CUSTODIAN AGREEMENT
THIS AGREEMENT, dated as of January 29, 2003, between the STI Classic
Funds and STI Classic Variable Trust, each an open-end management investment
company organized under the laws of the Commonwealth of Massachusetts and
registered with the Commission under the 1940 Act (each a FUND AND COLLECTIVELY
THE FUNDS), and XXXXX BROTHERS XXXXXXXX & CO., a limited partnership formed
under the laws of the State of New York (BBH&CO. or the CUSTODIAN).
W I T N E S S E T H:
WHEREAS, each Fund wishes to employ BBH&Co. to act as custodian for the
Fund and to provide related services, all as provided herein, and BBH&Co. is
willing to accept such employment, subject to the terms and conditions herein
set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the Funds and BBH&Co. hereby agree, as follows:
1. APPOINTMENT OF CUSTODIAN. The terms of this agreement shall apply separately
and respectively to each Fund and to each separate portfolio of each Fund that
is designated by such Fund as a separate account on the books of the Custodian..
Each Fund hereby appoints BBH&Co. as the Fund's custodian, and BBH&Co. hereby
accepts such appointment. All Investments of a Fund delivered to the Custodian
or its agents or Subcustodians shall be dealt with as provided in this Agreement
and any attachments or schedules thereto. The duties of the Custodian with
respect to a Fund's Investments shall be only as set forth expressly in this
Agreement which duties are generally comprised of safekeeping and various
administrative duties that will be performed in accordance with Instructions and
as reasonably required to effect Instructions.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE FUND. Each Fund hereby
represents, warrants and
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covenants each of the following:
2.1 This Agreement has been, and at the time of delivery of
each Instruction such Instruction will have been, duly authorized,
executed and delivered by the Fund. This Agreement does not violate any
Applicable Law or conflict with or constitute a default under the
Fund's prospectus or other organic document, agreement, judgment, order
or decree to which the Fund is a party or by which it or its
Investments is bound.
2.2 By providing an Instruction with respect to the first
acquisition of an Investment in a jurisdiction other than the United
States of America, the Fund shall be deemed to have confirmed to the
Custodian that the Fund has (a) assessed all material Country or
Sovereign Risks and accepted responsibility for their occurrence (b)
made all determinations required to be made by the Fund under the 1940
Act, save those delegated to the Custodian pursuant to Delegation
Schedule attached hereto and (iii) if deemed appropriate by the Fund,
adequately disclosed to its shareholders and prospective investors, all
material investment risks, including any Country Risks. Nothing in this
section shall relieve the Custodian of its responsibility for
performance of its duties under Section 8.2 with respect to foreign
depository information in connection with Rule 17f-7 under the 1940
Act.
2.3 The Fund shall safeguard and shall solely be responsible
for its safekeeping of any testkeys, identification codes, passwords,
other security devices or statements of account with which the
Custodian provides it (except to the extent that any failure by Fund to
safe keep such devices or statements is beyond its reasonable control
or is caused or contributed to by the Custodian or by the design, or
intended use or manufacture of the device or statement). In furtherance
and not limitation of the foregoing, in the event the Fund utilizes any
on-line service offered by the Custodian, the Fund and the Custodian
shall be fully responsible for the security of its own connecting
terminal, access thereto and the proper and authorized use thereof and
the initiation and application of continuing effective safeguards in
respect thereof (except to the extent that any failure by Fund to safe
keep such devices or statements is beyond its reasonable control or is
caused or contributed to by the Custodian or by the design, or intended
use or manufacture of the device or statement). Additionally, if the
Fund uses any on-line or similar communications service made available
by the Custodian, the Fund shall be solely responsible for ensuring the
security of its access to the service and for the use of the service
(except to the extent that any failure by Fund to safe keep such
devices or statements is beyond its reasonable control or is caused or
contributed to by the Custodian or by the design, or intended use or
manufacture of the device or statement) and shall only attempt to
access the service and the Custodian's computer systems as directed by
the Custodian. If the Custodian provides any computer software to the
Fund relating to the services described in this Agreement, the Fund
will only use the software for the purposes for which the Custodian
provided the software to the Fund, and will abide by the license
agreement accompanying the software and any other security policies
which the Custodian provides to the Fund.
3. REPRESENTATION AND WARRANTY OF BBH&CO. BBH&Co. hereby represents and warrants
that this Agreement has been duly authorized, executed and delivered by BBH&Co.
and does not and will not violate any Applicable Law or conflict with or
constitute a default under BBH&Co.'s limited partnership agreement or any
agreement, instrument, judgment, order or decree to which BBH&Co. is a party or
by which it is bound. BBH further represents and warrants that it has adopted
and maintains reasonable procedures to provide for continued services in the
event of an emergency or disaster.
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4. INSTRUCTIONS. Unless otherwise explicitly indicated herein, the Custodian
shall perform its duties pursuant to Instructions. As used herein, the term
INSTRUCTION shall mean a directive initiated by the Fund, acting directly or
through its board of trustees, officers or other Authorized Persons, which
directive shall conform to the requirements of this Section 4.
4.1 AUTHORIZED PERSONS. For purposes hereof, an AUTHORIZED PERSON shall
be a person or entity authorized by the Fund to give Instructions for or on
behalf of the Fund and designated as such by written notices from the Fund to
the Custodian (or otherwise in accordance with procedures delivered to and
acknowledged by the Custodian). The Custodian may treat any Authorized Person as
having full authority of the Fund to issue Instructions hereunder unless the
notice of authorization contains explicit limitations as to said authority. The
Custodian shall be entitled to rely upon the authority of previously designated
Authorized Persons until it receives appropriate written notice from the Fund to
the contrary.
4.2 FORM OF INSTRUCTION. Each Instruction shall be transmitted by such
secured or authenticated electro-mechanical means as the Custodian shall make
available to the Fund from time to time unless the Fund shall elect to transmit
such Instruction in accordance with Subsections 4.2.1 through 4.2.3 of this
Section.
4.2.1 FUND DESIGNATED SECURED-TRANSMISSION METHOD. Instruc-
tions may be transmitted through a secured or tested electro-mechanical
means identified by the Fund or by an Authorized Person entitled to
give Instruction and acknowledged and accepted by the Custodian; it
being understood that such acknowledgment shall authorize the Custodian
to receive and process such means of delivery but shall not represent a
judgment by the Custodian as to the reasonableness or security of the
method determined by the Authorized Person (unless such method is a
product proprietary to the Custodian and offered to the Fund by the
Custodian).
4.2.2 WRITTEN INSTRUCTIONS. Instructions may be transmitted in
a writing that bears the manual signature of an Authorized Person.
4.2.3 OTHER FORMS OF INSTRUCTION. Instructions may also be
transmitted by another means determined by the Fund or Authorized
Persons and acknowledged and accepted by the Custodian (subject to the
same limits as to acknowledgements as is contained in Subsection 4.2.1,
above) including Instructions given orally or by SWIFT, telex or
telefax (whether tested or untested).
When an Instruction is given by means established under Subsections
4.2.1 through 4.2.3 above, it shall be the responsibility of the Custodian to
use reasonable care to adhere to any security or other procedures established in
writing between the Custodian and the Authorized Person with respect to such
means of Instruction, but such Authorized Person shall be solely responsible for
determining that the particular means chosen is reasonable under the
circumstances (unless such method is a product proprietary to the Custodian and
offered to the Fund by the Custodian). Oral Instructions shall be binding upon
the Custodian only if and when the Custodian takes action with respect thereto.
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With respect to telefax instructions, the parties agree and acknowledge that
receipt of legible instructions cannot be assured, that the Custodian cannot
verify that authorized signatures on telefax instructions are original or
properly affixed, and that the Custodian shall not be liable for losses or
expenses incurred through actions taken in reasonable reliance on inaccurately
stated, illegible or unauthorized telefax instructions. Custodian shall promptly
notify the Fund once it becomes aware that it has received an illegible or
unauthorized Instruction and shall be protected in waiting to act until such
Instruction is clarified. The provisions of Section 4A of the Uniform Commercial
Code shall apply to Funds Transfers performed in accordance with Instructions.
The Funds Transfer Services Schedule and the Electronic and Online Services
Schedule to this Agreement shall comprise a designation of form of a means of
delivering Instructions for purposes of this Section 4.2.
4.3 COMPLETENESS AND CONTENTS OF INSTRUCTIONS. The Authorized Person
shall be responsible for assuring the adequacy and accuracy of Instructions.
Particularly, upon any acquisition or disposition or other dealing in the Fund's
Investments and upon any delivery and transfer of any Investment or moneys, the
person initiating such Instruction shall give the Custodian an Instruction with
appropriate detail, including, without limitation:
4.3.1 The transaction date and the date and location of
settlement;
4.3.2 The specification of the type of transaction;
4.3.3 A description of the Investments or moneys in question,
including, as appropriate, quantity, price per unit, amount of money to
be received or delivered and currency information. Where an Instruction
is communicated by electronic means, or otherwise where an Instruction
contains an identifying number such as a CUSIP, SEDOL or ISIN number,
the Custodian shall be entitled to rely on such number as controlling
notwithstanding any inconsistency contained in such Instruction,
particularly with respect to Investment description; and
4.3.4 The name of the broker or similar entity concerned with
execution of the transaction.
If the Custodian shall determine that an Instruction is either unclear
or incomplete, the Custodian will give prompt notice of such determination to
the Fund, and the Fund shall thereupon amend or otherwise reform such
Instruction. In such event, the Custodian shall have no obligation to take any
action in response to the Instruction initially delivered until the redelivery
of an amended or reformed Instruction.
4.4 TIMELINESS OF INSTRUCTIONS. In giving an Instruction, the Fund
shall take into consideration generally acknowledged or known delays which may
occur due to the involvement of a Subcustodian or agent, differences in time
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zones, and other factors particular to a given market, exchange or issuer. When
the Custodian has established, and communicated to the Fund in advance and in
writing, specific timing requirements or deadlines with respect to particular
classes of Instruction, or when an Instruction is received by the Custodian at
such a time that it could not reasonably be expected to have acted on such
Instruction due to time zone differences or other factors beyond its reasonable
control, the execution of any Instruction received by the Custodian after such
deadline or at such time (including any modification or revocation of a previous
Instruction) shall be at the risk of the Fund.
5. SAFEKEEPING OF FUND ASSETS. The Custodian shall hold Investments delivered to
it or Subcustodians for the Funds in accordance with the provisions of this
Section. The Custodian shall not be responsible for (a) the safekeeping of
Investments not delivered or that are not caused to be issued to it or its
Subcustodians; or (b) pre-existing faults or defects in Investments that are
delivered to the Custodian or its Subcustodians. The Custodian is hereby
authorized to hold with itself or a Subcustodian, and to record in one or more
accounts, all Investments delivered to and accepted by the Custodian, any
Subcustodian or their respective agents pursuant to an Instruction or in
consequence of any corporate action. The Custodian shall hold Investments for
the account of each Fund (and portfolio) and shall segregate Investments from
assets belonging to the Custodian and shall cause its Subcustodians to segregate
Investments from assets belonging to the Subcustodian in an account held for the
Fund (and for the relevant portfolio) or in an account maintained by the
Subcustodian generally for non-proprietary assets of the Custodian.
5.1 USE OF SECURITIES DEPOSITORIES. The Custodian may deposit and
maintain Investments in any Securities Depository, either directly or through
one or more Subcustodians appointed by the Custodian. Investments held in a
Securities Depository shall be held (a) subject to the agreement, rules,
statement of terms and conditions or other document or conditions effective
between the Securities Depository and the Custodian or the Subcustodian, as the
case may be, and (b) in an account for each Fund (or portfolio) or in bulk
segregation in an account maintained for the non-proprietary assets of the
entity holding such Investments in the Depository with appropriate
identification of the Fund's (and portfolio's) Investments on the Custodian's
books. If market practice or the rules and regulations of the Securities
Depository prevent the Custodian, the Subcustodian (or any nominee or agent of
either) from holding its client assets in such a non-proprietary account, the
Custodian, the Subcustodian or other agent shall as appropriate segregate such
Investments for benefit of the Fund (or portfolio) or for benefit of clients of
the Custodian generally on its own books with appropriate identification of each
Fund's (or portfolio's) Investments on the Custodian's books.
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5.2 CERTIFICATED ASSETS. Investments which are certificated may be held
in registered or bearer form: (a) in the Custodian's vault; (b) in the vault of
a Subcustodian or agent of the Custodian or a Subcustodian; or (c) in an account
maintained by the Custodian, Subcustodian or agent at a Securities Depository;
all in accordance with customary market practice in the jurisdiction in which
any Investments are held.
