Registration Nos. 2-67029/811-3055
Registration Nos. 2-87059/811-3872
Registration Nos. 33-49117/811-7051
Registration Nos. 2-57265/811-2684
Registration Nos. 2-94641/811-4163
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
Post-Effective Amendment No. 26 / X /
|
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
/ X /
Amendment No. 18 / X /
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
Post-Effective Amendment No. 19 / X /
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
/ X /
Amendment No. 16 / X /
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
Post-Effective Amendment No. 3 / X /
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
/ X /
Amendment No. 4 / X /
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
Post-Effective Amendment No. 36 / X /
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
/ X /
Amendment No. 20 / X /
PAGE 2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
Post-Effective Amendment No. 15 / X /
|
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
/ X /
Amendment No. 14 / X /
Fiscal Years Ended February 28, 1994
It is proposed that this filing will become effective (check appropriate box):
/___/immediately upon filing pursuant to paragraph (b)
/___/on (date) pursuant to paragraph (b)
/___/60 days after filing pursuant to paragraph (a)
/_X_/on July 1, 1994 pursuant to paragraph (a) of Rule 485
+ Not applicable, as no securities are being registered by this Post- Effective Amendment No. 26 to the Registration Statement.
Pursuant to Section 24f-2 of the Investment Company Act of 1940, the Registrant has registered an indefinite number of securities under the Securities Act of 1933 and intends to file a 24f-2 Notice by April 29, 1994.
+ Not applicable, as no securities are being registered by this Post- Effective Amendment No. 19 to the Registration Statement.
Pursuant to Section 24f-2 of the Investment Company Act of 1940, the Registrant has registered an indefinite number of securities under the Securities Act of 1933 and intends to file a 24f-2 Notice by April 29, 1994.
+ Not applicable, as no securities are being registered by this Post- Effective Amendment No. 3 to the Registration Statement.
Pursuant to Section 24f-2 of the Investment Company Act of 1940, the Registrant has registered an indefinite number of securities under the Securities Act of 1933 and intends to file a 24f-2 Notice by April 29, 1994.
+ Not applicable, as no securities are being registered by this Post- Effective Amendment No. 36 to the Registration Statement.
Pursuant to Section 24f-2 of the Investment Company Act of 1940, the Registrant has registered an indefinite number of securities under the Securities Act of 1933 and intends to file a 24f-2 Notice by April 29, 1994.
+ Not applicable, as no securities are being registered by this Post- Effective Amendment No. 15 to the Registration Statement.
Item 1. Cover Page Cover Page
Item 2. Synopsis Transaction Costs and Fund
Expenses
Item 3. Condensed Financial InformationFinancial Highlights
Item 4. General Description of RegistrantTransaction Costs and
Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management;
Understanding
Performance Information;
Investment Policies and
Practices; Ratings of
Municipal Debt Securities
Item 5. Management of the Fund Transaction Costs and Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management
Item 6. Capital Stock and Other SecuritiesUseful Information on
Distributions and Taxes;
The
Fund's Organization and
Management
Item 7. Purchase of Securities Being Pricing Shares and
Receiving
Offered Sale Proceeds; Transaction
Procedures and Special
Requirements; Meeting
Requirements for New
Accounts;
Shareholder Services
|
Item 8. Redemption or Repurchase Pricing Shares and
Receiving
Sale Proceeds; Transaction
Procedures and Special
Requirements; Exchanging
and
Redeeming Shares;
Shareholder
Services
Item 9. Pending Legal Proceedings +
PART B
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History+
Item 13. Investment Objectives and PoliciesInvestment Objectives
and
Policies; Risk Factors;
Investment Programs;
Investment
Restrictions; Investment
Performance Item 14. Management of the Registrant Management of Funds
Item 15. Control Persons and Principal Principal Holders of Holders of Securities Securities
Item 16. Investment Advisory and Other Investment Management Services Services; Custodian; Independent Accountants; Legal Counsel
Item 17. Brokerage Allocation Portfolio Transactions Item 18. Capital Stock and Other SecuritiesDividends; Capital Stock
Item 19. Purchase, Redemption and PricingRatings of Municipal
Debt
of Securities Being OfferedSecurities; Ratings of
Municipal Notes and
Variable Rate Securities;
Ratings of Commercial
Paper; Redemptions in
Kind; Pricing of
Securities; Net Asset
Value Per Share;
Federal and State
Registration
of Shares
Item 20. Tax Status Tax Status Item 21. Underwriters Distributor for Funds Item 22. Calculation of Yield Quotations of
Money Market Funds Yield Information
Item 23. Financial Statements Incorporated by Reference
from Annual Report
|
Item 1. Cover Page Cover Page
Item 2. Synopsis Transaction Costs and Fund
Expenses
Item 3. Condensed Financial InformationFinancial Highlights
Item 4. General Description of RegistrantTransaction Costs and
Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management;
Understanding
Performance Information;
Investment Policies and
Practices; Ratings of
Municipal Debt Securities
Item 5. Management of the Fund Transaction Costs and Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management
Item 6. Capital Stock and Other SecuritiesUseful Information on
Distributions and Taxes;
The
Fund's Organization and
Management
Item 7. Purchase of Securities Being Pricing Shares and
Receiving
Offered Sale Proceeds; Transaction
Procedures and Special
Requirements; Meeting
Requirements for New
Accounts;
Shareholder Services
|
Item 8. Redemption or Repurchase Pricing Shares and
Receiving
Sale Proceeds; Transaction
Procedures and Special
Requirements; Exchanging
and
Redeeming Shares;
Shareholder
Services
Item 9. Pending Legal Proceedings +
PART B
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History+
Item 13. Investment Objectives and PoliciesInvestment Objectives
and
Policies; Risk Factors;
Investment Programs;
Investment
Restrictions; Yield
Information; Investment
Performance Item 14. Management of the Registrant Management of Funds Item 15. Control Persons and Principal Principal Holders of Holders of Securities Securities
Item 16. Investment Advisory and Other Investment Management Services Services; Custodian; Independent Accountants; Legal Counsel
Item 17. Brokerage Allocation Portfolio Transactions
Item 18. Capital Stock and Other SecuritiesDividends; Capital
Stock
Item 19. Purchase, Redemption and PricingRatings of Municipal
Debt
of Securities Being OfferedSecurities; Ratings of
Municipal Notes and
Variable Rate Securities;
Ratings of Commercial
Paper; Redemptions in
Kind; Pricing of
Securities; Net Asset
Value Per Share;
Federal and State
Registration of Shares
Item 20. Tax Status Tax Status Item 21. Underwriters Distributor for Funds Item 22. Calculation of Yield Quotations of
Money Market Funds +
