Exhibit (h.7)
AMENDED AND RESTATED
SECURITIES LENDING AGENCY AGREEMENT
AGREEMENT, dated as of October 15, 2010, between iShares, Inc., a
Maryland corporation, iShares MSCI Russia Capped Index Fund, Inc., a Maryland
corporation, iShares MSCI Emerging Markets Small Cap Index Fund, Inc. a Maryland
corporation, and iShares Trust, a Delaware statutory trust (each singly and
together, the "Company"), acting on behalf of the funds listed on Schedule A
hereto and any future series or portfolio of the Company (each, a "Fund"), and
BlackRock Institutional Trust Company, N.A., a national banking association
("BTC") and its successors.
WHEREAS, the Company is registered as an open-end investment company
under the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, BTC acts as the agent for iShares, Inc. and iShares Trust for
the purpose of lending Securities in the Account (as defined below) pursuant to
a securities lending agency agreement, dated as of November 2, 2009, as amended;
and
WHEREAS, the parties to this Agreement desire to amend and restate such
agreement on the terms set forth herein;
NOW, THEREFORE, for and in consideration of the mutual promises set
forth herein, the parties hereto agree as follows:
1. Definitions.
Whenever used in this Agreement, unless the context otherwise requires,
the following words shall have the meanings set forth below. Capitalized terms
used but not defined herein shall have the meaning assigned to them in the
applicable Securities Lending Agreement.
1.1 "Account" shall mean the custodial account or accounts
established and maintained by the Custodian on behalf of each Fund for the
safekeeping of Securities and monies of the Fund from time to time.
1.2 "Approved Investment" shall mean any type of investment
permitted for Cash Collateral under the Securities Lending Guidelines.
1.3 "Authorized Person" shall be any officer of the Company and
any other person, whether or not any such person is an officer or employee of
the Company, duly authorized by resolutions of the Company to give Oral
Instructions and/or Written Instructions on behalf of the Company, such persons
to be designated in a Certificate which contains a specimen signature of such
person.
1.4 "Book-Entry System" shall mean the Federal Reserve/Treasury
book-entry system for receiving and delivering Government Securities (as defined
herein), its successors or equivalent and nominees.
1.5 "Borrower" shall mean any entity which is permitted to borrow
Securities from the Company pursuant to then applicable law, regulation, and/or
interpretation and pursuant to the Securities Lending Guidelines, and which has
a valid Securities Lending Agreement in place with BTC.
1.6 "Business Day" shall mean, with respect to a Fund for which
Securities loans are outstanding pursuant to this Agreement, a day on which both
such Fund and BTC are open for business.
1.7 "Cash Collateral" shall mean either Fed funds or New York
Clearing House funds or their equivalent if denominated in U.S. dollars, or the
equivalent if the Cash Collateral is denominated in a currency other than U.S.
dollars, as applicable for a particular loan of Securities.
1.8 "Cash Management Costs" shall mean the expenses incurred in
connection with the management and investment of a Fund's Cash Collateral,
including fees and expenses payable to BTC, BlackRock Fund Advisors ("BFA") or
any other affiliate of BTC (or its successors) as a result of the investment of
Cash Collateral in any joint account, fund or similar vehicle.
1.9 "Certificate" shall mean any notice, instruction, schedule or
other instrument in writing, authorized or required by this Agreement to be
given to BTC, which is actually received by BTC and signed on behalf of the
Company by an Authorized Person or a person reasonably believed by BTC to be an
Authorized Person.
1.10 "Collateral" shall mean Cash Collateral, Government Securities
and Letters of Credit, plus such other collateral as may be then permitted by
applicable law, regulation and/or interpretation, and the Securities Lending
Guidelines.
1.11 "Collateral Account" shall mean a segregated account or
accounts established and maintained by the Custodian for the purpose of holding
Collateral and Approved Investments, and interest, dividends and other payments
and distributions received with respect to Collateral and Approved Investments
("Distributions"). A Collateral Account may include a joint account as permitted
by the Securities Lending Guidelines.
1.12 "Custodian" shall mean State Street Bank and Trust Company, a
trust company organized and existing under the laws of the Commonwealth of
Massachusetts, or such other company that may from time to time be retained as
custodian by the Company with respect to one or more Funds.