5.3 REGISTERED ASSETS. Investments that are registered may be
registered in the name of the Custodian, a Subcustodian, or in the name of the
Fund or a nominee for any of the foregoing, and may be held in any manner set
forth in paragraph 5.2.
5.4 BOOK ENTRY ASSETS. Investments that are represented by book-entry
may be so held in an account maintained by the Book-entry Agent on behalf of the
Custodian, a Subcustodian or another agent of the Custodian, or a Securities
Depository.
5.5 REPLACEMENT OF LOST INVESTMENTS. In the event of a loss of
Investments for which the Custodian is responsible under the terms of this
Agreement, the Custodian shall replace such Investment, or in the event that
such replacement cannot be effected, the Custodian shall pay to the Fund the
fair market value of such Investment based on the last available price as of the
close of business in the relevant market on the date that a claim was first made
to the Custodian with respect to such loss or, if less, such other amount as
shall be agreed by the parties as the date for settlement.
6. ADMINISTRATIVE DUTIES OF THE CUSTODIAN. The Custodian shall perform the
following administrative duties with respect to Investments of the Fund.
6.1 PURCHASE OF INVESTMENTS. Pursuant to Instruction, Investments
purchased for the account of the Fund (or portfolio) shall be paid for (a)
against delivery thereof to the Custodian or a Subcustodian, as the case may be,
either directly or through a Clearing Corporation or a Securities Depository (in
accordance with the rules of such Securities Depository or such Clearing
Corporation), or (b) otherwise in accordance with an Instruction, Applicable
Law, generally accepted trade practices, or the terms of the instrument
representing such Investment.
6.2 SALE OF INVESTMENTS. Pursuant to Instruction, Investments sold for
the account of the Fund (or portfolio) shall be delivered (a) against payment
therefor in cash, by check or by bank wire transfer, (b) by credit to the
account of the Custodian or the applicable Subcustodian, as the case may be,
with a Clearing Corporation or a Securities Depository (in accordance with the
rules of such Securities Depository or such Clearing Corporation), or (c)
otherwise in accordance with an Instruction, Applicable Law, generally accepted
trade practices, or the terms of the instrument
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representing such Investment.
6.3 DELIVERY AND RECEIPT IN CONNECTION WITH BORROWINGS OF THE FUND OR
OTHER COLLATERAL AND MARGIN REQUIREMENTS. Pursuant to Instruction, the Custodian
may deliver or receive Investments or cash of the Fund (or portfolio) in
connection with borrowings or loans by the Fund (or portfolio) and other
collateral and margin requirements.
6.4 FUTURES AND OPTIONS. If, pursuant to an Instruction, the Custodian
shall become a party to an agreement with the Fund and a futures commission
merchant regarding margin (TRI-PARTY AGREEMENT), the Custodian shall (a) receive
and retain, to the extent the same are provided to the Custodian, confirmations
or other documents evidencing the purchase or sale by the Fund of
exchange-traded futures contracts and commodity options, (b) when required by
such Tri-Party Agreement, deposit and maintain in an account opened pursuant to
such Agreement (MARGIN ACCOUNT), segregated either physically or by book-entry
in a Securities Depository for the benefit of any futures commission merchant,
such Investments as the Fund shall have designated as initial, maintenance or
variation "margin" deposits or other collateral intended to secure the Fund's
performance of its obligations under the terms of any exchange-traded futures
contracts and commodity options; and (c) thereafter pay, release or transfer
Investments into or out of the margin account in accordance with the provisions
of such Agreement. Alternatively, the Custodian may deliver Investments, in
accordance with an Instruction, to a futures commission merchant for purposes of
margin requirements in accordance with Rule 17f-6 under the 1940 Act. The
Custodian shall in no event be responsible for the acts and omissions of any
futures commission merchant to whom Investments are delivered pursuant to this
Section; for the sufficiency of Investments held in any Margin Account; or, for
the performance of any terms of any exchange-traded futures contracts and
commodity options.
6.5 CONTRACTUAL OBLIGATIONS AND SIMILAR INVESTMENTS. From time to time,
the Fund's Investments may include Investments that are not ownership interests
as may be represented by certificate (whether registered or bearer), by entry in
a Securities Depository or by book entry agent, registrar or similar agent for
recording ownership interests in the relevant Investment. If the Fund shall at
any time acquire such Investments, including without limitation deposit
obligations, loan participations, repurchase agreements and derivative
arrangements, the Custodian shall (a) receive and retain, to the extent the same
are provided to the Custodian, confirmations or other documents evidencing the
arrangement; and (b) perform on the Fund's account in accordance with the terms
of the applicable arrangement, but only to the extent directed to do so by
Instruction. The Custodian shall have no responsibility for agreements running
to the Fund as to which it is not a party other than to retain, to the extent
the same are provided to the Custodian,
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documents or copies of documents evidencing the arrangement and, in accordance
with Instruction, to include such arrangements in reports made to the Fund.
6.6 EXCHANGE OF SECURITIES. Unless otherwise directed by Instruction,
the Custodian shall: (a) exchange securities held for the account of the Fund
for other securities in connection with any reorganization, recapitalization,
conversion, split-up, change of par value of shares or similar event, and (b)
deposit any such securities in accordance with the terms of any reorganization
or protective plan.
6.7 SURRENDER OF SECURITIES. Unless otherwise directed by Instruction,
the Custodian may surrender securities: (a) in temporary form for definitive
securities; (b) for transfer into the name of an entity allowable under Section
5.3; and (c) for a different number of certificates or instruments representing
the same number of shares or the same principal amount of indebtedness.
6.8 RIGHTS, WARRANTS, ETC. Pursuant to Instruction, the Custodian shall
(a) deliver warrants, puts, calls, rights or similar securities to the issuer or
trustee thereof, or to any agent of such issuer or trustee, for purposes of
exercising such rights or selling such securities, and (b) deposit securities in
response to any invitation for the tender thereof.
6.9 MANDATORY CORPORATE ACTIONS. Unless otherwise directed by
Instruction, the Custodian shall: (a) comply with the terms of all mandatory or
compulsory exchanges, calls, tenders, redemptions or similar rights of
securities ownership affecting securities held on the Fund's account and
promptly notify the Fund of such action; and (b) collect all stock dividends,
rights and other items of like nature with respect to such securities.
6.10 INCOME COLLECTION. Unless otherwise directed by Instruction, the
Custodian shall collect any amount due and payable to the Fund with respect to
Investments (including without limitation dividends, interest and other income
and distribution payable thereon) and promptly credit the amount collected to a
Principal or Agency Account; provided, however, that the Custodian shall not be
responsible for: (a) the collection of amounts due and payable with respect to
Investments that are in default; or (b) the collection of cash or share
entitlements with respect to Investments that are not registered in the name of
the Custodian or its Subcustodians. The Custodian is hereby authorized to
endorse and deliver any instrument required to be so endorsed and delivered to
effect collection of any amount due and payable to the Fund with respect to
Investments.
6.11 OWNERSHIP CERTIFICATES AND DISCLOSURE OF THE FUND'S INTEREST. The
Custodian is hereby authorized to execute on behalf of the Fund ownership
certificates, affidavits or other disclosure required under Applicable Law or
established market practice in connection with the receipt of income, capital
gains or other payments by the Fund with respect to Investments, or in
connection with the sale, purchase or ownership of Investments. With respect to
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securities issued in the United States of America, the Custodian MAY NOT 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 the Fund. With respect to securities
issued outside of the United States of America, information shall be released in
accordance with law or custom of the particular country in which such security
is located.
6.12 PROXY MATERIALS. The Custodian shall promptly deliver, or cause to
be delivered, to the Fund proxy forms, notices of meeting, and any other notices
or announcements materially affecting or relating to Investments received by the
Custodian or any nominee.
6.13. TAXES. The Custodian shall use its good faith efforts consistent
with the standard of care to obtain refunds of taxes withheld on dividends and
interest payments received by the Fund that are available under applicable tax
laws, treaties, and regulations. In the performance of its duties with respect
to tax withholding and reclamation, the Custodian shall be entitled to rely on
the advice of counsel and upon information and advice regarding the Fund's tax
status that is received from or on behalf of the Fund without duty of separate
inquiry (subject to Section 13.9 herein).
6.14 OTHER DEALINGS. The Custodian shall otherwise act as directed by
Instruction, including without limitation effecting the free payments of moneys
(including payments of dividends and distributions to Fund shareholders and
payments of Fund expenses) or the free delivery of securities, provided that
such Instruction shall indicate the purpose of such payment or delivery and that
the Custodian shall record the party to whom such payment or delivery is made.
The Custodian shall attend to all nondiscretionary details in connection with
the sale or purchase or other administration of Investments, except as otherwise
directed by an Instruction, and may make payments to itself or others for minor
expenses of administering Investments under this Agreement; provided that the
Custodian shall account to the Fund with respect to such expenses.
In fulfilling the duties set forth in Sections 6.6 through 6.10 above, the
Custodian shall transmit promptly to the Fund all written information
(including, without limitation, pendency of calls and maturities of domestic
securities and
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expirations of rights in connection with therewith and notices of exercise of
call and put options written by the Fund and the maturity of futures contracts
purchased or sold) received by the Custodian from issuers of the Investments
being held for the Fund. With respect to tender or exchange offers, the
Custodian shall transmit promptly to the Fund all written information received
by the Custodian from issuers of the Investments whose tender or exchange is
sought and from the party (or its agent) making the tender or exchange offer. If
the Fund desires to take action with respect to any tender offer, exchange offer
and any other similar transaction, the Fund shall notify the Custodian prior to
the date on which the Custodian is to take such action.
7. CASH ACCOUNTS, DEPOSITS AND MONEY MOVEMENTS. Subject to the terms and
conditions set forth in this Section 7, the Fund hereby authorizes the Custodian
to open and maintain, with itself or with Subcustodians, cash accounts in United
States Dollars, in such other currencies as are the currencies of the countries
in which the Fund maintains Investments or in such other currencies as the Fund
shall from time to time request by Instruction.
7.1 TYPES OF CASH ACCOUNTS. Cash accounts opened on the books of the
Custodian (PRINCIPAL ACCOUNTS) shall be opened in the name of the Fund. Such
accounts collectively shall be a deposit obligation of the Custodian and shall
be subject to the terms of this Section 7 and the general liability provisions
contained in Section 10. Cash accounts opened on the books of a Subcustodian may
be opened in the name of the Fund, in the name of the Custodian or in the name
of the Custodian for its customers generally, but reflected on the books of the
Custodian as being held for the Fund (AGENCY ACCOUNTS). Such deposits shall be
obligations of the Subcustodian and shall be treated as an Investment of the
Fund. Accordingly, the Custodian shall be responsible for exercising reasonable
care in the administration of such accounts but shall not be liable for their
repayment in the event such Subcustodian, by reason of its bankruptcy,
insolvency or otherwise, fails to make repayment. Nothing in this section shall
relieve the Custodian from responsibility for selection and monitoring of
Foreign or Domestic Subcustodians with due care as required by the terms of this
Agreement.
7.2 PAYMENTS AND CREDITS WITH RESPECT TO THE CASH ACCOUNTS. The
Custodian shall make payments from or deposits to any of said accounts in the
course of carrying out its administrative duties, including but not limited to
income collection with respect to the Fund's Investments, payments of dividends
and distributions to Fund shareholders, payments of Fund expenses, and otherwise
in accordance with Instructions. The Custodian and its Subcustodians shall be
required to credit amounts to the cash accounts only when moneys are actually
received in cleared funds in accordance with banking practice in the country and
currency of deposit. Any credit made to any Principal or Agency
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Account before actual receipt of cleared funds shall be provisional and may be
reversed by the Custodian in the event such payment is not actually collected.
The Custodian shall give the Fund prompt notice of any such reversal. Unless
otherwise specifically agreed in writing by the Custodian or any Subcustodian,
all deposits shall be payable only at the branch of the Custodian or
Subcustodian where the deposit is made or carried.
7.3 CURRENCY AND RELATED RISKS. Except as otherwise provided herein,
the Fund bears risks of holding or transacting in any currency. Except as
otherwise provided herein, the Custodian shall not be liable for any loss or
damage arising from the applicability of any law or regulation now or hereafter
in effect, or from the occurrence of any event, which may delay or adversely
affect the transferability, convertibility or availability of any currency in
the country (a) in which such Principal or Agency Accounts are maintained or (b)
in which such currency is issued, and in no event shall the Custodian be
obligated to make payment of a deposit denominated in a currency during the
period during which its transferability, convertibility or availability has been
prevented or adversely affected by any such law, regulation or event. Without
limiting the generality of the foregoing, neither the Custodian nor any
Subcustodian shall be required to repay any deposit made at a foreign branch of
either the Custodian or Subcustodian if such branch cannot repay the deposit due
to a cause for which the Custodian would not be responsible in accordance with
the terms of Section 10 of this Agreement unless the Custodian or such
Subcustodian expressly agrees in writing to repay the deposit under such
circumstances. All currency transactions in any account opened pursuant to this
Agreement are subject to exchange control regulations of the United States and
of the country where such currency is the lawful currency or where the account
is maintained. Any taxes, costs, charges or fees imposed on the convertibility
of a currency held by the Fund shall be for the account of the Fund.
