Exhibit h.4
Securities Lending Authorization Agreement
SECURITIES LENDING AUTHORIZATION AGREEMENT
Between
EACH TRUST LISTED ON SCHEDULE B HERETO,
ON BEHALF OF EACH RESPECTIVE SERIES OF EACH SUCH TRUST, SEVERALLY
AND NOT JOINTLY, AS SET FORTH ON SCHEDULE B
and
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
PAGE
1. DEFINITIONS.......................................................... 1
2. APPOINTMENT OF STATE STREET.......................................... 2
3. SECURITIES TO BE LOANED.............................................. 2
4. BORROWERS............................................................ 3
5. SECURITIES LOAN AGREEMENTS........................................... 5
6. LOANS OF AVAILABLE SECURITIES........................................ 5
7. DISTRIBUTIONS ON AND VOTING RIGHTS WITH RESPECT TO
LOANED SECURITIES................................................. 6
8. COLLATERAL........................................................... 6
9. INVESTMENT OF CASH COLLATERAL AND COMPENSATION ...................... 7
10. FEE DISCLOSURE....................................................... 9
11. RECORDKEEPING AND REPORTS............................................ 9
12. STANDARD OF CARE..................................................... 9
13. REPRESENTATIONS AND WARRANTIES.......................................10
14. BORROWER DEFAULT INDEMNIFICATION.....................................13
15. CONTINUING AGREEMENT AND TERMINATION.................................14
16. NOTICES.............................................................14
17. SECURITIES INVESTORS PROTECTION ACT..................................16
18. AUTHORIZED REPRESENTATIVES ..........................................13
19. NON-US BORROWERS.....................................................14
20. FORCE MAJEURE........................................................
21. MISCELLANEOUS........................................................15
22. COUNTERPARTS.........................................................16
23. MODIFICATION.........................................................17
EXHIBITS AND SCHEDULES
SCHEDULE A (Schedule of Fees)
SCHEDULE B (Funds)
SCHEDULE C (Acceptable Forms of Collateral)
SECURITIES LENDING AUTHORIZATION AGREEMENT
Agreement dated the 1st day of August 2005 between EACH OF THE TRUSTS
LISTED ON SCHEDULE B HERETO, each a registered management investment company
organized and existing under the laws of Delaware (each, a "Trust"), on behalf
of each series of each such Trust, severally and not jointly, as listed,
respectively, on Schedule B (each such series, a "Fund" and collectively, the
"Funds"), and STATE STREET BANK AND TRUST COMPANY and State Street Affiliates
(collectively referred to herein as "State Street"), setting forth the terms and
conditions under which State Street is authorized to act on behalf of each Fund
with respect to the lending of certain securities of each Fund held by State
Street as custodian.
This Agreement shall be deemed for all purposes to constitute a
separate and discrete agreement between State Street and each Trust on behalf of
each respective Fund as listed on Schedule B to this Agreement, as it may be
amended by the parties from time to time, and no Fund shall be responsible or
liable for any of the obligations of any other Fund under this Agreement or
otherwise, notwithstanding anything to the contrary contained herein.
WHEREAS, the Phoenix Series Fund (the "Original Participating Trust")
entered into a separate Securities Lending Authorization Agreement (the
"Original SLAA") with State Street, dated January 6, 1992; and
WHEREAS, the Original Participating Trust desires to hereby amend and
restate its Original SLAA, and the additional Trusts and respective series of
shares of each Trust listed on Schedule B hereto desire to enter into this
agreement, all as hereinafter provided.
NOW, THEREFORE, in consideration of the mutual promises and of the
mutual covenants contained herein, each of the parties does hereby covenant and
agree as follows:
1. Definitions. For the purposes hereof:
-----------
(a) "Authorized Representative" means any person who is, or State
Street reasonably believes to be, authorized to act on behalf of a Fund with
respect to any of the transactions contemplated by this Agreement.
(b) "Available Securities" means the securities of the Funds that are
available for Loans pursuant to Section 3.
(c) "Borrower" means any of the entities to which Available Securities
may be loaned under a Securities Loan Agreement, as described in Section 4.
(d) "Collateral" means collateral delivered by a Borrower to secure its
obligations under a Securities Loan Agreement.
1
(e) "Investment Manager" when used in any provision, means the person
or entity who has discretionary authority over the investment of the Available
Securities to which the provision applies.
(f) "Loan" means a loan of Available Securities to a Borrower.
(g) "Loaned Security" shall mean any "security" which is delivered as a
Loan under a Securities Loan Agreement; provided that, if any new or different
security shall be exchanged for any Loaned Security by recapitalization, merger,
consolidation, or other corporate action, such new or different security shall,
effective upon such exchange, be deemed to become a Loaned Security in
substitution for the former Loaned Security for which such exchange was made.