Item 23. Financial Statements Incorporated by Reference
from Annual Report
|
Item 1. Cover Page Cover Page
Item 2. Synopsis Transaction Costs and Fund
Expenses
Item 3. Condensed Financial InformationFinancial Highlights
Item 4. General Description of RegistrantTransaction Costs and
Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management;
Understanding
Performance Information;
Investment Policies and
Practices; Ratings of
Municipal Debt Securities
Item 5. Management of the Fund Transaction Costs and Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management
Item 6. Capital Stock and Other SecuritiesUseful Information on
Distributions and Taxes;
The
Fund's Organization and
Management
Item 7. Purchase of Securities Being Pricing Shares and
Receiving
Offered Sale Proceeds; Transaction
Procedures and Special
Requirements; Meeting
Requirements for New
Accounts;
Shareholder Services
|
Item 8. Redemption or Repurchase Pricing Shares and
Receiving
Sale Proceeds; Transaction
Procedures and Special
Requirements; Exchanging
and
Redeeming Shares;
Shareholder
Services
Item 9. Pending Legal Proceedings +
PART B
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History+
Item 13. Investment Objectives and PoliciesInvestment Objectives
and
Policies; Risk Factors;
Investment Programs;
Investment
Restrictions; Yield
Information; Investment
Performance Item 14. Management of the Registrant Management of Funds Item 15. Control Persons and Principal Principal Holders of Holders of Securities Securities
Item 16. Investment Advisory and Other Investment Management Services Services; Custodian; Independent Accountants; Legal Counsel
Item 17. Brokerage Allocation Portfolio Transactions
Item 18. Capital Stock and Other SecuritiesDividends; Capital
Stock
Item 19. Purchase, Redemption and PricingRatings of Municipal
Debt
of Securities Being OfferedSecurities; Ratings of
Municipal Notes and
Variable Rate Securities;
Ratings of Commercial
Paper; Redemptions in
Kind; Pricing of
Securities; Net Asset
Value Per Share;
Federal and State
Registration of Shares
Item 20. Tax Status Tax Status Item 21. Underwriters Distributor for Funds Item 22. Calculation of Yield Quotations of
Money Market Funds +
Item 23. Financial Statements Incorporated by Reference
from Annual Report
|
Item 1. Cover Page Cover Page
Item 2. Synopsis Transaction Costs and Fund
Expenses
Item 3. Condensed Financial InformationFinancial Highlights
Item 4. General Description of RegistrantTransaction Costs and
Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management;
Understanding
Performance Information;
Investment Policies and
Practices; Ratings of
Municipal Debt Securities;
Asset Composition
Item 5. Management of the Fund Transaction Costs and Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management
Item 6. Capital Stock and Other SecuritiesUseful Information on
Distributions and Taxes;
The
Fund's Organization and
Management
Item 7. Purchase of Securities Being Pricing Shares and
Receiving
Offered Sale Proceeds; Transaction
Procedures and Special
Requirements; Meeting
Requirements for New
Accounts;
Shareholder Services
|
Item 8. Redemption or Repurchase Pricing Shares and
Receiving
Sale Proceeds; Transaction
Procedures and Special
Requirements; Exchanging
and
Redeeming Shares;
Shareholder
Services
Item 9. Pending Legal Proceedings +
PART B
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History+
Item 13. Investment Objectives and PoliciesInvestment Objectives
and
Policies; Risk Factors;
Investment Programs;
Investment
Restrictions; Yield
Information; Investment
Performance Item 14. Management of the Registrant Management of Funds Item 15. Control Persons and Principal Principal Holders of Holders of Securities Securities
Item 16. Investment Advisory and Other Investment Management Services Services; Custodian; Independent Accountants; Legal Counsel
Item 17. Brokerage Allocation Portfolio Transactions
Item 18. Capital Stock and Other SecuritiesDividends; Capital
Stock
Item 19. Purchase, Redemption and PricingRatings of Municipal
Debt
of Securities Being OfferedSecurities; Ratings of
Municipal Notes and
Variable Rate Securities;
Ratings of Commercial
Paper; Redemptions in
Kind; Pricing of
Securities; Net Asset
Value Per Share;
Federal and State
Registration of Shares
Item 20. Tax Status Tax Status Item 21. Underwriters Distributor for Funds Item 22. Calculation of Yield Quotations of
Money Market Funds +
Item 23. Financial Statements Incorporated by Reference
from Annual Report
|
PART C
Information required to be included in Part C is set forth under
the appropriate item, so numbered, in Part C to this Registration
Statement.
+Not applicable or negative answer
Item 1. Cover Page Cover Page
Item 2. Synopsis Transaction Costs and Fund
Expenses
Item 3. Condensed Financial InformationFinancial Highlights
Item 4. General Description of RegistrantTransaction Costs and
Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management;
Understanding
Performance Information;
Investment Policies and
Practices; Ratings of
Municipal Debt Securities;
Asset Composition
Item 5. Management of the Fund Transaction Costs and Fund
Expenses; Fund and Market
Characteristics: What to
Expect; The Fund's
Organization
and Management
Item 6. Capital Stock and Other SecuritiesUseful Information on
Distributions and Taxes;
The
Fund's Organization and
Management
Item 7. Purchase of Securities Being Pricing Shares and
Receiving
Offered Sale Proceeds; Transaction
Procedures and Special
Requirements; Meeting
Requirements for New
Accounts;
Shareholder Services
|
Item 8. Redemption or Repurchase Pricing Shares and
Receiving
Sale Proceeds; Transaction
Procedures and Special
Requirements; Exchanging
and
Redeeming Shares;
Shareholder
Services
Item 9. Pending Legal Proceedings +
PART B
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History+
Item 13. Investment Objectives and PoliciesInvestment
Objective and Policies;
Risk
Factors; Investment
Program;
Investment Restrictions;
Yield Information;
Investment Performance
Item 14. Management of the Registrant Management of Fund
Item 15. Control Persons and PrincipalPrincipal Holders of
Holders of Securities Securities
Item 16. Investment Advisory and OtherInvestment Management Services Services; Custodian; Independent Accountants; Legal Counsel
Item 17. Brokerage Allocation Portfolio Transactions
Item 18. Capital Stock and Other SecuritiesDividends; Capital
Stock
Item 19. Purchase, Redemption and PricingRatings of Municipal
Debt
of Securities Being Offered Securities; Ratings of
Municipal Notes and
Variable
Rate Securities; Ratings
of
Commercial Paper;
Pricing of Securities;
Net Asset Value Per Share;
Redemptions in Kind;
Federal and State
Registration
of Shares
Item 20. Tax Status Tax Status
Item 21. Underwriters Distributor for the Fund
Item 22. Calculation of Yield Quotations of
Money Market Funds +
Item 23. Financial Statements Incorporated by Reference
from
Annual Report
PART C
|
T. Rowe Price
Tax-Free Funds
July 1, 1994
Facts at a Glance
Objectives The highest
possible levels of income
exempt from federal
income taxes, consistent
with each Fund's
prescribed investment
program. As with all
mutual funds, these Funds
may not meet their
objectives.