7.4 FOREIGN EXCHANGE TRANSACTIONS. The Custodian shall, subject to the
terms of this Section, settle foreign exchange transactions (including
contracts, futures, options and options on futures) on behalf and for the
account of the Fund with such currency brokers or banking institutions,
including Subcustodians, as the Fund may direct pursuant to Instructions. The
Custodian may act as principal in any foreign exchange transaction with the Fund
in accordance with Section 7.4.2 of this Agreement. The obligations of the
Custodian in respect of all foreign exchange transactions (whether or not the
Custodian shall act as principal in such transaction) shall be contingent on the
free, unencumbered transferability of the currency transacted on the actual
settlement date of the transaction unless such limitation was also in effect on
the trade date of the transaction.
7.4.1 THIRD PARTY FOREIGN EXCHANGE TRANSACTIONS. The
Custodian shall process foreign exchange transactions
(including without limitation contracts, futures, options, and
options on
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futures), where any third party acts as principal
counterparty to the Fund on the same basis it performs
duties as agent for the Fund with respect to any other of
the Fund's Investments. Accordingly the Custodian shall only
be responsible for delivering or receiving currency on
behalf of the Fund in respect of such contracts pursuant to
Instructions. The Custodian shall not be responsible for the
failure of any counterparty (including any Subcustodian) in
such agency transaction to perform its obligations
thereunder. The Custodian (a) shall transmit cash and
Instructions to and from the currency broker or banking
institution with which a foreign exchange contract or option
has been executed pursuant hereto, (b) may make free
outgoing payments of cash in the form of Dollars or foreign
currency without receiving confirmation of a foreign
exchange contract or option or confirmation that the
countervalue currency completing the foreign exchange
contract has been delivered or received or that the option
has been delivered or received and (c) shall hold all
confirmations, certificates and other documents and
agreements received by the Custodian and evidencing or
relating to such foreign exchange transactions in
safekeeping. The Fund accepts full responsibility for its
use of third-party foreign exchange dealers and for
execution of said foreign exchange contracts and options,
and understands that the Fund shall be responsible for any
and all costs and interest charges which may be incurred by
the Fund or the Custodian as a result of the failure or
delay of third parties to deliver foreign exchange. Nothing
in this section shall relieve the Custodian of its
responsibility for its own actions in connection with such
transactions.
7.4.2 FOREIGN EXCHANGE WITH THE CUSTODIAN AS
PRINCIPAL. The Custodian may undertake foreign exchange
transactions with the Fund as principal as the Custodian and
the Fund may agree from time to time. In such event, the
foreign exchange transaction will be performed in accordance
with the particular agreement of the parties, or in the event
a principal foreign exchange transaction is initiated by
Instruction in the absence of specific agreement, such
transaction will be performed in accordance with the usual
commercial terms of the Custodian.
7.5 DELAYS. In the event that a delay shall have been caused by the
negligence, bad faith or willful misconduct of the Custodian in carrying out an
Instruction to credit or transfer cash, the Custodian shall be liable to and
indemnify the Fund for damages, plus: (a) with respect to Principal Accounts,
for interest to be calculated at the rate customarily paid on such deposit and
currency by the Custodian on overnight deposits at the time the delay occurs for
the period from the day when the transfer should have been effected until the
day it is in fact effected; and, (b) with respect to Agency Accounts, for
interest to be calculated at the rate customarily paid on such deposit and
currency by the Subcustodian on overnight deposits at the time the delay occurs
for the period from the day when the transfer should have been effected until
the day it is in fact effected. The Custodian shall not be liable for delays in
carrying out such Instructions to transfer cash that are not due to the
Custodian's own negligence, bad faith or willful misconduct.
7.6 ADVANCES. If, for any reason in the proper conduct of its
safekeeping duties pursuant to Section 5 hereof or its administration of the
Fund's assets pursuant to Section 6 hereof, the Custodian or any Subcustodian
advances monies to facilitate settlement or otherwise for benefit of the Fund
(whether or not any Principal or Agency Account shall be overdrawn either
during, or at the end of, any Business Day), the Fund hereby does:
7.6.1 acknowledge that the Fund shall have no right
or title to any Investments purchased with such Advance save a
right to receive such Investments upon: (a) the debit of the
Principal or Agency Account; or, (b) if such debit would
12
produce an overdraft in such account, other reimbursement of
the associated Advance;
7.6.2 grant to the Custodian a security interest in
all Investments; and,
7.6.3 agree that the Custodian may secure the
resulting Advance by perfecting a security interest in all
Investments under Applicable Law.
Neither the Custodian nor any Subcustodian shall be obligated to
advance monies to the Fund, and in the event that such Advance occurs, any
transaction giving rise to an Advance shall be for the account and risk of the
Fund and shall not be deemed to be a transaction undertaken by the Custodian for
its own account and risk. If such Advance shall have been made by a Subcustodian
or any other person, the Custodian may assign the security interest and any
other rights granted to the Custodian hereunder to such Subcustodian. If the
Fund shall fail to repay when due the principal balance of an Advance and
accrued and unpaid interest thereon, the Custodian or its assignee, as the case
may be, shall be entitled to utilize the available cash balance in any Agency or
Principal Account and (to the extent that cash is insufficient) to dispose of
any Investments to the extent necessary to recover payment of all principal of,
and interest on, such Advance in full. The Custodian may assign any rights it
has under this Section to a Subcustodian. Any security interest in Investments
taken hereunder shall be treated as financial assets credited to securities
accounts under Articles 8 and 9 of the Uniform Commercial Code (1997).
Accordingly, the Custodian shall have the rights and benefits of a secured
creditor that is a securities intermediary under such Articles 8 and 9.
7.7 INTEGRATED ACCOUNT. For purposes hereof, deposits maintained in all
Principal Accounts (whether or not denominated in Dollars) shall collectively
constitute a single and indivisible current account with respect to a Fund's
obligations to the Custodian, or its assignee, and balances in such Principal
Accounts shall be available for satisfaction of the Fund's obligations under
this Section 7. The Custodian shall further have a right of offset against the
balances in any Agency Account maintained hereunder to the extent that the
aggregate of all Principal Accounts is overdrawn.
13
8. SUBCUSTODIANS AND SECURITIES DEPOSITORIES. Subject to the provisions
hereinafter set forth in this Section 8, the Fund hereby authorizes the
Custodian to utilize Securities Depositories to act on behalf of the Fund and to
appoint from time to time and to utilize Subcustodians. With respect to
Investments held by a Subcustodian, either directly or indirectly (including by
a Securities Depository or Clearing Corporation), notwithstanding any provisions
of this Agreement to the contrary, payment for securities purchased and delivery
of securities sold may be made prior to receipt of securities or payment,
respectively, and securities or payment may be received in a form, in accordance
with (a) governmental regulations, (b) rules of Securities Depositories and
clearing agencies, (c) generally accepted trade practice in the applicable local
market, (d) the terms and characteristics of the particular Investment, or (e)
the terms of Instructions.
8.1 DOMESTIC SUBCUSTODIANS AND SECURITIES DEPOSITORIES. The Custodian
may deposit and/or maintain, either directly or through one or more
agents appointed by the Custodian, Investments of the Fund in any
Securities Depository in the United States, including The Depository
Trust Company, provided such Depository meets applicable requirements
of the Federal Reserve Bank and of the Securities and Exchange
Commission. The Custodian may, at any time and from time to time,
appoint any bank as defined in Section 2(a)(5) of the 1940 Act meeting
the requirements of a custodian under Section 17(f) of the 1940 Act and
the rules and regulations thereunder, to act on behalf of the Fund as a
Subcustodian for purposes of holding Investments of the Fund in the
United States. The Custodian shall only use depositories that qualify
as such under Rule 17f-4 and shall hold Investments of the Fund in such
depositories in a manner consistent with the provisions of the rule
governing the manner in which a custodian may maintain securities in
such a depository.
8.2 FOREIGN SUBCUSTODIANS AND SECURITIES DEPOSITORIES. Unless
instructed otherwise by the Fund, the Custodian may deposit and/or
maintain non-U.S. Investments of the Fund in any non-U.S. Securities
Depository provided such Securities Depository meets the requirements
of an "eligible securities depository" under Rule 17f-7 promulgated
under the 1940 Act, or any successor rule or regulation ("Rule 17f-7")
or which by order of the Securities and Exchange Commission is exempted
therefrom. Prior to the time that securities are placed with such
depository, but subject to the provisions of Section 8.2.4 below, the
Custodian shall have prepared and delivered to the Fund a written
assessment of the custody risks associated with maintaining assets with
14
the Securities Depository and shall have established a system to
monitor such risks on a continuing basis in accordance with subsection
8.2.3 of this Section. Additionally, the Custodian may, at any time and
from time to time, appoint (a) any bank, trust company or other entity
meeting the requirements of an "eligible foreign custodian" under Rule
17f-5 or which by order of the Securities and Exchange Commission is
exempted therefrom, or (b) any bank as defined in Section 2(a)(5) of
the 1940 Act meeting the requirements of a custodian under Section
17(f) of the 1940 Act and the rules and regulations thereunder, to act
on behalf of the Fund as a Subcustodian for purposes of holding
Investments of the Fund outside the United States in accordance with
the Delegation Schedule. Such appointment of foreign Subcustodians
shall be subject to approval of the Fund in accordance with Subsections
8.2.1 and 8.2.2 hereof, and use of non-U.S. Securities Depositories
shall be subject to the terms of Subsections 8.2.3 and 8.2.4 hereof. An
Instruction to open an account in a given country shall comprise
authorization of the Custodian to hold assets in such country in
accordance with the terms of this Agreement. The Custodian shall not be
required to make independent inquiry as to the Fund's ability to invest
in such country. Nothing in this Section shall relieve the Custodian of
its responsibility for performance of its duties under Section 8.2.3 or
the Delegation Schedule.
8.2.1 BOARD APPROVAL OF FOREIGN SUBCUSTODIANS. Unless
and except to the extent that the Board has delegated to and
the Custodian has accepted delegation of review of certain
matters concerning the appointment of Subcustodians pursuant
to Subsection 8.2.2 below, the Custodian shall, prior to the
appointment of any Subcustodian for purposes of holding
Investments of the Fund outside the United States, obtain
written confirmation of the approval of the Board of Trustees
or Directors of the Fund with respect to (a) the identity of a
Subcustodian, and (b) the Subcustodian agreement which shall
govern such appointment, such approval to be signed by an
Authorized Person.
8.2.2 DELEGATION OF BOARD REVIEW OF SUBCUSTODIANS.
From time to time, the Custodian may agree to perform certain
reviews of Subcustodians and of Subcustodian Contracts as
delegate of the Fund's Board. In such event, the Custodian's
duties and obligations with respect to this delegated review
will be performed in accordance with the terms of the attached
Delegation Schedule to this Agreement.
8.2.3 MONITORING AND RISK ASSESSMENT OF SECURITIES
DEPOSITORIES. Prior to the placement of any assets of the Fund
with a non-U.S. Securities Depository, the Custodian: (a)
shall provide to the Fund or its authorized representative a
written assessment of the custody risks associated with
maintaining assets within such Securities Depository, which
shall include a determination as to whether the Securities
Depository qualifies as an "eligible securities depository" as
defined under Rule 17f-7; (b) shall have established a system
to monitor the custody risks associated with maintaining
assets with such Securities Depository and the continued
qualification of the Depository as an "eligible securities
depository" on a continuing basis, and to promptly notify the
Fund or its Investment Adviser of any material changes in such
risk or qualification; and (c) will promptly notify Fund in
writing of any such material changes. In performing its duties
under this subsection, the Custodian shall use reasonable
care, prudence and diligence, and may rely on such reasonable
sources of information as may be available including but not
limited to: (i) published ratings; (ii) information supplied
by a Subcustodian that is a participant in such Securities
Depository;
15
(iii) industry surveys or publications; (iv) information
supplied by the depository itself, by its auditors (internal
or external) or by the relevant Foreign Financial Regulatory
Authority. It is acknowledged that information procured
through some or all of these sources may not be
independently verifiable by the Custodian and that direct
access to Securities Depositories is limited under most
circumstances. Accordingly, the Custodian shall not be
responsible for errors or omissions in its duties hereunder
provided that it has acted with reasonable care in
performing its monitoring and assessment duties, gathering
such information, choosing such sources, and relying on such
information and sources. The risk assessment shall be
provided to the Fund or its Investment Advisor by such means
as the Custodian and Fund shall reasonably agree. Advices of
material change in such assessment may be provided by the
Custodian in the manner established as customary between the
Fund and the Custodian for transmission of material market
information.
