As filed with the Securities and Exchange Commission on November 23, 1999.
Registration Nos. 33-29180
811-5823
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 14
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 16
DOMINI SOCIAL EQUITY FUND
(Exact Name of Registrant as Specified in Charter)
11 West 25th Street, New York, NY 10010
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code: 212-352-9200
Amy L. Domini
Domini Social Investments LLC
11 West 25th Street
New York, NY 10010
(Name and Address of Agent for Service)
Copy To:
Roger P. Joseph, Esq.
Bingham Dana LLP
150 Federal Street
Boston, Massachusetts 02110
It is proposed that this filing will become effective on December 1, 1999
pursuant to paragraph (b) of Rule 485.*
Domini Social Index Portfolio has also executed this registration statement.
- --------------------------------
* This filing designates a new effective date of December 1, 1999 for Domini
Social Equity Fund's Post-Effective Amendment No. 13 under the Securities
Act of 1933 and Amendment No. 15 under the Investment Company Act of 1940,
as filed with the Commission on September 29, 1999.
<PAGE>
The Prospectus of Domini Social Equity Fund, as filed by the Registrant
pursuant to Rule 485(a) under the Securities Act of 1933, as amended (File No.
33-29180), with the Securities and Exchange Commission on September 29, 1999,
is incorporated in this Post-Effective Amendment No. 14 by reference.
The Statement of Additional Information of Domini Social Equity Fund, as filed
by the Registrant pursuant to Rule 485(a) under the Securities Act of 1933, as
amended (File No. 33-29180), with the Securities and Exchange Commission on
September 29, 1999, is incorporated in this Post-Effective Amendment No. 14 by
reference.
<PAGE>
PART C
Item 23. Exhibits
<TABLE>
<CAPTION>
<S> <C>
* a(1)Amended and Restated Declaration of Trust of the Registrant.
** a(2)Certificate and Amendment No. 2 to Declaration of Trust of the Registrant.
** b By-Laws of the Registrant, as amended October 6, 1997.
*** e Distribution Agreement between the Registrant and DSIL Investment Services
LLC, as distributor.
g Custodian Agreement between the Registrant and Investors Bank & Trust
Company, as custodian.
*** h(1)Transfer Agency Agreement between the Registrant and First Data Investor
Services Group, Inc. ("First Data").
** h(2)Sponsorship Agreement between the Registrant and DSIL, as sponsor.
*** i Opinion and consent of counsel.
*** m Distribution Plan of the Registrant.
*** q Powers of Attorney.
and filed
herewith
- ------------------------
* Incorporated by reference from Post-Effective Amendment No. 7 to the Registrant's
Registration Statement as filed with the SEC on November 22, 1995.
** Incorporated by reference from Post-Effective Amendment No. 11 to the Registrant's
Registration Statement as filed with the SEC on November 25, 1997.
*** Incorporated by reference from Post-Effective Amendment No. 13 to the Registrant's
Registration Statement as filed with the SEC on September 29, 1999.
</TABLE>
Item 24. Persons Controlled by or under Common Control with Registrant
Not applicable.
Item 25. Indemnification
Reference is hereby made to (a) Article V of the Registrant's
Declaration of Trust, filed as an exhibit to Post-Effective Amendment No. 7 to
the Registrant's Registration Statement; and (b) Section 4 of the Distribution
Agreement by and between the Registrant and DSIL Investment Services LLC, filed
as an exhibit to Post-Effective Amendment No. 13 to the Registrant's
Registration Statement.
The Trustees and officers of the Registrant and the personnel of the
Registrant's administrator and distributor are insured under an errors and
omissions liability insurance policy. The Registrant and its officers are also
insured under the fidelity bond required by Rule 17g-1 under the Investment
Company Act of 1940, as amended (the "1940 Act").
Item 26. Business and Other Connections of Investment Adviser
Domini Social Investments LLC ("DSIL") is a Massachusetts limited
liability company with offices at 11 West 25th Street, 7th Floor, New York, New
York 10010, and is registered as an investment adviser under the Investment
Advisers Act of 1940. The owners of DSIL are James Earl Brooks, Amy Lee Domini,
Peter D. Kinder, Steven D. Lydenberg, Sigward Moser and David P. Wieder.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Principal Employment during the
Name Business Address Past Two Fiscal Years
James E. Brooks Four Arlington Street President, Equity Resources Group, Inc.(real estate
Cambridge, MA 02140 investment)
Amy L. Domini 230 Congress Street CEO, Secretary and Treasurer, Kinder, Lydenberg,
Cambridge, MA 02110 Domini & Co., Inc. ("KLD")(investment adviser);
Trustee, Loring, Wolcott & Coolidge (fiduciary)
Peter D. Kinder 11 West 25th Street President, KLD
New York, NY 10010
Steven D. Lydenberg 11 West 25th Street Director of Research, KLD
New York, NY 10010
Sigward Moser 11 West 25th Street President and Director, Communication House
New York, NY 10010 International, Inc. (advertising agency)
David P. Wieder 11 West 25th Street President, Director, Equity Owner and Chairman,
New York, NY 10010 Fundamental Shareholder Services,Inc.; Secretary,
Fundamental Portfolio Advisors (investment
adviser); Registered Representative, Fundamental
Service Corp.(broker-dealer)
</TABLE>
Item 27. Principal Underwriters
(a) DSIL Investment Services LLC is the distributor for the
Registrant. DSIL Investment Services LLC serves as the
distributor or placement agent for the following other
registered investment companies: Domini Institutional Social
Equity Fund and Domini Social Index Portfolio.
(b) The information required by this Item 27 with respect to each
director or officer of DSIL Investment Services LLC is
incorporated herein by reference from Schedule A of Form BD
(File No. 008-44763) as filed by DSIL Investment Services LLC
pursuant to the Securities Exchange Act of 1934.
(c) Not applicable.
Item 28. Location of Accounts and Records
The accounts and records of the Registrant are located, in whole or in
part, at the offices of the Registrant and at the following locations:
Name: Address:
Domini Social Investments LLC 11 W. 25th Street (administrator)
New York, NY 10010
DSIL Investment Services LLC 11 W. 25th Street (distributor)
New York, NY 10010
Investors Bank & Trust Company 200 Clarendon Street (custodian)
Boston, MA 02116
First Data 4400 Computer Drive (transfer agent)
<PAGE>
Westborough, MA 01581
Item 29. Management Services
Not applicable.
Item 30. Undertakings
Not applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all
requirements for effectiveness of this Post-Effective Amendment to this
Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933
and has duly caused this Post-Effective Amendment to the Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Boston and Commonwealth of Massachusetts on the 22nd day of
November, 1999.
DOMINI SOCIAL EQUITY FUND
By:
Amy L. Domini
-------------------------------------
Amy L. Domini
President
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to the Registration Statement has been signed below by
the following persons in the capacities indicated below on November 22, 1999.
Signature Title
Amy L. Domini President (Principal Executive Officer) and
- -------------------------- Trustee of Domini Social Equity Fund
Amy L. Domini
Carole M. Laible Treasurer (Principal Accounting and
- -------------------------- Financial Officer) of Domini Social Equity
Carole M. Laible Fund
Julia Elizabeth Harris* Trustee of Domini Social Equity Fund
- --------------------------
Julia Elizabeth Harris
Kirsten S. Moy* Trustee of Domini Social Equity Fund
- --------------------------
Kirsten S. Moy
William C. Osborn* Trustee of Domini Social Equity Fund
- --------------------------
William C. Osborn
Karen Paul* Trustee of Domini Social Equity Fund
- --------------------------
Karen Paul
Gregory A. Ratliff* Trustee of Domini Social Equity Fund
- --------------------------
Gregory A. Ratliff
<PAGE>
Timothy H. Smith* Trustee of Domini Social Equity Fund
- --------------------------
Timothy H. Smith
Frederick C. Williamson, Sr.* Trustee of Domini Social Equity Fund
- --------------------------
Frederick C. Williamson, Sr.