1.13 "Depository" shall mean the Depository Trust Company,
Euroclear, and any other securities depository, sub-depository or clearing
agency (and their respective successors and nominees) authorized under
applicable law or regulation to act as a securities depository, sub-depository
or clearing agency, including any foreign securities depository or
sub-depository for the Company.
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1.14 "Earnings Account" shall mean a segregated account established
and maintained by the Custodian for the purpose of receiving any Securities Loan
Fee paid by Borrowers in connection with Securities loans hereunder.
1.15 "Government Security" shall mean book-entry Treasury
securities (as defined in Subpart 0 of Treasury Department Circular No. 300, 31
C.F.R. 306) and any other securities issued or guaranteed by the United States
government or any agency or instrumentality of the United States government.
1.16 "Letter of Credit" shall mean an unconditional and irrevocable
letter of credit in favor of BTC as agent for the Fund issued by a bank other
than the Borrower, the creditworthiness of which has been deemed to be
acceptable by BTC and which meets any applicable requirements in the Securities
Lending Guidelines.
1.17 "Oral Instructions" shall mean verbal instructions actually
received by BTC from an Authorized Person or from a person reasonably believed
by BTC to be an Authorized Person.
1.18 "Rebate" shall mean the amount payable by the Fund to a
Borrower in connection with Securities loans at any time collateralized by Cash
Collateral.
1.19 "Securities Lending Agreement" shall mean with respect to any
Borrower, the agreement pursuant to which BTC lends securities on behalf of its
customers (including the Fund) to such Borrower, as amended from time to time,
which agreement shall meet any applicable requirements in the Securities Lending
Guidelines. The Securities Lending Agreement may be in the form of a master
agreement covering a series of Securities lending transactions from multiple
lenders, including the Company.
1.20 "Securities Lending Guidelines" shall mean guidelines
governing the Company's Securities lending program adopted by the Company and
provided to BTC from time to time. The Securities Lending Guidelines may address
any aspect of the Company's Securities lending program, including without
limitation the kinds of Securities that may be lent, permissible forms of
Collateral, permissible Approved Investments, the selection of Borrowers, and
regular reporting to the Company.
1.21 "Securities Loan Fee" shall mean the amount payable by a
Borrower to BTC, as agent for the Fund, pursuant to the applicable Securities
Lending Agreement in connection with Securities loans, if any, collateralized by
Collateral other than Cash Collateral.
1.22 "Security" shall mean any Government Securities, non-U.S.
securities, U.S. common stock and other equity securities, bonds, debentures,
corporate debt securities, notes, mortgages or other obligations, and any
certificates, warrants or other instruments representing rights to receive,
purchase, or subscribe for the same, or evidencing or representing any other
rights or interests therein, which are available for lending pursuant to Section
2.2 of this Agreement.
1.23 "Written Instructions" shall mean written communications
actually received by BTC from an Authorized Person or from a person reasonably
believed by BTC to be an Authorized Person by letter, memorandum, telegram,
cable, telex, telecopy facsimile, computer,
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video (CRT) terminal or other on-line system, or any other method whereby BTC is
able to verify with a reasonable degree of certainty the identity of the sender.
2. Appointment; Scope of Agency Authority.
2.1 Appointment. The Company, on behalf of each Fund, hereby
appoints BTC as its agent to lend Securities in the Account to Borrowers from
time to time as hereinafter set forth, and BTC hereby accepts appointment as
such agent and agrees to so act.
2.2 Securities Subject to Lending. Unless the Company provides BTC
Written Instructions to the contrary, all Securities maintained in the Account
shall be available for lending pursuant to this Agreement.
2.3 Securities Lending Agreement.
(a) Attached hereto as Exhibit A are the standard forms of
Securities Lending Agreements in effect between BTC and the Borrowers as of the
date hereof. BTC shall provide the Company with any proposed material amendments
or changes, and notify the Company of any such amendments or changes, to any
form of Securities Lending Agreement to be used prior to their effectiveness.
The Company may elect, without penalty, to terminate any Borrower if it opposes
the change.
(b) BTC is hereby authorized to lend Securities in the Account
to Borrowers pursuant to the Securities Lending Agreements, this Agreement and
the Securities Lending Guidelines.