8.3 RESPONSIBILITY FOR SUBCUSTODIANS. Except as provided in the last
sentence of this Section 8.3, the Custodian shall be liable to the Fund for any
loss or damage to the Fund caused by or resulting from the acts or omissions of
any Subcustodian to the extent that the Custodian would be liable to the Fund
hereunder.
8.4 NEW COUNTRIES. The Custodian and the Fund will work together in
good faith to arrange for custody in such new markets as the Fund may request,
recognizing that it may not be possible to secure an eligible foreign custodian
meeting the requirements of Rule 17f-5 under the Act. The Fund shall be
responsible for informing the Custodian sufficiently in advance of a proposed
investment which is to be held in a country in which no Subcustodian is
authorized to act in order that the Custodian shall, if it deems appropriate to
do so, have sufficient time to establish a subcustodial arrangement in
accordance herewith. In the event, however, the Custodian is unable to establish
such arrangements prior to the time such investment is to be acquired, the
Custodian is authorized to designate at its discretion a local safekeeping
agent, and the use of such local safekeeping agent shall be at the sole risk of
the Fund.
9. THIRD PARTY SECURITIES LENDING. In addition to the Custodian's
other responsibilities hereunder, the Fund hereby directs the Custodian to,
among the other activities as shall be set forth in the 3rd Party Lending
Agent/BBH&Co. Securities Lending Operating Document (the "Guidelines") by and
among the Fund, the Custodian and the Fund's designated third party lending
agent (the "Lending Agent"), deliver securities out of custody to a borrower and
to receive securities from a borrower (the "Securities Lending Activities") in
accordance with instructions received from time to time from the Lending Agent.
In so directing the Custodian, both parties agree that the Custodian shall be
responsible for exercising reasonable care in acting on the instructions of the
Lending Agent. But, absent Custodian's negligence, bad faith and willful
misconduct in the performance of its duties under this Agreement, the Custodian
shall not be liable to the Fund for the acts or omissions of the Lending Agent
and for any risks in connection with Securities Lending Activities. Accordingly,
the Fund hereby acknowledges certain risks inherent in the lending of securities
16
through a third party lending agent, including, but not limited to such risks as
outlined below, and agrees that such risks are for the account of the Fund:
o the failure or insolvency of any third party (including any issuer of any
of security which is a part of the Securities Lending Activities or
book-entry or other agent of such an issuer, any counterparty with respect
to any such securities, a borrower, the Lending Agent, or any other third
parties similarly beyond the control or choice of the Custodian);
o the default of a borrower and any resulting damages;
o the late return of loaned securities by the borrower which results in
market buy-ins, or failed trades and the penalties and costs related
thereto resulting from the late return of a loan, a late or incorrect loan
instruction, or any other reason for which the Custodian is not
responsible;
o the failure of any third party including the Lending Agent to inform the
Custodian, the Fund or a borrower of pending corporate actions;
o the failure of the Custodian to inform the Lending Agent, the Fund or a
borrower of pending corporate actions for securities of a particular issuer
on loan, but only to the extent that all such securities are on loan when
the Custodian receives notice of the corporate action;
o the receipt of collateral in connection with securities lending activities
(including any xxxx to market of an outstanding loan), which shall be held
by the Lending Agent or its agent;
o the market risks associated with the investment of collateral;
o the legal, tax or regulatory issues inherent in any jurisdiction in which
securities are loaned; and
o the failure of the Lending Agent to properly safe keep and administer any
securities of the Fund held overnight by the Lending Agent.
The Fund further acknowledges and agrees in connection with the Securities
Lending Activities, that the Custodian in its sole discretion may refuse to
settle any transaction for certain types of securities, or any transaction
occurring in certain markets in contravention of applicable law or regulation or
which might give rise to material adverse tax consequences. In the event that
the Fund or its Lending Agent transmits an instruction to which the previous
sentence applies, the Custodian shall promptly provide the Fund with written or
other agreed-form notice of such fact.
10. RESPONSIBILITY OF THE CUSTODIAN. In performing its duties and obligations
hereunder, the Custodian shall exercise good faith, and use reasonable care.
Subject to the specific provisions of this Section, the Custodian shall be
17
liable for any damage incurred by the Fund in consequence of the Custodian's (or
its employees, partners or officers) negligence, bad faith or willful
misconduct. In no event shall either party be liable hereunder to the other for
any special, indirect, punitive or consequential damages arising out of,
pursuant to or in connection with this Agreement. It is agreed that, except as
otherwise provided herein, the Custodian shall have no duty to assess the risks
inherent in the Fund's Investments or to provide investment advice with respect
to such Investments and that the Fund as principal shall bear any risks
attendant to particular Investments such as failure of counterparty or issuer.
10.1 LIMITATIONS OF PERFORMANCE. The Custodian shall not be responsible
under this Agreement for any failure to perform its duties, and shall not liable
hereunder for any loss or damage in association with such failure to perform,
for or in consequence of the following causes:
10.1.1 FORCE MAJEURE. FORCE MAJEURE shall mean any
circumstance or event which is beyond the reasonable control
of the Fund, Custodian, a Subcustodian or any agent of the
Custodian or a Subcustodian and which adversely affects the
performance by the Fund or the Custodian of its obligations
hereunder, by the Subcustodian of its obligations under its
Subcustody Agreement or by any other agent of the Custodian or
the Subcustodian, including any event beyond the relevant
party's reasonable control which caused by, arising out of or
involving (a) an act of God, (b) accident, fire, water damage
or explosion, (c) any computer, system or other equipment
failure or malfunction caused by any computer virus or the
malfunction or failure of any communications medium, (d) any
interruption of the power supply or other utility service, (e)
any strike or other work stoppage, whether partial or total,
(f) any delay or disruption resulting from or reflecting the
occurrence of any Sovereign Risk, (g) any disruption of, or
suspension of trading in, the securities, commodities or
foreign exchange markets, whether or not resulting from or
reflecting the occurrence of any Sovereign Risk, (h) any
encumbrance on the transferability of a currency or a currency
position on the actual settlement date of a foreign exchange
transaction, whether or not resulting from or reflecting the
occurrence of any Sovereign Risk, or (i) any other cause
similarly beyond the party's reasonable control.
The Fund shall not be responsible under this Agreement and
shall not be liable hereunder for any loss or damage in
consequence of any Force Majeure circumstance or event.
10.1.2 COUNTRY RISK. COUNTRY RISK shall mean, with
respect to the acquisition, ownership, settlement or custody
of Investments in a jurisdiction, all risks relating to, or
arising in consequence of, systemic and markets factors
affecting the acquisition, payment for or ownership of
Investments including (a) the prevalence of crime and
corruption, (b) the inaccuracy or unreliability of business
and financial information, (c) the instability or volatility
of banking and financial systems, or the absence or inadequacy
of an infrastructure to support such systems, (d) custody and
settlement infrastructure of the market in which such
Investments are transacted and held, (e) the acts, omissions
and operation of any Securities Depository, (f) the risk of
the bankruptcy or insolvency of banking agents, counterparties
to cash and securities transactions, registrars or transfer
agents, and (g) the existence of market conditions which
prevent the orderly execution or settlement of transactions or
which affect the value of assets. Nothing under this section
shall relieve the Custodian of its responsibilities under
Section 8.2.3 of this Agreement or the Delegation Schedule
attached hereto.
18
10.1.3 SOVEREIGN RISK. SOVEREIGN RISK shall mean, in
respect of any jurisdiction, including the United States of
America, where Investments is acquired or held hereunder or
under a Subcustody Agreement, all risks of (a) any act of war,
terrorism, riot, insurrection or civil commotion, (b) the
imposition of any investment, repatriation or exchange control
restrictions by any governmental authority, (c) the
confiscation, expropriation or nationalization of any
Investments by any governmental authority, whether de facto or
de jure, (iv) any devaluation or revaluation of the currency,
(d) the imposition of taxes, levies or other charges affecting
Investments, (vi) any change in the Applicable Law, or (e) any
other economic or political risk incurred or experienced.
Nothing in this section shall relieve Custodian of its obligations
under Section 8.2.3.
10.2. LIMITATIONS ON LIABILITY. The Custodian shall not be liable for
any loss, claim, damage or other liability arising from the following
causes:
10.2.1 FAILURE OF THIRD PARTIES. The failure of any
third party (other than a Subcustodian or agent for which the
Custodian is responsible in accordance with the terms of this
Agreement) including: (a) any issuer of Investments or
book-entry or other agent of and issuer; (b) any counterparty
with respect to any Investment, including any issuer of
exchange-traded or other futures, option, derivative or
commodities contract; (c) failure of an Investment Advisor,
Foreign Custody Manager or other agent (other than a
Subcustodian or agent for which the Custodian is responsible
in accordance with the terms of this Agreement) of the Fund;
or (d) failure of other third parties similarly beyond the
control or choice of the Custodian.
10.2.2 INFORMATION SOURCES. The Custodian may rely
upon information received from issuers of Investments or
agents of such issuers, information received from
Subcustodians and from other commercially reasonable sources
such as commercial data bases, but shall not be responsible
for specific inaccuracies in such information, provided that
the Custodian has relied upon such information in good faith
and has acted with reasonable care.
10.2.3 RELIANCE ON INSTRUCTION. Action by the
Custodian or the Subcustodian in accordance with an
Instruction, even when such action conflicts with, or is
contrary to any provision of, the Fund's declaration of trust,
certificate of incorporation or by-laws, Applicable Law, or
actions by the trustees, directors or shareholders of the
Fund.
10.2.4 RESTRICTED SECURITIES. The limitations
inherent in the rights, transferability or similar investment
characteristics of a given Investment of the Fund.
11. INDEMNIFICATION. Except for such claims and liabilities as may arise from
the negligence, bad faith willful misconduct or other breach of this Agreement,
each Fund hereby indemnifies the Custodian and each Subcustodian, and their
respective agents, nominees and the partners, employees, officers and directors,
and agrees to hold each of them harmless from and against all claims and
liabilities, including counsel fees and taxes, incurred or assessed against any
of them in connection with the performance of this Agreement, any Instruction
and the Securities Lending Activities. If a Subcustodian or any other person
indemnified under the preceding sentence, gives written notice of claim to the
19
Custodian, the Custodian shall promptly give written notice to the Fund. Not
more than thirty (30) days following the date of such notice, unless the
Custodian shall be liable under Section 8 hereof in respect of such claim, the
Fund will pay the amount of such claim or reimburse the Custodian for any
payment made by the Custodian in respect thereof. Except for such claims and
liabilities as may arise from the Fund's negligence, bad faith, willful
misconduct or other breach of this Agreement, the Custodian hereby indemnifies
the Fund and its employees, officers, trustees and agents, and agrees to hold
each of them harmless from and against all claims and liabilities, including
counsel fees and taxes, incurred or assessed against any of them for which the
Custodian is responsible under this Agreement.
12. REPORTS AND RECORDS. The Custodian shall:
12.1 create and maintain records relating to the performance
of its obligations under this Agreement (including without limitation
such reports as may be required pursuant to Section 31(a) of the 1940
Act and the rules thereunder) ;
12.2 make available to the Fund, its auditors, agents and
employees, during regular business hours of the Custodian, upon
reasonable request and during normal business hours of the Custodian,
all records maintained by the Custodian pursuant to paragraph 12.1
above, subject, however, to all reasonable security requirements of the
Custodian then applicable to the records of its custody customers
generally; and
12.3 make available to the Fund all Electronic Reports; it
being understood that the Custodian shall not be liable hereunder for
the inaccuracy or incompleteness thereof or for errors in any
information included therein.
The Fund shall examine all records, howsoever produced or transmitted,
promptly upon receipt thereof and notify the Custodian promptly of any
discrepancy or error therein. Unless the Fund delivers written notice of any
such discrepancy or error within a reasonable time after its receipt thereof,
such records shall be deemed to be true and accurate. It is understood that the
Custodian now obtains and will in the future obtain information on the value of
assets from outside sources that may be utilized in certain reports made
available to the Fund. The Custodian deems such sources to be reliable but it is
acknowledged and agreed that the Custodian does not verify nor represent nor
warrant as to the accuracy or completeness of such information and accordingly
shall be without liability in selecting and using such sources and furnishing
such information.
