CUSTODIAN CONTRACT
Between
HERITAGE CONVERTIBLE INCOME-GROWTH TRUST
and
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
Page
1. Employment of Custodian and Property to be Held by It . . . 1
2. Duties of the Custodian with Respect to Property of the
Fund Held By the Custodian . . . . . . . . . . . . . . . . . 2
2.1 Holding Securities . . . . . . . . . . . . . . . . . 2
2.2 Delivery of Securities . . . . . . . . . . . . . . . 2
2.3 Registration of Securities . . . . . . . . . . . . . 8
2.4 Bank Accounts . . . . . . . . . . . . . . . . . . . 8
2.5 Payments for Shares . . . . . . . . . . . . . . . . 9
2.6 Availability of Federal Funds . . . . . . . . . . . 9
2.7 Collection of Income . . . . . . . . . . . . . . . . 10
2.8 Payment of Fund Moneys . . . . . . . . . . . . . . . 10
2.9 Payment in Advance of Receipt of Securities
Purchased . . . . . . . . . . . . . . . . . . . . . 13
2.10 Payments for Repurchases or Redemptions of Shares
of the Fund . . . . . . . . . . . . . . . . . . . . 13
2.11 Appointment of Agents . . . . . . . . . . . . . . . 14
2.12 Deposit of Fund Assets in Securities Systems . . . . 14
2.13 Segregated Account . . . . . . . . . . . . . . . . . 17
2.14 Ownership Certificates for Tax Purposes . . . . . . 18
2.15 Proxies . . . . . . . . . . . . . . . . . . . . . . 19
2.16 Communications Relating to Fund Portfolio
Securities . . . . . . . . . . . . . . . . . . . . . 19
2.17 Proper Instructions . . . . . . . . . . . . . . . . 20
2.18 Actions Permitted Without Express Authority . . . . 20
2.19 Evidence of Authority . . . . . . . . . . . . . . . 21
3. Duties of Custodian with Respect to the Books of Account
and Calculation of Net Asset Value and Net Income . . . . . 22
4. Records . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5. Opinion of Fund's Independent Certified Public Accountants . 23
6. Reports to Fund by Independent Certified Public
Accountants . . . . . . . . . . . . . . . . . . . . . . . . 24
7. Compensation of Custodian . . . . . . . . . . . . . . . . . 24
8. Responsibility of Custodian . . . . . . . . . . . . . . . . 24
9. Effective Period, Termination and Amendment . . . . . . . . 26
10. Successor Custodian . . . . . . . . . . . . . . . . . . . . 27
11. Interpretive and Additional Provisions . . . . . . . . . . . 29
12. Additional Funds . . . . . . . . . . . . . . . . . . . . . . 29
13. Massachusetts Law to Apply . . . . . . . . . . . . . . . . . 29
14. Prior Contracts . . . . . . . . . . . . . . . . . . . . . . 30
15. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . 30
16. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . 30
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CUSTODIAN CONTRACT
------------------
This Contract between Heritage Convertible Income-Growth Trust, a
business trust organized and existing under the laws of Massachusetts,
having its principal place of business at 0000-00xx Xxxxxx, Xxxxx, Xx.
Xxxxxxxxxx, Xxxxxxx 00000 hereinafter called the "Fund", and State Street
Bank and Trust Company, a Massachusetts corporation, having its principal
place of business at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, 00000,
hereinafter called the "Custodian",
WITNESSETH that in consideration of the mutual covenants and
agreements hereinafter contained, the parties hereto agree as follows:
1. Employment of Custodian and Property to be Held by It
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The Fund hereby employs the Custodian as the custodian of its
assets pursuant to the provisions of the Fund's Declaration of Trust and
the terms and conditions hereof. The Fund agrees to deliver to the
Custodian all securities and cash owned by the Fund, and all payments of
income, principal and capital distributions received by the Fund with
respect to all securities it owns from time to time, and the cash
consideration received by the Fund for such new or treasury shares of
beneficial interest, without par value ("Shares") of the Fund as may be
issued or sold from time to time. The Custodian shall not be responsible
for any property of the Fund held or received by the Fund and not
delivered to the Custodian.
Upon receipt of "Proper Instructions" (within the meaning of
Section 2.17), the Custodian shall from time to time employ one or more
sub-custodians, but only after the prior express written consent of the
Fund in accordance with an applicable vote by the Board of Trustees, and
provided that the Custodian shall have no more or less responsibility or
liability to the Fund on account of any actions or omissions of any
sub-custodian so employed than any such sub-custodian has to the
Custodian.
2. Duties of the Custodian with Respect to Property of the Fund Held
By the Custodian
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2.1 Holding Securities. The Custodian shall hold and physically
segregate for the account of the Fund all non-cash property,
including all securities owned by the Fund, other than securities
which are maintained pursuant to Section 2.12 in a clearing
agency which acts as a securities depository or in a book-entry
system authorized by the U.S. Department of the Treasury,
collectively referred to herein as "Securities System".