2.4 Loan Opportunities. The Company on behalf of each Fund
acknowledges and agrees that BTC shall have the right to decline to make any
loans of Securities under any Securities Lending Agreement, to discontinue
lending or to terminate any loans of Securities under any Securities Lending
Agreement in its sole discretion. The Company on behalf of each Fund agrees that
it shall have no claim against BTC based on, or relating to, loans made for
other customers, or loan opportunities refused hereunder, whether or not BTC has
made fewer or more loans for any other customer than for the Fund, and whether
or not any loan for another customer, or the opportunity refused, could have
resulted in loans made hereunder.
2.5 Use of Book-Entry System and Depositories. The Company on
behalf of each Fund hereby authorizes BTC on a continuous and on-going basis, to
deposit in the Book-Entry System and any Depositories all Securities eligible
for deposit therein and to utilize the Book-Entry System and Depositories to the
extent possible in connection with its receipt and delivery of Securities,
Collateral, Approved Investments and monies under this Agreement. Where
Securities, Collateral (other than Cash Collateral) and Approved Investments
eligible for deposit in the Book-Entry System or a Depository are transferred to
the Account, BTC shall identify or cause to be identified as belonging to the
Fund a quantity of securities in a fungible bulk of securities shown on BTC's
account on the books of the Book-Entry System or the applicable Depository.
Securities, Collateral and Approved Investments deposited in the Book-Entry
System or a Depository will be commingled in accounts which include assets held
by BTC for customers, including but not limited to accounts in which BTC acts in
a fiduciary or agency
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capacity, as well as assets held by or on behalf of other clients or
participants of the Book-Entry System or Depository.
2.6 Use of Third-Party Service Providers. The Company on behalf of
each Fund hereby acknowledges and agrees that BTC may utilize third-party
service providers to perform or analyze the functions described herein,
including service providers in which BTC may have an ownership interest. As
permitted by Section 5.8 below, these services may require the transmission, use
or sharing of data created in Securities lending transactions involving the
Funds. BTC shall bear the cost of any such service providers out of its portion
of the proceeds from Securities lending.
3. Representations and Warranties.
3.1 Company's Representations. The Company hereby represents and
warrants to BTC, which representations and warranties shall be deemed to be
continuing and to be reaffirmed on any day that a Securities loan hereunder is
outstanding, that:
(a) This Agreement and the Securities Lending Guidelines have
been approved by the Board of Trustees or Board of Directors of the Company (as
applicable); this Agreement is, and, if properly entered into under the terms of
this Agreement and the Securities Lending Guidelines, each Securities loan and
Approved Investment will be, legally and validly entered into by the Company on
behalf of each Fund, does not, and will not, violate any statute, regulation,
rule, order or judgment binding on the Fund, or any provision of the Company's
charter or by-laws, or any agreement binding on the Company or affecting its
property, and is enforceable against the Company and each Fund in accordance
with its terms, except as may be limited by bankruptcy, insolvency or similar
laws, or by equitable principles relating to or limiting creditors' rights
generally;
(b) The person executing this Agreement and all Authorized
Persons acting on behalf of the Company or any Fund has and have been duly and
properly authorized to do so;
(c) Each Fund is lending Securities as principal for its own
account and it will not transfer, assign or encumber its interest in, or rights
with respect to, any Securities loans; and
(d) All Securities available for lending pursuant to Section
2.2 of this Agreement are free and clear of all liens, claims, security
interests and encumbrances that would preclude their being lent as contemplated
by this Agreement. The Company shall promptly notify BTC in the manner agreed
between the parties from time to time when any Securities are no longer subject
to the representations contained in this sub-paragraph (d).
3.2 BTC's Representations. BTC hereby represents and warrants to
the Company, which representations and warranties shall be deemed to be
continuing and to be reaffirmed on any day that a Securities loan hereunder is
outstanding, that:
(a) This Agreement is legally and validly entered into by BTC,
does not and will not, violate any statute, regulation, rule, order or, judgment
binding on BTC, or any provision of BTC's charter or by-laws, or any agreement
binding on BTC or affecting its property, and is enforceable against BTC in
accordance with its terms, except as may be limited by bankruptcy,
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insolvency or similar laws, or by equitable principles relating to or limiting
creditors' rights generally;
(b) Both the person executing this Agreement on behalf of BTC
and all persons acting on BTC's behalf pursuant to this Agreement have been duly
and properly authorized to do so; and
(c) It will comply with all laws, rules and regulations,
including without limitation the conditions of any exemptive orders granted to
the Company by the Securities and Exchange Commission with respect to securities
lending transactions, if required, applicable to the Securities lending
transactions contemplated by this Agreement.