Strategy and Risk/Reward Contents
Potential _________________________________
Tax-Exempt Money Fund, 1 About the Tax-Free Funds
Inc.R Invests in high- _________________________________
quality, short-term Transaction Costs and Fund Expenses
municipal securities, and _________________________________
its average maturity will Financial Highlights
not exceed 90 days. The _________________________________
Fund is managed to Fund and Market Characteristics
maintain a stable share _________________________________
price of $1.00 but there 2 About Your Account
is no assurance the price _________________________________
will always be stable. Pricing Shares;
Your investment in the Receiving Sale Proceeds
Fund is neither insured _________________________________
nor guaranteed by the Distributions and Taxes
U.S. Government. _________________________________
Risk/Reward: Lowest Transaction Procedures and Special
potential risk and Requirements
reward. _________________________________
3 More About the Funds
Tax-Free Short- _________________________________
Intermediate Fund, Inc.R Organization and Management
Invests primarily in _________________________________
higher-quality short- and Understanding Fund Performance
intermediate-term _________________________________
municipal bonds rated A Investment Policies and Practices
or above. Its average _________________________________
portfolio maturity will 4 Investing With T. Rowe Price
|
not exceed five years. _________________________________
Risk/Reward: Moderate Meeting Requirements for New Accounts
income level and share- _________________________________
price fluctuation. Opening a New Account
_________________________________
Tax-Free Insured Purchasing Additional Shares
Intermediate Bond Fund, _________________________________
Inc. Invests primarily in Exchanging and Redeeming
intermediate-term _________________________________
municipal bonds whose Shareholder Services
interest and principal _________________________________
payments are insured by
private insurance This prospectus contains information you
companies. Insurance should know before investing. Please keep
does not apply to the it for future reference. A Statement of
Fund's share price, which Additional Information about the Funds,
will fluctuate. Average dated July 1, 1994, has been filed with the
maturity will range Securities and Exchange Commission and is
between 5 and 10 years. incorporated by reference in this
Risk/Reward: Somewhat prospectus. To obtain a free copy, call 1-
higher income and 800-638-5660.
potential share-price
fluctuation than the
Short-Intermediate Fund.
(See discussion on
insurance on pages 17 and
18.)
Tax-Free Income Fund,
Inc.R Invests in longer-
term, investment-grade
municipal bonds with an
average maturity
generally exceeding 15
years. Risk/Reward:
Higher income and
potential share-price
fluctuation than the
shorter-term Funds.
Tax-Free High Yield Fund,
Inc.R Invests in long-
term municipal bonds
whose credit quality
ranges from upper-medium
to lower, including
"junk" bonds. The
average maturity will
|
generally exceed 15
years. Risk/Reward:
Highest income, greatest
credit risk, and highest
potential share-price
volatility.
Investor Profile
Investors whose income
tax level enables them to
benefit from tax-exempt
income. Not appropriate
for tax-deferred
retirement plans.
Fees and Charges 100% no
load. No fees or charges
to buy or sell shares or
to reinvest dividends; no
12b-1 marketing fees;
free telephone exchange.
Investment Manager
Founded in 1937 by the
late Thomas Rowe Price,
Jr., T. Rowe Price
Associates, Inc. ("T.
Rowe Price") and its
affiliates currently
manage over $40 billion,
including over $4 billion
in municipal bond assets,
for approximately two and
a half million individual
and institutional
investors.
THESE SECURITIES HAVE NOT
BEEN APPROVED OR
DISAPPROVED BY THE
SECURITIES AND EXCHANGE
COMMISSION, OR ANY STATE
SECURITIES COMMISSION,
NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION
PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS
PROSPECTUS. ANY
REPRESENTATION TO THE
CONTRARY IS A CRIMINAL
OFFENSE.
1 About the Tax-Free Transaction Costs and Fund Expenses
Funds
These tables should help you understand the
kinds of expenses you will bear directly or
indirectly as a Fund shareholder.
In Table 1 below, "Shareholder Transaction
Costs," shows that you pay no direct costs
to buy, sell, or exchange shares in the
Fund. All the money you invest in a Fund
goes to work for you.
_________________________ ___________________________________________
Like all T. Rowe Price Fund Expenses
Funds, the Tax-Free Shareholder Transaction Costs
Funds are 100% no-load. Money Short- Insured
Intermediate Intermediate
___________________________________________
Sales "Charge" None None None
(load) on purchases
___________________________________________
Sales "Charge" None None None
(load) on reinvested dividends
___________________________________________
Redemption fees* None None None
___________________________________________
Exchange fees None None None
___________________________________________
Income High
Yield
___________________________________________
None None
___________________________________________
None None
___________________________________________
None None
___________________________________________
None None
___________________________________________
|
Annual Mutual Fund Expenses Percentage of Fiscal 1994 Average Net Assets
Money Short- Insured
Intermediate Intermediate
(After Re-
duction)**
___________________________________________
Management
Fee 0.45% 0.45% 0.50%
___________________________________________
Distribution None None None
(12b-1) Fee
___________________________________________
Other admin-0.14% 0.15% 0.15%
istrative and servicing costs
___________________________________________
Total Fund
Expenses* 0.59% 0.60% 0.65%
___________________________________________
Income High
Yield
___________________________________________
0.50% 0.65%
___________________________________________
None None
___________________________________________
0.09% 0.14%
___________________________________________
0.59% 0.79%
___________________________________________
|
*The Funds charge a $5.00 fee for wire redemptions under $5,000, subject to change without notice.
**The Fund's management fee and its total
expense ratio would have been 0.40% and
0.90%, respectively, had T. Rowe Price not
agreed to reduce management fees in
accordance with the expense limitation.