2.2 Delivery of Securities. The Custodian shall release and deliver
securities owned by the Fund held by the Custodian or in a
Securities System account of the Custodian only upon receipt of
Proper Instructions, which may be continuing instructions when
deemed appropriate by the parties, and only in the following
cases:
1) Upon sale of such securities for the account of
the Fund and receipt by the Custodian of payment
therefor;
2) Upon the receipt of payment in connection with
any repurchase agreement related to such
securities entered into by the Fund;
3) In the case of a sale effected through a
Securities System, in accordance with the
provisions of Section 2.12 hereof;
4) To the depository agent in connection with tender
or other similar offers for portfolio securities
of the Fund;
5) To the issuer thereof or its agent when such
securities are called, redeemed, retired or
otherwise become payable; provided that, in any
such case, the cash or other consideration is to
be delivered to the Custodian;
6) To the issuer thereof, or its agent, for transfer
into the name of the Fund or into the name of any
nominee or nominees of the Custodian or into the
name or nominee name of any agent appointed
pursuant to Section 2.11 or into the name or
nominee name of any sub-custodian appointed
pursuant to Article 1; or for exchange for a
different number of bonds, certificates or other
evidence representing the same aggregate face
amount or number of units; provided that, in any
such case, the new securities are to be delivered
to the Custodian;
7) Upon the sale of such securities for the account
of the Fund, to the broker or its clearing agent,
against a receipt, for examination in accordance
with "street delivery" custom; provided that in
any such case, the Custodian shall have no
responsibility or liability for any loss arising
from the delivery of such securities prior to
receiving payment for such securities except as
may arise from the Custodian's own negligence or
willful misconduct;
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8) For exchange or conversion pursuant to any plan
of merger, consolidation, recapitalization,
reorganization or readjustment of the securities
of the issuer of such securities, or pursuant to
provisions for conversion contained in such
securities, or pursuant to any deposit agreement;
provided that, in any such case, the new
securities and cash, if any, are to be delivered
to the Custodian;
9) In the case of warrants, options, rights or
similar securities, the surrender thereof in the
exercise of such warrants, options, rights or
similar securities or the surrender of interim
receipts or temporary securities for definitive
securities; provided that, in any such case, the
new securities and cash, if any, are to be
delivered to the Custodian;
10) For delivery in connection with any loans of
securities made by the Fund, but only against
receipt of adequate collateral as agreed upon
from time to time by the Custodian and the Fund,
which may be in the form of cash or securities,
including obligations issued by the United States
government, its agencies or instrumentalities,
except that in connection with any loans for
which collateral is to be credited to the
Custodian's account in the book-entry system
authorized by the U.S. Department of the
Treasury, the Custodian will not be held liable
or responsible for the delivery of securities
owned by the Fund prior to the receipt of such
collateral;
11) For delivery as security in connection with any
borrowings by the Fund requiring a pledge of
assets by the Fund, but only against receipt of
amounts borrowed;
12) For delivery in accordance with the provisions of
any agreement among the Fund, the Custodian and a
broker-dealer registered under the Securities
Exchange Act of 1934 (the "Exchange Act") and a
member of The National Association of Securities
Dealers, Inc. ("NASD"), relating to compliance
with the rules of The Options Clearing
Corporation and of any registered national
securities exchange, or of any similar
organization or organizations, regarding escrow
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or other arrangements in connection with
transactions by the Fund;
13) For delivery in accordance with the provisions of
any agreement among the Fund, the Custodian, and
a Futures Commission Merchant registered under
the Commodity Exchange Act, relating to
compliance with the rules of the Commodity
Futures Trading Commission and/or any Contract
Market, or any similar organization or
organizations, regarding account deposits in
connection with transactions by the Fund;
14) Upon receipt of instructions from the Fund's
transfer agent ("Transfer Agent") for delivery to
such Transfer Agent or to the holders of Shares
in connection with distributions in kind, as may
be described from time to time in the Fund's
currently effective prospectus and statement of
additional information ("Registration
Statement"), in satisfaction of requests by
holders of Shares for repurchase or redemption;
and
15) For release of securities to designated brokers
under covered call options; provided however,
that such securities shall be released only upon
payment to the Custodian of monies for the
premium due and a receipt for the securities
which are to be held in escrow. Upon exercise of
the option, or at expiration, the Custodian will
receive from brokers the securities previously
deposited. The Custodian will act strictly in
accordance with Proper Instructions in the
delivery of securities to be held in escrow and
will have no responsibility or liability for any
such securities which are not returned promptly
when due other than to make proper request for
such return;
16) For any other proper corporate purpose, but only
upon receipt of, in addition to Proper
Instructions, a certified copy of a resolution of
the Board of Trustees or of the Executive
Committee signed by an officer of the Fund and
certified by the Secretary or an Assistant
Secretary, specifying the securities to be
delivered, setting forth the purpose for which
such delivery is to be made, declaring such
purpose to be a proper corporate purpose, and
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naming the person or persons to whom delivery of
such securities shall be made.
