GLOBAL
CUSTODIAL SERVICES AGREEMENT
SOUND SHORE FUND, INC.
TABLE OF CONTENTS
1. DEFINITIONS AND INTERPRETATION 1
2. ESTABLISHMENT OF ACCOUNTS 2
3. CUSTODY ACCOUNT PROCEDURES 3
4. CASH ACCOUNT PROCEDURES 3
5. INSTRUCTIONS 3
6. PERFORMANCE BY THE CUSTODIAN 4
7. TAX STATUS/WITHHOLDING TAXES 5
8. USE OF THIRD PARTIES 5
9. REPRESENTATIONS 7
10. SCOPE OF RESPONSIBILITY 8
11 SUBROGATION 9
12. INDEMNITY 9
13. LIEN AND SET OFF 9
14. FEES AND EXPENSES 9
15. CITIGROUP ORGANISATION INVOLVEMENT 9
16. RECORDS AND ACCESS 10
17. INFORMATION 10
18. ADVERTISING 10
19. TERMINATION. 10
20. GOVERNING LAW AND JURISDICTION 11
21. MISCELLANEOUS 11
SIGNATURES 12
SCHEDULES:
o Schedule A
o Fee Schedule
THIS GLOBAL CUSTODIAL SERVICES AGREEMENT is made as of January 31, 2004, by and
between Sound Shore Fund, Inc, a corporation organized under the laws of the
State of Maryland (the "CLIENT") and Citibank, N.A. acting through its offices
located in New York, New York (the "CUSTODIAN").
WHEREAS, the Custodian represents to the Client that it is eligible to serve as
a custodian for a management investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), and
WHEREAS, The Client is a management investment company registered under the 1940
Act with separate portfolios as listed on Schedule A to this Agreement (each of
the funds being hereinafter referred to as the "Fund"), each of such Funds
acting on its own behalf separately from all the other Funds and not jointly or
jointly and severally with any of the other funds, and
WHEREAS, the Client wishes to appoint the Custodian as the custodian for the
Funds,
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the parties hereto agree as follows:
1. DEFINITIONS AND INTERPRETATION
(A) DEFINITIONS.
"AUTHORIZED PERSON," means the Client or any person (including any
individual or entity) authorized by the Client in a notice reasonably
acceptable to the Custodian to act on Client's behalf or on behalf of the
applicable Fund in the performance of any act, discretion or duty under
this Agreement (including, for the avoidance of doubt, any officer or
employee of such person).
"CASH" means all cash or cash equivalents in any currency received and
held on the terms of this Agreement.
"CITIGROUP ORGANIZATION" means Citigroup, Inc. and any company or other
entity of which Citigroup, Inc. is directly or indirectly a shareholder
or owner. For purposes of this Agreement, each branch of Citibank, N.A.
shall be a separate member of the Citigroup Organization.
"CLEARANCE SYSTEM" means any clearing agency, settlement system or
depository (including any entity that acts as a system for the central
handling of Securities in the country where it is incorporated or
organized or that acts as a transnational system for the central handling
of Securities) used in connection with transactions relating to
Securities and any nominee of the foregoing.
"FEE SCHEDULE" means the schedule referred to in Section 14, as annexed
hereto.
"INSTRUCTIONS" means any and all instructions (including approvals,
consents and notices) received by the Custodian from, or reasonably
believed by the Custodian to be from, any Authorized Person, including
any instructions communicated through any manual or electronic medium or
system agreed between the Authorized Person and the Custodian.
"SECURITIES" means any financial asset (other than Cash) from time to
time held for the benefit of the Fund on the terms of this Agreement.
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"TAXES" means all taxes, levies, imposts, charges, assessments,
deductions, withholdings and related liabilities, including additions to
tax, penalties and interest imposed on or in respect of (i) Securities or
Cash, (ii) the transactions effected under this Agreement or (iii) the
Fund; provided that "Taxes" does not include income or franchise taxes
imposed on or measured by the net income of the Custodian or its agents.
(B) INTERPRETATION.
References in this Agreement to the Client shall mean the Client acting
individually and separately on behalf of each Fund. The appointment of
the Custodian subject to the terms and provisions of this Agreement shall
constitute a separate appointment by the Client on behalf of each Fund.
Except as otherwise agreed, each reference herein to Accounts and to
Securities and Cash shall mean the Accounts, Securities and Cash
maintained, received, delivered and held separately for Fund and not on
an omnibus basis or aggregate basis for all of the Funds. The Client and
the Custodian agree that the Client shall be the primary obligor with
respect to any obligations of the Client or any Fund specified in this
Agreement; provided, however, the obligations of the Client with respect
to a Fund shall be limited to the extent such obligations relate to the
Accounts or transactions of that Fund. Custodian may seek to enforce the
obligations of the Client in respect to a Fund's Accounts and
transactions effected under this Agreement directly against the Accounts
and the Securities and Cash held hereunder for the Fund but only to the
extent such obligations relate to the Accounts or transactions of that
Fund. Upon request, the Client shall reasonably identify how any
obligation of the Client provided under this Agreement should be
allocated to a Fund or to any Accounts maintained hereunder for such
Fund.