4. Securities Lending Transactions.
4.1 Compliance with Securities Lending Guidelines. BTC hereby
acknowledges receipt of the current Securities Lending Guidelines. The Company
shall promptly notify BTC of any changes to the Securities Lending Guidelines.
BTC acknowledges and agrees that it shall only lend Securities on behalf of the
Funds in accordance with the conditions of the Securities Lending Guidelines
applicable to the Funds' lending agent.
4.2 Loan Initiation. From time to time BTC may lend Securities to
Borrowers and deliver such Securities against receipt of Collateral in
accordance with the applicable Securities Lending Agreement and the Securities
Lending Guidelines. If instructed by the Company in writing, BTC shall refrain
from lending a particular Security or from making loans to a particular
Borrower.
4.3 Receipt of Collateral; Approved Investments.
(a) With respect to any Securities loan entered into on behalf
of a Fund, BTC shall require that the Borrower deliver and maintain collateral
that is equal at all times during the term of the loan to at least the market
value of the Securities loaned and any accrued interest thereon. If Cash
Collateral is received, BTC is hereby authorized and directed, without obtaining
any further approval from the Fund, to invest and reinvest all or substantially
all of the Cash Collateral received in any Approved Investments, including in
the name of and on behalf of the Fund to redeem, withdraw or sell the same, and
to receive distributions in the name of and on behalf of the Fund in accordance
with the Securities Lending Guidelines. The Company hereby agrees to execute all
necessary documents and take all necessary actions reasonably requested by BTC
in order to permit BTC to so act with regard to Approved Investments. BTC shall
instruct the Custodian to credit all Collateral, Approved Investments and
Distributions received with respect to Collateral and Approved Investments to
the Collateral Account and ▇▇▇▇ its books and records to identify the Fund's
ownership thereof as appropriate.
(b) All Approved Investments shall be for the account and risk
of the Fund. To the extent any loss arising out of Approved Investments results
in a deficiency in the amount of Collateral available for return to a Borrower
pursuant to the Securities Lending Agreement, the Fund agrees to pay BTC on
demand cash in an amount equal to such deficiency.
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(c) Except as otherwise provided herein, all Collateral,
Approved Investments and Distributions credited to the Collateral Account shall
be controlled by, and subject only to the instructions of, BTC, and BTC shall
not be required to comply with any instructions of the Company with respect to
the same.
4.4 Distributions on Loaned Securities. Except as provided in the
next sentence, all amounts received from the Borrower equivalent to all
interest, dividends, and other distributions which the owner of the loaned
Securities is entitled to receive shall be credited to the Fund's Account on the
date such amounts are delivered by the Borrower to the Custodian. 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 applicable loan (and shall be considered to
constitute loaned Securities) as of the date such non-cash distribution is
declared payable whether or not it has been received by the Borrower, provided
that any such addition shall be conditional upon the actual receipt of such
non-cash distribution and may be reversed by the Custodian to the extent that
such non-cash distribution is not received.
4.5 ▇▇▇▇ to Market. BTC shall on each Business Day ▇▇▇▇ to market
in U.S. dollars the value of all Collateral (other than Cash Collateral) and
Securities loaned hereunder and accordingly receive and release Collateral in
accordance with the applicable Securities Lending Agreement.
4.6 Collateral Substitutions. BTC may accept substitutions of
Collateral in accordance with the applicable Securities Lending Agreement and
the Securities Lending Guidelines and shall credit all such substitutions to the
Collateral Account; provided, however, that unless other Collateral has been
mutually agreed upon in writing by BTC and the Fund (including by means of the
Securities Lending Guidelines), no other Collateral may be substituted for Cash
Collateral.
4.7 Termination of Loans. In addition to BTC's authority to
terminate a loan of Securities pursuant to the terms of the applicable
Securities Lending Agreement as described in Section 2.4 above, BTC shall
terminate any Securities loan to a Borrower in accordance with the applicable
Securities Lending Agreement promptly:
(a) upon receipt by BTC of Oral Instructions or Written
Instructions instructing it to terminate a Securities loan; provided that the
Company may require that each Security must be returned to the Fund by no later
than the date which is the standard settlement date for trades of such Security
entered into on the date such Oral Instruction or Written Instruction is
received by BTC;
(b) upon receipt by BTC of Oral Instructions or Written
Instructions pursuant to the Securities Lending Guidelines to no longer lend to
a particular Borrower;
(c) upon receipt of written notice from the Company
terminating this Agreement with respect to one or more Funds in accordance with
Section 6; or
(d) as contemplated by the Securities Lending Guidelines.