*By:
Amy L. Domini
- --------------------------
Amy L. Domini
Executed by Amy L. Domini on
behalf of those indicated
pursuant to Powers of Attorney.
<PAGE>
SIGNATURES
Domini Social Index Portfolio has duly caused this Post-Effective
Amendment to the Registration Statement on Form N-1A (File No. 33-29180) of
Domini Social Equity Fund to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Boston and Commonwealth of
Massachusetts on the 22nd day of November, 1999.
DOMINI SOCIAL INDEX PORTFOLIO
By:
Amy L. Domini
-------------------------------------
Amy L. Domini
President of Domini Social Index Portfolio
This Post-Effective Amendment to the Registration Statement on Form N-1A
of Domini Social Equity Fund has been signed below by the following persons in
the capacities indicated below on November 22, 1999.
Signature Title
Amy L. Domini President (Principal Executive Officer) and
- -------------------------- Trustee of Domini Social Index
Amy L. Domini Portfolio
Carole M. Laible Treasurer (Principal Accounting and
- -------------------------- Financial Officer) of Domini Social Index
Carole M. Laible Portfolio
Julia Elizabeth Harris* Trustee of Domini Social Index Portfolio
- --------------------------
Julia Elizabeth Harris
Kirsten S. Moy* Trustee of Domini Social Index Portfolio
- --------------------------
Kirsten S. Moy
William C. Osborn* Trustee of Domini Social Index Portfolio
- --------------------------
William C. Osborn
Karen Paul* Trustee of Domini Social Index Portfolio
- --------------------------
Karen Paul
Gregory A. Ratliff* Trustee of Domini Social Index Portfolio
- --------------------------
Gregory A. Ratliff
Timothy H. Smith* Trustee of Domini Social Index Portfolio
- --------------------------
Timothy H. Smith
<PAGE>
Frederick C. Williamson, Sr.* Trustee of Domini Social Index Portfolio
- --------------------------
Frederick C. Williamson, Sr.
*By:
Amy L. Domini
- --------------------------
Amy L. Domini
Executed by Amy L. Domini on behalf of
those indicated pursuant to Powers of
Attorney.
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION OF EXHIBIT
g Custodian Agreement between the Registrant and
Investors Bank & Trust Company, as custodian.
q Powers of Attorney.
EXHIBIT G
CUSTODIAN AGREEMENT
BETWEEN
DOMINI SOCIAL INDEX TRUST
AND
INVESTORS BANK & TRUST COMPANY
<PAGE>
TABLE OF CONTENTS
1. Bank Appointed Custodian............................................. 1
2. Definitions.......................................................... 1
(a) Authorized Person.............................................. 1
(b) Security....................................................... 1
(c) Portfolio Security............................................. 1
(d) Officers' Certificate.......................................... 2
(e) Federal Book-Entry System...................................... 2
(f) Depository..................................................... 2
3. Proper Instructions.................................................. 2
4. Separate Accounts.................................................... 2
5. Certification as to Authorized Persons............................... 3
6. Custody as to Authorized Persons
A. Cash .......................................................... 3
(a) Purchase of Securities.................................... 3
(b) Redemptions............................................... 3
(c) Distributions and Expenses of Fund........................ 4
(d) Payment in Respect of Securities.......................... 4
(e) Repayment of Loans........................................ 4
(f) Repayment of Cash......................................... 4
(g) Other Authorized Payments................................. 4
(h) Termination............................................... 4
B. Securities..................................................... 5
(a) Use of Federal Book-Entry System.......................... 5
(b) Use of a Depository....................................... 7
(c) Use of Book-Entry System for Commercial Paper............. 8
(d) Use of Book-Entry System for Mutual Fund Shares........... 9
C. Options and Futures Transactions............................... 9
(a) Puts and Calls Traded on Securities Exchanges,
NASDAQ or Over-the Counter.............................. 9
(b) Puts, Calls and Futures Traded on Commodities Exchanges... 10
(c) Segregated Account........................................ 10
D. Segregated Account for "when issued", "forward commitment" and
Reverse Repurchase Agreement Transactions.................... 11
E. Interest Bearing Call or Time Deposits......................... 11
<PAGE>
7. Transfers of securities............................................... 12
8. Redemptions........................................................... 13
9. Merger, Dissolution, etc. of Fund..................................... 13
10. Actions of Bank Without Prior Authorization........................... 14
11. Maintenance of Records; Fund Evaluation, Accounting Services.......... 15
12. Concerning the Bank................................................... 16
A. Performance of Duties.......................................... 16
B. Fees and Expenses of Bank...................................... 17
C. Advanced by Bank............................................... 16
13. Termination........................................................... 18
14. Notices............................................................... 19
15. Amendments............................................................ 19
16. Parties............................................................... 19
17. Governing Law......................................................... 19
18. Limitation of Liability of the Trustees and Shareholder............... 19
<PAGE>
CUSTODIAN AGREEMENT
AGREEMENT made this 3rd day of June, 1993, between DOMINI SOCIAL INDEX
TRUST, a business trust established under the laws of the Commonwealth of
Massachusetts (the "Fund"), and INVESTORS BANK & TRUST COMPANY, a trust company
organized under the laws of the Commonwealth of Massachusetts ("Bank").
The Fund, an open-end management investment company, desires to place and
maintain all of its portfolio securities and cash in the custody of the Bank.
The Bank has at least the minimum qualification required by Section 17(f)(1) of
the Investment Company Act of 1940, as amended (the "Act"), to act as custodian
of the portfolio securities and cash of the Fund, and has indicated its
willingness to so act, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements contained herein, the parties hereto agree as follows:
1. Bank Appointed Custodian. The Fund hereby appoints the Bank as
custodian of its portfolio securities and cash delivered to the Bank as
hereinafter described, and the Bank agrees to act as such upon the terms and
conditions hereinafter set forth.
2. Definitions. Whenever used herein, the terms listed below will have the
following meaning:
(a) AUTHORIZED PERSON. Authorized Person will mean any of the persons
duly authorized to give Proper Instructions or otherwise act on
behalf of the Fund by appropriate resolution of the Board of Trustees
of the Fund (the "Board of Trustees").
(b) SECURITY. The term security as used herein will have the same
meaning as when such term is used in the Securities Act of 1933 as
amended, including, without limitation, any note, stock, treasury
stock, bond, debenture, evidence of indebtedness, certificate of
interest or participation in any profit sharing agreement,
collateral-trust certificate, preorganization, certificate or
subscription, transferable share, investment contract, voting trust
certificate, certificate of deposit for a security, fractional
undivided interest in oil, gas, or other mineral rights, any put,
call, straddle, option, or privilege on any security, certificate of
deposit, or group or index of securities (including any interest
therein or based on the value thereof), or any put, call, straddle,
options, or privilege entered into on a national securities exchange
relating to a foreign currency, or, in general, any interest or
instrument commonly known as a "security", or any certificate of
interest or participation in, temporary or interim certificate for,
receipt for, guarantee of, or warrant or right to subscribe to, or
option contract to purchase or sell any of the foregoing and futures,
forward contracts and options thereon.
(b) PORTFOLIO SECURITY. Portfolio Security will mean any security
owned by the Fund.
<PAGE>
(d) OFFICER'S CERTIFICATE. Officer's Certificate will mean unless
otherwise indicated, any request, direction, instruction, or
certification in writing signed by any two Authorized Persons of the
Fund.