2. ESTABLISHMENT OF ACCOUNTS
(A) ACCOUNTS. The Client authorizes the Custodian to establish on its books,
pursuant to the terms of this Agreement, (i) a custody account or
accounts (the "Custody Account") and (ii) a cash account or accounts (the
"Cash Account"). The Custody Account will be a custody account for the
receipt, safekeeping and maintenance of Securities, and the Cash Account
will be a current account for Cash.
(B) ACCEPTANCE OF SECURITIES AND CASH. The Custodian will determine in its
reasonable discretion whether to accept (i) for custody in the Custody
Account, Securities of any kind and (ii) for deposit in the Cash Account,
Cash in any currency.
(C) DESIGNATION OF ACCOUNTS.
(i) The Custody Account will be in the name of the Fund or such other name as
the Client may reasonably designate and will indicate that Securities do
not belong to the Custodian and are segregated from the Custodian's
assets.
(ii) The Cash Account will be in the name of the Fund or such other name as
the Client may reasonably designate and will be held by the Custodian as
banker.
(D) SEGREGATION.
(i) Subject to 8(b)(iii) and (iv), to the extent reasonably practicable the
Custodian will hold Securities with a subcustodian only in an account
that holds exclusively assets held by the Custodian for its customers.
The Custodian will direct each subcustodian to identify on its books that
Securities are held for the account of the Custodian as custodian for its
customers. The Custodian will direct each subcustodian, to the extent
practicable, to hold Securities in a Clearance System only in an account
of the subcustodian that holds exclusively assets held by the
subcustodian for its customers.
(ii) Any Securities deposited by the Custodian with a subcustodian will be
subject only to the instructions of the Custodian, and any Securities
held in a Clearance System for the account of a subcustodian will be
subject only to the instructions of the subcustodian.
(iii) The Custodian shall require the subcustodian to agree that Securities
will not be subject to any right, charge, security interest, lien or
claim of any kind in favor of the subcustodian.
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3. CUSTODY ACCOUNT PROCEDURES
(A) CREDITS TO THE CUSTODY ACCOUNT. The Custodian is not obligated to credit
Securities to the Custody Account before receipt of such Securities by
final settlement.
(B) DEBITS TO THE CUSTODY ACCOUNT. If the Custodian has received Instructions
that would result in the delivery of Securities exceeding credits to the
Custody Account for that Security, the Custodian may reject the
Instructions or may decide which deliveries it will make (in whole or in
part and in the order it selects).
(C) DENOMINATION OF SECURITIES. The Client and the Fund shall bear the risk
and expense associated with investing in Securities denominated in any
currency.
4. CASH ACCOUNT PROCEDURES
(A) CREDITS AND DEBITS TO THE CASH ACCOUNT. The Custodian is not obliged to
make a credit or debit to the Cash Account before receipt by the
Custodian of a corresponding and final payment in cleared funds. If the
Custodian makes a credit or debit before such receipt, the Custodian may
at any time reverse all or part of the credit or debit (including any
interest thereon), make an appropriate entry to the Cash Account, and if
it reasonably so decides, require repayment of any amount corresponding
to any debit.
(B) DEBIT BALANCES IN THE CASH ACCOUNT. The Custodian is not obliged to make
any debit to the Cash Account, which might result in or increase a debit
balance. The Custodian may make any debit to the Cash Account even if
this results in (or increases) a debit balance. If the total amount of
debits to the Cash Account at any time would otherwise result in a debit
balance or exceed the immediately available funds credited to the Cash
Account, the Custodian may decide which debits it will make (in whole or
in part and in the order it selects).
(C) PAYMENTS. The Custodian may at any time cancel any extension of credit.
The Client will transfer to the Custodian on closure of the Cash Account
and otherwise on demand from the Custodian sufficient immediately
available funds to cover any debit balance on the Cash Account or any
other extension of credit and any interest, fees and other amounts owed.
(D) FOREIGN CURRENCY RISKS. The Client and the Fund shall bear the risk and
expense associated with Cash denominated in any currency.
5. INSTRUCTIONS
The Custodian is entitled to rely and act upon Instructions of any
Authorized Person until the Custodian has received notice of any change
from the Client and has had a reasonable time to note and implement such
change. The Custodian is authorized to rely upon any Instructions
received by any means, provided that the Custodian and the Authorized
Person have agreed upon the means of transmission and the method of
identification for the Instructions. In particular:
(i) The Authorized Person and the Custodian will comply with security
procedures designed to verify the origination of Instructions.