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4.8 Securities Loan Fee. BTC shall receive any applicable
Securities Loan Fee paid by any Borrower pursuant to a Securities Lending
Agreement and credit all such amounts received to the Earnings Account.
4.9 Borrower's Financial Condition. BTC has delivered to BFA, the
investment adviser to the Funds, each Borrower's most recent statements required
to be furnished to customers by Rule 17a-5(c) of the Securities and Exchange
Commission under the Securities Exchange Act of 1934, as have been made
available to BTC pursuant to the Securities Lending Agreements. BTC shall
promptly deliver to any investment adviser for the Funds all statements and
financial information subsequently delivered to BTC and required to be furnished
to BTC under the Securities Lending Agreements.
4.10 Transfer Taxes and Necessary Costs. All transfer taxes and
necessary costs with respect to the transfer of the loaned Securities by the
Fund to the Borrower and the Borrower to the Fund upon the termination of the
loan shall be paid by the Borrower in accordance with the applicable Securities
Lending Agreement.
4.11 BTC's Obligation. Except as specifically set forth herein, or
in any applicable Securities Lending Agreement, BTC shall have no duty or
obligation to take action to effect payment by a Borrower of any amounts owed by
such Borrower pursuant to the Securities Lending Agreement.
4.12 Loans to Affiliated Borrowers. The Company and BTC have
obtained an exemptive order from the Securities and Exchange Commission that
permits BTC to lend Securities on behalf of the Funds to Affiliated Borrowers,
provided that such loans are made in accordance with the conditions and
procedures outlined in the exemptive order. BTC shall only make loans to
Affiliated Borrowers in accordance with such conditions and procedures, as they
may be amended from time to time, and only so long as they remain applicable,
and in accordance with the Securities Lending Guidelines.
5. Concerning BTC.
5.1 Standard of Care: Indemnification.
(a) It is expressly understood and agreed that in exercising
its rights and performing its obligations hereunder, BTC owes no fiduciary duty
to the Fund. BTC shall not be liable for any costs, expenses, damages,
liabilities or claims (including reasonable attorneys and accountants fees)
incurred by the Fund, except to the extent those costs, expenses, damages,
liabilities or claims result from BTC's material breach of this Agreement or
BTC's negligence, willful misconduct, bad faith, or reckless disregard of its
obligations and duties hereunder.
Neither the Company nor BTC shall have any obligation
hereunder for costs, expenses, damages, liabilities or claims (including
reasonable attorneys and accountants fees), which are sustained or incurred by
reason of any action or inaction by the Book-Entry System or any Depository or
their respective successors or nominees. In no event shall either party be
liable to the other for special, punitive or consequential damages, arising
under or in connection with this Agreement, even if previously informed of the
possibility of such damages.
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(b) The Company on behalf of each Fund agrees to indemnify BTC
and to hold it harmless from and against any and all costs, expenses, damages,
liabilities or claims (including reasonable fees and expenses of counsel) which
BTC may sustain or incur or which may be asserted against BTC by reason of or as
a result of any action taken or omitted by BTC in connection with or arising out
of BTC's operating under and in compliance with this Agreement, except those
costs, expenses, damages, liabilities or claims arising out of BTC's negligence,
bad faith, willful misconduct, or reckless disregard of its obligations and
duties hereunder. Actions taken or omitted in reasonable reliance upon Oral
Instructions or Written Instructions, any Certificate, or upon any information,
order, indenture, stock certificate, power of attorney, assignment, affidavit or
other instrument reasonably believed by BTC to be genuine or bearing the
signature of a person or persons reasonably believed by BTC to be genuine or
bearing the signature of a person or persons reasonably believed to be
authorized to sign, countersign or execute the same, shall be presumed to have
been taken or omitted in good faith.