(h) "Market Value" of a security means the market value of such
security (including, in the case of a Loaned Security that is a debt security,
the accrued interest on such security) as determined by the independent pricing
service designated by State Street, or such other independent sources as may be
selected by State Street on a reasonable basis.
(i) "Securities Loan Agreement" means the agreement between a Borrower
and State Street (on behalf of the Funds) that governs Loans, as described in
Section 5.
(j) "Replacement Securities" means securities of the same issuer,
class and denomination as Loaned Securities.
(k) "State Street Affiliate" means any entity that directly or
indirectly through one or more intermediaries, controls State Street or that is
controlled by or is under common control with State Street.
2. Appointment of State Street.
---------------------------
Each Fund hereby appoints and authorizes State Street as its agent to
lend Available Securities to Borrowers in accordance with the terms of this
Agreement. State Street shall have the responsibility and authority to do or
cause to be done all acts State Street shall determine to be desirable,
necessary, or appropriate to implement and administer this securities lending
program. Each Fund agrees that State Street is acting as a fully disclosed agent
and not as principal in connection with the securities lending program. State
Street may take action as agent of the Fund on an undisclosed or a disclosed
basis Conditional upon receipt by State Street of express written authorization
(the "Third Party Custodian Authorization") on behalf of all (but not less than
all) of the Funds after the date hereof, and in no event prior, State Street
shall be authorized to request The Bank of New York or JPMorgan Chase Bank to
undertake certain custodial functions in connection with holding of the
Collateral provided by a Borrower pursuant to the terms hereof. In connection
therewith, and subject to having received said Third Party Custodian
Authorization, State Street may
2
instruct The Bank of New York or JPMorgan Chase Bank to establish and maintain a
Borrower's account and a State Street account wherein all Collateral, including
cash, shall be maintained by such bank (as applicable) in accordance with the
terms of a form of custodial arrangement which shall also be consistent with the
terms hereof.
3. Securities to be Loaned.
-----------------------
All of the Fund's securities held by State Street as custodian shall be
subject to this securities lending program and constitute Available Securities
hereunder, except those securities which the Fund or the Investment Manager
specifically identifies herein or in notices to State Street as not being
Available Securities. In the absence of any such identification herein or other
notices identifying specific securities as not being Available Securities, State
Street shall have no authority or responsibility for determining whether any of
the Fund's securities should be excluded from the securities lending program.
4. Borrowers.
---------
The Available Securities may be loaned to any Borrower
identified on the Schedule of Borrowers, as such Schedule may be modified from
time to time by State Street and the Fund.
State Street shall not be responsible for any statements,
representations, warranties or covenants made by any Borrower in connection with
any Loan or for any Borrower's performance of or failure to perform the terms of
any Loan under the applicable Securities Loan Agreement or any related
agreement, including the failure to make any required payments, except as
otherwise expressly provided herein.
5. Securities Loan Agreements.
--------------------------
Each Fund authorizes State Street to enter into one or more Securities
Loan Agreements with such Borrowers as may be selected by State Street. Each
Securities Loan Agreement shall have such terms and conditions as State Street
may negotiate with the Borrower. Certain terms of individual Loans, including
rebate fees to be paid to the Borrower for the use of cash Collateral, shall be
negotiated at the time a Loan is made.
6. Loans of Available Securities.
-----------------------------
State Street shall be responsible for determining whether any Loans
shall be made and shall have the authority to terminate any Loan in its
discretion, at any time and without prior notice to the Fund.
Each Fund acknowledges that State Street administers securities lending
programs for other clients of State Street. State Street will allocate
securities lending opportunities among its clients, using reasonable and
equitable methods established by State Street from time to
3
time. State Street does not represent or warrant that any amount or percentage
of the Fund's Available Securities will in fact be loaned to Borrowers. Each
Fund agrees that it shall have no claim against State Street and State Street
shall have no liability arising from, based on, or relating to, loans made for
other clients, or loan opportunities refused hereunder, whether or not State
Street has made fewer or more loans for any other client, and whether or not any
loan for another client, or the opportunity refused, could have resulted in
loans made under this Agreement.
Each Fund also acknowledges that, under the applicable Securities Loan
Agreements, the Borrowers will not be required to return Loaned Securities
immediately upon receipt of notice from State Street terminating the applicable
Loan, but instead will be required to return such Loaned Securities within such
period of time following such notice as is specified in the applicable
Securities Loan Agreement and in no event later than the end of the customary
settlement period. Upon receiving a notice from the Fund or the Investment
Manager that Available Securities which have been loaned to a Borrower should no
longer be considered Available Securities (whether because of the sale of such
securities or otherwise), State Street shall use its reasonable efforts to
notify promptly thereafter the Borrower which has borrowed such securities that
the Loan of such Available Securities is terminated and that such Available
Securities are to be returned within the time specified by the applicable
Securities Loan Agreement and in no event later than the end of the customary
settlement period. Each Fund agrees that in the event of a default by a Borrower
with respect to a Loan, State Street shall be fully protected in acting in its
sole discretion in a manner it deems appropriate.
