CUSTODIAN.
2.
THE CORPORATION UNDERSTANDS THAT WHEN CUSTODIAN IS INSTRUCTED TO DELIVER
SECURITIES AGAINST PAYMENT, DELIVERY OF SUCH SECURITIES AND RECEIPT OF PAYMENT
THEREFOR MAY NOT BE COMPLETED SIMULTANEOUSLY.
NOTWITHSTANDING ANY PROVISION IN
THIS AGREEMENT TO THE CONTRARY, SETTLEMENTS, PAYMENTS AND DELIVERIES OF
SECURITIES MAY BE EFFECTED BY CUSTODIAN OR ANY SUBCUSTODIAN IN ACCORDANCE WITH
THE CUSTOMARY OR ESTABLISHED SECURITIES TRADING OR SECURITIES PROCESSING
PRACTICES AND PROCEDURES IN THE JURISDICTION IN WHICH THE TRANSACTION OCCURS,
INCLUDING, WITHOUT LIMITATION, DELIVERY TO A PURCHASER OR DEALER THEREFOR (OR
AGENT) AGAINST RECEIPT WITH THE EXPECTATION OF RECEIVING LATER PAYMENT FOR SUCH
SECURITIES.
THE CORPORATION ASSUMES FULL RESPONSIBILITY FOR ALL RISKS,
INCLUDING, WITHOUT LIMITATION, CREDIT RISKS, INVOLVED IN CONNECTION WITH SUCH
DELIVERIES OF SECURITIES.
3.
CUSTODIAN MAY, AS A MATTER OF BOOKKEEPING CONVENIENCE OR BY SEPARATE
AGREEMENT WITH THE CORPORATION, CREDIT THE ACCOUNT WITH THE PROCEEDS FROM THE
SALE, REDEMPTION OR OTHER DISPOSITION OF SECURITIES OR INTEREST, DIVIDENDS OR
OTHER DISTRIBUTIONS PAYABLE ON SECURITIES PRIOR TO ITS ACTUAL RECEIPT OF FINAL
PAYMENT THEREFOR.
ALL SUCH CREDITS SHALL BE CONDITIONAL UNTIL CUSTODIAN'S
ACTUAL RECEIPT OF FINAL PAYMENT AND MAY BE REVERSED BY CUSTODIAN TO THE EXTENT
THAT FINAL PAYMENT IS NOT RECEIVED.
PAYMENT WITH RESPECT TO A TRANSACTION WILL
NOT BE "FINAL" UNTIL CUSTODIAN SHALL HAVE RECEIVED IMMEDIATELY AVAILABLE
CORPORATIONS WHICH UNDER APPLICABLE LOCAL LAW, RULE AND/OR PRACTICE ARE
IRREVERSIBLE AND NOT SUBJECT TO ANY SECURITY INTEREST, LEVY OR OTHER
ENCUMBRANCE, AND WHICH ARE SPECIFICALLY APPLICABLE TO SUCH TRANSACTION.
ARTICLE V
OVERDRAFTS OR INDEBTEDNESS
1.
IF CUSTODIAN SHOULD IN ITS SOLE DISCRETION ADVANCE CORPORATIONS ON BEHALF
OF ANY SERIES WHICH RESULTS IN AN OVERDRAFT (INCLUDING, WITHOUT LIMITATION, ANY
DAY-LIGHT OVERDRAFT) BECAUSE THE MONEY HELD BY CUSTODIAN IN AN ACCOUNT FOR SUCH
SERIES SHALL BE INSUFFICIENT TO PAY THE TOTAL AMOUNT PAYABLE UPON A PURCHASE OF
SECURITIES SPECIFICALLY ALLOCATED TO SUCH SERIES, AS SET FORTH IN A CERTIFICATE,
INSTRUCTIONS OR ORAL INSTRUCTIONS, OR IF AN OVERDRAFT ARISES IN THE SEPARATE
ACCOUNT OF A SERIES FOR SOME OTHER REASON, INCLUDING, WITHOUT LIMITATION,
BECAUSE OF A REVERSAL OF A CONDITIONAL CREDIT OR THE PURCHASE OF ANY CURRENCY,
OR IF THE CORPORATION IS FOR ANY OTHER REASON INDEBTED TO CUSTODIAN WITH RESPECT
TO A SERIES, INCLUDING ANY INDEBTEDNESS TO THE BANK OF NEW YORK UNDER THE
CORPORATION'S CASH MANAGEMENT AND RELATED SERVICES AGREEMENT (EXCEPT A BORROWING
FOR INVESTMENT OR FOR TEMPORARY OR EMERGENCY PURPOSES USING SECURITIES AS
COLLATERAL PURSUANT TO A SEPARATE AGREEMENT AND SUBJECT TO THE PROVISIONS OF
SECTION 2 OF THIS ARTICLE), SUCH
9
OVERDRAFT OR INDEBTEDNESS SHALL BE DEEMED TO BE A LOAN MADE BY CUSTODIAN TO THE
CORPORATION FOR SUCH SERIES PAYABLE ON DEMAND AND SHALL BEAR INTEREST FROM THE
DATE INCURRED AT A RATE PER ANNUM ORDINARILY CHARGED BY CUSTODIAN TO ITS
INSTITUTIONAL CUSTOMERS, AS SUCH RATE MAY BE ADJUSTED FROM TIME TO TIME.
IN
ADDITION, THE CORPORATION HEREBY AGREES THAT CUSTODIAN SHALL TO THE MAXIMUM
EXTENT PERMITTED BY LAW HAVE A CONTINUING LIEN, SECURITY INTEREST, AND SECURITY
ENTITLEMENT IN AND TO ANY