(c) BTC shall indemnify and hold harmless the Company and each
Fund, its Board of Trustees or Board of Directors (as applicable) and its
agents, BFA and any investment adviser for the Funds from any and all loss,
liability, costs, damages, actions, and claims ("Loss") to the extent that any
such Loss arises out of the material breach of this Agreement by or negligent
acts or omissions, bad faith or willful misconduct of BTC, its officers,
directors or employees or any of its agents or subcustodians in connection with
the Securities lending activities undertaken pursuant to this Agreement,
provided that BTC's indemnification obligation with respect to the acts or
omissions of its subcustodians shall not exceed the indemnification provided by
the applicable subcustodian to BTC.
(d) prior to lending on behalf of any Fund or Funds, BTC shall
have obtained a Guaranty and Indemnity from Barclays Bank PLC or another entity,
the creditworthiness of which is reasonably satisfactory to the Board of
Trustees or Board of Directors (as applicable) of the Company, in favor of such
Fund or Funds. Upon the termination of that guaranty, BTC shall obtain, and bear
the costs of obtaining, a guaranty from Barclays Bank PLC or another entity, the
creditworthiness of which is reasonably satisfactory to the Board of Trustees or
Board of Directors (as applicable) of the Company, pursuant to which the
guarantor will indemnify the Funds for losses due to a Borrower default on terms
that are consistent in all material respects with the existing Guarantee and
Indemnity by Barclays Bank PLC. The Funds and/or Company, at their expense, may
obtain further indemnification against losses due to a Borrower default from a
third party to which BTC is not a party.
5.2 No Obligation to Inquire. Without limiting the generality of
the foregoing, BTC shall be under no obligation to inquire into, and shall not
be liable for, the validity of the issue of any Securities at any time held in
the Account or Approved Investments held in the Collateral Account.
5.3 Advice of Counsel. BTC may, with respect to questions of law,
apply for and obtain the advice and opinion of counsel which may be counsel to
the Company, provided that the foregoing shall not be deemed to be a waiver by
the Company of any conflict of such counsel.
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5.4 No Collection Obligations. BTC shall be under no obligation or
duty to take action to effect collection from the issuer of any amounts payable
in respect of Securities or Approved Investments if the issuer of such
Securities or Approved Investments is in default, or if payment is refused after
due demand and presentation.
5.5 Pricing Methods. BTC is authorized to utilize any recognized
pricing information service or any other means of valuation specified in the
applicable Securities Lending Agreement ("Pricing Methods") in order to perform
its valuation responsibilities with respect to loaned Securities, Collateral and
Approved Investments, and the Fund agrees to hold BTC harmless from and against
any loss or damage suffered or incurred as a result of errors or omissions of
any such Pricing Methods.
5.6 BTC's Fee as Securities Lending Agent, etc.
(a) In connection with each Securities loan hereunder, the
Fund shall, subject to Section 5.6(c), pay to BTC a percentage (the "BTC Fee
Percentage") of the net amount earned from Securities lending activities,
consisting of income earned on the investment and reinvestment of Cash
Collateral plus any Securities Loan Fees otherwise paid by the Borrowers. The
net amount to be paid to BTC shall be computed after deducting any rebate due to
the Borrowers under the applicable Securities Lending Agreement with the
Borrowers. The BTC Fee Percentage shall be such percentage as may from time to
time be agreed upon by the Board of the Company and BTC and shall be set forth
in writing. Effective as of October 15, 2010, the BTC Fee Percentage is thirty
five percent (35%).
(b) BTC is authorized on a monthly basis to charge the fee
owed to it by a Fund under this Section 5.6 against the applicable Collateral
Account or Earnings Account. Such fee shall be charged and paid at the end of
each month. Subject to Section 5.6(c), BTC shall simultaneously therewith direct
the Custodian to pay to the applicable Fund the net amount earned from
Securities lending activities, as described in Section 5.6(a), that is not paid
to BTC as its fee.
(c) BTC shall be responsible for all transaction fees and all
other operational costs relating to Securities lending activities, other than
extraordinary expenses (e.g., litigation and indemnification expenses). In the
event that a Fund directly or indirectly bears all or a portion of any fees and
expenses payable to BTC, BFA or any other affiliate of BTC as a result of the
investment of Cash Collateral in any joint account, fund or similar vehicle,
such fees and expenses (other than extraordinary expenses), as computed at least
monthly by BTC or its designee, then such excess shall, without limitation, be
deemed a transaction fee or other operational cost for which BTC shall be
responsible.