(ii) The Custodian is not responsible for errors or omissions made by the
Authorized Person or resulting from fraud or the duplication of any
Instruction by the Authorized Person, and the Custodian may act on any
Instruction by reference to an account number only, even if any
account name is provided.
(iii) The Custodian may act on an Instruction if it reasonably believes the
Instruction contains sufficient information.
(iv) The Custodian may decide not to act on an Instruction where it
reasonably doubts its contents, authorization, origination or
compliance with any security procedures and will promptly notify the
Authorized Person of its decision.
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(v) If the Custodian acts on any Instruction sent manually (including
facsimile or telephone), then, if the Custodian complies with the
security procedures, the Client and the Fund will be responsible
for any loss the Custodian may incur in connection with that
Instruction. The Client expressly acknowledges that the Client is
aware that the use of manual forms of communication to convey
Instructions increases the risk of error, security and privacy
issues and fraudulent activities.
(vi) Instructions are to be given in the English language.
(vii) The Custodian is obligated to act on Instructions only within
applicable cut-off times on banking days when the Custodian and
the applicable financial markets are open for business.
(viii) In some securities markets, securities deliveries and payments
therefor may not be or are not customarily made simultaneously.
Accordingly, notwithstanding Instruction to deliver Securities
against payment or to pay for Securities against delivery, the
Custodian may make or accept payment for or delivery of Securities
at such time and in such form and manner as is in accordance with
relevant local law and practice or with the customs prevailing in
the relevant market.
6. PERFORMANCE BY THE CUSTODIAN
(A) CUSTODIAL DUTIES REQUIRING INSTRUCTIONS. The Custodian shall carry
out the following actions only upon receipt of and in accordance
with specific Instructions:
(i) make payment for and/or receive any Securities or deliver or
dispose of any Securities, except as otherwise specifically
provided for in this Agreement;
(ii) deal with rights, conversions, options, warrants and other similar
interests or any other discretionary right in connection with
Securities; and
(iii) carry out any action affecting Securities or the Custody Account
or Cash or the Cash Account other than those specified in Section
6(B) below, but in each instance subject to the agreement of the
Custodian.
(B) NON-DISCRETIONARY CUSTODIAL DUTIES. Absent a contrary Instruction,
the Custodian shall carry out the following without further
Instructions:
(i) in the Client's or the Fund's name or on its behalf, sign any
affidavits, certificates of ownership and other certificates and
documents relating to Securities that may be required (i) to
obtain any Securities or Cash or (ii) by any tax or regulatory
authority;
(ii) collect, receive, and/or credit the Custody Account or Cash
Account, as appropriate, with all income, payments and
distributions in respect of Securities and any capital arising out
of or in connection with Securities (including all Securities
received by the Custodian as a result of a stock dividend, bonus
issue, share sub-division or reorganization, capitalization of
reserves or otherwise) and take any action necessary and proper in
connection therewith;
(iii) exchange interim or temporary receipts for definitive
certificates, and old or over stamped certificates for new
certificates;
(iv) notify the Client of notices, circulars, reports and announcements
that the Custodian has received in the course of acting in the
capacity of Custodian concerning Securities held in the Custody
Account that require discretionary action;
(v) make any payment by debiting the Cash Account or any other
designated account of the Client with the Custodian as required to
effect any Instruction; and
(vi) attend to all non-discretionary matters in connection with
anything provided in this Section 6(B) or any Instruction.
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7. TAX STATUS/WITHHOLDING TAXES
(A) INFORMATION. The Client will provide the Custodian, from time to
time and in a timely manner, with information and proof (copies or
originals) as the Custodian reasonably requests, as to the Fund's
tax status or residence. Information and proof may include, as
appropriate, executing certificates, making representations and
warranties, or providing other information or documents in respect
of Securities, as the Custodian deems necessary or proper to
fulfill obligations under applicable law.
(B) PAYMENT. If any Taxes become payable with respect to any payment
to be made to the Fund, such Taxes will be payable by the Fund and
the Custodian may withhold the Taxes from such payment. The
Custodian may withhold any Cash held or received with respect to
the Cash Account and apply such Cash in satisfaction of such
Taxes. If any Taxes become payable with respect to any prior
payment made to the Cash Account for the Fund by the Custodian,
the Custodian may withhold any Cash in satisfaction of such prior
Taxes. The Client and the Fund shall remain liable for any
deficiency.
(C) TAX RELIEF. In the event the Client requests that the Custodian
provide tax relief services and the Custodian agrees to provide
such services, the Custodian shall apply for appropriate tax
relief (either by way of reduced tax rates at the time of an
income payment or retrospective tax reclaims in certain markets
as agreed from time to time); provided the Client provides to the
Custodian such documentation and information as to the Fund as is
necessary to secure such tax relief. However, in no event shall
the Custodian be responsible, or liable, for any Taxes resulting
from the inability to secure tax relief, or for the failure of
the Fund to obtain the benefit of credits, on the basis of
foreign taxes withheld, against any income tax liability.