2.3 Registration of Securities. Securities held by the Custodian
(other than bearer securities) shall be registered in the name of
the Fund or in the name of any nominee of the Fund or of any
nominee of the Custodian which nominee shall be assigned
exclusively to the Fund, unless the Fund has authorized in
writing the appointment of a nominee to be used in common with
other registered investment companies having the same investment
adviser, as the Fund or in the name or nominee name of any a
appointed pursuant to Section 2.11 or in the name or nominee name
of any sub-custodian appointed pursuant to Article 1 hereof. All
securities accepted by the Custodian on behalf of the Fund under
the terms of this Contract shall be in "street name" or other
good delivery form.
2.4 Bank Accounts. The Custodian shall open and maintain a separate
bank account or accounts in the name of the Fund, subject only to
draft or order by the Custodian acting pursuant to the terms of
this Contract, and shall hold in such account or accounts,
subject to the provisions hereof, all cash received by it from or
for the account of the Fund, other than cash maintained by the
Fund in a bank account established and used in accordance with
Rule 17f-3 under the Investment Company Act of 1940 ("1940 Act").
Funds held by the Custodian for the Fund may be deposited by it
to its credit as Custodian in the Banking Department of the
Custodian or in such other banks or trust companies as it may in
its discretion deem necessary or desirable; provided, however,
that every such bank or trust company shall be qualified to act
as a custodian under the 1940 Act and that each such bank or
trust company and the funds to be deposited with each such bank
or trust company shall be approved by vote of a majority of the
Board of Trustees of the Fund. Such funds shall be deposited by
the Custodian in its capacity as Custodian and shall be
withdrawable by the Custodian only in that capacity.
2.5 Payments for Shares. The Custodian shall receive from the
distributor for the Fund's Shares or from the Transfer Agent of
the Fund and deposit into the Fund's account such payments as are
received for Shares of the Fund issued or sold from time to time
by the Fund. The Custodian will provide timely notification to
the Fund and the Transfer Agent of any receipt by it of payments
for Shares of the Fund.
2.6 Availability of Federal Funds. Upon mutual agreement between the
Fund and the Custodian, the Custodian shall, upon the receipt of
Proper Instructions, make federal funds available to the Fund as
of specified times agreed upon from time to time by the Fund and
the Custodian in the amount of checks received in payment for
Shares of the Fund which are deposited into the Fund's account.
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2.7 Collection of Income. The Custodian shall collect on a timely
basis all income, dividends and other payments with respect to
registered securities held hereunder to which the Fund shall be
entitled either by law or pursuant to custom in the securities
business, and shall collect on a timely basis all income,
dividends and other payments with respect to bearer securities
if, on the date of payment by the issuer, such securities are
held by the Custodian or its agent thereof and shall credit such
income, dividends and other payments, as collected, to the Fund's
custodian account. Without limiting the generality of the
foregoing, the Custodian shall detach and present for payment all
coupons and other income items requiring presentation as and when
they become due and shall collect interest when due on securities
held hereunder. Income due the Fund on securities loaned
pursuant to the provisions of Section 2.2 (10) shall be the
responsibility of the Fund. The Custodian will have no duty or
responsibility in connection therewith, other than to provide the
Fund with such information or data as may be necessary to assist
the Fund in arranging for the timely delivery to the Custodian of
the income to which the Fund is properly entitled.
2.8 Payment of Fund Moneys. Upon receipt of Proper Instructions,
which may be continuing instructions when deemed appropriate by
the parties, the Custodian shall pay out moneys of the Fund in
the following cases only:
1) Upon the purchase of securities, futures
contracts or options on futures contracts for the
account of the Fund but only (a) against the
delivery of such securities, or evidence of title
to futures contracts or options on futures
contracts, to the Custodian (or any bank, banking
firm or trust company doing business in the
United States or abroad which is qualified under
the 1940 Act, as amended, to act as a custodian
and which has been designated by the Custodian as
its agent for this purpose) registered in the
name of the Fund or in the name of a nominee of
the Custodian referred to in Section 2.3 hereof
or in proper form for transfer; (b) in the case
of a purchase effected through a Securities
System, in accordance with the conditions set
forth in Section 2.12 hereof or (c) in the case
of repurchase agreements entered into between the
Fund and the Custodian, or another bank, or a
broker-dealer which is a member of NASD, (i)
against delivery of the securities either in
certificate form or through an entry crediting
the Custodian's account at the Federal Reserve
Bank with such securities (notwithstanding that
the written agreement to repurchase will be
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received subsequently) or (ii) if the agreement
is with the Custodian against delivery of the
receipt evidencing purchase by the Fund of
securities owned by the Custodian along with
written evidence of the agreement by the
Custodian to repurchase such securities from the
Fund;
2) In connection with conversion, exchange or
surrender of securities owned by the Fund as set
forth in Section 2.2 hereof;
3) For the redemption or repurchase of Shares issued
by the Fund as set forth in Section 2.10 hereof;
4) For the payment of any expense or liability
incurred by the Fund, including but not limited
to the following payments for the account of the
Fund: interest, taxes, management, distribution,
advisory, accounting, transfer agent and legal
fees, and operating expenses of the Fund whether
or not such expenses are to be in whole or part
capitalized or treated as deferred expenses;
5) For the payment of any dividends declared
pursuant to the governing documents of the Fund;
6) For payment of the amount of dividends received
in respect of securities sold short;
7) For any other proper purpose, but only upon
receipt of, in addition to Proper Instructions, a
certified copy of a resolution of the Board of
Trustees or of the Executive Committee of the
Fund signed by an officer of the Fund and
certified by its Secretary or an Assistant
Secretary, specifying the amount of such payment,
setting forth the purpose for which such payment
is to be made, declaring such purpose to be a
proper purpose, and naming the person or persons
to whom such payment is to be made.