5.7 Reliance on Certificates and Instructions. The Company agrees
to furnish to BTC a new Certificate whenever any then Authorized Person ceases
to be an Authorized Person or additional Authorized Persons are appointed and
authorized. BTC shall be entitled to rely, and shall be fully protected in
acting, upon any Certificate, any information contained on any schedule hereto
as may be amended in accordance with the terms hereof, and any Written or Oral
Instruction actually received by BTC and reasonably believed by BTC to be duly
authorized and delivered. The Company agrees to forward to BTC Written
Instructions confirming Oral
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Instructions in such manner so that such Written Instructions are received by
BTC by the close of business of the same day that such Oral Instructions are
given to BTC. The Company agrees that the fact that such confirming Written
Instructions are not received on a timely basis or that contrary instructions
are received by BTC shall in no way affect the validity or enforceability of the
transactions authorized by the Company. BTC shall use reasonable efforts to
report any subsequently received contrary instructions. In this regard, the
records of BTC shall be presumed to reflect accurately any Oral Instructions
given by an Authorized Person or a person reasonably believed by BTC to be an
Authorized Person.
5.8 Disclosure of Information. BTC may not disclose or supply any
information regarding the Company or Fund unless required by any law or
governmental regulation now or hereafter in effect or requested to do so by
Company; provided that BTC may disclose or supply information regarding the
Company and/or Fund and any transactions authorized by this Agreement as
necessary in the sole discretion of BTC in order to facilitate, effect or
continue any Securities loans hereunder or to assist in the analysis of the
performance of the Securities lending program.
5.9 Reports. BTC shall furnish the Company and the Fund with
reports relating to loans hereunder and other information requested by the
Company and shall provide such reports to the Company's Board of Trustees or
Board of Directors (as applicable) upon request or as may be required by the
Securities Lending Guidelines.
5.10 Force Majeure. Notwithstanding anything to the contrary in
this Agreement, in no event shall a party to this Agreement be liable to the
other party or any third party for losses resulting from (i) any acts of God,
fires, floods, or other disturbances of nature, epidemics, strikes, riots,
nationalization, expropriation, currency restrictions, terrorist activity, or
insurrection, or (ii) other happenings or events beyond the reasonable control
or anticipation of the party affected, provided that (A) the affected party has
in place appropriate business continuity procedures, systems and facilities and
(B) the affected party uses its best efforts to avoid or remove the cause of
such losses.
5.11 No Implied Duties.
(a) BTC shall have no duties or responsibilities whatsoever
except such duties and responsibilities as are specifically set forth in this
Agreement and in the applicable Securities Lending Agreement, and no covenant or
obligation shall be implied against BTC in connection with this Agreement.
(b) Neither the Company nor any Fund shall have any duties or
responsibilities whatsoever except such duties and responsibilities as are
specifically set forth in this Agreement, and no covenant or obligation shall be
implied against the Company or any Fund in connection with this Agreement.
(c) Nothing in this Agreement shall be understood to imply
that in performing the functions described herein, BTC is acting in the capacity
of an investment adviser or is providing advice as to the value of securities or
as to the advisability of investing in, purchasing, or selling securities.
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6. Termination.
6.1 Termination. This Agreement may be terminated at any time with
respect to one or more Funds by either party upon delivery to the other party of
a written notice specifying the date of such termination, which shall be not
less than 60 days after the date of receipt of such notice.
6.2 Cooperation. Both parties shall take all commercially
reasonable steps to cooperate to provide a smooth transition in the event of a
termination.
6.3 Termination of Loans, etc. upon Termination of Agreement.
Notwithstanding any such notice, this Agreement shall continue in full force and
effect with respect to any loans of Securities that remain outstanding as of the
date of termination; provided, however, that BTC shall promptly terminate all
loans of Securities made pursuant to this Agreement and shall not make any
further loans of Securities pursuant to this Agreement.
7. Miscellaneous.
7.1 Exclusivity. During the term of this Agreement, the Company
agrees that it shall not enter into any other agreement with any third party
whereby such third party is permitted to make loans on behalf of any Fund of any
Securities held by BTC in the Account from time to time; provided, however, that
nothing in this provision shall prevent the Company from terminating this
Agreement and/or hiring a securities lending agent other than BTC. The parties
agree that this provision does not prohibit the Company from maintaining this
Agreement during any transition period to another Securities lending agent.