7. Distributions on and Voting Rights with Respect to Loaned Securities.
--------------------------------------------------------------------
Each Fund represents and warrants that it is the legal and beneficial
owner of (or exercises complete investment discretion over) all Available
Securities free and clear of all liens, claims, security interests and
encumbrances and no such security has been sold, and that it is entitled to
receive all distributions made by the issuer with respect to Loaned Securities.
Except as provided in the next sentence, all interest, dividends, and other
distributions paid with respect to Loaned Securities shall be credited to the
Fund's account on the date such amounts are delivered by the Borrower to State
Street. Any non-cash distribution on Loaned Securities which is in the nature of
a stock split or a stock dividend shall be added to the Loan (and shall be
considered to constitute Loaned Securities) as of the date such non-cash
distribution is received by the Borrower; provided that the Fund or Investment
Manager may, by giving State Street ten (l0) business days' notice prior to the
date of such non-cash distribution, direct State Street to request that the
Borrower deliver such non-cash distribution to State Street, pursuant to the
applicable Securities Loan Agreement, in which case State Street shall credit
such non-cash distribution to the Fund's account on the date it is delivered to
State Street.
Each Fund acknowledges that it will not be entitled to participate in
any dividend reinvestment program or to vote with respect to Available
Securities that are on loan on the applicable record date for such Available
Securities.
4
Each Fund also acknowledges that any payments of distributions from
Borrower to the Fund are in substitution for the interest or dividend accrued or
paid in respect of Loaned Securities and that the tax and accounting treatment
of such payment may differ from the tax and accounting treatment of such
interest or dividend.
If an installment, call or rights issue becomes payable on or in
respect of any Loaned Securities, State Street shall use all reasonable
endeavors to ensure that any timely instructions from the Fund or its Investment
Manager are complied with, but State Street shall not be required to make any
payment unless the Fund has first provided State Street with funds to make such
payment.
Each Fund acknowledges and agrees that, with respect to a dividend paid
during the Loan term by a company that is a resident of France, the Fund will
not be entitled to receive, either from the French company or the Borrower, any
additional dividends (sometimes referred to as "complementary coupons") declared
and payable by such company that are equivalent to a refund of any prepayment of
French tax ("equalization tax" or "precompte") or an additional tax credit
adjustment ("credit d'impot").
Each Fund further acknowledges and agrees that the Fund will be
required to accept cash in lieu of fractional shares in all instances in which
an issuer does issue fractional shares.
8. Collateral.
----------
(a) Receipt of Collateral. Each Fund hereby authorizes State Street (or
subject to the prior receipt by State Street from the Funds of the Third Party
Custodian Authorization, The Bank of New York or JPMorgan Chase Bank as
described in Section 2 above) to receive and to hold, on the Fund's behalf,
Collateral from Borrowers to secure the obligations of Borrowers with respect to
any Loan of Available Securities made on behalf of the Fund pursuant to the
Securities Loan Agreements. All investments of cash Collateral shall be for the
account and at the risk of the Fund. Concurrently with or prior to the delivery
of the Loaned Securities to the Borrower under any Loan, State Street shall
receive from the Borrower Collateral in any of the forms listed on Schedule C.
Said Schedule may be amended from time to time by State Street and the Fund.
(b) Marking to Market. The initial Collateral received shall have (i)
in the case of Loaned Securities denominated in United States Dollars or whose
primary trading market is located in the United States, sovereign debt issued by
foreign governments (other than Canada) or corporate bonds that are not
denominated in United States Dollars (other than those issued in Canada), a
value of 102% of the Market Value of the Loaned Securities, or (ii) in the case
of Loaned Securities which are not denominated in United States Dollars or whose
primary trading market is not located in the United States (and not referenced
in (i)), a value of 105% of the Market Value of the Loaned Securities, or (iii)
in the case of Loaned
5
Securities comprised of UK Gilts, a value of 102.5% of the Market Value of the
Loaned Securities, or (iv) in all other cases, such other value, but not less
than 102% of the Market Value of the Loaned Securities, as may be applicable in
the jurisdiction in which such Loaned Securities are customarily traded.