8. USE OF THIRD PARTIES
(A) GENERAL AUTHORITY.
(i) The Custodian is hereby authorized to appoint subcustodians and
administrative support providers as its delegates and to use or
participate in market infrastructures and Clearance Systems to
perform any of the duties of the Custodian under this Agreement.
(ii) Subcustodians are those persons utilized by the Custodian for the
safekeeping, clearance and settlement of Securities.
(iii) Administrative support providers are those persons utilized by the
Custodian to perform ancillary services of a purely administrative
nature such as couriers, messengers or other commercial transport
systems.
(iv) Market infrastructures are public utilities, external
telecommunications facilities and other common carriers of
electronic and other messages, and external postal services.
Market infrastructures are not delegates of the Custodian.
(v) Securities deposited with Clearance Systems hereunder will be
subject to the laws, rules, and statements of principle and
practices of such Clearance Systems. Clearance Systems are not
delegates of the Custodian.
(B) RESPONSIBILITY.
(i) The Custodian shall act in good faith and use reasonable care in
the selection and continued appointment of subcustodians and
administrative support providers.
(ii) The Custodian may deposit or procure the deposit of Securities
with any Clearance System as required by law, regulation or best
market practice. The Custodian has no responsibility for selection
or appointment of, or for performance by, any Clearance System or
market infrastructure.
(iii) The Custodian agrees that any subcustodian will be a 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
or a "Qualified Foreign Bank" meeting the requirements of an
"Eligible Foreign Custodian" as specified in Rule 17f-5 under the
1940 Act. With regard to each Eligible Foreign Custodian, the
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Custodian agrees to accept the responsibility it would have
assumed if it had been delegated responsibility to serve as the
Fund's "Foreign Custody Manager" as defined in Rule 17f-5(a)(3)
under the 1940 Act, in respect to the Client's foreign
investments held from time to time by the Custodian with any
subcustodian that is an Eligible Foreign Custodian. Foreign
investments are any Securities for which the primary market is
outside the United States of America.
In regard to each selection and appointment of a subcustodian that
is an Eligible Foreign Custodian, the Custodian shall:
(1) select the Eligible Foreign Custodian to serve as foreign
custodian and place and maintain the Fund's foreign
investments with respect to the relevant market with such
foreign custodian;
(2) in selecting an Eligible Foreign Custodian, first determine
that foreign investments placed and maintained in the
safekeeping of the Eligible Foreign Custodian shall be
subject to reasonable care, based on the standards
applicable to custodians in the relevant market, after
having considered all factors relevant to the safekeeping of
such investments including, without limitation, those
factors set forth in Rule 17f-5;
(3) enter into written agreements with the Eligible Foreign
Custodian selected by the Custodian hereunder;
(4) determine that the written contract with the Eligible
Foreign Custodian requires that the Eligible Foreign
Custodian will provide reasonable care for the foreign
investments, based on the standards applicable to custodians
in the relevant market, and that all such contracts, rules,
practices and procedures satisfy the requirements of Rule
17f-5;
(5) provide written reports (x) notifying the Client of the
placement of foreign investments with the Eligible Foreign
Custodian, such reports to be provided at such time as the
Client deems reasonable and appropriate, but not less than
quarterly, and (y) promptly notifying the Client of the
occurrence of any material change in the arrangements with
the Eligible Foreign Custodian; and
(6) monitor the continued appropriateness of (x) maintaining the
foreign investments with the Eligible Foreign Custodian
selected hereunder and (y) the governing contractual
arrangement; it being understood, however, that in the event
the Custodian shall determine that the Eligible Foreign
Custodian would no longer afford the foreign investments
reasonable care, the Custodian shall promptly so advise the
Client and shall then act in accordance with Instructions
(as defined in the Agreement) with respect to the
disposition of the foreign investments; and
Nothing in this paragraph shall relieve the Custodian of any
responsibility otherwise provided in the Agreement for loss or
damage suffered by the Client or the Fund from an act of
negligence or willful misconduct on the part of the Custodian.
Nothing in this Agreement shall require the Custodian to make any
selection that would entail consideration of any factor reasonably
related to the systemic risk of holding assets in a particular
country including, but not limited to, such country's financial
infrastructure and prevailing settlement practices. The Custodian
agrees to provide to the Client such information relating to such
risk as the Client shall reasonably request from time to time and
such other information as the Custodian generally makes available
to customers with regard to such countries and risk.