From July 1, 1993 through February 28,
1994, T. Rowe Price will bear any expenses
that would cause the Fund's ratio of
expenses to average net assets to exceed
0.50%. Expenses paid or assumed under this
agreement are subject to reimbursement to
T. Rowe Price by the Fund whenever the
Fund's expense ratio is below 0.50%.
However, no reimbursement will be made
after February 29, 1996, or if it would
result in the expense ratio exceeding
0.50%.
The second half of the table "Annual Mutual Fund Expenses" provides an estimate of how much it will cost to operate the Fund for a year, based on 1994 fiscal year expenses. These are costs you pay indirectly, because they are deducted from the Fund's total assets before the daily share price is calculated and before dividends and other distributions are made. In other words, you will not see these expenses on your account statement.
The main types of expenses, which all mutual funds may charge against fund assets, are:
0 A management fee -- the percent of Fund assets paid to the Fund's investment manager. Each Fund's fee comprises both a group fee, described later, and an individual fund fee, as follows: Money 0.10%; Short-Intermediate 0.10%; Insured Intermediate 0.05%; Income 0.15%; and High Yield 0.30%,
0 "Other" administrative expenses -- primarily the servicing of shareholder accounts, such as providing statements, reports, custodial services, and disbursing dividends. For the fiscal year ended February 28, 1994, the Funds paid the following fees to T. Rowe Price Services, Inc. for transfer and dividend disbursing functions and shareholder services and to T. Rowe Price for Fund accounting services.
Transfer Agent
and
Shareholder Services Accounting
___________________________________________
Money $461,000 $93,000
|
___________________________________________ Short- Intermediate$308,00 $85,000 ___________________________________________ Insured Intermediate$123,000 $53,000 ___________________________________________ Income $641,000 $100,000 ___________________________________________ High Yield $574,000 $110,000 ___________________________________________ Table 2A |
0 Marketing or distribution fees -- an annual charge ("12b-1") to existing shareholders to defray the cost of selling shares to new shareholders. T.
Rowe Price Funds do not levy 12b-1
fees. For further details on the
composition of Fund fees, please see
"The Fund's Organization and
Management."
0 Assume you invest at least $1,000, the
Fund returns 5% annually, expense
ratios remain as listed above, and you
close your account at the end of the
time periods shown. Your expenses per
$1,000 invested would be:
The table at right is Example of Fund Expenses
just an example. The 5%
return does not represent 1 year 3 years5 years 10 years
the Funds' past or future ___________________________________________
performance, and actual Money $6 $19 $33 $74
expenses can be higher or ___________________________________________
lower than those shown. Short-
Intermediate $6 $19 $33 $75
___________________________________________
Insured
Intermediate $7 $21 $36 $81
___________________________________________
Income $6 $19 $33 $74
___________________________________________
High Yield $8 $25 $44 $98
___________________________________________
|
Table 2B
FINANCIAL HIGHLIGHTS
Table 3 reflects the Funds' history in terms of a single share outstanding during each Fund's fiscal year. The information has been audited by the Funds' independent accountants, whose respective unqualified report for each Fund covers the periods shown and is included in each Fund's Annual Report to shareholders. The latter is incorporated by reference into the Statement of Additional Information, which is available to shareholders.
Investment Activities Distributions
Net RealizedTotal
and from
Net Asset Net UnrealizedInvest- Net
|
Value,Invest- Gain ment Invest- Net Total Year Ended, Beginning ment (Loss) onActivi- ment Realized Distri-
February 28 of PeriodIncome Investments
ties Income
___________________________________________________________________
Money Fund
1985 $1.000 $.058 -- $.058$(.058) -- $(.058)
1986 1.000 .049 -- .049 (.049) -- (.049)
1987 1.000 .042 -- .042 (.042) -- (.042)
1988## 1.000 .044 -- .044 (.044) -- (.044)
1989 1.000 .050 -- .050 (.050) -- (.050)
1990 1.000 .057 -- .057 (.057) -- (.057)
1991 1.000 .051 -- .051 (.051) -- (.051)
1992## 1.000 .036 -- .036 (.036) -- (.036)
1993 1.000 .023 -- .023 (.023) -- (.023)
1994 1.000 .020 -- .020 (.020) -- (.020)
End of Period
Ratio
of Net
Ratio ofInvestment
Net Asset Expenses Income Portfolio
Value, End Total Net Assets to Average
|
1985 $1.000 5.93% $948,941 0.61% 5.81% -- 1986 1.000 5.02% 872,040 0.61% 4.89% -- 1987 1.000 4.30% 1,131,755 0.60% 4.23% -- 1988## 1.000 4.47% 1,247,256 0.60% 4.41% -- 1989 1.000 5.08% 1,157,246 0.60% 4.97% -- 1990 1.000 5.87% 1,064,141 0.60% 5.75% -- 1991 1.000 5.22% 977,638 0.60% 5.12% -- 1992## 1.000 3.69% 801,846 0.61% 3.65% -- 1993 1.000 2.36% 695,699 0.60% 2.35% -- 1994 1.000 2.05% 732,900 0.59% 2.04% -- |
Investment Activities Distributions
Net RealizedTotal
and from
Net Asset Net UnrealizedInvest- Net
Value,Invest- Gain ment Invest- Net Total
Year Ended, Beginning ment (Loss) onActivi-
ment RealizedDistri-
February 28 of PeriodIncome
Investmentsties Incom
_______________________________________________________________________
Short-Intermediate Fund
1985 $4.97 $.32 $.05 $.37 $(.32) -- $(.32)
1986 5.02 .32 .18 .50 (.32) -- (.32)