20
13. MISCELLANEOUS.
13.1 LIMITATION OF LIABILITY. The execution and delivery of this
Agreement have been authorized by the Board of Trustees of each Fund and signed
by an authorized officer of each 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, and the obligations of this Agreement are
not binding upon any of the Trustees or Shareholders of the Funds, but bind only
the appropriate property of the Fund, portfolio, or Class, as provided in the
relevant Trust's Declaration of Trust. Further, no Fund or portfolio will be
liable or responsible for the acts, omissions or obligations of another Fund or
portfolio.
13.2 PROXIES, ETC. The Fund will promptly execute and deliver, upon
request, such proxies, powers of attorney or other instruments as may be
necessary or desirable for the Custodian to provide, or to cause any
Subcustodian to provide, the services contemplated by this Agreement.
13.3 ENTIRE AGREEMENT. Except as specifically provided herein, this
Agreement (together with any exhibits, schedules or other agreements or
documents referenced herein) constitutes the entire agreement between the Fund
and the Custodian with respect to the subject matter hereof. Accordingly, this
Agreement supersedes any custody agreement or other oral or written agreements
heretofore in effect between the Fund and the Custodian with respect to the
custody of the Fund's Investments.
13.4 WAIVER AND AMENDMENT. No provision of this Agreement may be
waived, amended or modified, and no addendum to this Agreement shall be or
become effective, or be waived, amended or modified, except by an instrument in
writing executed by the party against which enforcement of such waiver,
amendment or modification is sought; provided, however, that an Instruction
shall, whether or not such Instruction shall constitute a waiver, amendment or
modification for purposes hereof, shall be deemed to have been accepted by the
Custodian when it commences actions pursuant thereto or in accordance therewith.
13.5 GOVERNING LAW AND JURISDICTION. THIS AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH, AND BE GOVERNED BY THE LAWS OF, THE STATE OF NEW YORK,
WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW OF SUCH STATE. The parties hereby
agree to the non-exclusive jurisdiction of federal courts sitting in the State
of New York or the Commonwealth of Massachusetts, or of the State courts of
21
either such State or such Commonwealth.
13.6 NOTICES. Notices and other writings contemplated by this
Agreement, other than Instructions, shall be delivered (a) by hand, (b) by first
class registered or certified mail, postage prepaid, return receipt requested,
(c) by a nationally recognized overnight courier, or (d) by facsimile
transmission, provided that any notice or other writing sent by facsimile
transmission shall also be mailed, postage prepaid, to the party to whom such
notice is addressed. All such notices shall be addressed, as follows:
If to the Fund:
Attn: ]
Telephone: [ ]
Facsimile [ ]
If to the Custodian:
Xxxxx Brothers Xxxxxxxx & Co.
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Manager, Securities Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000,
or such other address as the Fund or the Custodian may have designated
in writing to the other.
13.7 HEADINGS. Paragraph headings included herein are for convenience
of reference only and shall not modify, define, expand or limit any of the terms
or provisions hereof.
13.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original. This Agreement shall
become effective when one or more counterparts have been signed and delivered by
the Fund and the Custodian.
13.9 CONFIDENTIALITY. The parties hereto agree that each shall treat
confidentially the terms and conditions of this Agreement and all information
provided by each party to the other regarding its business and operations. All
22
confidential information provided by a party hereto shall be used by any other
party hereto solely for the purpose of rendering or obtaining services pursuant
to this Agreement and, except as may be required in carrying out this Agreement,
shall not be disclosed to any third party without the prior consent of such
providing party. The foregoing shall not be applicable to any information that
is publicly available when provided or thereafter becomes publicly available
other than through a breach of this Agreement, or that is required to be
disclosed by or to any bank examiner of the Custodian or any Subcustodian, any
Regulatory Authority, any auditor of the parties hereto, or by judicial or
administrative process or otherwise by Applicable Law.
13.10 COUNSEL. In fulfilling its duties hereunder, the Custodian shall
be entitled to receive and act upon the advice of (i) counsel regularly retained
by the Custodian in respect of such matters, (ii) counsel for the Fund or (iii)
such counsel as the Fund and the Custodian may agree upon, with respect to all
matters, and, provided that the Fund has been appropriately notified of such
advice, the Custodian shall be without liability for any action reasonably taken
or omitted pursuant to such advice.
14. DEFINITIONS. The following defined terms will have the respective meanings
set forth below.
14.1 ADVANCE(S) shall mean any extension of credit by or through the
Custodian or by or through any Subcustodian and shall include amounts paid to
third parties for account of the Fund or in discharge of any expense, tax or
other item payable by the Fund.
14.2 AGENCY ACCOUNT(S) shall mean any deposit account opened on the
books of a Subcustodian or other banking institution in accordance with Section
7.1 hereof.
14.3 AGENT(S) shall have the meaning set forth in the last sentence of
Section 6 hereof.
14.4 APPLICABLE LAW shall mean with respect to each jurisdiction, all
(a) laws, statutes, treaties, regulations, guidelines (or their equivalents);
(b) orders, interpretations licenses and permits; and (c) judgments, decrees,
injunctions writs, orders and similar actions by a court of competent
jurisdiction; compliance with which is required or customarily observed in such
jurisdiction.
14.5 AUTHORIZED PERSON(S) shall mean any person or entity authorized to
give Instructions on behalf of the Fund in accordance with Section 4.1 hereof.
14.6 BOOK-ENTRY AGENT(S) shall mean an entity acting as agent for the
issuer of Investments for purposes of recording ownership or similar entitlement
to Investments, including without limitation a transfer agent or registrar.
23
14.7 CLEARING CORPORATION shall mean any entity or system established
for purposes of providing securities settlement and movement and associated
functions for a given market.
14.8 DELEGATION SCHEDULE shall mean any schedule entered into between
the Custodian and the Fund or its authorized representative with respect to
certain matters concerning the appointment and administration of Subcustodians
delegated to the Custodian pursuant to Rule 17f-5 under the 1940 Act.
14.9 ELECTRONIC AND ONLINE SERVICES SCHEDULE shall mean any schedule to
this agreement entered into between the Custodian and the Fund or its authorized
representative with respect to certain matters concerning electronic and online
services as described therein and as may be made available from time to time by
the Custodian to the Fund.
14.10 ELECTRONIC REPORTS shall mean any reports prepared by the
Custodian and remitted to the Fund or its authorized representative via the
internet or electronic mail.
14.11 FOREIGN CUSTODY MANAGER shall mean the Fund's foreign custody
manager appointed pursuant to Rule 17f-5 under the 1940 Act.
14.12 FOREIGN FINANCIAL REGULATORY AUTHORITY shall have the meaning
given by Section 2(a)(50) of the 0000 Xxx.
14.13 FUNDS TRANSFER SERVICES SCHEDULE shall mean any schedule entered
into between the Custodian and the Fund or its authorized representative with
respect to certain matters concerning the processing of payment orders from
Principal Accounts of the Fund.
14.14 GUIDELINES shall have the meaning assigned in Section 9 hereof.
14.15 GLOBAL CUSTODY NETWORK LISTING shall mean the Countries approved
by the Fund and Subcustodians SELECTED by the Custodian in connection with
Investments in non-U.S. Markets.
14.16 INSTRUCTION(S) shall have the meaning assigned in Section 4
hereof.
14.17 INVESTMENT ADVISOR shall mean any person or entity that is an
Authorized Person to give Instructions with respect to the investment and
reinvestment of the Fund's Investments.
14.18 INVESTMENT(S) shall mean any investment asset of the Fund,
including without limitation securities, bonds, notes, and debentures as well as
receivables, derivatives, contractual rights or entitlements and other
intangible assets.
14.19 LENDING AGENT shall have the meaning assigned in Section 9
hereof.
24
14.20 MARGIN ACCOUNT shall have the meaning set forth in Section 6.4
hereof.
14.21 PRINCIPAL ACCOUNT(S) shall mean deposit accounts of the Fund
carried on the books of BBH&Co. as principal in accordance with Section 7
hereof.
14.22 SAFEKEEPING ACCOUNT shall mean an account established on the
books of the Custodian or any Subcustodian for purposes of segregating the
interests of the Fund (or clients of the Custodian or Subcustodian) from the
assets of the Custodian or any Subcustodian.
14.23 SECURITIES DEPOSITORY shall mean a central or book entry system
or agency established under Applicable Law for purposes of recording the
ownership and/or entitlement to investment securities for a given market that,
if a foreign Securities Depository, meets the definitional requirements of Rule
17f-7 under the 1940 Act.
14.24 SECURITIES LENDING ACTIVITIES shall have the meaning assigned in
Section 9 hereof.
14.25 SUBCUSTODIAN(S) shall mean each bank appointed by the Custodian
pursuant to Section 8 hereof, but shall not include Securities Depositories.
14.26 TRI-PARTY AGREEMENT shall have the meaning set forth in Section
6.4 hereof.
14.27 1940 ACT shall mean the Investment Company Act of 1940.
15. COMPENSATION. The Fund agrees to pay to the Custodian (a) a fee in an amount
set forth in the fee letter between the Fund and the Custodian in effect on the
date hereof or as amended from time to time, and (b) all out-of-pocket expenses
incurred by the Custodian, including the fees and expenses of all Subcustodians,
and payable from time to time provided that such fees and expenses are timely
accounted to the Fund. Amounts payable by the Fund under and pursuant to this
Section 14 shall be payable by wire transfer to the Custodian at BBH&Co. in New
York, New York.
16. TERMINATION. This Agreement may be terminated by either party in accordance
with the provisions of this Section. The provisions of this Agreement and any
other rights or obligations incurred or accrued by any party hereto prior to
25
termination of this Agreement shall survive any termination of this Agreement.
Upon termination the Custodian shall take reasonable and customary steps to
facilitate transition including, without limitation, the transfer of Fund
records.
16.1 NOTICE AND EFFECT. This Agreement may be terminated by either
party by written notice effective no sooner than seventy-five (75) consecutive
calendar days following the date that notice to such effect shall be delivered
to other party at its address set forth in paragraph 13.5 hereof.
16.2 SUCCESSOR CUSTODIAN. In the event of the appointment of a
successor custodian, it is agreed that the Investments of the Fund held by the
Custodian or any Subcustodian shall be delivered to the successor custodian in
accordance with reasonable Instructions. The Custodian agrees to cooperate with
the Fund in the execution of documents and performance of other actions
necessary or desirable in order to facilitate the succession of the new
custodian. If no successor custodian shall be appointed, the Custodian shall in
like manner transfer the Fund's Investments in accordance with Instructions.
16.3 DELAYED SUCCESSION. If no Instruction has been given as of the
effective date of termination, Custodian may at any time on or after such
termination date and upon ten (10) consecutive calendar days written notice to
the Fund either (a) deliver the Investments of the Fund held hereunder to the
Fund at the address designated for receipt of notices hereunder; or (b) deliver
any investments held hereunder to a bank or trust company having a
capitalization of $2,000,000 USD equivalent and operating under the Applicable
law of the jurisdiction where such Investments are located, such delivery to be
at the risk of the Fund. In the event that Investments or moneys of the Fund
remain in the custody of the Custodian or its Subcustodians after the date of
termination owing to the failure of the Fund to issue Instructions with respect
to their disposition or owing to the fact that such disposition could not be
accomplished in accordance with such Instructions despite diligent efforts of
the Custodian, the Custodian shall be entitled to compensation for its services
with respect to such Investments and moneys during such period as the Custodian
or its Subcustodians retain possession of such items and the provisions of this
Agreement shall remain in full force and effect until disposition in accordance
with this Section is accomplished.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed as of the date first above written.
26
XXXXX BROTHERS XXXXXXXX & CO. STI CLASSIC FUNDS
AND
STI CLASSIC VARIABLE TRUST
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxx
---------------------------- ------------------------------
Name: Xxxxxxx X. Xxxxxx Name: Xxxxxxx X. Xxxxx
Title: Partner Title: Vice President
Date: February 11, 2003 Date: February 13, 2003
27
FUNDS TRANSFER SERVICES SCHEDULE TO CUSTODIAN AGREEMENT
1. EXECUTION OF PAYMENT ORDERS. Xxxxx Brothers Xxxxxxxx & Co. (the CUSTODIAN) is
hereby instructed by STI Classic Funds and STI Classic Variable Trust (the
COMPANY) to execute each payment order, whether denominated in United States
dollars or other applicable currencies, received by the Custodian in the
Company's name as sender and authorized and confirmed by an Authorized Person as
defined in a Custodian Agreement dated as of January 29, 2003 by and between the
Custodian and the Company, as amended or restated from time thereafter (the
AGREEMENT), provided that the Company has sufficient available funds on deposit
in a Principal Account as defined in the Agreement and provided that the order
(i) is received by the Custodian in the manner specified in this Funds Transfer
Services Schedule or any amendment hereafter; (ii) complies with any written
instructions and restrictions of the Company as set forth in this Funds Transfer
Services Schedule or any amendment hereafter; (iii) is authorized by the Company
or is verified by the Custodian in compliance with a security procedure set
forth in Paragraph 2 below for verifying the authenticity of a funds transfer
communication sent to the Custodian in the name of the Company or for the
detection of errors set forth in any such communication; and (iv) contains
sufficient data to enable the Custodian to process such transfer.