Pursuant to the terms of the applicable Securities Loan Agreement,
State Street shall, in accordance with State Street's reasonable and customary
practices, ▇▇▇▇ Loaned Securities and Collateral to their Market Value each
business day based upon the Market Value of the Collateral and the Loaned
Securities at the close of business employing the most recently available
pricing information and receive and deliver Collateral in order to maintain the
value of the Collateral at no less than one hundred percent (100%) of the Market
Value of the Loaned Securities.
(c) Return of Collateral. The Collateral shall be returned to Borrower
at the termination of the Loan upon the return of the Loaned Securities by
Borrower to State Street in accordance with the applicable Securities Loan
Agreement.
(d) Limitations. State Street shall invest cash Collateral in
accordance with any directions, including any limitations established by the
Funds and set forth on Schedule A. State Street shall exercise reasonable care,
skill, diligence and prudence in the investment of Collateral. Subject to the
foregoing limits and standard of care, State Street does not assume any market
or investment risk of loss with respect to the investment of cash Collateral. If
the value of the cash Collateral so invested is insufficient to return any and
all other amounts due to such Borrower pursuant to the Securities Loan
Agreement, the Fund shall be responsible for such shortfall as set forth in
Section 9.
9. Investment of Cash Collateral and Compensation.
----------------------------------------------
To the extent that a Loan is secured by cash Collateral, such cash
Collateral, including money received with respect to the investment of the same,
or upon the maturity, sale, or liquidation of any such investments, shall be
invested by State Street, subject to the directions referred to above, if any,
in short-term instruments, short term investment funds maintained by State
Street, money market mutual funds and such other investments as State Street may
from time to time select, including without limitation, investments in
obligations or other securities of State Street or of any State Street Affiliate
and investments in any short-term investment fund, mutual fund, securities
lending trust or other collective investment fund with respect to which ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇/▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Affiliates provide investment management or advisory,
trust, custody, transfer agency, shareholder servicing and/or other services for
which they are compensated. State Street does not assume any market or
investment risk of loss associated with any investment or change of investment
in any such investments, including any cash collateral investment vehicle
designated on Schedule A.
Each Fund acknowledges that interests in such mutual funds, securities
lending trusts and other collective investment funds, to which State
6
Street and/or one or more of the State Street Affiliates provide services are
not guaranteed or insured by State Street or any of the State Street Affiliates
or by the Federal Deposit Insurance Corporation or any government agency. Each
Fund hereby authorizes State Street to purchase or sell investments of cash
Collateral to or from other accounts held by State Street or State Street
Affiliates.
The net income generated by any investment made pursuant to the first
paragraph of this Section 9 shall be allocated among the Borrower, State Street,
and the Fund, as follows: (a) a portion of such income shall be paid to the
Borrower in accordance with the agreement negotiated between the Borrower and
State Street; (b) the balance, if any, shall be split between State Street, as
compensation for its services in connection with this securities lending
program, and the Fund and such income shall be credited to the Fund's account,
in accordance with the fee split set forth on Schedule A.
In the event the net income generated by any investment made pursuant
to the first paragraph of this Section 9 does not equal or exceed the amount due
the Borrower (the rebate fee for the use of cash Collateral) in accordance with
the agreement between Borrower and State Street, State Street and the Fund
shall, in accordance with the fee split set forth on Schedule A, share the
amount equal to the difference between the net income generated and the amounts
to be paid to the Borrower pursuant to the Securities Loan Agreement. The Fund
shall be solely responsible for any and all other amounts due to such Borrower
pursuant to the Securities Loan Agreement and State Street may debit the Fund's
account accordingly. In the event debits to the Fund's account produce a deficit
therein, State Street shall sell or otherwise liquidate investments made with
cash Collateral and credit the net proceeds of such sale or liquidation to
satisfy the deficit. In the event the foregoing does not eliminate the deficit,
State Street shall have the right to charge the deficiency to any other account
or accounts maintained by the Fund with State Street.
To the extent that a Loan is secured by non-cash Collateral, the
Borrower shall be required to pay a loan premium, the amount of which shall be
negotiated by State Street. Such loan premium shall be allocated between State
Street and the Fund as follows: (a) a portion of such loan premium shall be paid
to State Street as compensation for its services in connection with this
securities lending program, in accordance with Schedule A hereto; and (b) the
remainder of such loan premium shall be credited to the Fund's account.
Each Fund hereby agrees that it shall reimburse State Street for any
and all funds advanced by State Street on behalf of the Fund as a consequence of
the Fund's obligations hereunder, including the Fund's obligation to return cash
Collateral to the Borrower and to pay any fees due the Borrower, all as provided
in Section 8 hereof.