1987 5.20 .29 .13 .42 (.29) -- (.29)
1988## 5.33 .27 (.16) .11 (.27) $(.02) (.29)
1989 5.15 .28 (.12) .16 (.28) -- (.28)
1990 5.03 .30 .06 .36 (.30) -- (.30)
1991 5.09 .29 .06 .35 (.29) -- (.29)
1992## 5.15 .28 .07 .35 (.28) -- (.28)
1993 5.22 .24 .14 .38 (.24) -- (.24)
1994 5.36 .22 .04 .18 (.22) -- (.22)
End of Period
Ratio
of Net
Ratio ofInvestment
Net Asset Expenses Income Portfolio
Value, End Total Net Assets to Average
to AverageTurnover
of Period Return(in thousands)Net Assets
Net Assets Rate
________________________________________________
1985 $5.02 7.70% $68,015 0.90%+ 6.51% 300.7%
1986 5.20 10.30% 155,420 0.90% 6.26% 128.7%
1987 5.33 8.41% 405,092 0.73% 5.60% 119.5%
1988## 5.15 2.25% 291,850 0.74% 5.29% 225.2%
1989 5.03 3.14% 249,489 0.74% 5.46% 53.4%
1990 5.09 7.36% 223,180 0.75% 5.93% 190.8%
1991 5.15 7.06% 232,923 0.74% 5.67% 190.1%
1992## 5.22 6.94% 328,312 0.67% 5.34% 81.3%
1993 5.36 7.51% 454,162 0.63% 4.61% 38.5%
1994 5.32 3.49% 540,728 0.60% 4.18% 51.1%
|
Investment Activities Distributions
Net RealizedTotal
and from
Net Asset Net UnrealizedInvest- Net
Value,Invest- Gain ment Invest- Net Total
Year Ended, Beginning ment (Loss) onActivi-
ment RealizedDistri-
February 28 of PeriodIncome
Investmentsties Incom
____________________________________________
___________________________
Insured Intermediate Fund
1993* $10.00 $.13 $(.55) $.68 $(.13) -- $(.13)
1994 10.55 .48 (.09) .57 (.48) $(.06) (.54)
End of Period
Ratio
of Net
Ratio ofInvestment
Net Asset Expenses Income Portfolio
Value, End Total Net Assets to Average
to AverageTurnover
of Period Return(in thousands)Net Assets
Net Assets Rate
__________________________________
1993*$10.55 6.81% $37,960 0.00%** 5.08% 65.3%
1994 10.58 5.49% 99,162 0.33%** 4.45% 74.8%
|
Investment Activities Distributions
Net RealizedTotal
and from
Net Asset Net UnrealizedInvest- Net
Value,Invest- Gain ment Invest- Net Total
Year Ended, Beginning ment (Loss) onActivi- ment
RealizedDistri-
February 28 of PeriodIncome
Investmentsties Income G
____________________________________________________
Income Fund
1985 $8.48 $.65 $(.07) $.58 $(.65) -- $(.65)
1986 8.41 .71 1.32 2.03 (.71) -- (.71)
1987 9.73 .68 .54 1.22 (.68) -- (.68)
1988## 10.27 .59 (.92) (.33) (.59) $(.54) (1.13)
1989 8.81 .59 (.24) .35 (.59) -- (.59)
1990 8.57 .59 .09 .68 (.59) -- (.59)
1991 8.66 .57 .13 .70 (.57) -- (.57)
1992## 8.79 .57 .30 .87 (.57) -- (.57)
1993 9.09 .56 .75 1.31 (.56) -- (.56)
1994 9.84 .54 -- .54 (.54) (.18) (.72)
End of Period
Ratio
of Net
Ratio ofInvestment
Net Asset Expenses Income Portfolio
Value, End Total Net Assets to Average
to AverageTurnover
of Period Return(in thousands)Net Assets
Net Assets Rate
______________________
1985 $8.41 7.24% $936,791 0.63% 7.84% 277.2%
1986 9.73 25.37% 1,325,179 0.63% 8.07% 187.8%
1987 10.27 13.07% 1,558,795 0.61% 6.94% 236.6%
1988## 8.81 -3.17% 1,094,430 0.65% 6.72% 180.6%
1989 8.57 4.11% 1,023,204 0.66% 6.81% 115.9%
1990 8.66 8.15% 1,123,143 0.64% 6.80% 140.5%
1991 8.79 8.40% 1,128,635 0.63% 6.59% 79.7%
1992## 9.09 10.17% 1,245,297 0.62% 6.34% 57.9%
1993 9.84 14.88% 1,441,646 0.61% 5.98% 76.7%
1994 9.66 5.50% 1,452,581 0.59% 5.40% 71.2%
|
Investment Activities Distributions
Net RealizedTotal
and from
Net Asset Net UnrealizedInvest- Net
Value,Invest- Gain ment Invest- Net Total
Year Ended, Beginning ment (Loss) onActivi-
ment RealizedDistri-
February 28 of PeriodIncome
Investmentsties Income Gain butions
_________________________________________
High Yield Fund
1986! $10.00 $.87 $1.43 $2.30 $(.87) -- $(.87)
1987 11.43 .87 .78 1.65 (.87) -- (.87)
1988## 12.21 .83 (.77) .06 (.83) $(.25)(1.08)
1989 11.19 .83 .06 .89 (.83) -- (.83)
1990 11.25 .84 .20 1.04 (.84) (.06) (.90)
1991 11.39 .83 .04 .87 (.83) (.03) (.86)
1992## 11.40 .81 .35 1.16 (.81) (.10) (.91)
1993 11.65 .78 .78 1.56 (.78) (.10) (.88)
1994 12.33 .74 .16 .90 (.74) (.23) (.97)
|
End of Period
Ratio
1986!$11.43 24.24% $168,308 1.00%# 8.47% 156.8% 1987 12.21 15.04% 324,094 0.98% 7.45% 111.4% 1988##11.19 0.83% 280,580 0.96% 7.49% 127.6% 1989 11.25 8.27% 331,329 0.92% 7.45% 61.8% 1990 11.39 9.54% 443,372 0.88% 7.38% 72.4% 1991 11.40 7.93% 505,025 0.85% 7.30% 51.2% 1992##11.65 10.56% 623,877 0.83% 7.01% 51.0% 1993 12.33 13.94% 853,185 0.81% 6.58% 34.7% 1994 12.26 7.49% 941,295 0.79% 5.95% 59.3% _____________________________________________ |
+ Excludes investment management fees and fund expenses in excess
0.90% voluntary expense limitation in effec
1985.
* For the period November 30, 1992 (commencement of operations) to
February 28, 1993.
**
T. Rowe Price voluntarily agreed to bear all expenses of the Fund
through June 30, 1993. Excludes expenses in excess of a 0.20%
voluntary expense limitation in effect July 1, 1993 through
July 31,
1993, a 0.30% voluntary expense limitation in effect August 1, 1993
through August 31, 1993, a 0.40% voluntary expense limitation in
effect September 1, 1993 through September 30, 1993, and a 0.50%
voluntary expense limitation in effect October 1, 1993 through
February 28, 1994.
! For the period March 1, 1985 (commencement of operations) to
February
28, 1986.
# Excludes investment management fees in excess of a 1.0% voluntary
expense limitation in effect through February 28, 1986.
##Year ended February 29.
Fund and Market Characteristics: What to
Expect
To help you decide whether a tax-free fund
is appropriate for you, this section takes
a closer look at the T. Rowe Price Funds'
investment programs and the securities in
which they invest.