2. SECURITY PROCEDURE. The Company hereby elects to use the procedure selected
below as its security procedure (the SECURITY PROCEDURE). The Security Procedure
will be used by the Custodian to verify the authenticity of a payment order or a
communication amending or canceling a payment order. The Custodian will act on
instructions received provided the instruction is authenticated by the Security
Procedure. The Company agrees and acknowledges in connection with (i) the size,
type and frequency of payment orders normally issued or expected to be issued by
the Company to the Custodian, (ii) all of the security procedures offered to the
Company by the Custodian, and (iii) the usual security procedures used by
customers and receiving banks similarly situated, that authentication through
the Security Procedure shall be deemed commercially reasonable for the
authentication of all payment orders submitted to the Custodian. The Company
hereby elects (PLEASE CHOOSE ONE) the following Security Procedure as described
below:
[ ] BIDS AND BIDS WORLDVIEW PAYMENT PRODUCTS. BIDS and BIDS Worldview
Payment Products, are on-line payment order authorization facilities
with built-in authentication procedures. The Custodian and the Company
shall each be responsible for maintaining the confidentiality of
passwords or other codes to be used by them in connection with BIDS.
The Custodian will act on instructions received through BIDS without
duty of further confirmation unless the Company notifies the Custodian
that its password is not secure.
[ ] SWIFT. The Custodian and the Company shall comply with SWIFT's
authentication procedures. The Custodian will act on instructions
received via SWIFT provided the instruction is authenticated by the
SWIFT system.
[ ] TESTED TELEX. The Custodian will accept payment orders sent by
tested telex, provided the test key matches the algorithmic key the
Custodian and Company have agreed to use.
[ ] COMPUTER TRANSMISSION. The Custodian is able to accept transmissions
sent from the Company's computer facilities to the Custodian's
computer facilities provided such transmissions are encrypted and
digitally certified or are otherwise authenticated in a reasonable
manner based on available technology. Such procedures shall be
established in an operating protocol between the Custodian and the
Company.
[ ] TELEFAX INSTRUCTIONS. A payment order transmitted to the Custodian by
telefax transmission shall transmitted by the Company to a telephone
number specified from time to time by the Custodian for such purposes.
If it detects no discrepancies, the Custodian will then either:
1. If the telefax requests a repetitive payment order, the
Custodian may call the Company at its last known telephone
number, request to speak to the Company or Authorized
Person, and confirm the authorization and the details of
the payment order (a CALLBACK); or
2. If the telefax requests a non-repetitive order, the
Custodian will perform a Callback.
All faxes must be accompanied by a fax cover sheet that indicates the
sender's name, company name, telephone number, fax number, number of
pages, and number of transactions or instructions attached.
28
[ ] Telephonic. A telephonic payment order shall be called into the
Custodian at the telephone number designated from time to time by the
Custodian for that purpose. The caller shall identify herself/himself
as an Authorized Person. The Custodian shall obtain the payment order
data from the caller. The Custodian shall then:
1. If a telephonic repetitive payment order, the Custodian
may perform a Callback; or
2. If a telephonic non-repetitive payment order, the
Custodian will perform a Callback.
In the event the Company chooses a procedure which is not a Security Procedure
as described above, the Company agrees to be bound by any payment order (whether
or not authorized) issued in its name and accepted by the Custodian in
compliance with the procedure selected by the Company.
3. REJECTION OF PAYMENT ORDERS. The Custodian shall give the Company prompt
notice of the Custodian's rejection of a payment order. Such notice may be given
in writing or orally by telephone, each of which is hereby deemed commercially
reasonable. In the event the Custodian fails to execute a properly executable
payment order and fails to give the Company immediate notice of the Custodian's
non-execution, the Custodian shall be liable only for the Company's actual
damages. Notwithstanding anything in this Funds Transfer Services Schedule and
the Agreement to the contrary, the Custodian shall in no event be liable for any
consequential or special damages under this Funds Transfer Services Schedule,
even if the Custodian has been advised of the possibility of such damages.
4. CANCELLATION OF PAYMENT ORDERS. The Company may cancel a payment order but
the Custodian shall have no liability for the Custodian's failure to act on a
cancellation instruction unless the Custodian has received such cancellation
instruction at a time and in a manner affording the Custodian reasonable
opportunity to act prior to the Custodian's execution of the order. Any
cancellation shall be sent and confirmed in the manner set forth in Paragraph 2
above.
5. RESPONSIBILITY FOR THE DETECTION OF ERRORS AND UNAUTHORIZED PAYMENT ORDERS.
Except as may be provided, the Custodian is not responsible for detecting any
Company error contained in any payment order sent by the Company to the
Custodian. In the event that the Company's payment order to the Custodian either
(i) identifies the beneficiary by both a name and an identifying or bank account
number and the name and number identify different persons or entities, or (ii)
identifies any bank by both a name and an identifying number and the number
identifies a person or entity different from the bank identified by name,
execution of the payment order, payment to the beneficiary, cancellation of the
payment order or actions taken by any bank in respect of such payment order may
be made solely on the basis of the number. The Custodian shall not be liable for
interest on the amount of any payment order that was not authorized or was
erroneously executed unless the Company so notifies the Custodian within thirty
(30) business days following the Company's receipt of notice that such payment
order had been processed. If a payment order in the name of the Company and
accepted by the Custodian was not authorized by the Company, the liability of
the parties will be governed by the applicable provisions of UCC 4A.
6. LAWS AND REGULATIONS. The rights and obligations of the Custodian and the
Company with respect to any payment order executed pursuant to this Funds
Transfer Services Schedule will be governed by any applicable laws, regulations,
circulars and funds transfer system rules, the laws and regulations of the
United States of America and of other relevant countries including exchange
control regulations and limitations on dealings or other sanctions, and
including without limitation those sanctions imposed under the law of the United
States of America by the Office of Foreign Assets Control (OFAC). The Custodian
represents and warrants that it has established and maintains controls and
procedures reasonably designed to comply with OFAC regulations, and with all
applicable anti-money laundering laws or regulations, including but not limited
to the USA Patriot Act of 2001. Any taxes, fines, costs, charges or fees imposed
by relevant authorities on such transactions shall be for the account of the
Company.
7. MISCELLANEOUS. All accounts opened by the Company or its authorized agents at
the Custodian subsequent to the date hereof shall be governed by this Funds
Transfer Schedule. All terms used in this Funds Transfer Services Schedule shall
have the meaning set forth in Article 4A of the Uniform Commercial Code as
currently in effect in the State of New York (UCC 4A) unless otherwise set forth
herein. The terms and conditions of this Funds Transfer Services Schedule are in
addition to, and do not modify or otherwise affect, the terms and conditions of
the Agreement and any other agreement or arrangement between the parties hereto.
The execution and delivery of this Agreement have been authorized by the Board
of Trustees of each Fund and signed by an authorized officer of each 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, and
the obligations of this Agreement are not binding upon any of the Trustees or
29
Shareholders of the Funds, but bind only the appropriate property of the Fund,
portfolio, or Class, as provided in the relevant Trust's Declaration of Trust.
Further, no Fund or portfolio will be liable or responsible for the acts,
omissions or obligations of another Fund or portfolio.
8. INDEMNIFICATION. The Custodian does not recommend the sending of instructions
by telefax or telephonic means as provided in Paragraph 2. BY ELECTING TO SEND
INSTRUCTIONS BY TELEFAX OR TELEPHONIC MEANS, THE COMPANY AGREES TO INDEMNIFY THE
CUSTODIAN AND ITS PARTNERS, OFFICERS AND EMPLOYEES FOR ALL LOSSES THEREFROM.
---------------------------------------------
OPTIONAL: The Custodian will perform a Callback if
instructions are sent by telefax or telephonic means as provided in
Paragraph 2. THE COMPANY MAY, AT ITS OWN RISK AND BY HEREBY AGREEING TO
INDEMNIFY THE CUSTODIAN AND ITS PARTNERS, OFFICERS AND EMPLOYEES FOR
ALL LOSSES THEREFROM )EXCEPT AS MAY ARISE FROM THE GROSS NEGLIGENCE,
WILL MISCONDUCT OR ACTIVE COLLUSION OF THE CUSTODIAN), ELECT TO WAIVE A
CALLBACK BY THE CUSTODIAN BY INITIALLING HERE:____
---------------------------------------------
Accepted and agreed:
XXXXX BROTHERS XXXXXXXX & CO. STI CLASSIC FUNDS
AND
STI CLASSIC VARIABLE TRUST
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxx
---------------------------- ------------------------------
Name: Xxxxxxx X. Xxxxxx Name: Xxxxxxx X. Xxxxx
Title: Partner Title: Vice President
Date: February 11, 2003 Date: February 13, 2003
30
ELECTRONIC AND ON-LINE SERVICES
SCHEDULE
This Electronic and On-Line Services Schedule (this SCHEDULE) to a Custodian
Agreement dated as of January 29, 2003 (as amended from time to time hereafter,
the AGREEMENT) by and between Xxxxx Brothers Xxxxxxxx & Co. (WE, US, OUR) and
STI Classic Funds and STI Classic Variable Trust (YOU, YOUR OR FUND), provides
general provisions governing your use of and access to the Services (as
hereinafter defined) provided to you by us via the Internet (at xxx.xxxxx.xxx or
such other URL as we may instruct you to use to access our products) and via a
direct dial-up connection between your computer and our computers, as of January
29, 2003 (the EFFECTIVE DATE). Use of the Services constitutes acceptance of the
terms and conditions of this Schedule, any Appendices hereto, the Terms and
Conditions posted on our web site, and any terms and conditions specifically
governing a particular Service or our other products, which may be set forth in
the Agreement or in a separate related agreement (collectively, the RELATED
AGREEMENTS).
1. GENERAL TERMS.
You will be granted access to our suite of online products, which may
include, but shall not be limited to the following services via the
Internet or dial-up connection (each separate service is a SERVICE;
collectively referred to as the SERVICES):
1.1. BIDS(R) and BIDS WorldView, a system for effectuating securities and
fund trade instruction and execution, processing and handling
instructions, and for the input and retrieval of other information;
1.2. F/X WorldView, a system for executing foreign exchange trades;
1.3. Fund WorldView, a system for receiving fund and prospectus
information;
1.4. BBHCOnnect, a system for placing securities trade instructions and
following the status and detail of trades;
1.5. ActionViewSM, a system for receiving certain corporate action
information;
1.6. Risk View, an interactive portfolio risk analysis tool; and
1.7. Such other services as we shall from time to time offer.
2. SECURITY / PASSWORDS.
2.1. A digital certificate and/or an encryption key may be required to
access certain Services. You may apply for a digital certificate
and/or an encryption key by following the procedures set forth at
xxxx://xxx.xxx.xxx/xxxxx/. You also will need an identification code
(ID) and password(s) (PASSWORD) to access the Services.
2.2. You agree to safeguard your digital certificate and/or encryption
key, ID, and Password and not to give or make available,
intentionally or otherwise, your digital certificate, ID, and/or
Password to any unauthorized person. You must immediately notify us
in writing if you believe that your digital certificate and/or
encryption key, Password, or ID has been compromised or if you
suspect unauthorized access to your account by means of the Services
or otherwise, or when a person to whom a digital certificate and/or
an encryption key, Password, or ID has been assigned leaves or is no
longer permitted to access the Services.
2.3. We will not be responsible for any breach of security, or for any
unauthorized trading or theft by any third party, caused by your
failure (be it intentional, unintentional, or negligent) to maintain
the confidentiality of your ID and/or Password and/or the security
of your digital certificate and/or encryption key.
3. INSTRUCTIONS.
3.1. Proper instructions under this Schedule shall be provided as
designated in the Related Agreements (INSTRUCTIONS).
31
3.2. The following additional provisions apply to Instructions provided
via the Services:
a. Instructions sent by electronic mail will not be accepted or
acted upon.
b. You authorize us to act upon Instructions received through the
Services utilizing your digital certificate, ID, and/or Password
as though they were duly authorized written instructions,
without any duty of verification or inquiry on our part, and
agree to hold us harmless for any losses you experience as a
result.
c. From time to time, the temporary unavailability of third party
telecommunications or computer systems required by the Services
may result in a delay in processing Instructions. In such an
event, we shall not be liable to you or any third party for any
liabilities, losses, claims, costs, damages, penalties, fines,
obligations, or expenses of any kind (including without
limitation, reasonable attorneys', accountants', consultants',
or experts' fees and disbursements) that you experience due to
such a delay.