(e) FEDERAL BOOK-ENTRY SYSTEM. Federal Book-Entry System shall mean
the Federal Reserve Treasury Department Book Entry System for the
United States government, instrumentality and agency securities
operated by the Federal Reserve Banks, its successor or successors
and its nominee or nominees.
(f) DEPOSITORY. Depository shall mean The Depository Trust Company
("DTC"), a clearing agency registered with the Securities and
Exchange Commission under Section 17A of the Securities Exchange Act
of 1934 (The "Exchange Act"), its successor or successors and its
nominee or nominees. The term "Depository" shall further mean and
include any other person authorized to act as a depository under the
Act, its successor or successors and its nominee or nominees,
specifically identified in a certified copy of a resolution of the
Fund's Board of Trustees.
3. PROPER INSTRUCTIONS. Proper Instructions shall mean (i) instructions
regarding the purchase or sale of Securities for the portfolio f the Fund, and
payments and deliveries in connection therewith, given by an Authorized Person,
such instructions to be given in such form and manner as the Bank and the Fund
shall agree upon from time to time, and (ii) instructions (which may be
continuing instructions) regarding other matters signed or initiated by an
Authorized Person. Oral instructions will be considered Proper Instructions if
the Bank reasonably believes them to have been given by an Authorized Person.
The Fund shall cause all oral instructions to be promptly confirmed in writing.
The Bank shall act upon and comply with any subsequent Proper Instruction which
modifies a prior instruction and the sole obligation of the Bank with respect
to any follow-up or confirmatory instruction, shall be to make reasonable
efforts to detect any discrepancy between the original instruction and such
confirmation and to report such discrepancy to the Fund. The Fund shall be
responsible, at the Fund's expense, for taking any action, including any
reprocessing, necessary to correct any such discrepancy or error, and to the
extent such action requires the Bank to act the Fund shall give the Bank
specific Proper Instructions as to the action required. Upon receipt of an
Officer's Certificate as to the authorization by the Board of Trustees of the
Fund, accompanied by a detailed description of procedures approved by the Fund,
Proper Instructions may include communication effected directly between
electro-mechanical or electronic devices provided that the Board of Trustees
and the Bank are satisfied that such procedures afford adequate safeguards for
the Fund's assets.
4. SEPARATE ACCOUNTS. In the event that the Fund establishes one or more
series or portfolios in addition to any established on the date hereof, with
respect to which it desires to have the Bank render services as custodian under
the terms hereof, it shall so notify the Bank in writing, and if the Bank
agrees in writing to provide such services, such series or portfolios shall be
treated for all purposes as a Fund hereunder.
<PAGE>
5. CERTIFICATION AS TO AUTHORIZED PERSONS. The Secretary or Assistant
Secretary of the Fund will at all times maintain on file with the Bank his
certification to the Bank, in such form as may be acceptable to the Bank, of
(i) the names and signatures of the Authorized Persons and (ii) the names of
the members of the Board of Trustees of the Fund, it being understood that upon
the occurrence of any change in the information set forth in the most recent
certification on file (including without limitation any person named in the
most recent certification who is no longer an Authorized Person as designated
therein), the Secretary or Assistant Secretary of Fund will sign a new or
amended certification setting forth the change and the new, additional or
omitted names or signatures. The Bank will be entitled to rely and act upon any
Officer's Certificate given to it by the Fund which has been signed by officers
named in the most recent certification.
6. CUSTODY OF CASH AND SECURITIES. As custodian for the Fund, the Bank
will keep safely all of the Portfolio Securities delivered to the Bank, and
will deposit to the account of the Fund all of the cash of the Fund delivered
to the Bank, as set forth below.
A. CASH. The Bank will open and maintain a separate account or accounts in
the name of the Fund or in the name of the Bank, as custodian of the Fund,
subject only to draft or order by the Bank acting pursuant to the terms of this
Agreement. Except as otherwise permitted by this Section 6, the Bank will hold
in such account or accounts as custodian, subject to the provisions hereof, all
cash received by it, including borrowed funds, for the account of the Fund.
Upon receipt by the Bank of Proper Instructions (which may be continuing
instructions) or in the case of payments for redemptions and repurchases of
outstanding shares of beneficial interest ("Common Stock") of the Fund,
notification from the Fund's transfer agent as provided in Section 8,
requesting such payment, designating the payee or the account or accounts to
which the Bank will release funds for deposit, and stating that it is for a
purpose permitted under the terms of this Section 6(A), specifying the
applicable subsection, or describing such purpose with sufficient particularity
to permit the Bank to ascertain the applicable subsection, the Bank will make
payments of cash held for the accounts of the Fund, insofar as funds are
available for that purpose, only as permitted in (a)-(h) below.
(a) PURCHASE OF SECURITIES: upon the purchase of Portfolio Securities
for the Fund, against contemporaneous receipt of such Securities by
the Bank registered in the name of the Fund or in the name of, or
properly endorsed and in form for transfer to, the Bank, or a nominee
of the Bank, or receipt for the account of the Bank in the case of
Portfolio Securities which are not physically held by the Bank as
permitted by this Section 6, each such payment to be made at the
purchase price shown on a broker's confirmation (or transaction
report in the case of Book Entry Paper) of purchase of the Portfolio
securities received by the Bank before such payment is made, as
confirmed in the Proper Instructions received by the Bank before such
payment is made:
(b) REDEMPTIONS: in such amount as may be necessary for the
repurchase or redemption of shares of common stock of the Fund
offered for repurchase or redemption in accordance with Section 8 of
this agreement;
<PAGE>
(c) DISTRIBUTIONS AND EXPENSES OF FUND; for the payment on the
account of the Fund of dividends or other distributions to
shareholders as may from time to time be declared by the Board of
Trustees of the Fund, interest, taxes, management or supervisory
fees, distribution fees including fees under any 12b-I plan, fees of
the Bank for its services hereunder and reimbursement of the expenses
and liabilities of the Bank as provided hereunder, fees of any
service organization, fees of any transfer agent, fees for legal,
accounting, and auditing services, or other operating expenses of the
Fund;
(d) PAYMENT IN RESPECT OF SECURITIES: for payments in connection with
the conversion, exchange or surrender of Portfolio Securities or
Securities subscribed to by the Fund held by or to be delivered to
the Bank;
(e) REPAYMENT OF LOANS: to repay loans of money made to the Fund,
but, in the case of final payment, only upon redelivery to the Bank
of any Portfolio Securities pledged or hypothecated therefor and upon
surrender of documents evidencing the loan;
(f) REPAYMENT OF CASH: to repay the cash delivered to the Fund for
the purpose of collateralizing the obligation to return to the Fund
certificates borrowed from the Fund representing Portfolio
Securities, but only upon redelivery to the Bank of such borrowed
certificates;
(g) OTHER AUTHORIZED PAYMENTS: for other authorized transactions of
the Fund, or other obligations of the Fund incurred for proper Fund
purposes; provided that before making any such payment the Bank will
also receive a certified copy of a resolution of the Board of
Trustees signed by an Authorized Person of the Fund (other than the
Person certifying such resolution) and certified by its Secretary or
Assistant Secretary, naming the person or persons to whom such
payment is to be made, and either describing the transaction for
which payment is to be made and declaring it to be an authorized
transaction of the Fund, or specifying the amount of the obligation
for which payment is to be made, setting forth the purpose for which
such obligation was incurred and declaring such purpose to be a
proper corporate purpose; and
(h) TERMINATION: upon the termination of this Agreement as
hereinafter set forth pursuant to Section 9 and Section 13 of this
Agreement.
The Bank is hereby authorized to endorse for collection and collect on behalf
of and in the name of the Fund all checks, drafts, or other negotiable or
transferable instruments or other orders for the payment of money received by
it for the account of the Fund.