Who issues tax-exempt securities?
State and local governments and
governmental authorities
sell notes and bonds (usually called
"municipals") to pay
for public projects and services.
Who buys municipal securities?
Individuals are the primary investors, and
a principal way they invest is through
mutual funds. Because mutual funds have
become a major source of demand, prices of
municipals may be affected by major changes
in flows of money into or out of municipal
bond and money market funds. For example,
substantial and sustained redemptions from
municipal bond funds could result in lower
prices for municipal securities and for
shares of funds investing in them.
_______________________ What is "tax-free" about municipal bonds
Characteristics of and bond funds?
municipal securities. The regular income dividends you receive
from the Fund are exempt from federal
income taxes. In addition, your state may
not tax that portion of the Fund's income
earned on their own obligations (if any).
However, capital gains distributed by the
Funds are taxable to you. (See "Useful
Information on Distributions and Taxes",
page , for details.)
Is a fund's yield fixed or will it vary?
It will vary. The yield is calculated
every day by dividing a Fund's income
(expressed at annual rates) by the share
price. Even if the income stays the same,
the yield will vary as the Fund's price
fluctuates.
|
Is a Fund's yield the same thing as the
total return?
"Yes" for money funds, "no" for all bond
funds. Your total return is the net result
of reinvested income and the net change in
share price for a given time period. Since
money funds are managed to maintain a
stable share price, their yield and total
return should be the same.
What are the main risks of bond funds?
As with all fixed-income funds, the main
risks are:
0 interest rate or market risk, which
refers to the fact that a Fund's price
will decline to some degree when general
interest rate levels rise. (This should
not apply to money funds, which are
managed to maintain a stable share
price); and
0 credit risk, which is the chance that
any of a Fund's holdings will default (fail
to make scheduled interest and principal
payments) and adversely affect the Fund's
income level and share price.
How do fund managers try to reduce risk?
Consistent with each Fund's objective, T.
Rowe Price Municipal Bond Funds are
actively managed to minimize risks and
maximize total return. Risk management
tools include:
_________________________ 0 maturity adjustments to reflect our
For further details about interest rate outlook;
the Funds' investment 0 broad diversification of assets to reduce
programs and fundamental the impact of a single holding on the
policies, please see the Fund's net asset value; and
section, "Investment 0 thorough credit research by our own
Policies and Practices." analysts.
What is the relation between a bond fund's
average maturity and its price?
As interest rate levels change, prices of
outstanding bonds adjust so that their
yields stay in line with those on newly
|
issued securities. The bond's maturity affects the extent of the adjustment
(Please see Table 4.)
_________________________ __________________________________________
Generally speaking, the How Interest Rates May Affect High-Quality
longer the bond's Bond Prices
maturity, the greater the Bond Coupon Principal Value of $1,000
potential price movement Maturity Bond if Interest Rates:
in response to a given Increase Decrease:
change in interest rates, 1% 2% 1% 2%
as shown in the table at 1 Year 2.25% $990 $981 $1,010 $1,020
right. 5 Years 4.00 $956 $915 $1,046 $1,095
10 Years 4.70 $925 $856 $1,083 $1,174
20 Years 5.40 $880 $793 $1,132 $1,289
30 Years 5.50 $869 $763 $1,164 $1,370
___________________________________________
Table 4 Coupons reflect yields on AAA-rated
municipals as of February 28, 1993. This
is an illustration and does not represent
expected share price changes of any Fund.
How can I decide which investments are most
appropriate for me?
Review your own financial objectives, time
horizon, and risk tolerance. Use the table
below, which summarizes the Funds' main
characteristics, to choose a fund (or
funds) suitable for your particular needs.
For example, only the Tax-Exempt Money Fund
provides principal stability, which makes
it a good choice for money you may need for
contingencies. However, if you are
investing for the highest possible tax-free
income and can tolerate some price
fluctuation, you should consider a longer-
term bond fund. Keep in mind that the
share prices of the Bond Funds will
fluctuate. The price you receive when you
sell your shares may be higher or lower
than the price you paid originally.
__________________________________________
Differences Among Funds
Fund Credit Income Risk of
Quality Share-Price
Categories Fluctuation
|
__________________________________________
Money Two highest Low Stable
__________________________________________
Short- Three highest Low to Low to
Intermediate Moderate Moderate
__________________________________________
Insured Two highest Moderate Moderate
Intermediate
__________________________________________
Income Predominantly Moderate Greater
four highest
__________________________________________
High Yield Generally High Highest
upper-medium
to low quality
__________________________________________
Expected
Average Maturity
__________________________________________
No more than 90 days
__________________________________________
Less than 5 years
__________________________________________
5 to 10 years
__________________________________________
15+ years
__________________________________________
15+ years
__________________________________________
Table 5
Is there additional information about the
five funds to help me make a decision?
You should review the following details
about each Fund's program:
________________________
The Fund or Funds you Tax Exempt Money Fund. The Fund's
select should reflect objectives are to seek preservation of
your individual capital, liquidity and, consistent with
investment goals, but these objectives, the highest current
should not represent your income exempt from federal income taxes.
complete investment While the Fund's share price has been $1.00
program. No Fund should since inception, there is no assurance this
be used for short-term will always be so. The Fund's yield will
trading purposes. fluctuate in response to changes in the
general level of interest rates. Unlike a
|
bank account or certificate of deposit, your investment is not insured or guaranteed by the U.S. Government.
The Fund generally purchases securities with maturities of 13 months or less, and its dollar weighted average maturity will not exceed 90 days. All securities purchased by the Fund will have ratings in the two highest categories established by well known rating agencies, or, if unrated, will be of equivalent quality as determined by T. Rowe Price analysts.
Incorporated in Maryland in 1980, the Fund has an Investment Advisory Committee composed of the following members: Patrice L. Berchtenbreiter, Chairman, Janet G. Albright, Paul W. Boltz, Michael P. Buckley, Patricia S. Deford, Laura L. McAree, Mary J. Miller, William T. Reynolds, and Edward A. Wiese. The Chairman has day-to-day responsibility for managing the Fund and works with the Committee in developing and executing the Fund's investment program. Ms.
Berchtenbreiter joined T. Rowe Price in
1972 and has been managing investments
since 1987.