10. Fee Disclosure.
--------------
The fees associated with the investment of cash Collateral in funds
maintained or advised by State Street are disclosed on Schedule A hereto. Said
fees may be changed from
7
time to time by State Street upon notice to the Funds. An annual report with
respect to such funds is available to the Funds, at no expense, upon request.
11. Recordkeeping and Reports.
-------------------------
State Street will establish and maintain such records as are reasonably
necessary to account for Loans that are made and the income derived therefrom.
On a monthly basis, State Street will provide the Funds with a statement
describing the Loans made, and the income derived from the Loans, during the
period covered by such statement. Each party to this Agreement shall comply with
the reasonable requests of the other for information necessary to the
requester's performance of its duties in connection with this securities lending
program.
12. Standard of Care and Indemnification.
------------------------------------
(a) State Street shall use reasonable care in the performance of its
duties hereunder consistent with that exercised by banks generally in the
performance of duties arising from acting as agent for clients in securities
lending transactions (as appropriate).
(b) Each Fund shall indemnify State Street and hold State Street
harmless from any loss or liability (including without limitation, the
reasonable fees and disbursements of counsel) incurred by State Street in
rendering services hereunder or in connection with any breach of the terms of
this Agreement by such Fund, except such loss or liability which results from
the State Street's failure to exercise the standard of care required by this
Section 12. Nothing in this Section shall derogate from the indemnities provided
by State Street in ▇▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ may charge any amounts to which it
is entitled hereunder against each Fund's account.
(c) Notwithstanding any express provision to the contrary herein, State
Street shall not be liable for any consequential, incidental, special or
exemplary damages.
Each Fund acknowledges that in the event that its participation in
securities lending generates income for the Fund, State Street may be required
to withhold tax or may claim such tax from the Fund as is appropriate in
accordance with applicable law.
State Street, in determining the Market Value of Securities, including
without limitation, Collateral, may rely upon any recognized pricing service and
shall not be liable for any errors made by such service.
13. Representations and Warranties.
------------------------------
Each party hereto represents and warrants that (a) it has and will have
the legal right, power and authority to execute and deliver this Agreement, to
enter into the transactions contemplated hereby, and to perform its obligations
hereunder; (b) it has taken all necessary
8
action to authorize such execution, delivery, and performance; (c) this
Agreement constitutes a legal, valid, and binding obligation enforceable against
it; and (d) the execution, delivery, and performance by it of this Agreement
will at all times comply with all applicable laws and regulations.
State Street represents and warrants that it has received an exemptive
order from the Securities and Exchange Commission, dated September 22, 1998,
relating to State Street Navigator Securities Lending Trust, granting an
exemption from Section 12(d)(1) and Section 17(a) of the Investment Company Act
of 1940 for investments by mutual funds in State Street Navigator Securities
Lending Trust.
Each Fund represents and warrants that (a) it has made its own
determination as to the tax and accounting treatment of any dividends,
remuneration or other funds received hereunder; (b) it is the legal and
beneficial owner of (or exercises complete investment discretion over) all
Available Securities free and clear of all liens, claims, security interests and
encumbrances and no such security has been sold, and that it is entitled to
receive all distributions made by the issuer with respect to Loaned Securities.
Each Fund further represents and warrants that it will immediately
notify State Street orally and by written notice, of the relevant details of any
private consent offers/agreements and/or any other off-market arrangements that
may require the recall and/or restriction of a security from lending activity,
including but not limited to any such private or off-market arrangement that
would require State Street as agent to recall Loaned Securities by a specified
delivery date. Such written notice shall be delivered sufficiently in advance so
as to: (a) provide State Street with reasonable time to notify Borrowers of any
instructions necessary to comply with the terms of the private consent
offers/agreements and/or other off-market arrangements, and (b) provide such
Borrowers with reasonable time to comply with such instructions.
The person executing this Agreement on behalf of the Funds represents
that he or she has the authority to execute this Agreement on behalf of the
Funds.
Each Fund hereby represents to State Street that: (i) its policies and
objectives generally permit it to engage in securities lending transactions;
(ii) its policies permit it to purchase shares of the State Street Navigator
Securities Lending Trust with cash Collateral; (iii) its participation in State
Street's securities lending program, including the investment of cash Collateral
in the State Street Navigator Securities Lending Trust, and the existing series
thereof has been approved by a majority of the directors or trustees which
directors and trustees are not "interested persons" within the meaning of
section 2(a)(19) of the Investment Company Act of 1940, and such directors or
trustees will evaluate the securities lending program no less frequently than
annually to determine that the investment of cash Collateral in the State Street
Navigator Securities Lending Trust, including any series thereof, is in the
Fund's best interest; and (iv) its prospectus provides appropriate disclosure
concerning its securities lending activity.