2.9 Liability for Payment in Advance of Receipt of Securities
Purchased. In any and every case where payment for purchase of
securities for the account of the Fund is made by the Custodian
in advance of receipt of the securities purchased, in the absence
of specific written instructions from the Fund to so pay in
advance, the Custodian shall be absolutely liable to the Fund for
such securities to the same extent as if the securities had been
received by the Custodian.
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2.10 Payments for Repurchases or Redemptions of Shares of the Fund.
From such funds as may be available for the purpose but subject
to the limitations of the Declaration of Trust and By-Laws and
any applicable resolution of the Board of Trustees of the Fund
pursuant thereto, the Custodian shall, upon receipt of
instructions from the Transfer Agent, make funds available for
payment to holders of Shares who have delivered to the Transfer
Agent a request for redemption or repurchase of their Shares and
for payment to the distributor of the Fund's Shares for its
repurchase of Shares as agent for the Fund. In connection with
the redemption or repurchase of Shares of the Fund, the Custodian
is authorized upon receipt of instructions from the Transfer
Agent to wire funds to or through a commercial bank designated by
the redeeming shareholders or the distributor of the Fund's
Shares. In connection with the redemption or repurchase of
Shares of the Fund, the Custodian shall honor checks drawn on the
Custodian by a holder of Shares, which checks have been furnished
by the Fund to the holder of Shares, when presented to the
Custodian in accordance with such procedures and controls as are
mutually agreed upon from time to time between the Fund and the
Custodian.
2.11 Appointment of Agents. The Custodian may at any time or times in
its discretion appoint (and may at any time remove) any other
bank or trust company which is itself qualified under the 1940
Act, as amended, to act as a custodian, as its agent to carry out
such of the provisions of this Article 2 as the Custodian may
from time to time direct; provided, however, that the appointment
of any agent shall not relieve the Custodian of its
responsibilities or liabilities hereunder.
2.12 Deposit of Fund Assets in Securities Systems. The Custodian may
deposit and/or maintain securities owned by the Fund in a
clearing agency registered with the Securities and Exchange
Commission under Section 17A of the Exchange Act, which acts as a
securities depository, or in the book-entry system authorized by
the U.S. Department of the Treasury and certain federal agencies,
(collectively referred to herein as "Securities System") in
accordance with applicable Federal Reserve Board and Securities
and Exchange Commission rules and regulations, if any, and
subject to the following provisions:
1) The Custodian may keep securities of the Fund in
a Securities System provided that such securities
are represented in an account ("Account") of the
Custodian in the Securities System which shall
not include any assets of the Custodian other
than assets held as a fiduciary, custodian or
otherwise for customers;
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2) The records of the Custodian with respect to
securities of the Fund which are maintained in a
Securities System shall identify by book-entry
those securities belonging to the Fund;
3) The Custodian shall pay for securities purchased
for the account of the Fund upon (i) receipt of
advice from the Securities System that such
securities have been transferred to the Account,
and (ii) the making of an entry on the records of
the Custodian to reflect such payment and
transfer for the account of the Fund. The
Custodian shall transfer securities sold for the
account of the Fund upon (i) receipt of advice
from the Securities System that payment for such
securities has been transferred to the Account,
and (ii) the making of an entry on the records of
the Custodian to reflect such transfer and
payment for the account of the Fund. Copies of
all advices from the Securities System of
transfers of securities for the account of the
Fund shall identify the Fund, be maintained for
the Fund by the Custodian and be provided to the
Fund at its request. Upon request, the Custodian
shall furnish the Fund confirmation of each
transfer to or from the account of the Fund in
the form of a written advice or notice and shall
furnish to the Fund copies of daily transaction
sheets reflecting each day's transactions in the
Securities System for the account of the Fund.
4) The Custodian shall provide the Fund with any
report obtained by the Custodian on the
Securities System's accounting system, internal
accounting control and procedures for
safeguarding securities deposited in the
Securities System;
5) The Custodian shall have received the initial or
annual certificate, as the case may be, required
by Article 9 hereof;
6) Anything to the contrary in this Contract
notwithstanding, the Custodian shall be liable to
the Fund for any loss or damage to the Fund
resulting from use of the Securities System by
reason of any negligence, misfeasance or
misconduct of the Custodian or any of its agents
or of any of its or their employees or from
failure of the Custodian or any such agent to
enforce effectively such rights as it may have
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against the Securities System; at the election of
the Fund, it shall be entitled to be subrogated
to the rights of the Custodian with respect to
any claim against the Securities System or any
other person which the Custodian may have as a
consequence of any such loss or damage if and to
the extent that the Fund has not been made whole
for any such loss or damage.