(iv) The Custodian agrees that in connection with Securities
settled within the United States it will meet the requirements
specified in Rule 17f-4 under the 1940 Act with respect to the
use of Clearance Systems. The Custodian may deposit and/or
maintain assets of the Fund that consist of foreign investments
only in a Clearance System located outside of the United States
of America that the Custodian has determined satisfies the
requirements of Rule 17f-7(b)(1) as an
PAGE 6 OF 12
Eligible Securities Depository, as defined therein. In such
manner as the Custodian deems reasonable, the Custodian shall
give the Client prompt notice of any material change known to the
Custodian that would adversely effect the Custodian's
determination that a Clearance System is an Eligible Securities
Depository. The Custodian shall provide the Client with an
analysis (in form and substance as reasonably determined by the
Custodian) of the custody risks associated with maintaining
securities with each Eligible Securities Depository in accordance
with Rule 17f-7. The Custodian shall monitor such custody risks
on a continuing basis and in such manner as the Custodian deems
reasonable and shall promptly notify the Client of any adverse
material changes in such risks in accordance with Rule.
(1) In performing its obligations under this Section 8(B)(iv),
the Custodian may obtain information from sources the
Custodian believes to be reliable, but the Custodian does
not warrant its completeness or accuracy and has no duty to
verify or confirm any such information. The Custodian is not
obligated to make any determination regarding whether any
Eligible Securities Depository provides reasonable care for
foreign investments or to provide any information or
evaluation comparing any Eligible Securities Depository to
any other Clearance System or any existing or proposed
standards for securities depositories.
(2) Upon the receipt of Instructions, the Custodian shall
withdraw securities from any Clearance System to the extent
and as soon as reasonably practicable; provided, however,
the Custodian shall have no obligation to obtain, safekeep
or provide any services in respect of any certificated or
physical security in any jurisdiction where the Custodian
does not offer or provide such services generally to
customers within that jurisdiction.
(C) SHAREHOLDERS VOTING. The Custodian shall provide shareholder-voting
services for Securities held in the Custody Account only upon the terms
and conditions separately agreed to by the Custodian and the Client.
9. REPRESENTATIONS
(A) GENERAL. The Client and the Custodian each represents at the date this
Agreement is entered into and any custodial service is used or provided
that:
(i) It is duly organized and in good standing in every jurisdiction where it
is required so to be;
(ii) It has the power and authority to sign and to perform its obligations
under this Agreement;
(iii) This Agreement is duly authorized and signed and is its legal, valid and
binding obligation;
(iv) Any consent, authorization or instruction required in connection with its
execution and performance of this Agreement has been provided by any
relevant third party;
(v) Any act required by any relevant governmental or other authority to be
done in connection with its execution and performance of this Agreement
has been or will be done (and will be renewed if necessary); and
(vi) Its performance of this Agreement will not violate or breach any
applicable law, regulation, contract or other requirement.
(B) CLIENT. The Client also represents at the date this Agreement is entered
into and any custodial service is used or provided that:
(i) It has authority to deposit the Securities received in the Custody
Account and the Cash in the Cash Account and there is no claim or
encumbrance that adversely affects any delivery of Securities or payment
of Cash made in accordance with this Agreement;
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(ii) Where it acts as an agent on behalf of any of its own customers, whether
or not expressly identified to the Custodian from time to time, any such
customers shall not be customers or indirect customers of the Custodian
except as expressly provided in this Agreement; and
(iii) Except as set forth in this Agreement, it has not relied on any oral or
written representation made by the Custodian or any person on its behalf.
10. SCOPE OF RESPONSIBILITY
(A) STANDARD OF CARE. The Custodian shall exercise the due care of a
professional custodian for hire.
(B) LIMITATIONS ON LOSSES. The Custodian will not be responsible for any loss
or damage suffered by the Client or the Fund unless the loss or damage
results from the Custodian's negligence, willful misconduct or fraud or
the negligence, willful misconduct or fraud of its nominees or any
subcustodian or administrative support providers; in the event of such
negligence or willful misconduct the liability of the Custodian in
connection with the loss or damage will not exceed direct damages to the
Client or the Fund. Under no circumstances will the Custodian be liable
to the Client or the Fund for consequential loss or damage, even if
advised of the possibility of such loss or damage.
(C) LIMITATIONS ON THE CUSTODIAN'S RESPONSIBILITY.
(i) GENERAL. The Custodian is responsible for the performance of only those
duties as are expressly set forth herein, including the performance of
any Instruction given in accordance with this Agreement. The Custodian
shall have no implied duties or obligations.
(ii) SOLE OBLIGATIONS OF THE CUSTODIAN. The Client understands and agrees that
(i) the obligations and duties of the Custodian will be performed only by
the Custodian and are not obligations or duties of any other member of
the Citigroup Organization (including any branch or office of the
Custodian) and (ii) the rights of the Client and the Fund with respect to
the Custodian extend only to such Custodian and, except as provided by
law, do not extend to any other member of the Citigroup Organization.