9
Each Fund hereby further represents that it is not subject to the
Employee Retirement Income Security Act of 1974, as amended ("ERISA") with
respect to this Agreement and the Securities; that it qualifies as an
"accredited investor" within the meaning of Rule 501 of Regulation D under the
Securities Act of 1933, as amended; and that the taxpayer identification
number(s) and corresponding tax year-end are as set forth on Schedule B.
14. Borrower Default Indemnification.
--------------------------------
(a) If at the time of a default by a Borrower with respect to a Loan
(within the meaning of the applicable Securities Loan Agreement), some or all of
the Loaned Securities under such Loan have not been returned by the Borrower,
and subject to the terms of this Agreement, State Street shall indemnify the
Fund against the failure of the Borrower as follows. State Street shall purchase
a number of Replacement Securities equal to the number of such unreturned Loaned
Securities, to the extent that such Replacement Securities are available on the
open market. Such Replacement Securities shall be purchased by applying the
proceeds of the Collateral with respect to such Loan to the purchase of such
Replacement Securities. Subject to the Fund's obligations pursuant to Section 8
hereof, if and to the extent that such proceeds are insufficient or the
Collateral is unavailable, the purchase of such Replacement Securities shall be
made at State Street's expense.
(b) If State Street is unable to purchase Replacement Securities
pursuant to Paragraph 14(a) hereof, State Street shall credit to the Fund's
account an amount equal to the Market Value of the unreturned Loaned Securities
for which Replacement Securities are not so purchased, determined as of (i) the
last day the Collateral continues to be successfully marked to market by the
Borrower against the unreturned Loaned Securities; or (ii) the next business day
following the day referred to in (i) above, if higher.
(c) In addition to making the purchases or credits required by
Paragraphs (a) and (b) hereof, State Street shall credit to the Fund's account
the value of all distributions on the Loaned Securities (not otherwise credited
to the Fund's accounts with State Street), for record dates which occur before
the date that State Street purchases Replacement Securities pursuant to
Paragraph (a) or credits the Fund's account pursuant to Paragraph (b).
(d) Any credits required under Paragraphs (b) and (c) hereof shall be
made by application of the proceeds of the Collateral, if any, that remains
after the purchase of Replacement Securities pursuant to Paragraph (a). If and
to the extent that the Collateral is unavailable or the value of the proceeds of
the remaining Collateral is less than the value of the sum of the credits
required to be made under Paragraphs (b) and (c), such credits shall be made at
State Street's expense.
(e) If after application of Paragraphs (a) through (d) hereof,
additional Collateral remains or any previously unavailable Collateral becomes
available or any additional amounts owed by the Borrower with respect to such
Loan are received from the Borrower,
▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ shall apply the proceeds of such Collateral or such additional
amounts first to reimburse itself for any amounts expended by State Street
pursuant to Paragraphs (a) through (d) above, and then to credit to the Fund's
account all other amounts owed by the Borrower to the Fund with respect to such
Loan under the applicable Securities Loan Agreement.
(f) In the event that State Street is required to make any payment
and/or incur any loss or expense under this Section, State Street shall, to the
extent of such payment, loss, or expense, be subrogated to, and succeed to, all
of the rights of the Fund against the Borrower under the applicable Securities
Loan Agreement.
15. Continuing Agreement and Termination.
------------------------------------
It is the intention of the parties hereto that this Agreement shall constitute a
continuing agreement in every respect and shall apply to each and every Loan,
whether now existing or hereafter made. The Funds and State Street may each at
any time terminate this Agreement upon five (5) business days' written notice to
the other to that effect. The only effects of any such termination of this
Agreement will be that (a) following such termination, no further Loans shall be
made hereunder by State Street on behalf of the Funds, and (b) State Street
shall, within a reasonable time after termination of this Agreement, terminate
any and all outstanding Loans. The provisions hereof shall continue in full
force and effect in all other respects until all Loans have been terminated and
all obligations satisfied as herein provided. State Street does not assume any
market or investment risk of loss associated with the Fund's change in cash
Collateral investment vehicles or termination of, or change in, its
participation in this securities lending program and the corresponding
liquidation of cash Collateral investments.
16. Notices.
-------
Except as otherwise specifically provided herein, notices under this
Agreement may be made in writing, or by any other means mutually acceptable to
the parties. If in writing, a notice shall be sufficient if delivered to the
party entitled to receive such notices at the following addresses:
If to the Funds:
PHOENIX INVESTMENT PARTNERS, LTD.
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇. ▇▇▇ ▇▇▇▇▇▇▇
If to State Street:
State Street Bank and Trust Company
11
Securities Finance
State Street Financial Center
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇-▇▇▇▇
or to such other addresses as either party may furnish the other party by
written notice under this section.