7.2 Notices.
(a) Any notice or other instrument in writing, authorized or
required by this Agreement to be given to BTC, shall be sufficiently given if
addressed to BTC and received by it at its offices at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Securities Lending Department, with a copy to
the General Counsel or at such other place as BTC may from time to time
designate in writing.
(b) Any notice or other instrument in writing, authorized or
required by this Agreement to be given to the Company shall be sufficiently
given if addressed to the Fund and/or Company and received by - Mutual Fund
Administration, c/o BlackRock Fund Advisors, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, with a copy to: Legal Department, or at such other place as
the Company may from time to time designate in writing.
7.3 Cumulative Rights and No Waiver. Each and every right granted
to a party hereunder or under any other document delivered hereunder or in
connection herewith, or allowed it by law or equity, shall be cumulative and may
be exercised from time to time. No failure on the part of a party to exercise,
and no delay in exercising, any right shall operate as a
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waiver thereof, nor shall any single or partial exercise by a party of any right
preclude any other or future exercise thereof or the exercise of any other
right.
7.4 Severability. In case any provision in or obligation under
this Agreement shall be invalid, illegal or unenforceable in any jurisdiction,
the validity, legality and enforceability of the remaining provisions or
obligations shall not in any way be affected or impaired thereby, and if any
provision is inapplicable to any person or circumstances, it shall nevertheless
remain applicable to all other persons and circumstances.
7.5 Amendments. This Agreement may not be amended or modified in
any manner except by a written agreement executed by both parties.
7.6 Successors and Assigns. This Agreement shall extend to and
shall be binding upon the parties hereto, and their respective successors and
assigns; provided, however, that this Agreement shall not be assignable by
either party without the written consent of the other.
7.7 Governing Law. This Agreement shall be construed in accordance
with the laws of the State of California without regard to conflict of laws
principles thereof.
7.8 No Third Party Beneficiaries. In performing hereunder, BTC is
acting solely on behalf of the Company and, except as specifically provided
herein, no contractual or service relationship shall be deemed to be established
hereby between BTC and any other person.
7.9 Counterparts. This 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 instrument.
7.10 SIPA Notice. THE PROVISIONS OF THE SECURITIES INVESTOR
PROTECTION ACT OF 1970 MAY NOT PROTECT THE FUND WITH RESPECT TO LOANS HEREUNDER
AND, THEREFORE, THE COLLATERAL DELIVERED TO BTC AS AGENT FOR THE FUND MAY
CONSTITUTE THE ONLY SOURCE OF SATISFACTION OF A BORROWER'S OBLIGATION IN THE
EVENT SUCH BORROWER FAILS TO RETURN THE LOANED SECURITIES.
7.11 Survival of Indemnification. The indemnifications provided by
a party hereunder shall be a continuing obligation of such party, its successors
and assigns, notwithstanding the termination of any loans hereunder or of this
Agreement.
7.12 No Personal Liability. It is understood and agreed that none
of the shareholders, officers, agents, Directors or Trustees (as applicable) of
the Company or any Fund shall be personally liable hereunder. All persons
contracting with or having a claim against the Company with respect to a Fund
shall look solely to the assets of such Fund for payment of such contract or
claim, and no Fund shall be liable for the obligations of any other Fund.
[End of Text]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers, thereunto duly authorized, as of the day
and year first above written.
iSHARES, INC.
By: /s/ ▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇▇▇
Title: Treasurer and Chief Financial
Officer
iSHARES TRUST
By: /s/ ▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇▇▇
Title: Treasurer and Chief Financial
Officer
iSHARES MSCI RUSSIA CAPPED INDEX FUND, INC.
By: /s/ ▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇▇▇
Title: Treasurer and Chief
Financial Officer
iSHARES MSCI EMERGING MARKETS SMALL CAP
INDEX FUND, INC.
By: /s/ ▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇▇▇
Title: Treasurer and Chief Financial
Officer
BLACKROCK INSTITUTIONAL TRUST COMPANY, N.A.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Managing Director
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
Approved by the Board of Trustees of iShares Trust, the Board of Directors of
iShares, Inc., the Board of Directors of iShares MSCI Russia Capped Index Fund,
Inc., and the Board of Directors of iShares MSCI Emerging Markets Small Cap
Index Fund, Inc. on September16, 2010
[Signature page to Securities Lending Agency Agreement]