<PAGE>
B. SECURITIES. Except as otherwise provided in this Section 6, the Bank as
custodian, will receive and hold pursuant to the provisions hereof, in a
separate account or accounts and physically segregated at all times from those
of other persons, any and all Portfolio Securities which may now or hereafter
be delivered to it by or for the account of the Fund. All such Portfolio
Securities will be held or disposed of by the Bank for, and subject at all
times to, the instructions of the Fund pursuant to the terms of this Agreement.
Subject to the specific provisions of this Section 6 relating to Portfolio
Securities that are not physically held by the Bank, the Bank will register all
Portfolio Securities (unless otherwise directed by Proper Instructions or an
Officer's Certificate), in the name of a registered nominee of the Bank as
defined in the Internal Revenue Code and any Regulations of the Treasury
Department issued thereunder, and will execute and deliver all such
certificates in connection therewith as may be required by such laws or
Regulations or under the laws of any State. The Bank will use its best efforts
to the end that the specific Portfolio Securities held by it hereunder will be
at all times identifiable.
The Bank will use the same care with respect to the safekeeping of
Portfolio Securities and cash of the Fund held by it as it uses in respect of
its own similar property but it need not maintain any special insurance for the
benefit of the Fund. The Bank shall make available to the Fund, upon request,
information relating to its insurance coverage.
The Fund will from time to time furnish to the Bank appropriate
instruments to enable it to hold or deliver in proper form for transfer, or to
register in the name of its registered nominee, any Portfolio Securities which
it may hold for the account of the Fund and which may from time to time be
registered in the name of the Fund.
Neither the Bank nor any nominee of the Bank will vote any of the
Portfolio Securities held hereunder by or for the account of the Fund, except
in accordance with Proper Instructions or an Officer's Certificate.
The Bank will execute and deliver, or cause to be executed and delivered,
to the Fund all notices, proxies and proxy soliciting materials with respect to
such Portfolio Securities, such proxies to be executed by the registered holder
of such Portfolio Securities (if registered otherwise than in the name of the
Fund), but without indicating the name in which such proxies are to be voted.
(a) USE OF FEDERAL BOOK-ENTRY SYSTEM. Provided (i) the Bank has
received a certified copy of a resolution of the Board of Trustees of
the Fund specifically approving deposits of Fund assets in the
Book-Entry System, indicating that, and (ii) for each year following
such approval, the Board of Trustees of the Fund has reviewed and
approved the arrangement and has not delivered an Officer's
Certificate to the Bank indicating that it has withdrawn its
approval:
1. The Bank may keep Portfolio Securities in the Federal Book-Entry System
provided that such Securities are represented in an account ("Account") of the
Bank (or its agent) in such System which shall not include any assets of the
Bank (or such agent) other than assets held as a fiduciary, custodian, or
otherwise for customers.
<PAGE>
2. The records of the Bank (and any such agent) with respect to the Fund's
participation in the Federal Book-Entry System through the Bank (or any such
agent) will identify by Book-Entry Portfolio Securities which are included with
other Securities deposited in the Account and shall at all times during the
regular business hours of the Bank (or such agent) be open for inspection by
duly authorized officers, employees or agents of the Fund. Where Securities are
transferred to the Fund's account, the Bank shall also, by book entry or
otherwise, identify as belonging to the Fund a quantity of Securities in a
fungible bulk (i) registered in the name of the Bank or its nominee, or (ii)
shown on the Bank's account on the books of the Federal Reserve bank.
3. The Bank (or its agent) shall pay for Securities purchased for the
account of the Fund or shall pay cash collateral against the return of
Portfolio Securities loaned by the Fund upon (i) receipt of advice from the
Federal Book-Entry System that such securities have been transferred to the
Account, and (ii) the making of any entry on the records of the Bank (or its
agent) to reflect such payment and transfer for the account of the Fund. The
Bank (or its agent) shall transfer Securities sold or loaned for the account of
the Fund upon
(a) Receipt of advice from the Federal Book-Entry System that payment
for Securities sold or payment of the initial cash collateral against
the delivery of Portfolio Securities loaned by the Fund has been
transferred to the Account, and
(b) The making of an entry on the records of the Bank (or its agent)
to reflect such transfer and payment for the account of the Fund.
Copies of all adivses from the Federal Book-Entry System of transfers
of Securities for the account of the Fund shall identify the Fund, be
maintained for the Fund by the Bank and shall be provided to the Fund
at its request. The Bank shall send the Fund a confirmation, as
defined by Rule 17f-4 under the Act, of any transfer to or from the
account of the Fund.
4. The Bank will promptly provide the Fund with any report obtained by the
Bank or its agent on the Federal Book-Entry System's accounting system,
internal accounting control and procedures for safeguarding Securities
deposited in the Federal Book-Entry System. The Bank will provide the Fund and
cause any such agent to provide, at such times as the Fund may reasonably
require, with reports by independent public accounts on the accounting system,
internal accounting control and procedures for safeguarding Portfolio
Securities, including Portfolio securities deposited in the Federal Book-Entry
System, relating to the services provided by the bank or such agent under the
Agreement.
5. Anything to the contrary in the Agreement notwithstanding, the Bank
shall be liable to the Fund for any loss or damage to the Fund resulting from
use of the Federal Book-Entry System by reason of any gross negligence, willful
misfeasance or bad faith of the Bank or any of its agents or of any of its or
their employees or from any reckless disregard by the Bank or any such agent of
its duty to enforce effectively such rights as it may have against the Federal
Book-Entry System; at the election of the Fund, it shall be entitled to be
subrogated for the Bank in any claim against the Federal Book-Entry System or
any other person which the Bank or its agent 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 loss or damage.
<PAGE>
(b) USE OF A DEPOSITORY. Provided (i) the Bank has received a
certified copy of a resolution of the Fund's Board of Trustees
specifically approving deposits in DTC or other such Depository and
(ii) for each year following such approval, the Board of Trustees f
the Fund has received and approved the arrangement and has not
delivered an Officer's Certificate to the Bank indicating that it has
withdrawn its approval:
1. The Bank may use a Depository to hold, received, exchange, release,
lend, deliver ad otherwise deal with Portfolio Securities, including stock
dividends, rights and other items of like nature, and to receive and remit to
the Bank on behalf of the Fund all income and other payments thereon and to
take all steps necessary and proper in connection with the collection thereof.
2. Registration of the Portfolio Securities may be made in the name of any
nominee or nominees used by such Depository.
3. Payment for Portfolio Securities purchased and sold may be made through
the clearing medium employed by such Depository for transactions of
participants acting through it. Upon any purchase of Securities for the account
of the Fund, payment will be made only upon delivery of the Securities to or
for the account of the Fund and the Fund shall pay cash collateral against the
return of Portfolio Securities loaned by the Fund only upon delivery of the
Portfolio Securities for the account of the Fund, delivery of the Portfolio
Securities will be made only against payment thereof or, in the event Portfolio
Securities are loaned, delivery of Portfolio Securities will be made only
against receipt of the initial cash collateral to or for the account of the
Fund.
4. The Bank shall be subject to the same liability and duty to the Fund
and its shareholders with respect to all Portfolio Securities and all cash,
stock dividends, rights and items of like nature to which the Fund is entitled,
held or received by a central securities system as agent for the Bank, pursuant
to the foregoing authorization, as if the same were held or received by the
Bank at its own offices. In this connection, with respect to the use of the
Depository by the Bank but without limiting the foregoing duty or liability,
the Bank, without cost to the Fund, shall ensure that:
(a) The Depository obtains replacement of any certificated Portfolio
Security deposited with it in the event such Portfolio Security is
lost, destroyed, wrongfully taken or otherwise not available to be
returned to the Bank upon its request:
(b) Any proxy materials received by Depository with respect to
Portfolio Securities deposited with such Depository are forwarded,
immediately to the Bank for prompt transmittal to the Fund;
<PAGE>
(c) Such Depository immediately forwards to the Bank confirmation of
any purchase or sale of Securities for the account of the Fund and of
the appropriate book entry made by such Depository to the Fund's
account;
(d) Such Depository prepares and delivers to the Bank such records
with respect OT the performance of the Bank's obligations and duties
hereunder as may be necessary for the Fund to comply with the
recordkeeping requirements of Section 31(a) of the Act and Rule 31a-1
thereunder; and
(e) Such Depository delivers to the Bank and the Fund all internal
accounting control reports, whether or note audited by an independent
public accountant, as well as such other reports as the Fund may
reasonably request in order to verify the Portfolio Securities held
by such Depository.