Whenever this Agreement permits or requires the Funds to give notice
to, direct, provide information to State Street, such notice, direction, or
information shall be provided to State Street on the Funds' behalf by any
individual designated for such purpose by the Funds in a written notice to State
Street. This Agreement shall be considered such a designation of the person
executing the Agreement on the Funds' behalf. After State Street's receipt of
such a notice of designation and until its receipt of a notice revoking such
designation, State Street shall be fully protected in relying upon the notices,
directions, and information given by such designee.
17. Securities Investors Protection Act of 1970 Notice.
--------------------------------------------------
EACH FUND IS HEREBY ADVISED AND ACKNOWLEDGES THAT THE PROVISIONS OF THE
SECURITIES INVESTOR PROTECTION ACT OF 1970 MAY NOT PROTECT THE FUND WITH RESPECT
TO THE LOAN OF SECURITIES HEREUNDER AND THAT, THEREFORE, THE COLLATERAL
DELIVERED TO THE FUND MAY CONSTITUTE THE ONLY SOURCE OF SATISFACTION OF THE
BROKER'S OR DEALER'S OBLIGATION IN THE EVENT THE BROKER OR DEALER FAILS TO
RETURN THE SECURITIES.
18. Authorized Representatives.
--------------------------
Each Fund authorizes State Street to accept and to act on any
instructions or other communications, regardless of how sent or delivered, from
any Authorized Representative. Each Fund shall be fully responsible for all acts
of any Authorized Representative, even if that person exceeds his or her
authority, and in no event shall State Street be liable to a Fund or any other
third party for any losses or damages arising out of or relating to any act
State Street takes or fails to take in connection with any such instructions or
other communications.
19. Non-US Borrowers.
----------------
In the event a Fund approves lending to Borrowers resident in the
United Kingdom ("UK"), the Fund shall provide sufficient documentation, in the
form and manner required by the UK Inland Revenue, to establish that the Fund is
(1) the beneficial owner of any manufactured dividends received and (2) not a UK
recipient for purposes of UK manufactured overseas dividend rules
12
20. Force Majeure.
-------------
State Street shall not be responsible for any losses, costs or damages
suffered by a Fund resulting directly or indirectly from war, riot, revolution,
terrorism, acts of government or other causes beyond the reasonable control or
apprehension of State Street.
21. Miscellaneous.
-------------
This Agreement supersedes any other agreement between the parties or
any representations made by one party to the other, whether oral or in writing,
concerning Loans of Available Securities by State Street on behalf of the Funds,
including the Original SLAA. This Agreement shall not be assigned, with respect
to any Fund, by either State Street or any Fund without the prior written
consent of the other party. Subject to the foregoing, this Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, representatives, successors, and assigns. This Agreement shall
be governed and construed in accordance with the laws of The Commonwealth of
Massachusetts. Each Fund hereby irrevocably submits to the jurisdiction of any
Massachusetts state or Federal court sitting in The Commonwealth of
Massachusetts in any action or proceeding arising out of or related to this
Agreement and hereby irrevocably agrees that all claims in respect of such
action or proceeding may be heard and determined in such Massachusetts state or
Federal court except that this provision shall not preclude any party from
removing any action to Federal court. Each Fund hereby irrevocably waives, to
the fullest extent it may effectively do so, the defense of an inconvenient
forum to the maintenance of such action or proceeding. Each Fund hereby
irrevocably consents to the service of any and all process in any such action or
proceeding by the mailing of copies of such process to the Funds at their
address specified in Section 16 hereof. Each Fund agrees that a final judgment
in any such action or proceeding, all appeals having been taken or the time
period for such appeals having expired, shall be conclusive and may be enforced
in other jurisdictions by suit on the judgment or in any other manner provided
by law. The provisions of this Agreement are severable and the invalidity or
unenforceability of any provision hereof shall not affect any other provision of
this Agreement. If in the construction of this Agreement any court should deem
any provision to be invalid because of scope or duration, then such court shall
forthwith reduce such scope or duration to that which is appropriate and enforce
this Agreement in its modified scope or duration.
22. Counterparts.
------------
The Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one (1) instrument.
23. Modification.
------------
13
This Agreement shall not be modified except by an instrument in writing
signed by the parties hereto.