2.13 Segregated Account. The Custodian shall upon receipt of Proper
Instructions establish and maintain a segregated account or
accounts for and on behalf of the Fund, into which account or
accounts may be transferred cash and/or securities, including
securities maintained in an account by the Custodian pursuant to
Section 2.12 hereof, (i) in accordance with the provisions of any
agreement among the Fund, the Custodian and a broker-dealer
registered under the Exchange Act and a member of the NASD (or
any futures commission merchant registered under the Commodity
Exchange Act), relating to compliance with the rules of The
Options Clearing Corporation and of any registered national
securities exchange (or the Commodity Futures Trading Commission
or any registered contract market), or of any similar
organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Fund, (ii)
for purposes of segregating cash or securities in connection with
options purchased, sold or written by the Fund or commodity
futures contracts or options thereon purchased or sold by the
Fund, (iii) for the purposes of compliance by the Fund with the
procedures required by Investment Company Act Release No. 10666,
or any subsequent release or releases of the Securities and
Exchange Commission relating to the maintenance of segregated
accounts by registered investment companies and (iv) for other
proper corporate purposes, but only, in the case of clause (iv),
upon receipt of, in addition to Proper Instructions, a certified
copy of a resolution of the Board of Trustees or of the Executive
Committee signed by an officer of the Fund and certified by the
Secretary or an Assistant Secretary, setting forth the purpose or
purposes of such segregated account and declaring such purposes
to be proper corporate purposes.
2.14 Ownership Certificates for Tax Purposes. The Custodian shall
execute ownership and other certificates and affidavits for all
federal and state tax purposes in connection with receipt of
income or other payments with respect to securities of the Fund
held by it and in connection with transfers of securities.
2.15 Proxies. The Custodian shall, with respect to the securities
held hereunder, cause to be promptly executed by the registered
holder of such securities, if the securities are registered
otherwise than in the name of the Fund or a nominee of the Fund,
all proxies, without indication of the manner in which such
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proxies are to be voted, and shall promptly deliver to the Fund
such proxies, all proxy soliciting materials and all notices
relating to such securities.
2.16 Communications Relating to Fund Portfolio Securities. The
Custodian shall transmit promptly to the Fund all written
information (including, without limitation, pendency of calls and
maturities of securities and expirations of rights in connection
therewith and notices of exercise of call and put options written
by the Fund and the maturity of futures contracts purchased or
sold by the Fund) received by the Custodian from issuers of the
securities 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 securities whose tender or exchange is sought and
from the party (or his agents) making the tender or exchange
offer. If the Fund desires to take action with respect to any
tender offer, exchange offer or any other similar transaction,
the Fund shall notify the Custodian at least three business days
prior to the date on which the Custodian is to take such action.
2.17 Proper Instructions. Proper Instructions as used throughout this
Article 2 means a writing signed or initialled by one or more
person or persons as the Board of Trustees shall have from time
to time authorized. Each such writing shall set forth the
specific transaction or type of transaction involved, including a
specific statement of the purpose for which such action is
requested. Oral instructions will be considered Proper
Instructions if the Custodian reasonably believes them to have
been given by a person authorized to give such instructions with
respect to the transaction involved. The Fund shall cause all
oral instructions to be confirmed in writing. Upon receipt of a
certificate of the Secretary or an Assistant Secretary as to the
authorization by the Board of Trustees of the Fund accompanied by
a detailed description of procedures approved by the Board of
Trustees, Proper Instructions may include communications effected
directly between electro-mechanical or electronic devices
provided that the Board of Trustees and the Custodian are
satisfied that such procedures afford adequate safeguards for the
Fund's assets.
2.18 Actions Permitted without Express Authority. The Custodian may
in its discretion, without express authority from the Fund:
1) make payments to itself or others for minor
expenses of handling securities or other similar
items relating to its duties under this Contract,
provided that all such payments shall be
accounted for to the Fund;
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2) surrender securities in temporary form for
securities in definitive form;
3) endorse for collection, in the name of the Fund,
checks, drafts and other negotiable instruments;
and
4) in general, attend to all non-discretionary
details in connection with the sale, exchange,
substitution, purchase, transfer and other
dealings with the securities and property of the
Fund except as otherwise directed by the Board of
Trustees of the Fund.
2.19 Evidence of Authority. The Custodian shall be protected in
acting upon any instructions, notice, request, consent,
certificate or other instrument or paper believed by it to be
genuine and to have been properly executed by or on behalf of the
Fund. The Custodian may receive and accept a certified copy of a
vote or resolution of the Board of Trustees of the Fund as
conclusive evidence (a) of the authority of any person to act in
accordance with such vote or resolution or (b) of any
determination or of any action by the Board of Trustees pursuant
to the Declaration of Trust as described in such vote or
resolution, and such vote or resolution may be considered as in
full force and effect until receipt by the Custodian of written
notice to the contrary.
3. Duties of Custodian with Respect to the Books of Account and
Calculation of Net Asset Value and Net Income.