(c) USE OF BOOK-ENTRY SYSTEM FOR COMMERCIAL PAPER. Provided (i) the Bank
has received a certified copy of a resolution of the Fund's Board of Trustees
specifically approving participation in a system maintained by the Bank for the
holding of commercial paper in book-entry form ("Book Entry Paper") and (ii)
for each year following such approval the Board of Trustees of the Fund has
received and approved the arrangements, upon receipt of Proper Instructions and
upon receipt of confirmation from an Issuer (as defined below) that the Fund
has purchased such Issuer's Book Entry Paper, the Bank shall issue and hold in
book-entry form, on behalf of the Fund, commercial paper issued by issuers with
whom the Bank has entered into a book-entry agreement (the "Issuers"). In
maintaining its Book Entry Paper System, the Bank agrees that:
1. The Bank will maintain all Book Entry Paper held by the Fund in an
account of the Bank that includes only assets held by it for customers:
2. The records of the Bank with respect to the Fund's purchase of Book
Entry Paper through the Bank will identify, by book entry, Commercial Paper
belonging to the Fund which is included in the Book Entry paper System and
shall at all times during the regular business hours of the Bank be open for
inspection by duly authorized officers, employees or agents of the Fund.
3. (a) The Bank shall pay for Book Entry Paper purchased for the account
of the Fund upon contemporaneous (i) receipt of advice from the Issuer that
such sale of Book Entry Paper has bee effected, and (ii) the making of any
entry on the records of the Bank to reflect such payment and transfer for the
account of the Fund.
(b) The Bank shall cancel such Book Entry Paper obligation upon the
maturity thereof upon contemporaneous (i) receipt of advice that payment for
such Book Entry Paper has been transferred to the Fund, and (ii) the making of
an entry on the records of the Bank to reflect such payment for the account of
the Fund.
<PAGE>
4. The Bank shall transmit to the Fund a transaction journal confirming
each transaction in Book Entry Paper for the account of the Fund on the next
business day following the transaction;
5. The Bank will send to the Fund such reports on its system of internal
accounting control as the Fund may reasonable request from time to time.
d) USE OF BOOK-ENTRY SYSTEM FOR MUTUAL FUND SHARES. Provided (i) the Bank
has received a certified copy of a resolution of the Board of Trustees of the
Fund specifically approving the maintenance of shares of mutual funds which are
Portfolio Securities in the book-entry systems of such mutual funds' transfer
agents, and (ii) for each year following such approval, the Board of Trustees
of the Fund has reviewed and approved the arrangement and has not delivered an
Officer's Certificate to the Bank indicating that it has withdrawn its
approval:
1. The Bank may keep Portfolio Securities which are mutual fund shares in
the book-entry systems of the mutual funds transfer agents, provided that such
mutual fund shares are maintained directly with the transfer agents in an
account in the name of the Bank or the Bank's nominee as custodian for the
Fund.
2. The transfer agents will maintain segregated accounts representing only
assets held for the Bank, as custodian of the Fund.
3. The Bank will send to the Fund copies of all confirmation received from
the transfer agents of any transfers to or from the account of the Fund.
4. The Bank shall send to the Fund reports on its system of internal
accounting control as the Fund may reasonably request from time to time.
C. OPTIONS AND FUTURES TRANSACTIONS.
(a) PUTS AND CALLS TRADED ON SECURITIES EXCHANGES, NASDAQ OR OVER-THE-
COUNTER.
1. The Bank shall take action as to put options ("puts") and call options
("calls") purchased or sold (written) by the Fund regarding escrow or other
arrangements (i) in accordance with the provisions of any agreement entered
into upon receipt of Proper Instructions between the Bank, any broker-dealer
registered under the Securities Exchange Act of 1934 and a member of the
National Association of Securities Dealers, Inc. ("NASD"), and, if necessary,
the Fund relating to the compliance with the rules of the Options Clearing
Corporation and of any registered national securities exchange, or of any
similar organization or organizations.
<PAGE>
2. Unless another agreement requires it to do so, the Bank shall be under
no duty or obligation to see that the Fund has deposited or is maintaining
adequate margin, if required, with any broker in connection with any option,
nor shall the Bank be under duty or obligation to present such option to the
broker for exercise unless it receives Proper Instructions from the Fund. The
Bank shall have no responsibility for the legality of any put or call purchased
or sold on behalf of the Fund, the propriety of any such purchase or sale, or
the adequacy of any collateral delivered to a broker in connection with an
option or deposited to or withdrawn from a Segregated Account as described in
sub-paragraph c of this Section 6(C). The Bank specifically, but not by way of
limitation, shall not be under any duty or obligation to: (i) periodically
check or notify the Fund that the amount of such collateral held by a broker or
held in a Segregated Account as described in sub-paragraph (c) of this Section
6(C) is sufficient to protect such broker or the Fund against any loss; (ii)
effect it holds, has or is about to expire. Such duties or obligations shall be
the sole responsibility for the Fund.
(b) PUTS, CALLS AND FUTURES TRADED ON COMMODITIES EXCHANGES.
1. The Bank shall take action as to puts, calls and futures contracts
("Futures") purchased or sold by the Fund in accordance with the provisions of
any agreement among the Fund, the Bank 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 with transactions by
the Fund.
2. The responsibilities and liabilities of the Bank as to Futures, puts
and calls traded on commodities exchanges, and Futures Commission Merchant
account and the Segregated Account shall be limited as set forth in
sub-paragraph (a)(2) of this Section 6(C) as if such sub-paragraph referred to
Futures Commission Merchants rather than brokers, and Futures and puts and
calls thereon instead of options.
(c) SEGREGATED ACCOUNT
The Bank 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 Portfolio Securities
including Portfolio Securities maintained in an Account by the Bank pursuant to
Section 6(B) hereof, (i) in accordance with the provisions of any agreement
among the Fund, the Bank 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, and (ii) for the
purpose of segregating cash or Securities in connection with options purchased,
or written by the Fund or commodity futures purchased or written by the Fund,
and (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 of the Fund, or of the Executive Committee
<PAGE>
signed by an officer of the Fund and certified by the Secretary or an Assistant
Secretary, setting forth the purpose r purposes of such Segregated Account and
declaring such purposes to be proper corporate purposes.