(iii) NO LIABILITY FOR THIRD PARTIES. Except as provided in Section 8 hereof,
the Custodian is not responsible for the acts, omissions, defaults or
insolvency of any third party, including, but not limited to, any broker,
counterparty or issuer of Securities.
(IV) PERFORMANCE SUBJECT TO LAWS. The Client understands and agrees that the
Custodian's performance of this Agreement is subject to the relevant
local laws, regulations, decrees, orders and government acts, and the
rules, operating procedures and practices of any relevant stock exchange,
Clearance System or market where or through which Instructions are to be
carried out and to which the Custodian is subject and as exist in the
country in which any Securities or Cash are held.
(v) PREVENTION OF PERFORMANCE. The Custodian will not be responsible for
any failure to perform any of its obligations (nor will it be
responsible for any unavailability of funds credited to the Cash
Account) if such performance is prevented, hindered or delayed by a
Force Majeure Event, and in such case its obligations will be
suspended for so long as the Force Majeure Event continues. "Force
Majeure Event" means any event due to any cause beyond the reasonable
control of the Custodian, such as restrictions on convertibility or
transferability, requisitions, involuntary transfers, unavailability
of communications systems, sabotage, fire, flood, explosion, acts of
God, civil commotion, strikes or industrial action of any kind, riots,
insurrection, war or acts of government.
(vi) CLIENT'S REPORTING OBLIGATIONS. The Client or the Fund shall be solely
responsible for all filings, tax returns and reports on any transactions
in respect of Securities or Cash or relating to Securities or Cash as may
be required by any relevant authority, whether governmental or otherwise.
(vii) VALIDITY OF SECURITIES. The Custodian shall exercise reasonable care in
receiving Securities but does not warrant or guarantee the form,
authenticity, value or validity of any Security received by the
Custodian. If the Custodian becomes aware of any defect in title or
forgery of any Security, the Custodian shall promptly notify the Client.
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(viii) CAPACITY OF CUSTODIAN. The Custodian is not acting under this Agreement
as an investment manager, nor as an investment, legal or tax adviser to
the Client or the Fund, and the Custodian's duty is solely to act as a
Custodian in accordance with the terms of this Agreement.
(ix) FORWARDED INFORMATION. The Custodian is not responsible for the form,
accuracy or content of any notice, circular, report, announcement or
other material or information provided under Section 6(B)(iv) of this
Agreement not prepared by the Custodian, including the accuracy or
completeness of any translation provided by the Custodian in regard to
such forwarded communication.
11. SUBROGATION
To the extent permissible by law or regulation and upon the Client's
request, the Client and the Fund shall be subrogated to the rights of the
Custodian with respect to any claim for any loss, damage or claim
suffered by the Client or the Fund, in each case to the extent that the
Custodian fails to pursue any such claim or the Client is not made whole
in respect of such loss, damage or claim.
12. INDEMNITY
(A) INDEMNITY TO THE CUSTODIAN. The Client agrees to indemnify the Custodian
and to defend and hold the Custodian harmless from all losses, costs,
damages and expenses (including reasonable legal fees) and liabilities
for any claims, demands or actions (each referred to as a "Loss"),
incurred by the Custodian in connection with this Agreement, except any
Loss resulting from the Custodian's (or its subcustodians' or
administrative support providers') negligence, willful misconduct or
fraud. Under no circumstances will the Client be liable to the Custodian
for consequential loss or damage, even if advised of the possibility of
such loss or damage.
(B) CLIENT'S DIRECT LIABILITY. The disclosure by the Client to the Custodian
that the Client has entered into this Agreement as the agent or
representative of another person shall not relieve the Client of any of
its obligations under this Agreement.
13. LIENS AND SET OFF
(A) LIENS. In addition to any other remedies available to the Custodian under
applicable law, the Custodian shall have, and the Client hereby grants on
behalf of each Fund, a continuing general lien on all Securities until
the satisfaction of liabilities arising under this Agreement of the
Client or the Fund to the Custodian in respect to any fees and expenses
or credit exposures incurred in the performance of services under this
Agreement.
(B) SET OFF. To the extent permitted by applicable law and in addition to any
other remedies available to the Custodian under applicable law, the
Custodian may, without prior notice to the Client or the Fund, set off
any payment obligation owed to it by the Client or the Fund in connection
with all liabilities arising under this Agreement against any payment
obligation owed by it to the Fund under this Agreement regardless of the
place of payment or currency of either obligation (and for such purpose
may make any currency conversion necessary).