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The Custodian shall cooperate with and supply necessary
information to the entity or entities appointed by the Board of Trustees
of the Fund to keep the books of account of the Fund and/or compute the
net asset value per share of the outstanding shares of the Fund or, if
directed in writing to do so by the Fund, shall itself keep such books of
account and/or compute such net asset value per share. If so directed,
the Custodian shall also calculate daily the net income of the Fund
including the calculation of distribution and advisory fees, all as
described in the Fund's currently effective Registration Statement and
shall advise the Fund and the Transfer Agent daily of the total amounts of
such fees and net income and, if instructed in writing by an officer of
the Fund to do so, shall advise the Transfer Agent periodically of the
division of such net income among its various components. The
calculations of the net asset value per share and the daily income of the
Fund shall be made at the time or times described from time to time in the
Fund's currently effective Registration Statement and in accordance with
the requirements of the 1940 Act and the rules thereunder.
- 12 -
4. Records
-------
The Custodian shall create and maintain all records relating to
its activities and obligations under this Contract in such manner as will
meet the obligations of the Fund under the 1940 Act, with particular
attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
applicable federal and state tax laws and any other law or administrative
rules or procedures which may be applicable to the Fund. All such records
shall be the property of the Fund and shall at all times during the
regular business hours of the Custodian be open for inspection by duly
authorized officers, employees or agents of the Fund and employees and
agents of the Securities and Exchange Commission. The Custodian shall, at
the Fund's request, supply the Fund with a tabulation of securities owned
by the Fund and held by the Custodian and shall, when requested to do so
by the Fund and for such compensation as shall be agreed upon between the
Fund and the Custodian, include certificate numbers in such tabulations.
5. Opinion of Fund's Independent Certified Public Accountants
----------------------------------------------------------
The Custodian shall take all reasonable action, as the Fund may
from time to time request, to obtain from year to year favorable opinions
from the Fund's certified public accountants with respect to its
activities hereunder in connection with the preparation of the Fund's Form
N-1A, and Form N-SAR or other reports to the Securities and Exchange
Commission and with respect to any other requirements of such Commission.
6. Reports to Fund by Independent Certified Public Accountants
-----------------------------------------------------------
The Custodian shall provide the Fund, at such times as the Fund
may reasonably require, with reports by independent certified public
accountants on the accounting system, internal accounting control and
procedures for safeguarding securities, futures contracts and options on
futures contracts, including securities deposited and/or maintained in a
Securities System, relating to the services provided by the Custodian
under this Contract; such reports, shall be of sufficient scope and in
sufficient detail, as may reasonably be required by the Fund to provide
reasonable assurance that any material inadequacies would be disclosed by
such examination, and, if there are no such inadequacies, the reports
shall so state.
7. Compensation of Custodian
-------------------------
The Custodian shall be entitled to reasonable compensation for
its services and expenses as Custodian, as agreed upon from time to time
between the Fund and the Custodian.
- 13 -
8. Responsibility of Custodian
---------------------------
So long as and to the extent that it is in the exercise of
reasonable care, the Custodian shall not be responsible for the title,
validity or genuineness of any property or evidence of title thereto
received by it or delivered by it pursuant to this Contract and shall be
held harmless in acting upon any notice, request, consent, certificate or
other instrument reasonably believed by it to be genuine and to be signed
by the proper party or parties. The Custodian shall be held to the
exercise of reasonable care in carrying out the provisions of this
Contract, but shall be kept indemnified by and shall be without liability
to the Fund for any action taken or omitted by it in good faith without
negligence. It shall be entitled to rely on and may act upon advice of
counsel (who may be counsel for the Fund) on all matters, and shall be
without liability for any action reasonably taken or omitted pursuant to
such advice. Notwithstanding the foregoing, the responsibility of the
Custodian with respect to redemptions effected by check shall be in
accordance with a separate Agreement entered into between the Custodian
and the Fund.
If the Fund requires the Custodian to take any action with
respect to securities, which action involves the payment of money or which
action may, in the opinion of the Custodian, result in the Custodian or
its nominee assigned to the Fund being liable for the payment of money or
incurring liability of some other form, the Fund, as a prerequisite to
requiring the Custodian to take such action, shall provide indemnity to
the Custodian in an amount and form satisfactory to it.
If the Fund requires the Custodian to advance cash or securities
for any purpose or in the event that the Custodian or its nominee shall
incur or be assessed any taxes, charges, expenses, assessments, claims or
liabilities in connection with the performance of this Contract, except
such as may arise from its or its nominee's own negligent action,
negligent failure to act or willful misconduct, any property at any time
held for the account of the Fund shall be security therefor and should the
Fund fail to repay the Custodian promptly, the Custodian shall be entitled
to utilize available cash and to dispose of Fund assets to the extent
necessary to obtain reimbursement.
