiary of a U.S. bank or bank holding company which subsidiary is
incorporated or organized under the laws of a country other than the United
States; (iii) a securities depository or clearing agency, incorporated or
organized under the laws of a country other than the United States, that acts
as a system for the central handling of securities or equivalent book-entries
in that country and that is regulated by a foreign financial regulatory
authority as defined under section 2(a)(5) of the 1940 Act, (iv) a securities
depository or clearing agency organized under the laws of a country other than
the United States to the extent acting as a transnational system for the
central handling of securities
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or equivalent book-entries, and (v) any other entity that shall have been so
qualified by exemptive order, rule or other appropriate action of the SEC.
For purposes of clarity, it is agreed that as used in Section 12(a)(i), the term
Subcustodian shall include neither any Eligible Foreign Custodian as to which
Bank has not acted as Foreign Custody Manager nor any Compulsory Depository.
D. Insert the following language at the beginning of the second sentence of
Section 4(d): "or, in the case of cash deposits, except for liens or rights in
favor of creditors of the Subcustodian arising under bankruptcy, insolvency or
similar laws."
E. Insert the following language at the beginning of the second sentence of
Section 12(a)(i):
Except with respect to those countries as to which the parties may from
time to time agree in writing otherwise."
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
THE ANALYTIC OPTIONED EQUITY FUND, INC.
By:
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Title:
THE CHASE MANHATTAN BANK
By:
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Title:
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Appendix 1-A
Compulsory Depositories
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Appendix 1-B
Information Regarding Country Risk
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1. To aid Customer's investment advisers in their determinations
regarding Country Risk, Bank shall furnish Customer annually and upon the
initial placing of Assets into a country the following information (check items
applicable):
A. Opinions of local counsel concerning:
____ i. Whether applicable foreign law would restrict the access afforded
Customer's independent public accountants to books and records kept by
an eligible foreign custodian located in that country.
____ ii. Whether applicable foreign law would restrict the Customer's
ability to recover its assets in the event of the bankruptcy of an
Eligible Foreign Custodian located in that country.
____ iii. Whether applicable foreign law would restrict the Customer's
ability to recover assets that are lost while under the control of an
Eligible foreign Custodian located in the country.
B. Written information concerning:
____ i. The likelihood of expropriation, nationalization, freezes, or
confiscation of Customer's assets.
____ ii. Whether difficulties in converting Customer's cash and cash
equivalents to U.S. dollars are reasonably foreseeable.
C. A market report with respect to the following topics:
(i) securities regulatory environment, (ii) foreign ownership
restrictions, (iii) foreign exchange, (iv) securities settlement and
registration, (v) taxation, and (vi) compulsory depositories
(including depository evaluation).
2. To aid Customer's investment advisers in monitoring Country Risk,
Bank shall furnish Customer the following additional information:
Market flashes, including with respect to changes in the information in market
reports.
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