14. FEES AND EXPENSES
The Client agrees to pay all fees, charges and obligations incurred from
time to time for any services pursuant to this Agreement as determined in
accordance with the terms of the Fee Schedule, which may be changed from
time to time by written agreement by the Client and the Custodian,
together with any other amounts payable to the Custodian under this
Agreement. The Custodian may debit the Cash Account to pay any such fees,
charges and obligations with regard to the Fund.
15. CITIGROUP ORGANIZATION INVOLVEMENT
The Client agrees and understands that any member of the Citigroup
Organization can engage as principal or otherwise in any transaction
effected by the Client or by any person for its account and
PAGE 9 OF 12
benefit, or by or on behalf of any counterparty or issuer. When
instructed to effect any transactions (particularly foreign exchange
transactions), the Custodian is entitled to effect any transaction by
or with itself or any member of the Citigroup Organization and to pay
or keep any fee, commissions or compensation as specified in the
Client's Instruction or, if no specification is provided, any charges,
fees, commissions or similar payments generally in effect from time to
time with regard to such or similar transactions.
16. RECORDS AND ACCESS
(A) EXAMINATION OF STATEMENTS. The Client shall examine each statement sent
by the Custodian and notify the Custodian in writing within sixty (60)
days of the date of such statement of any discrepancy between
Instructions given by the Client and the position shown on the statement
and of any other errors known to the Client. Absent such notification,
the Custodian's liability for any loss or damage in regard to such
discrepancy or errors shall not accrue beyond such sixty (60) days.
(B) ACCESS TO RECORDS. The Custodian shall allow the Client and the Fund and
their independent public accountants, agents or regulators reasonable
access to the records of the Custodian relating to Securities or Cash as
is required in connection with an examination of the books and records
pertaining to the affairs of the Client or the Fund and will seek to
obtain such access from each subcustodian and Clearance System.
(C) REPORTS. The Custodian shall provide to the Client from year to year any
report prepared by the Custodian's independent certified public
accountants with respect to the services provided by the Custodian under
this Agreement including, without limitation, the Custodian's accounting
system, internal accounting control and procedures for safeguarding Cash,
Securities and other assets. Upon request, the Custodian shall provide
the Client with any similar report received from any subcustodian or any
Clearance System.
17. INFORMATION
The Custodian will treat information related to the Client and the Fund
as confidential but, unless prohibited by law, the Client and the Fund
authorizes the transfer or disclosure of any information relating to the
Client and the Fund to and between the branches, subsidiaries,
representative offices, affiliates and agents of the Custodian and third
parties selected by any of them, wherever situated, for confidential use
in connection with the provision of services to the Client and the Fund
(including for data processing, statistical and risk analysis purposes),
and further acknowledges that any such branch, subsidiary, representative
office, affiliate, agent or third party may transfer or disclose any such
information as required by any law, court, regulator or legal process.
The Client will treat the terms of this Agreement, including any Fee
Schedule, as confidential; provided, however, the Client may provide this
Agreement to the Fund and to Client's counsel, auditors and service
providers on a need-to-know basis and may also provide copies to any
regulatory authorities with jurisdiction over the Client or any Fund upon
the request of such persons.
18. ADVERTISING
Neither the Client nor the Custodian shall display the name, trade xxxx
or service xxxx of the other without the prior written approval of the
other, nor will the Client display that of Citigroup, Inc. or any
subsidiary of Citigroup, Inc. without prior written approval from
Citigroup, Inc. or the subsidiary concerned. The Client shall not
advertise or promote any service provided by the Custodian without the
Custodian's prior written consent.
19. TERMINATION
(A) DATE OF TERMINATION. Any party may terminate this Agreement in whole or
as between itself and the other parties hereto by giving not less than
ninety (90) days' prior written notice to such other parties.
PAGE 10 OF 12
(B) EFFECT ON PROPERTY. The Custodian shall deliver the Securities and
Cash as instructed by the Client. If by the termination date the
Client has not given instructions to deliver any Securities or Cash,
the Custodian will continue to safekeep such Securities and/or Cash
until the Client provides Instructions to effect a free delivery of
such. However, the Custodian will provide no other services as regard
to any such Securities except to collect and hold any cash
distributions. Notwithstanding termination of this Agreement or any
Instruction, the Custodian may retain sufficient Securities or Cash to
close out or complete any transaction that the Custodian will be
required to settle on the Client's or the Fund's behalf.
(C) SURVIVING TERMS. The rights and obligations contained in Sections 7,
10, 12, 13, 17, 18 and 20 of this Agreement shall survive the termination
of this Agreement.
20. GOVERNING LAW AND JURISDICTION
(A) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws (and not the laws of conflicts) of the
country in which the Custodian is located and performs its obligations
hereunder.
(B) JURISDICTION. The courts of the country in which the Custodian is located
and performs its obligations hereunder (including any appropriate
sub-jurisdiction) shall have non-exclusive jurisdiction to hear any
disputes arising out of or in connection with this Agreement, and the
parties irrevocably submit to the jurisdiction of such courts.