4. ELECTRONIC DOCUMENTS.
We may make periodic statements, disclosures, notices, and other documents
available to you electronically, and, subject to any delivery and receipt
verification procedures required by law, you agree to receive such
documents electronically and to check the statements for accuracy. You may
also opt to receive printed reports. If you believe any such statement
contains incorrect information, you must follow the procedures set forth in
the Related Agreement(s).
5. MALICIOUS CODE.
[You understand and agree that you will be responsible for the introduction
(by you, your employees, agents, or representatives) into the Services,
whether intentional or unintentional, of (i) any virus or other code,
program, or sub-program that damages or interferes with the operation of
the computer system containing the code, program or sub-program, or halts,
disables, or interferes with the operation of the Services themselves; or
(ii) any device, method, or token whose knowing or intended purpose is to
permit any person to circumvent the normal security of the Services or the
system containing the software code for the Services (MALICIOUS CODE),
except to the extent that we provided or transmitted, whether intentionally
or unintentionally, such virus, code, program, device, method or token to
you. You agree to take all necessary actions and precautions as you would
with your own systems to prevent the introduction and proliferation of any
Malicious Code into those systems that interact with the Services.
6. INDEMNIFICATION.
For avoidance of doubt, each party hereby agrees that the provisions in the
Related Agreement(s) related to indemnification and any limitations on
liability and responsibilities shall be applicable to this Agreement, and
are hereby expressly incorporated herein. You agree that the Services are
comprised of telecommunications and computer systems, and that it is
possible that Instructions, information, transactions, or account reports
might be added to, changed, or omitted by electronic or programming
malfunction, unauthorized access, or other failure of the systems which
comprise the Services, despite the security features that have been
designed into the Services. You agree that we will not be liable for any
action taken or not taken in complying with the terms of this Schedule,
except for our willful misconduct, bad faith or negligence. The provisions
of this paragraph shall survive the termination of this Schedule and the
Related Agreements.
7. PAYMENT.
You may be charged for services hereunder as set forth in a fee schedule
from time to time agreed by us.
8. TERM/TERMINATION.
8.1. This Schedule is effective as of the date you sign it or first use
the Services, whichever is first, and continues in effect until such
time as either you or we terminate the Schedule in accordance with
this Section 8 and/or until your off-line use of the Services is
terminated.
8.2. We may terminate your access to the Services at any time, for any
reason, with 10 (ten) business days prior notice; provided that we
may terminate your access to the Services with no prior notice (i)
if your account with us is closed, (ii) if you fail to comply with
32
any of the terms of this Agreement, (iii) if we believe that your
continued access to the Services poses a security risk, or (iv) if
we believe that you are violating or have violated applicable laws,
and we will not be liable for any loss you may experience as a
result of such termination. You may terminate your access to the
Services at any time by giving us ten (10) business days notice.
Upon termination, we will cancel all your Passwords and IDs and any
in-process or pending Instructions will be carried out or cancelled,
at our sole discretion.
9. MISCELLANEOUS.
9.1. NOTICES. All notices, requests, and demands (other than routine
operational communications, such as Instructions) shall be in such
form and effect as provided in the Related Agreement(s).
9.2. INCONSISTENT PROVISIONS. Each Service may be governed by separate
terms and conditions in addition to this Schedule and the Related
Agreement(s). Except where specifically provided to the contrary in
this Schedule, in the event that such separate terms and conditions
conflict with this Schedule and the Related Agreement(s), the
provisions of this Schedule shall prevail to the extent this
Schedule applies to the transaction in question.
9.3. BINDING EFFECT; ASSIGNMENT; SEVERABILITY. The execution and delivery
of this Agreement have been authorized by the Board of Trustees of
each Fund and signed by an authorized officer of each 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, and the obligations of this Agreement are not
binding upon any of the Trustees or Shareholders of the Funds, but
bind only the appropriate property of the Fund, portfolio, or Class,
as provided in the relevant Trust's Declaration of Trust. Further,
no Fund or portfolio will be liable or responsible for the acts,
omissions or obligations of another Fund or portfolio. Your rights
under this Schedule may not be assigned without our prior written
consent. In the event that any provision of this Schedule conflicts
with the law under which this Schedule is to be construed or if any
such provision is held invalid or unenforceable by a court with
jurisdiction over you and us, such provision shall be deemed to be
restated to effectuate as nearly as possible the purposes of the
Schedule in accordance with applicable law. The remaining provisions
of this Schedule and the application of the challenged provision to
persons or circumstances other than those as to which it is invalid
or unenforceable shall not be affected thereby, and each such
provision shall be valid and enforceable to the full extent
permitted by law.
9.4. CHOICE OF LAW; JURY TRIAL. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND BE GOVERNED BY THE LAWS OF, THE STATE OF NEW
YORK, WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW OF SUCH STATE.
The parties hereby agree to the non-exclusive jurisdiction of
federal courts sitting in the State of New York or the Commonwealth
of Massachusetts, or of the State courts of either such State or
such Commonwealth.
STI CLASSIC FUNDS
AND
STI CLASSIC VARIABLE TRUST ("YOU")
BY: /S/ XXXXXXX X. XXXXX
---------------------------
TITLE: VICE PRESIDENT
---------------------------
DATE: FEBRUARY 13, 2003
---------------------------
33
DELEGATION SCHEDULE
By its execution of this Delegation Schedule dated as of January 29,
2003, [FUND], a management investment company registered with the Securities and
Exchange Commission (the COMMISSION) under the Investment Company Act of 1940,
as amended, (the 1940 ACT), acting through its Board of Directors/Trustees or
its duly appointed representative (the FUND), hereby appoints XXXXX BROTHERS
XXXXXXXX & CO., a New York limited partnership with an office in Boston,
Massachusetts (the DELEGATE) as its delegate to perform certain functions with
respect to the custody of Fund's Assets outside the United States.
1. MAINTENANCE OF FUND'S ASSETS ABROAD. The Fund, acting through its Board or
its duly authorized representative, hereby instructs Delegate pursuant to the
terms of the Custodian Agreement dated as of the date hereof executed by and
between the Fund and the Delegate (the CUSTODIAN AGREEMENT) to place and
maintain the Fund's Assets in countries outside the United States in accordance
with Instructions received from the Fund's Investment Advisor and in accordance
with this Schedule. Such instruction shall represent an Instruction under the
terms of the Custodian Agreement. The Fund acknowledges that (a) the Delegate
shall perform services hereunder only with respect to the countries where it
accepts delegation as Foreign Custody Manager as indicated on Delegate's Global
Custody Network Listing, as may be revised from time to time upon advance
written notice to Fund; (b) depending on conditions in the particular country,
advance notice may be required before the Delegate shall be able to perform its
duties hereunder in or with respect to such country (such advance notice to be
reasonable in light of the specific facts and circumstances attendant to
performance of duties in such country); and (c) nothing in this Delegation
Schedule shall require the Delegate to provide delegated or custodial services
in any country, and there may from time to time be countries as to which the
Delegate determines it will not provide delegation services. Delegate will
provide the Fund with advance written notice of such countries.
2. DELEGATION. Pursuant to the provisions of Rule 17f-5 under the 1940 Act as
amended, the Board hereby delegates to the Delegate, and the Delegate hereby
accepts such delegation and agrees to perform those duties set forth in this
1
Delegation Schedule concerning the safekeeping of the Fund's Assets in each of
the countries designated on the Global Custody Network Listing. The Delegate is
hereby authorized to take such actions on behalf of or in the name of the Fund
as are reasonably required to discharge its duties under this Delegation
Schedule, including, without limitation, to cause the Fund's Assets to be placed
with a particular Eligible Foreign Custodian in accordance herewith. The Fund
confirms to the Delegate that the Fund or its investment adviser has considered
the Sovereign Risk and Country Risk as part of its continuing investment
decision process, including such factors as may be reasonably related to the
systemic risk of maintaining the Fund's Assets in a particular country,
including, but not limited to, financial infrastructure, prevailing custody and
settlement systems and practices (including the use of any Securities Depository
in the context of information provided by the Custodian in the performance of
its duties as required under 1940 Act Rule 17f-7 and the terms of the Custodian
Agreement governing such duties), and the laws relating to the safekeeping and
recovery of the Fund's Assets held in custody pursuant to the terms of the
Custodian Agreement. The Delegate agrees to provide the Board from time to time
such reasonable documentation of its capacity to exercise reasonable care in
respect of the duties described in this attachment as the Board may reasonably
require.
3. SELECTION OF ELIGIBLE FOREIGN CUSTODIAN AND CONTRACT ADMINISTRATION. The
Delegate shall perform the following duties with respect to the selection of
Eligible Foreign Custodians and administration of certain contracts governing
the Fund's foreign custodial arrangements:
(a) SELECTION OF ELIGIBLE FOREIGN CUSTODIAN. The Delegate shall
place and maintain the Fund's Assets with an Eligible Foreign Custodian;
PROVIDED that the Delegate shall have determined that the Fund's Assets will be
subject to reasonable care based on the standards applicable to custodians in
the relevant market after considering all factors relevant to the safekeeping of
such assets, including without limitation:
(i) The Eligible Foreign Custodian's practices, procedures, and
internal controls, including, but not limited to, the physical
protections available for certificated securities (if applicable),
the controls and procedures for dealing with any Securities
Depository, the method of keeping custodial records, and the
security and data protection practices;
(ii) Whether the Eligible Foreign Custodian has the requisite
financial strength to provide reasonable care for the Fund's
Assets;
2
(iii) The Eligible Foreign Custodian's general reputation and
standing; and
(iv) Whether the Fund will have jurisdiction over and be able to
enforce judgments against the Eligible Foreign Custodian, such as
by virtue of the existence of any offices of such Eligible Foreign
Custodian in the United States or such Eligible Foreign
Custodian's appointment of an agent for service of process in the
United States or consent to jurisdiction in the United States.
(b) CONTRACT ADMINISTRATION. The Delegate shall cause that the
foreign custody arrangements with an Eligible Foreign Custodian shall be
governed by a written contract that the Delegate has determined will provide
reasonable care for Fund assets based on the standards applicable to custodians
in the relevant market. Each such contract shall, except as set forth in the
last paragraph of this subsection (b), include provisions that provide:
(i) For indemnification or insurance arrangements (or any
combination of the foregoing) such that the Fund will be adequately
protected against the risk of loss of assets held in accordance with
such contract;
(ii) That the Fund's Assets will not be subject to any right,
charge, security interest, lien or claim of any kind in favor of the
Eligible Foreign Custodian or its creditors except a claim of payment
for their safe custody or administration or, in the case of cash
deposits, liens or rights in favor of creditors of such Custodian
arising under bankruptcy, insolvency or similar laws;
(iii) That beneficial ownership of the Fund's Assets will be
freely transferable without the payment of money or value other than
for safe custody or administration;
(iv) That adequate records will be maintained identifying the
Fund's Assets as belonging to the Fund or as being held by a third
party for the benefit of the Fund;
(v) That the Fund's independent public accountants will be given
access to those records described in (iv) above or confirmation of the
contents of such records; and
(vi) That the Delegate (and the Fund, if the Fund so requests)
will receive sufficient and timely periodic reports with respect to the
safekeeping of the Fund's Assets, including, but not limited to,
notification of any transfer to or from the Fund's account or a third
party account containing the Fund's Assets.
3
Such contract may contain, in lieu of any or all of the provisions
specified in this Section 3(b), such other provisions that the Delegate
determines will provide, in their entirety, the same or a greater level
of care and protection for the Fund's Assets as the specified
provisions, in their entirety.
(c) LIMITATION TO DELEGATED SELECTION. Notwithstanding anything in
this Delegation Schedule to the contrary, and unless otherwise agreed upon by
the parties, the duties under this Section 3 shall apply only to Eligible
Foreign Custodians selected by the Delegate and shall not apply to Securities
Depositories or to any Eligible Foreign Custodian that the Delegate is directed
to use pursuant to Section 7 of this Delegation Schedule.
4. MONITORING. The Delegate shall establish and maintain a system to monitor at
reasonable intervals (but at least annually) the appropriateness of maintaining
the Fund's Assets with each Eligible Foreign Custodian that has been selected by
the Delegate pursuant to Section 3 of this Delegation Schedule. The Delegate
shall monitor the continuing appropriateness of placement of the Fund's Assets
in accordance with the criteria established under Section 3(a) of this
Delegation Schedule. The Delegate shall monitor the performance and continuing
appropriateness of the contract governing the Fund's arrangements in accordance
with the criteria established under Section 3(b) of this Delegation Schedule.