EACH TRUST LISTED ON SCHEDULE B HERETO,
ON BEHALF OF EACH RESPECTIVE SERIES OF
EACH SUCH TRUST, SEVERALLY AND NOT
JOINTLY, AS SET FORTH ON SCHEDULE B
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------------
Title: President
-----------------------------------------------
STATE STREET BANK AND TRUST COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------------
Title: Senior Vice President
-----------------------------------------------
14
SCHEDULE A
----------
This Schedule is attached to and made part of the Securities Lending
Authorization Agreement, dated the 1st day of August 2005 between EACH TRUST
LISTED ON SCHEDULE B HERETO (each a "Trust"), ON BEHALF OF EACH RESPECTIVE
SERIES OF EACH SUCH TRUST (each, a "Fund," and collectively, the "Funds"),
SEVERALLY AND NOT JOINTLY, AS SET FORTH ON SCHEDULE B and STATE STREET BANK
AND TRUST COMPANY ("State Street")
SCHEDULE OF FEES
1. Subject to Paragraph 2 below, all proceeds collected by State Street on
investment of cash Collateral or any fee income shall be allocated as follows
- Seventy percent (70%) payable to the Fund, and
- Thirty percent (30%) payable to State Street.
2. All payments to be allocated under Paragraph 1 above shall be made after
deduction of such other amounts payable to State Street or to the Borrower under
the terms of this Securities Lending Authorization Agreement.
3. Cash Collateral will be invested in the State Street Navigator Securities
Lending Prime Portfolio:
On an annualized basis, the management/trustee/custody/fund
administration/transfer agent fee for investing cash Collateral in the State
Street Navigator Securities Lending Prime Portfolio is not more than 5.00 basis
points netted out of yield. The trustee may pay out of the assets of the
Portfolio all reasonable expenses and fees of the Portfolio, including
professional fees or disbursements incurred in connection with the operation of
the Portfolio.
SCHEDULE B
This Schedule is attached to and made part of the Securities Lending
Authorization Agreement, dated the 1st day of August 2005 between EACH TRUST
LISTED ON SCHEDULE B HERETO (each a "Trust"), ON BEHALF OF EACH RESPECTIVE
SERIES OF EACH SUCH TRUST (each, a "Fund," and collectively, the "Funds"),
SEVERALLY AND NOT JOINTLY, AS SET FORTH ON SCHEDULE B and STATE STREET BANK
AND TRUST COMPANY ("State Street")
TAXPAYER
IDENTIFICATION TAX
TRUST NAME FUND NAME NUMBER YEAR-END
---------- --------- ------ --------
PHOENIX SERIES Phoenix Balanced Fund ▇▇-▇▇▇▇▇▇▇ 10/31
Phoenix Capital Growth Fund (f.k.a.
Phoenix-▇▇▇▇▇▇▇▇ Capital Growth Fund) ▇▇-▇▇▇▇▇▇▇ 10/31
Phoenix Core Bond Fund ▇▇-▇▇▇▇▇▇▇ 10/31
Phoenix Mid-Cap Growth Fund (f.k.a.
Phoenix-▇▇▇▇▇▇▇▇ Mid-Cap Growth Fund) ▇▇-▇▇▇▇▇▇▇ 10/31
Phoenix HighYield (f.k.a. Phoenix-▇▇▇▇▇▇▇ High
Yield Fund) ▇▇-▇▇▇▇▇▇▇ 10/31
PHOENIX-KAYNE FUNDS Phoenix Rising Dividends Fund (f.k.a.
Phoenix-Kayne Rising Dividends Fund ▇▇-▇▇▇▇▇▇▇ 12/31
Phoenix Small-Mid Cap Fund (f.k.a. Phoenix-Kayne
Small Cap Fund) ▇▇-▇▇▇▇▇▇▇ 12/31
Phoenix Overseas Fund (f.k.a. Phoenix-Kayne
International Fund) ▇▇-▇▇▇▇▇▇▇ 12/31
PHOENIX INVESTMENT TRUST 97 Phoenix Small-Cap Value Fund ▇▇-▇▇▇▇▇▇▇ 8/31
SCHEDULE C
----------
This Schedule is attached to and made part of the Securities Lending
Authorization Agreement, dated the 1st day of August 2005
between EACH TRUST LISTED ON SCHEDULE B HERETO (each a "Trust"), ON BEHALF
OF EACH RESPECTIVE SERIES OF EACH SUCH TRUST (each, a "Fund," and collectively,
the "Funds"), SEVERALLY AND NOT JOINTLY, AS SET FORTH ON SCHEDULE B and
STATE STREET BANK AND TRUST COMPANY ("State Street").
ACCEPTABLE FORMS OF COLLATERAL
- Cash (U.S. and foreign currency);
- Securities issued or guaranteed by the United States
government or its agencies or instrumentalities;
- Sovereign Debt;
- Irrevocable bank letters of credit issued by a person other
than the Borrower or an affiliate of the Borrower may be
accepted as Collateral, if State Street has determined that it
is appropriate to accept such letters of credit as Collateral
under the securities lending programs it administers; and
- Such other Collateral as the parties may agree to in writing
from time to time