D. SEGREGATED ACCOUNT FOR "WHEN ISSUED", "FORWARD COMMITMENT" AND REVERSE
REPURCHASE AGREEMENT TRANSACTIONS. Notwithstanding any other provisions of this
Section 6, the Bank will maintain a segregated account (the "Segregated
Account") in the name of the Fund (i) for the deposit of liquid assets, such as
cash, U.S. Government securities or other high grade debt obligations, having a
market value (marked to the market on a daily basis) at all times equal to not
less than the aggregate purchase price due on the settlement dates of all the
Fund's then outstanding forward commitment or "when issued" agreements relating
to the purchase of Portfolio Securities and all the Fund's then outstanding
commitments under reverse repurchase agreements entered into the broker-dealer
firms, and (ii) for the deposit of any Portfolio securities which the Fund has
agreed to sell on a forward commitment basis, all in accordance with Securities
and Exchange Commission Release No. IC-10666. No assets shall be deposited in
the Segregated Account except pursuant to Proper Instructions. Assets maybe
withdrawn from the segregated account pursuant to Proper Instructions only (a)
for sale or delivery to meet the Fund's obligations under outstanding firm
commitment or when-issued agreements for the purchase of Portfolio securities
and under reverse repurchase agreements, (b) for exchange for other liquid
assets of equal or greater value deposited in the Segregated Account, (c) to
the extent that the Fund's outstanding forward commitment or when-issued
agreements for the purchase of Portfolio Securities or reverse repurchase
agreements are sold to other parties or the Fund's obligations thereunder are
met from assets of the Fund other than those in the Segregated Account, or (d)
for delivery upon settlement of a forward commitment agreement for the sale of
Portfolio Securities.
E. Interest Bearing Call or Time Deposits. The Bank shall, upon receipt of
Proper Instructions relating to the purchase by the Fund of interest bearing
fixed term and call deposits, transfer cash, by wire or otherwise, in such
amounts and to such bank or banks as shall be indicated in such Proper
Instructions. The Bank shall include in its records with respect to the assets
of the Fund appropriate notation as to the amount of each such deposit, the
banking institution with which such deposit is made (the "Deposit Bank"), and
shall retain such forms of advice or receipt evidencing the deposit, if any, as
may be forwarded to the Bank by the Deposit Bank. Such deposits shall be deemed
Portfolio Securities of the Fund and the responsibility of the Bank therefore
shall be the same as and no greater than the Bank's responsibility in respect
of other Portfolio Securities of the Fund.
<PAGE>
7. TRANSFER OF SECURITIES. The Bank will transfer, exchange, deliver or
release Portfolio securities held by it hereunder, insofar as such securities
are available for such purpose, provided that before making any transfer,
exchange, delivery or release under this Section the Bank will received Proper
Instructions requesting such transfer, exchange or delivery stating that it is
for a purpose permitted under the terms of this Section 7, specifying the
applicable subsection, or describing the purpose of the transaction with
sufficient particularity to permit the Bank to ascertain the applicable
subsection, only
a) Upon sales of Portfolio Securities for the account of the
Fund, against contemporaneous receipt by the Bank of payment
therefore in full, each such payment to be in the amount of the sale
price shown in a broker's confirmation of sale of the Portfolio
Securities received by the Bank before such payment is made, as
confirmed in the Proper Instructions received by the Bank before such
payment is made;
b) In exchange for or upon conversion into other Securities
alone or other Securities and cash pursuant to any plan of merger,
consolidation, reorganization, share split-up, change in par value,
recapitalization or readjustment or otherwise;
c) Upon conversion of Portfolio securities pursuant to their
terms into other Securities;
d) Upon exercise of subscription, purchase or sale or other
similar rights represented by such Portfolio securities;
e) For the purpose of redeeming in kind shares of common stock
of the Fund upon authorization from the Fund;
f) In the case of option contracts owned by the Fund, for
presentation to the endorsing broker;
g) When such Portfolio securities are called, redeemed or
retired or otherwise become payable;
h) For the purpose of effectuating the pledge of Portfolio
Securities held by the Bank pursuant to this Agreement in order to
collateralize loans made to the Fund by any bank, including the Bank;
provided, however, that such Portfolio Securities will be released
only upon payment to the Bank for the account of the Fund of the
moneys borrowed, except that in cases where additional collateral is
required to secure a borrowing already made, and such fact is made to
appear in the Proper Instructions, further Portfolio Securities may
be released for that purpose without any such payment. In the event
that any such pledged Portfolio Securities are held by the Bank, they
will be so held for the account of the lender, and after notice to
the Fund from the lender in accordance with the normal procedures of
the lender, that an event of deficiency or default on the loan has
occurred, the Bank may deliver such pledged Portfolio Securities to
or for the account of the lender;
<PAGE>
i) For the purpose of releasing certificates representing
Portfolio Securities, against contemporaneous receipt by the Bank of
the fair market value of such Security, as set forth in Proper
Instructions received by the Bank before such payment is made;
j) For the purpose of tendering shares pursuant to a tender
offer therefor:
k) For the purpose of delivering Portfolio Securities lent by
the Fund to a bank or broker dealer, but only against receipt in
accordance with street delivery custom except as otherwise provided
in this Section 6, of adequate collateral as agreed upon from time to
time by the Fund and the Bank, and upon receipt of payment in
connection with any repurchase agreement relating to such Securities
entered into by the Fund;
l) For other authorized transactions of the Fund or for other
proper corporate purposes; provided that before making such transfer,
the Bank will also receive a certified copy of resolution of the
Board of Trustees of the Fund, signed by an authorized officer of the
Fund (other than the officer certifying such resolution) and
certified by its Secretary or Assistant Secretary, specifying the
Portfolio Securities to be delivered, setting forth the transaction
in or purpose for which such delivery is to be made, declaring such
transaction to be an authorized transaction of the Fund or such
purpose to be a proper corporate purpose, and naming the person or
persons to whom delivery of such Securities shall be made; and
m) Upon termination of this Agreement as hereinafter set forth
pursuant to Section 9 and Section 13 of this Agreement.
As to any deliveries made by the Bank pursuant to subsection (a), (b), (c),
(d), (f), (g), (h), (i) and (k) Portfolio Securities or cash receivable in
exchange therefor shall be delivered to the Bank.
8. REDEMPTIONS. In the case of payment of assets of the Fund held by the
Bank in connection with redemptions and repurchases by the Fund of outstanding
shares of its common stock, the Bank will rely on notification by the Fund's
transfer agent of receipt of a request for redemption and certificates, if
issued, in proper form for redemption before such payment is made. Payment
shall be made in accordance with the Declaration of Trust of the Fund, from
assets available for said purpose.
9. MERGER, DISSOLUTION, ETC. OF FUND. In the case of the following
transactions, not in the ordinary course of business, namely, the merger of the
Fund into or the consolidation of the Fund with another investment company, the
sale by the Fund of all, or substantially all of its assets to another
investment company, or the liquidation or dissolution of the Fund and
distribution of its assets, the Bank will deliver the Portfolio securities held
by it under this Agreement and disburse cash only upon the order of the Fund
set forth in an Officer's Certificate, accompanied by a certified copy of a
resolution of the Fund's Board of Trustees authorizing any of the foregoing
transactions. Upon completion of such delivery and disbursement and the payment
of the fees, disbursements and expenses of the Bank, this Agreement will
terminate.
10. ACTIONS OF BANK WITHOUT PRIOR AUTHORIZATION. Notwithstanding anything
herein to the contrary, unless and until the Bank receives an Officer's
Certificate to the contrary, it will without prior authorization or instruction
of the Fund or the transfer agent:
<PAGE>
(a) Receive and hold for the account of the Fund hereunder and deposit in
the account or accounts referred to in Section 6 hereof, all income, dividends,
interest and other payments or distribution of cash with respect to the
Portfolio Securities held thereunder;
(b) Present for payment all coupons and other income items held by it for
the account of the Fund which call for payment upon presentation and hold the
cash received by it upon such payment for the account of the Fund account or
accounts referred to in section 6 hereof;
(c) Receive and hold for the account of the Fund hereunder and deposit in
the account or accounts referred t in Section 6 hereof all Securities received
as a distribution on Portfolio Securities as a result of a stock dividend,
share split-up, reorganization, recapitalization, merger, consolidation,
readjustment, distribution of rights and similar Securities issued with respect
to any Portfolio Securities held by it hereunder.