5. REPORTING. At least annually and more frequently as mutually agreed between
the parties, the Delegate shall provide to the Board written reports specifying
placement of the Fund's Assets with each Eligible Foreign Custodian selected by
the Delegate pursuant to Section 3 of this Delegation Schedule and shall
promptly report as to any material changes to such foreign custody arrangements.
Delegate will prepare such a report with respect to any Eligible Foreign
Custodian that the Delegate has been instructed to use pursuant to Section 7 of
this Delegation Schedule only to the extent specifically agreed with respect to
the particular situation. The Delegate also will provide the Fund with any
additional information about the Fund's foreign custody arrangements as the Fund
may reasonably request from time to time.
6. WITHDRAWAL OF FUND'S ASSETS. If the Delegate determines that an arrangement
with a specific Eligible Foreign Custodian selected by the Delegate under
Section 3 of this Delegation Schedule no longer meets the requirements of said
Section, Delegate shall withdraw the Fund's Assets from the non-complying
4
arrangement as soon as reasonably practicable; PROVIDED, however, that if in the
reasonable judgment of the Delegate, such withdrawal would require liquidation
of any of the Fund's Assets or would materially impair the liquidity, value or
other investment characteristics of the Fund's Assets, it shall be the duty of
the Delegate to provide information regarding the particular circumstances and
to act only in accordance with Instructions of the Fund or its Investment
Advisor with respect to such liquidation or other withdrawal.
7. DIRECTION AS TO ELIGIBLE FOREIGN CUSTODIAN. Notwithstanding this Delegation
Schedule, the Fund, acting through its Board, its Investment Advisor or its
other authorized representative, may direct the Delegate to place and maintain
the Fund's Assets with a particular Eligible Foreign Custodian, including
without limitation with respect to investment in countries as to which the
Custodian will not provide delegation services. In such event, the Delegate
shall be entitled to rely on any such instruction as an Instruction under the
terms of the Custodian Agreement and shall have no duties under this Delegation
Schedule with respect to such arrangement save those that it may undertake
specifically in writing with respect to each particular instance.
8. STANDARD OF CARE. In carrying out its duties under this Delegation Schedule,
the Delegate agrees to exercise reasonable care, prudence and diligence such as
a person having responsibility for safekeeping the Fund's Assets would exercise.
9. REPRESENTATIONS. The Delegate hereby represents and warrants that it is a
U.S. Bank and that this Delegation Schedule has been duly authorized, executed
and delivered by the Delegate and is a legal, valid and binding agreement of the
Delegate.
The Fund hereby represents and warrants that its Board of Trustees has
determined that it is reasonable to rely on the Delegate to perform the
delegated responsibilities provided for herein and that this Delegation Schedule
has been duly authorized, executed and delivered by the Fund and is a legal,
valid and binding agreement of the Fund.
10. EFFECTIVENESS; TERMINATION. This Delegation Schedule shall be effective as
of the date on which this Delegation Schedule shall have been accepted by the
Delegate, as indicated by the date set forth below the Delegate's signature.
This Delegation Schedule may be terminated at any time, without penalty, by
written notice from the terminating party to the non-terminating party. Such
termination shall be effective on the 30th calendar day following the date on
5
which the non-terminating party shall receive the foregoing notice. The
foregoing to the contrary notwithstanding, this Delegation Schedule shall be
deemed to have been terminated concurrently with the termination of the
Custodian Agreement.
11. NOTICES. Notices and other communications under this Delegation Schedule are
to be made in accordance with the arrangements designated for such purpose under
the Custodian Agreement unless otherwise indicated in a writing referencing this
Delegation Schedule and executed by both parties.
12. DEFINITIONS. Capitalized terms in this Delegation Schedule have the
following meanings:
a. ELIGIBLE FOREIGN CUSTODIAN - shall have the meaning set forth
in Rule 17f-5(a)(1) and shall also include a U.S. Bank.
b. FUND'S ASSETS - shall mean any of the Fund'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 Fund's transactions in such
investments.
c. INSTRUCTIONS - shall have the meaning set forth in the
Custodian Agreement.
d. Securities Depository - shall have the meaning set forth in
Rule 17f-7.
e. Sovereign Risk - shall have the meaning set forth in Section
10.1.3 of the Custodian Agreement.
f . U.S. Bank - shall mean a bank that qualifies to serve as a
custodian of assets of investment companies under Section 17(f) of
the Act.
13. GOVERNING LAW AND JURISDICTION. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND BE GOVERNED BY THE LAWS OF, THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO THE CONFLICTS OF LAW OF SUCH STATE. The parties hereby agree to
the non-exclusive jurisdiction of federal courts sitting in the State of New
York or the Commonwealth of Massachusetts, or of the State courts of either such
State or such Commonwealth.
6
14. Integration. This Delegation Schedule sets forth all of the Delegate's
duties with respect to the selection and monitoring of Eligible Foreign
Custodians, the administration of contracts with Eligible Foreign Custodians,
the withdrawal of assets from Eligible Foreign Custodians and the issuance of
reports in connection with such duties. The terms of the Custodian Agreement
shall apply generally as to matters not expressly covered in this Delegation
Schedule, including dealings with the Eligible Foreign Custodians in the course
of discharge of the Delegate's obligations under the Custodian Agreement, and
indemnification provisions.
15. LIMITATION OF LIABILITY. The execution and delivery of this Agreement have
been authorized by the Board of Trustees of each Fund and signed by an
authorized officer of each 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, and the obligations of this Agreement are not binding upon
any of the Trustees or Shareholders of the Funds, but bind only the appropriate
property of the Fund, portfolio, or Class, as provided in the relevant Trust's
Declaration of Trust. Further, no Fund or portfolio will be liable or
responsible for the acts, omissions or obligations of another Fund or portfolio.
7
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed as of the date first above written.
XXXXX BROTHERS XXXXXXXX & CO. STI CLASSIC FUNDS
AND
STI CLASSIC VARIABLE TRUST
By: /s/ Xxxxxxx X. Xxxxxx By: Xxxxxxx X. Xxxxx
-------------------------- ---------------------------------
Name: Xxxxxxx X. Xxxxxx Name: Xxxxxxx X. Xxxxx
Title: Partner Title: Vice President
8
[STI Classic Funds LOGO OMITTED] GLOBAL CUSTODY FEE PROPOSAL [XXXXX
JANUARY 2003 BROTHERS
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OMITTED]
--------------------------------------------------------------------------------
I. GLOBAL CUSTODY & SECURITIES LENDING ADMINISTRATION FEES:
ANNUAL RELATIONSHIP BASED CHARGES: 3.00 basis points (non-US assets)
1.00 basis point (US assets)
NON-US TRANSACTION CHARGE*: $25.00
* Includes market charges, 3rd party FX, non-US wires, cancels & corrects,
and non-automated instructions.
US TRANSACTION CHARGE*: $8.00
* Includes DTCC, Fed, wires, book transfers, derivatives, securities
lending new loans/returns, repos, commercial paper, maturity collections,
paydowns, cancels & corrects, and non-automated instructions.
SECURITIES LENDING ADMINISTRATION ANNUAL MAINTENANCE: $5,000 per fund
OUT OF POCKET: Standard out of pocket expenses will apply, customized
programming to be negotiated.
Fees quoted above offered contingent upon the information provided and assuming
the actual experience will not be materially different from this projected. BBH
reserves the right to modify as additional markets and/or services are
introduced. If total "emerging /pre-emerging markets" assets reach 5.00% of the
total assets held at BBH, the global custody asset and transaction charges as
described in Section III will take effect.
II. VALUE ADDED CREDITS:
COMMISSION RECAPTURE (NON-US & US EQUITIES): BBH will provide Trusco with the
ability to recapture $1.00 for each $3.00 in commission dollars from any equity
trade executed through BBH or through its broker network.
BBH BROKERAGE: For US equity executions through BBH as broker directly utilizing
Bloomberg, Reuters, SWIFT, FIX, GL-Trader (or any other automated platform), BBH
will waive delivery and receipt charges.
CASH MANAGEMENT: BBH will pay Trusco interest on US and non-US balances. Idle
balances are invested automatically through our cash management sweep service
where investments are made in overnight time deposits with BBH's Grand Cayman
branch or branches of other US licensed commercial banks.
FOREIGN EXCHANGE CREDITS: BBH will provide Trusco with a credit of 0.15 basis
points towards BBH-generated fees based on a percentage of total volume directed
to BBH in each calendar year.
CONVERSION MANAGEMENT: BBH will provide Trusco with an on-site experienced
conversion team to assist Trusco throughout the entire conversion process.
Page 1 of 3
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JANUARY 2003 BROTHERS
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OMITTED]
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III. ALTERNATIVE GLOBAL CUSTODY PRICING:
DEVELOPED MARKETS
--------------------------------------------------------
CURRENT
STI ASSET BASED
MARKETS FEE (BPS) TRANS FEE ($)
DEVELOPED
x Australia 3.00 $ 25
x Austria 3.00 $ 25
x Belgium 3.00 $ 25
x Canada 3.00 $ 25
x Denmark 3.00 $ 25
x Finland 3.00 $ 25
x France 3.00 $ 25
x Germany 3.00 $ 25
x Hong Kong 3.00 $ 25
x Ireland 3.00 $ 25
x Italy 3.00 $ 25
x Japan 3.00 $ 25
x Luxembourg 3.00 $ 25
x Mexico 3.00 $ 25
x Netherlands 3.00 $ 25
x New Zealand 3.00 $ 25
x Norway 3.00 $ 25
x Singapore 3.00 $ 25
x Spain 3.00 $ 25
x Sweden 3.00 $ 25
x Switzerland 3.00 $ 25
x United Kingdom 3.00 $ 25
x United States 1.00 $ 8
--------------------------------------------------------
EMERGING MARKETS
--------------------------------------------------------
CURRENT
STI ASSET BASED
MARKETS FEE (BPS) TRANS FEE ($)
EMERGING
Argentina 25.00 $ 75
Bermuda 35.00 $ 000
Xxxxxx 15.00 $ 00
Xxxxx 35.00 $ 85
China 35.00 $ 00
Xxxxxxxx 45.00 $ 000
Xxxxx Xxxxxxxx 30.00 $ 65
Egypt 50.00 $ 150
x Greece (on site trans) 50.00 $ 000
Xxxxxxx 55.00 $ 000
Xxxxx 40.00 $ 150
Indonesia 15.00 $ 55
Israel 25.00 $ 75
Malaysia 10.00 $ 00
Xxxx 50.00 $ 000
Xxxxxxxxxxx 25.00 $ 65
Poland 60.00 $ 125
x Portugal 30.00 $ 150
Russia 65.00 $ 000
Xxxxxxxx 35.00 $ 100
So. Arica 12.00 $ 50
x So. Korea 20.00 $ 50
x Taiwan 25.00 $ 75
Thailand 15.00 $ 00
Xxxxxx 35.00 $ 125
Venezuela 45.00 $ 125
--------------------------------------------------------------------------------
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JANUARY 2003 BROTHERS
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OMITTED]
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PRE-EMERGING MARKETS
--------------------------------------------------------
CURRENT
STI ASSET BASED
MARKETS FEE (BPS) TRANS FEE ($)
PRE-EMERGING
Bahrain XXX XXX
Bangladesh XXX XXX
Bolivia XXX XXX
Botswana XXX XXX
Bulgaria XXX XXX
Costa Rica XXX XXX
Croatia XXX XXX
Cyprus XXX XXX
Ecuador XXX XXX
Estonia XXX XXX
Ghana XXX XXX
Iceland XXX XXX
Jamaica XXX XXX
Kazakhstan XXX XXX
Kenya XXX XXX
Latvia XXX XXX
Lebanon XXX XXX
Lithuania XXX XXX
Malawi XXX XXX
Malta XXX XXX
Mauritius XXX XXX
Morocco XXX XXX
Namibia XXX XXX
Nigeria XXX XXX
Oman XXX XXX
Pakistan XXX XXX
Palestine XXX XXX
Panama XXX XXX
Qatar XXX XXX
Romania XXX XXX
Slovenia XXX XXX
Sri Lanka XXX XXX
Swaziland XXX XXX
Trinidad & Tobago XXX XXX
Tunisia XXX XXX
Ukraine XXX XXX
United Arab emirates XXX XXX
Uruguay XXX XXX
Uzbekistan XXX XXX
Vietnam XXX XXX
West Africa XXX XXX
Zambia XXX XXX
Zimbabwe XXX XXX
--------------------------------------------------------
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