9. Effective Period, Termination and Amendment
-------------------------------------------
This Contract shall become effective as of the date hereof, shall
continue in full force and effect until terminated as hereinafter
provided, may be amended at any time by mutual agreement of the parties
hereto and may be terminated by either party by an instrument in writing
delivered or mailed, postage prepaid to the other party, such termination
to take effect not sooner than sixty (60) days after the date of such
delivery or mailing; provided, however that the Custodian shall not act
under Section 2.12 hereof in the absence of receipt of an initial
- 14 -
certificate of the Secretary or an Assistant Secretary that the Board of
Trustees of the Fund have approved the initial use of a particular
Securities System and the receipt of an annual certificate of the
Secretary or an Assistant Secretary that the Board of Trustees have
reviewed the use by the Fund of such Securities System, as required in
each case by Rule 17f-4 under the 1940 Act, as amended; provided further,
however, that the Fund shall not amend or terminate this Contract in
contravention of any applicable federal or state regulations, or any
provision of the Declaration of Trust or By-Laws, and further provided,
that the Fund may at any time by action of its Board of Trustees (i)
substitute another bank or trust company for the Custodian by giving
notice as described above to the Custodian, or (ii) immediately terminate
this Contract in the event of the appointment of a conservator or receiver
for the Custodian by the Comptroller of the Currency or upon the happening
of a like event at the direction of an appropriate regulatory agency or
court of competent jurisdiction.
Upon termination of the Contract, the Fund shall pay to the
Custodian such compensation as may be due as of the date of such
termination and shall likewise reimburse the Custodian for its costs,
expenses and disbursements as contemplated by this Contract.
10. Successor Custodian
-------------------
If a successor custodian shall be appointed by the Board of
Trustees of the Fund, the Custodian shall, upon termination, deliver to
such successor custodian at the office of the Custodian, duly endorsed and
in the form for transfer, and all other property of the Fund then held by
it hereunder and shall transfer to an account of the successor custodian
all of the Fund's securities held in a Securities System.
If this Contract is terminated and no such successor custodian
shall be appointed, the Custodian shall, in like manner, as directed by
vote of the holders of a majority of the outstanding shares of the stock
of the Fund or upon receipt of a certified copy of a vote or resolution of
the Board of Trustees of the Fund, deliver at the office of the Custodian
and transfer such securities, funds and other properties of the Fund then
held by it hereunder as specified and in accordance with such vote or
resolution.
In the event that no written order designating a successor
custodian or certified copy of a vote or resolution of the Board of
Trustees shall have been delivered to the Custodian on or before the date
when such termination of this Contract shall become effective, then the
Custodian shall have the right to deliver to a bank or trust company,
which is a "bank" as defined in the 1940 Act, doing business in Boston,
Massachusetts, of its own selection, having an aggregate capital, surplus,
and undivided profits, as shown by its last published report, of not less
than $25,000,000, all securities, funds and other properties held by the
Custodian hereunder and all instruments held by the Custodian relative
- 15 -
hereto and all other property held by it under this Contract and to
transfer to an account of such successor custodian all of the Fund's
securities held in any Securities System. Thereafter, such bank or trust
company shall be the successor of the Custodian under this Contract.
In the event that securities, funds and other properties remain
in the possession of the Custodian after the date of termination hereof
owing to failure of the Fund to deliver to the Custodian the written order
or certified copy referred to above, or of the Board of Trustees to
appoint a successor custodian, the Custodian shall be entitled to fair
compensation for its services during such period as the Custodian retains
possession of such securities, funds and other properties and the
provisions of this Contract relating to the duties and obligations of the
Custodian shall remain in full force and effect.
11. Interpretive and Additional Provisions
--------------------------------------
In connection with the operation of this Contract, the Custodian
and the Fund may from time to time agree on such provisions interpretive
of or in addition to the provisions of this Contract as may in their joint
opinion be consistent with the general tenor of this Contract. Any such
interpretive or additional provisions shall be in a writing signed by both
parties and shall be annexed hereto, provided that no such interpretive or
additional provisions shall contravene any applicable federal or state
regulations or any provision of the Declaration of Trust of the Fund. No
interpretive or additional provisions made as provided in the preceding
sentence shall be deemed to be an amendment of this Contract.
12. Additional Funds
----------------
In the event that the Fund establishes an additional series of
shares other than the Shares with respect to which it desires to have the
Custodian render services as custodian under the terms hereof, it shall so
notify the Custodian in writing, and if the Custodian agrees in writing to
provide such services, such additional series of shares shall become a
Fund hereunder.
13. Massachusetts Law to Apply
--------------------------
This Contract shall be construed and the provisions thereof
interpreted under and in accordance with laws of The Commonwealth of
Massachusetts.
14. Prior Contracts
---------------
This Contract supersedes and terminates, as of the date hereof,
all prior contracts between the Fund and the Custodian relating to the
- 16 -
custody of the Fund's assets. This Contract may not be assigned by the
Custodian, except as expressly provided in Section 10 hereof, without the
prior written consent of the Fund.
15. Headings
--------
The headings of the sections of this Contract are inserted for
reference and convenience only, and shall not affect the construction of
this Contract.
16. Notices
-------
Any notice shall be sufficiently given when sent by overnight,
registered or certified mail to the other party at the address of such
party set forth above or at such other address as such party may from time
to time specify in writing to the other party.