(d) Execute as agent on behalf of the Fund all necessary ownership and
other certificates and affidavits required by the Internal revenue Code or the
regulations of the Treasury Department thereunder, or by the laws of any State
now or hereafter in effect, inserting the fund's name on such certificates as
the owner of the Portfolio Securities covered thereby, to the extent it may
lawfully do so and as may be required to obtain payment in respect thereof. The
Bank will execute and deliver such certificates in connection with Portfolio
Securities delivered to it or by it under this Agreement as may be required
under the provisions of the Internal Revenue Code and any regulations of the
Treasury Department issued thereunder, or under the laws of any State;
(e) Present for payment all Portfolio Securities which are called,
redeemed, retired or otherwise become payable, and hold cash received by it
upon payment for the account of the Fund in the account or accounts referred to
in Section 6 hereof; and
(f) Exchange interim receipts or temporary Securities for definitive
Portfolio Securities.
The Bank will use all reasonable effort to collect any funds which may to
its knowledge become collectible arising from such Securities, including
dividends, interest and other income, and to transmit to the Fund notice
actually received by it of any call for redemption, offer of exchange, right of
subscription, reorganization or other proceedings affecting such Securities.
If Portfolio Securities upon which such income is payable are in default
or payment is refused after due demand or presentation, the Bank will notify
the Fund in writing of any default or refusal to pay within two business days
from the day on which it receives knowledge of such default or refusal. In
addition, the Bank will send the Fund a written report once each week showing
any income on any Portfolio Security held by it which is more than ten days
overdue on the date of such report and which has not previously been reported.
11. MAINTENANCE OF RECORDS; FUND EVALUATION; ACCOUNTING SERVICES. The Bank
will maintain records with respect to transactions for which the Bank is
responsible pursuant to the terms and conditions of this Agreement, and in
compliance with the applicable rules and regulations of the Act, and will
furnish the Fund daily with a statement of condition of the Fund. The Bank will
furnish to the Fund at the end of every month, and at the close of each quarter
of the Fund's fiscal year, a list of the Portfolio Securities and the aggregate
amount of cash held by it for the Fund. The books and records of the Bank
pertaining to its actions under this Agreement and reports by the bank or its
independent accountants concerning its accounting system, procedures for
safeguarding Securities and internal accounting controls will be open to
<PAGE>
inspection and audit at reasonable times by officers of or auditors employed by
the Fund, and will be preserved by the Bank in the manner and in accordance
with the applicable rules and regulations under the Act.
As custodian the Bank shall have and perform the following powers and
duties:
(a) To keep the books of account and render statements or copies from time
to time as reasonably requested by the Treasurer or any executive officer of
the Fund.
(b) To compute and, unless otherwise directed the Board of Trustees of the
Fund, determine as of close of business on the New York Stock Exchange each day
on which said Exchange is open for unrestricted trading and as of such other
hours, if any, as may be authorized by said Board of Trustees the net asset
value and the public offering price of a share of Common Stock of the Fund,
such determination to be made in accordance with the provisions of Declaration
of Trust of the Fund and Prospectus and Statement of Additional Information
relating to Fund, as they may from time to time be amended, and any applicable
resolution of the Board of Trustees of the Fund at the time in force and
applicable; and promptly to notify the Fund and the NASD or such other persons
as the Fund may request of the results of such computation and determination.
In computing the net asset value hereunder, the Bank may rely in good faith
upon information furnished to it by any Authorized Person in respect of (i) the
manner of accrual of the liabilities of the Fund and in respect of liabilities
of the Fund not appearing on its books of account kept by the Bank, (ii)
reserves, if any, authorized by the Board of Trustees or that no such reserves
have been authorized, (iii) the source of the quotations to be used in
computing the net asset value, (iv) the value to be assigned to any Portfolio
Security for which no price quotations are available, and (v) the method of
computation of the public offering price on the basis of the net asset value of
the shares, and the Bank shall not be responsible for any loss occasioned by
such reliance or for any good faith reliance on any quotations received from a
source pursuant to (iii) above.
(c) To assist generally in the preparation of reports to shareholders and
others, audits of accounts, and other ministerial matters of like nature.
12. CONCERNING THE BANK.
A. PERFORMANCE OF DUTIES. In performing its duties hereunder and any other
duties listed on any Schedule hereto, if any, the Bank will be entitled to
receive and act upon the advice of counsel, and will be without liability for
any action taken or thing done or omitted to be done in accordance with this
Agreement in good faith in conformity with such advice. The word "counsel" as
used in the preceding sentence shall mean counsel to the Fund or an attorney on
the staff of the Administrator to the Fund, provided, however, that if such
counsel or any such attorney is unable to render advice in a timely manner (in
the context of the situation requiring advice) or if such counsel or any other
such attorney would have a conflict in rendering such advice to the Bank, the
word "counsel" shall also mean such other counsel, whether otherwise counsel
to, or an employee of, the Bank, as would generally be viewed as having such
specific knowledge and experience with respect to the issue or matter in
question that prudent professionals in the industry would seek the advice of
such counsel with respect to such type of issue or matter. In the performance
of its duties hereunder, the Bank will be protected and not be liable, and will
be indemnified and saved harmless for any action taken or omitted to be taken
by it in good faith reliance upon the terms of this Agreement, any Officer's
<PAGE>
Certificate, Proper Instructions, resolution of the Trustees, telegram, notice,
request, certificate or other instrument reasonably believed by the Bank to be
genuine and for any other loss to the Fund except in the case of its gross
negligence, willful misfeasance or bad faith in the performance of its duties
or reckless disregard of its obligation and duties hereunder.
The Bank may employ agents in the performance of its duties hereunder,
including, upon receipt of Proper Instructions, subcustodians, provided that
any such subcustodian meets at least the minimum qualifications required by
Section 17(f)(1) of the Act to act as a custodian of the Fund's assets.
The Bank shall have no liability to the Fund or any other person by reason
of any act or omission of any subcustodian and the Fund shall indemnify the
Bank and hold it harmless from any and against any and all actions, suits and
claims, arising directly or indirectly out of the performance of any
subcustodian. Upon request of the Bank, the Fund shall assume the entire
defense of any action, suit, or claim subject to the foregoing indemnity.
The Fund shall pay all fees and expenses of any subcustodian.
The Bank will be under no duty or obligation to inquire into and will not
be liable for:
(a) The validity of the issue of any Portfolio Securities purchased by or
for the Fund, the legality of the purchases thereof or the propriety of the
price incurred therefor;
(b) The legality of any sale of any Portfolio Securities by or for the
Fund or the propriety of the amount for which the same are sold;
(c) The legality of an issue or sale of any shares of common stock of the
Fund or the sufficiency of the amount to be received therefor;
(d) The legality of the repurchase of any shares of common stock of the
Fund or the propriety of the amount to be paid therefor;
(e) The legality of the declaration of any dividend by the Fund or the
legality for the distribution of any Portfolio Securities as payment in kind of
such dividend; or
(f) Any property or moneys of the Fund unless and until received by it,
and any such property or moneys delivered or paid by it pursuant to the terms
hereof.
Moreover, the Bank will not be under any duty or obligation to ascertain
whether any Portfolio Securities at any time delivered to or held by it for the
account of the Fund are such as may properly be held by the Fund under the
provisions of its Articles of Incorporation or By-Laws, federal or state
statutes or any rule or regulation of any governmental agency.
B. FEES AND EXPENSES BANK. The Fund will pay or reimburse the Bank from
time to time for any transfer taxes payable upon transfer of Portfolio
Securities made hereunder, and for all necessary proper disbursements, expenses
and charges made or incurred by the Bank in the performance of this Agreement
(including any duties listed on any Schedule hereto, if any) including any
indemnities for any loss, liabilities or expense t the Bank as provided above.