Short-Intermediate Fund. The Fund's objective is to seek a high level of income exempt from federal income taxes consistent with modest price fluctuation by investing primarily in municipal securities in the three highest credit categories. The Fund will not purchase any bonds which are rated below investment grade (e.g., BBB) by a national rating agency (or if unrated the T. Rowe Price equivalent). This policy does not prohibit the fund from retaining a security which is downgraded after purchase. Investment-grade securities include a range of securities from the highest rated to medium quality (BBB). Securities in the BBB category may be more susceptible to adverse economic conditions or changing circumstances and the
securities at the lower end of the BBB category have certain speculative characteristics. This is the most conservative of the four T. Rowe Price tax- free bond funds. With a dollar weighted average maturity of five years or less, its price fluctuation should be modest in response to changes in interest rates. Its interest income should be above the money fund but lower than the other bond funds.
Incorporated in Maryland in 1983, the Fund has an Investment Advisory Committee composed of the following members: Mary J. Miller, Chairman, Janet G. Albright, Patrice L. Berchtenbreiter, Paul W. Boltz, Michael P. Buckley, Patricia S. Deford, Konstantine B. Mallas, and William T.
Reynolds. The Chairman has day-to-day
responsibility for managing the Fund and
works with the Committee in developing and
executing the Fund's investment program.
Ms. Miller joined T. Rowe Price in 1983 and
has been managing investments since
1987.
Tax-Free Insured Intermediate. The Fund's objective is to seek a high level of income exempt from federal income taxes, maximum credit protection, and moderate price fluctuation by investing primarily in insured municipal securities. By maintaining a dollar weighted average maturity between five and ten years, this Fund should provide higher income and volatility than the Short-Intermediate Fund and lower income and volatility than the other bond funds.
For extra credit-quality protection, the Fund will invest at least 65% of its total assets in municipals insured by companies carrying the highest credit rating from a national rating organization, e.g., AAA by Standard & Poor's or Aaa by Moody's Investors Service. (The insurer's rating determines the rating of the insured bond.)
Up to 35% of assets may also be invested in other municipals rated at least AA or Aa by rating agencies or, if unrated, which are believed to be of comparable quality at the time of purchase.
Incorporated in Maryland in 1992, the Fund has an Investment Advisory Committee composed of the following members: William T. Reynolds, Chairman, Paul W. Boltz, Patricia S. Deford, Charles B. Hill, Konstantine B. Mallas, and Mary J. Miller. The Chairman has day-to-day responsibility for managing the Fund and works with the Committee in developing and executing the Fund's investment program. Mr. Reynolds joined T. Rowe Price in 1981 and has been managing investments since 1981.
________________________ Tax-Free Income Fund. The Fund's
The Funds are not objective is to seek a high level of income
prohibited from retaining exempt from federal income taxes by
a holding that is investing primarily in long-term,
subsequently downgraded. investment-grade municipal securities. The
Fund has no maturity restrictions but
normally its dollar weighted average
maturity will exceed 15 years. As such,
the Fund is suitable for more aggressive
investors than the Funds with shorter
average maturities. It will be actively
managed to seek capital appreciation and
minimize losses due to interest rate
movements. From time to time, the Fund may
purchase below investment grade securities
(including securities which have received
the lowest rating or are not rated by a
national rating organization) however, no
such purchase will be made if it would
cause the Fund's investments in non-
investment grade bonds to exceed 5% of
total assets.
Incorporated in Maryland in 1976, the
Fund has an Investment Advisory Committee
composed of the following members: William
T. Reynolds, Chairman, Paul W. Boltz,
Patricia S. Deford, Charles B. Hill, Mary
|
J. Miller, Konstantine B. Mallas, and C. Stephen Wolfe II. The Chairman has day-to- day responsibility for managing the Fund and works with the Committee in developing and executing the Fund's investment program. Mr. Reynolds joined T. Rowe Price in 1981 and has been managing investments since 1981.
_________________________
The combination of long Tax-Free High Yield Fund. The Fund's
maturity and lower credit objective is to seek to provide a high
quality makes the High level of income exempt from federal income
Yield Fund potentially tax by investing primarily in long-term,
the most risky as well as low- to upper-medium quality municipal
potentially the most securities. This is the most aggressive of
rewarding of the Tax-Free our bond funds and should provide the
Funds. highest income, because the average credit
quality of its holdings is lower than our
other funds. Less creditworthy borrowers
must offer higher interest payments to
compensate investors for taking greater
risk. The Fund may invest a substantial
portion of assets in noninvestment-grade
municipal bonds, which have a higher risk
of default than investment-grade bonds.
Similar bonds in the taxable bond market
are called "junk." The Fund may also
purchase bonds which are in default, but
such bonds are not expected to exceed 10%
of the Fund's total assets. Lower-quality
municipals are more vulnerable to real or
perceived changes in the business climate
than higher-quality bonds, they may also be
considerably less liquid and more volatile
in price. As a result, we rely heavily on
our proprietary research when selecting
investments and judgement may play a bigger
role in valuing the Fund's securities.
The Fund has no maturity restrictions, but
normally 80% of its holdings will have
maturities over 15 years.
Incorporated in Maryland in 1984, the
Fund has an Investment Advisory Committee
composed of the following members: William
|
T. Reynolds, Chairman, Patricia S. Deford,
Charles O. Holland, and C. Stephen Wolfe
II. The Committee Chairman has day-to-day
responsibility for managing the Fund and
works with the Committee in developing and
executing the Fund's investment program.
Mr. Reynolds joined T. Rowe Price in 1981
and has been managing investments since
1981.
Note: Although each Fund offers only its own shares, it is possible that a Fund might become liable for a misstatement in this prospectus about another Fund. The Board of each Fund has considered this factor in approving the use of a single combined prospectus.
2 About Your Account
Pricing Shares and Receiving Sale Proceeds
_________________________
This section applies to Here are some procedures you should know if
all T. Rowe Price tax- you invest in a T. Rowe Price bond or money
free bond and money fund.
funds.
How and when shares are priced
Bond and Money Funds. The share price (also
called "net asset value" or NAV) for each
fund is calculated at 4 p.m. ET each day
the New York Stock Exchange is open for
business. To find the NAV, the fund's
assets are priced and totaled, the fund's
liabilities are subtracted from the asset
total, and the balance, called net assets,
is divided by the number of shares
outstanding.
_________________________ Money fund NAVs are calculated at noon ET
The various ways you can each day as well as 4 p.m. Amortized cost
buy, sell, and exchange or amortized market value is used to value
shares are explained at money fund securities that mature in 60
the end of this days or less.
prospectus and on the New
Account Form.
|
How your purchase, sale, or exchange price
is determined
_________________________
When filling out the New If we receive your request in correct form
Account Form, you may before 4 p.m. ET, your transaction will be
wish to give yourself the priced at that day's NAV. If we receive it
widest range of options after 4 p.m., it will be priced at the next
for receiving proceeds business day's NAV.
from a sale.