IN WITNESS WHEREOF, each of the parties has caused this
instrument to be executed in its name and behalf by its duly authorized
representative and its seal to be hereunder affixed as of the 31st day of
October, 1986.
ATTEST HERITAGE CONVERTIBLE INCOME-GROWTH
TRUST
/s/ Xxxxx Xxxxxxxxx By /s/ Xxxxxxx X. Xxxxx
-------------------- --------------------------------
ATTEST STATE STREET BANK AND TRUST COMPANY
Officer By Officer
---------------------- --------------------------------
Assistant Secretary Vice President
- 17 -
HERITAGE CONVERTIBLE INCOME-GROWTH TRUST
CUSTODIAN CONTRACT
APPENDIX A
The Custodian agrees that any claims by it against the Fund under
this Contract may be satisfied only from the assets of the Fund; that the
person executing this Contract has executed it on behalf of the Fund and
not individually, and that the obligations of the Fund arising out of this
Contract are not binding upon such person or the Fund's shareholders
individually but are binding only upon the assets and property of the
Fund; and that no shareholders, trustees or officers of the Fund may be
held personally liable or responsible for any obligations of the Fund
arising out of this Contract.
ATTEST HERITAGE CONVERTIBLE INCOME-GROWTH TRUST
/s/ Xxxxx Xxxxxxxxx By /s/ Xxxxxxx X. Xxxxx
----------------------- -------------------------------------
ATTEST STATE STREET BANK AND TRUST COMPANY
/s/ Officer By /s/ Officer
----------------------- -------------------------------------
- 18 -
STATE STREET BANK AND TRUST COMPANY
Custodian Fee Schedule
Heritage Convertible Income - Growth Trust
I. Administration
--------------
Custody, Portfolio and Fund Accounting Service - Maintain custody
of fund assets. Settle portfolio purchases and sales. Report
buy and sell fails. Determine and collect portfolio income.
Make cash disbursements and report cash transactions. Maintain
investment ledgers, provide selected portfolio transactions,
position and income reports. Maintain general ledger and capital
stock accounts. Prepare daily trial balance. Calculate net
asset value daily. Provide selected general ledger reports.
Securities yield or market value quotations will be provided to
State Street by the fund.
The administration fee shown below is an annual charge, billed
and payable monthly, based on average monthly net assets.
ANNUAL FEES PER PORTFOLIO
-------------------------
Custody, Portfolio
Fund Net Assets & Fund Acct.
--------------- --------------------
First $20 Million 1/ 15 of 1%
Next $80 Million 1/ 30 of 1%
Excess 1/100 of 1%
Minimum Monthly Charges $2,000
II. Portfolio Trades - For each line
item processed
--------------------------------
State Street Bank Repos $ 7.00
DTC or Fed Book Entry $12.00
New York Physical Settlements $25.00
All other trades $16.00
III. Options
-------
Option charge for each option
written or closing contract, per
issue, per broker $25.00
Option expiration charge, per issue,
per broker $15.00
Option exercised charge, per issue,
per broker $15.00
IV. Lending of Securities
---------------------
Deliver loaned securities versus
cash collateral $20.00
Deliver loaned securities versus
securities collateral $30.00
Receive/deliver additional cash
collateral $ 6.00
Substitutions of securities
collateral $30.00
Deliver cash collateral versus
receipt of loaned securities $15.00
Deliver securities collateral versus
receipt of loaned securities $25.00
Loan administration -- xxxx-to-
market per day, per loan $ 3.00
V. Interest Rate Futures
---------------------
Transactions -- no security movement $ 8.00
VI. Coupon Bonds
------------
Monitoring for calls and processing
coupons -- for each coupon issue
held -- monthly charge $ 5.00
VII. Holdings Charge
---------------
For each issue maintained -- monthly
charge $ 5.00
VIII. Paydown on Government Securities
--------------------------------
Per paydown $10.00
IX. Dividend Charges (For items held at
the Request of Traders over record
date in street form) $50.00
X. Special Services
----------------
Fees for activities of a non-recurring nature such as
fund consolidations or reorganizations, extraordinary
security shipments and the preparation of special
reports will be subject to negotiation. Fees for tax
accounting/recordkeeping for options, financial futures,
and other special items will be negotiated separately.
XI. Out-of-Pocket Expenses
----------------------
A billing for the recovery of applicable out-of-pocket
expenses will be made as of the end of each month. Out-
of-pocket expenses include, but are not limited to the
following:
Telephone
Wire Charges
Postage and Insurance
Courier Service
Duplicating
Legal Fees
Supplies Related to Fund Records
Rush Transfer -- $8.00 Each
Transfer Fees
Sub-custodian Charges
Price Waterhouse Audit Letter
Federal Reserve Fee for Return Check items over
$2,500 - $4.25
GNMA Transfer - $15 each
Heritage Convertible STATE STREET BANK AND TRUST CO.
Income - Growth Trust
By By /s/ Xxxxxx X. Xxxxxx
_________________________ ________________________________
Title ______________________ Title Vice President
Date Date 9/12/86
_______________________ _________________________________