(C) VENUE. Each party hereto waives any objection it may have at any time, to
the laying of venue of any actions or proceedings brought in any court
specified in Section 20(B) hereof, waives any claim that such actions or
proceedings have been brought in an inconvenient forum and further waives
the right to object that such court does not have jurisdiction over such
party.
(D) SOVEREIGN IMMUNITY. The Client and the Custodian each irrevocably waives,
with respect to itself and its revenues and assets, all immunity on the
grounds of sovereignty or similar grounds in respect of its obligations
under this Agreement.
21. MISCELLANEOUS
(A) ENTIRE AGREEMENT; AMENDMENTS. This Agreement consists exclusively of this
document together with the schedules. The Custodian may notify the Client
of terms that are applicable to the provision of services in the location
of a particular office and such terms shall be contained in a schedule
and shall supplement this Agreement in relation to that office. In case
of inconsistency with the rest of this Agreement, such terms shall
prevail in relation to that office.
Except as specified in this Agreement, this Agreement may only be
modified by written agreement of the Client and the Custodian.
(B) SEVERABILITY. If any provision of this Agreement is or becomes illegal,
invalid or unenforceable under any applicable law, the remaining
provisions shall remain in full force and effect (as shall that provision
under any other law).
(C) WAIVER OF RIGHTS. No failure or delay of the Client or the Custodian in
exercising any right or remedy under this Agreement shall constitute a
waiver of that right. Any waiver of any right will be limited to the
specific instance. The exclusion or omission of any provision or term
from this Agreement shall not be deemed to be a waiver of any right or
remedy the Client or the Custodian may have under applicable law.
(D) RECORDINGS. The Client, on behalf of itself and the Fund, and the
Custodian consent to telephonic or electronic recordings for security and
quality of service purposes and agree that either may produce telephonic
or electronic recordings or computer records as evidence in any
proceedings brought in connection with this Agreement.
PAGE 11 OF 12
(E) FURTHER INFORMATION. The Client agrees to execute and to cause the Fund
to execute further documents and provide materials and information as may
be reasonably requested by the Custodian to enable it to perform its
duties and obligations under this Agreement.
(F) ASSIGNMENT. No party may assign or transfer any of its rights or
obligations under this Agreement without the other's prior written
consent, which consent will not be unreasonably withheld or delayed;
provided that the Custodian may make such assignment or transfer to a
branch, subsidiary or affiliate if it does not materially affect the
provision of services to the Client.
(G) HEADINGS. Titles to Sections of this Agreement are included for
convenience of reference only and shall be disregarded in construing the
language contained in this Agreement.
(H) COUNTERPARTS. This Agreement may be executed in several counterparts,
each of which shall be an original, but all of which together shall
constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized.
CITIBANK, N.A. SOUND SHORE FUND, INC.
By: By:
--------------------------------- ---------------------------------
Name: Name: XXXXXX X. XXXXXX
--------------------------------- ---------------------------------
Title: Title: ASSISTANT SECRETARY
--------------------------------- --------------------------------
PAGE 12 OF 12
GLOBAL CUSTODIAL SERVICES AGREEMENT
SCHEDULE A
LIST OF PORTFOLIOS
Sound Shore Fund, Inc.
PAGE 1 OF 2
GLOBAL CUSTODIAL SERVICES AGREEMENT
FEE SCHEDULE
This Schedule shall be amended upon delivery by Custodian of a new Schedule to
Client and acceptance thereof by Client and shall be effective as of the date of
acceptance by Client or a date agreed upon between Custodian and Client.
1. ACCOUNT MAINTENANCE FEES
Domestic Custody Accounts $2,400 per account per year
2. DOMESTIC CUSTODY FEES
A. SAFEKEEPING CHARGES
Assets Annual
UNDER CUSTODY ASSET FEE
$0 - $1 Billion 1 Basis Point
$1 - $2 Billion 0.75 Basis Points
$2 - $6 Billion 0.50 Basis Points
$6 Billion + 0.25 Basis Points
B. TRANSACTION CHARGES
Cost Per
TRANSACTION TYPE TRANSACTION
---------------- -----------
DTC $12
Federal Book Entry $10
PTC $10
Physicals $25
Maturities (Depository) $10
Maturities (Physical) $25
P&I Payments (Book Entry) $3
P&I Payments (Physical) $10
Fed Wires (from Custody account) $8
SHE (Shares Held Elsewhere) Trades $25
CITIBANK, N.A. SOUND SHORE FUND, INC.
By: By:
--------------------------------- ---------------------------------
Name: Name: XXXXXX X. XXXXXX
--------------------------------- ---------------------------------
Title: Title: ASSISTANT SECRETARY
--------------------------------- --------------------------------