<PAGE>
For the services rendered by the Bank hereunder, the Fund will pay to the Bank
such compensation or fees at such rate and at such times as shall be agreed
upon in writing by the parties from time to time. The Bank will also be
entitled to reimbursement by the Fund for all reasonable expenses incurred in
conjunction with termination of this Agreement by the Fund.
C. ADVANCES BY BANK. The Bank may, it its sole discretion, advance funds
on behalf of the Fund to make any payment permitted by this Agreement upon
receipt of any proper authorization required by this Agreement for such
payments by the Fund. Should such a payment or payments, with advanced funds,
result in an overdraft (due to insufficiencies of the Fund's account with the
Bank, or for any other reason) this Agreement deems any such or related
indebtedness, a loan made by the Bank to the Fund payable on demand and bearing
interest at the current rate charged by the Bank for such loans unless the Fund
shall provide the Bank with agreed upon compensating balances. The Fund agrees
that the Bank shall have a continuing lien and security interest to the extent
of any overdraft or indebtedness, in and to any property at any time held by it
for the Fund's benefit or in which the Fund has an interest and which is then
in the Bank's possession or control (or in the possession or control of any
third party acting on the Bank's behalf). The Fund authorizes the Bank, in its
sole discretion, at any time to charge any overdraft or indebtedness, together
with interest due thereon against any balance of account standing to the credit
of the Fund on the Bank's books.
13. TERMINATION
(a) This Agreement may be terminated at any time without penalty upon
sixty days written notice delivered by either party to the other by means of
registered mail, and upon the expiration of such sixty days this Agreement will
terminate; provided, however, that the effective date of such termination may
be postponed to a date not more than ninety days from the date of delivery of
such notice (i) by the Bank in order to prepare for the transfer by the Bank of
all of the assets of the Fund held hereunder, and (ii) by the Fund in order to
give the Fund an opportunity to make suitable arrangements for a successor
custodian. At any time after the termination of this Agreement, the Fund will,
at its request, have access to the records of the Bank relating to the
performance of its duties as custodian.
(b) In the event of the termination of this Agreement, the Bank will
immediately upon receipt or transmittal, as the case may be, of notice of
termination, commerce and prosecute diligently to completion the transfer of
all cash and the delivery of all Portfolio Securities duly endorsed and all
records maintained under Section 11 to the successor custodian when appointed
by the Fund. The obligation of the Bank to deliver and transfer over the assets
of the Fund held by it directly to such successor custodian will commence as
soon as such successor is appointed and will continue until completed as
aforesaid. If the Fund does not select a successor custodian within ninety (90)
days from the date of delivery of notice of termination the Bank may, subject
to the provisions of subsection (c) of this Section 13, deliver the Portfolio
Securities and cash of the Fund held by the Bank to a bank or trust company of
its own selection which meets the requirements of Section 17(f) (l) of the Act
and has a reported capital, surplus and undivided profits aggregating not less
than $2,000,000, to be held as the property of the Fund under terms similar to
those on which they were held by the Bank, whereupon such bank or trust
company-so selected by the Bank will become the successor custodian of such
assets of the Fund with the same effect as though selected by the Board of
Trustees of the Fund.
<PAGE>
(c) Prior to the expiration of ninety (90) days after notice of
termination has been given, the Fund may furnish the Bank with an order of the
Fund advising that a successor custodian cannot be found willing and able to
act upon reasonable and customary terms and that there has been submitted to
the shareholders of the Fund the question of whether the Fund will be
liquidated or will function without a custodian for the assets of the Fund held
by the Bank. In that event the Bank will deliver the Portfolio Securities and
cash of the Fund held by it, subject as aforesaid, in accordance with one of
such alternatives which may be approved by the requisite vote of shareholders,
upon receipt by the Bank of a copy of the minutes of the meeting of
shareholders at which action was taken, certified by the Fund's Secretary.
14. NOTICES. Any notice or other instrument in writing authorized or
required by this Agreement to be given to either party hereto will be
sufficiently given if addressed to such party and mailed or delivered to it at
its office at the address set forth below namely:
(a) In the case of notices sent to the Fund to:
Domini Social Index Trust
6 St. James Avenue
Boston, Massachusetts 02116
(b) In the case of notices sent to the Bank to:
Investors Bank & Trust Company
P.O. Box 1537
Boston, Massachusetts 02205-1537
Attention: Timothy O'Leary
Or at such other place as such party may from time to time
designate in writing.
15. AMENDMENTS. This Agreement may not be altered or amended, except by
an instrument in writing, executed by both parties.
16. PARTIES. This Agreement will be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns;
provided, however, that this Agreement will not be assignable by the Fund
without the written consent of the Bank or by the Bank without the written
consent of the Fund, authorized and approved by its Board of Trustees; and
provided further that termination proceedings pursuant to Section 13 hereof
will not be deemed to be an assignment within the meaning of this provision.
17. GOVERNING LAW. This agreement and all performance hereunder will be
governed by the laws of the Commonwealth of Massachusetts.
18. LIMITATION OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS. The term
Domini Social Index Trust means and refers to the Trustees from time to time
serving under the Declaration of Trust, as the same may subsequently thereto
have been, or subsequently hereto be, amended. It is expressly agreed that the
obligation of the fund hereunder shall not be binding upon any of the Trustees,
Shareholders, nominees, officers, agents or employees of the Fund, personally,
but bind only the assets and property of the Fund, as provided in the
Declaration of Trust of the Fund. The execution and delivery of this Agreement
has been authorized by the Trustees of the Fund and signed by an authorized
<PAGE>
officer of the Fund, acting as such, and neither such authorization by such
Trustees nor such execution and delivery by such officer shall be deemed to
have been made by any of them individually or to impose any liability on any of
them personally, but shall bind only the assets and property of the Fund as
provided on its Declaration of Trust.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate and their respective corporate seals to be affixed hereto
as of the date first above written by their respective officers thereunto duly
authorized,
DOMINI SOCIAL INDEX TRUST
By James B. Craver
----------------------------
Treasurer
ATTEST: Thomas M. Lenz
-------------------------
Assistant Secretary
INVESTORS BANK & TRUST COMPANY
By Henry N. Joyce
----------------------------
Vice President
ATTEST: Timothy P. O'Leary
-------------------------
Vice President
Exhibit q
POWER OF ATTORNEY
The undersigned hereby constitutes and appoints Amy L. Domini, Carole M.
Laible, Sigward M. Moser, and David P. Wieder and each of them, with full
powers of substitution as her true and lawful attorneys and agents to execute
in her name and on her behalf in any and all capacities the Registration
Statements on Form N1A, and any and all amendments thereto, filed by Domini
Social Equity Fund, and Domini Institutional Trust, (each, a "Trust"), or the
Registration Statement(s), and any and all amendments thereto, filed by any
other investor (collectively with each Trust, the "Investors") in Domini Social
Index Portfolio (the "Portfolio") (insofar as each of the Investors invests all
its assets in the Portfolio), with the Securities and Exchange Commission under
the Investment Company Act of 1940, as amended, and/or the Securities Act of
1933, as amended, and any and all instruments which such attorneys and agents,
or any of them, deem necessary or advisable to enable any of the Investors or
the Portfolio, as applicable, to comply with such Acts, the rules, regulations
and requirements of the Securities and Exchange Commission, and the securities
or Blue Sky laws of any state or other jurisdiction, and the undersigned hereby
ratifies and confirms as her own act and deed any and all acts that such
attorneys and agents, or any of them, shall do or cause to be done by virtue
hereof. Any one of such attorneys and agents have, and may exercise, all of the
powers hereby conferred.
IN WITNESS WHEREOF, the undersigned has executed this instrument as of the
20th day of September, 1999.
Karen Paul
--------------------
Karen Paul