Sorry, but we cannot accept orders that
request a particular day or price for your
transaction or any other special
conditions.
Note: The fund reserves the right to change
the time at which transactions are priced
in case of an emergency or if the New York
Stock Exchange closes at a time other than
4 p.m. ET.
How you can receive the proceeds from a
sale
_________________________
If for some reason we Proceeds can be sent to you by mail, or to
cannot accept your your bank account by ACH or bank wire.
request to sell shares, Proceeds sent by bank wire should be
we will contact you. credited to your bank account the next
business day, and proceeds sent by ACH
transfer should be credited the second day
after the sale. If your request is
received in correct form, proceeds are
usually sent on the business day following
the completion of the transaction.
Exception:
0 Under certain circumstances and when
deemed to be in the fund's best
interests, the fund can delay sending
your proceeds for up to five business
days after receiving your sale or
exchange request. If you were exchanging
into another bond or money market fund,
your new investment would not begin to
earn dividends until the sixth business
day.
Useful Information on Distributions and
|
Taxes
Dividends and other distributions
Dividend and capital gain distributions are
reinvested in additional fund shares unless
you select another option on your New
Account Form. Dividends not reinvested are
paid by check or transmitted to your bank
account via ACH. If the Postal Service
cannot deliver your check, or if your check
remains uncashed for six months, the fund
________________________ reserves the right to reinvest your
The fund distributes all distribution check in your account at the
net investment income and then current NAV and to reinvest all
realized capital gains to subsequent distributions in shares of the
shareholders. fund.
Income dividends
o Bond funds declare income dividends
daily at 4 p.m. ET to shareholders of
record on the previous business day.
o Money funds declare income dividends
daily at noon ET to shareholders of
record at that time.
o Bond and money funds pay dividends on
the last business day of each month.
Capital gains
o A capital gain or loss is the difference
between the purchase and sale price of a
security.
o If the fund has net capital gains (after
subtracting any capital losses) for the
year, they are usually "declared" in
December to shareholders of record on a
specified date that month and usually
paid in early January. If a second
distribution is necessary, it is usually
declared and paid during the first
quarter of the following year.
Tax information
_________________________ Although the income dividends you receive
from municipal money market and bond funds
|
T. Rowe Price sends are exempt from federal income taxes, you
timely information for need to be aware of the possible tax
your tax filing needs. consequences when:
o the fund makes a capital gain
distribution to your account, or
o you sell fund shares, including an
exchange from one fund to another.
As a result of 1993 tax legislation, it is
more likely that municipal funds will pay
an annual short-term capital gain derived
from the amortization of market discounts
on bonds with original maturities beyond
one year. This payment, if any, will be
included in your December monthly dividend
and will be reported as ordinary income on
your 1099-DIV for that year.
Note: You must report your total tax-
exempt income on IRS Form 1040. The IRS
uses this information to help determine the
tax status of any social security payments
you may have received during the year.
_________________________ Taxes on Fund Distributions
Capital gain
distributions are taxable In January, the T. Rowe Price funds will
whether reinvested in send you and the IRS Form 1099-DIV
additional shares or indicating the tax status of any capital
received in cash. gain distribution made in each of your fund
accounts. Dividends are expected to be tax
exempt, and if there were no capital gain
distributions, a 1099-DIV is not sent. All
capital gain distributions are taxable to
you for the year in which they were paid.
The only exception is that distributions
declared during the last three months of
the year and paid in January are taxed as
though they were paid by December 31.
Short-term capital gains are taxable as
ordinary income and long-term gains at the
applicable rate for long-term gains. The
gain is long or short term depending on how
|
long the Fund held the securities, not how
long you held shares in the fund.
If the funds invest in certain "private
activity" bonds, shareholders who are
subject to the alternative minimum tax
(AMT) must include income generated by
these bonds in their AMT computation. The
portion of your fund's income which should
be included in your AMT calculation, if
any, will be reported to you in January.
Taxes on your fund transactions. When you
sell shares in any stock or bond fund, you
may realize a gain or loss. An exchange
from one fund to another is still a sale
for tax purposes.
If you realize a loss on the sale or
exchange of fund shares held six months or
less, your capital loss is redeemed by the
tax-exempt dividends received on those
shares.
In January, T. Rowe Price will send you and
the IRS Form 1099-B, indicating the date
and amount of each sale you made in a stock
or bond fund during the prior year. A copy
is filed with the IRS.
_________________________
T. Rowe Price furnishes We will also tell you the average cost of
average cost and capital the shares you sold, provided your account
gain (loss) information was opened by purchase or exchange after
on most share December 31, 1983. This information is not
redemptions. reported to the IRS, and you do not have to
use it. You may calculate the cost basis
using other methods acceptable to the IRS,
such as "specific identification."
To help you maintain accurate records, we
send you a confirmation immediately
following each transaction you make and a
year-end statement detailing all your
transactions in each fund account during
the year.
Tax effect of buying shares before a
|
capital gain distribution. If you buy
shares near or on the "record date"- the
date that establishes you as the person to
receive the upcoming distribution - you
will receive in the form of a taxable
distribution a portion of the money you
just invested. Therefore, you may wish to
find out a fund's record date(s) before
investing. Of course, a fund's share price
may reflect undistributed capital gains or
unrealized appreciation, at any time.
Transaction Procedures and Special
Requirements
_________________________ Purchase Conditions
Following these Nonpayment. If your payment is not received
procedures helps assure or you pay with a check or ACH transfer
timely and accurate that does not clear, your purchase will be
transactions. cancelled. You will be responsible for any
losses or expenses incurred by the fund or
transfer agent, and the fund can redeem
shares you own in this or another
identically registered T. Rowe Price fund
as reimbursement. The fund and its agents
have the right to reject or cancel any
purchase, exchange, or redemption due to
nonpayment.
U.S. Dollars. All purchases must be paid
for in U.S. dollars; checks must be drawn
on U.S. banks.
Sale (Redemption) Conditions
10-day Hold. If you sell shares that you
just purchased and paid for by check or ACH
transfer, the fund will process your
redemption but will generally delay sending
you the proceeds for up to 10 calendar days
to allow the check or transfer to clear. If
your redemption request was sent by mail or
mailgram, proceeds will be mailed no later
than the seventh day following receipt
unless the check has not cleared. If,
during the clearing period, we receive a
check drawn against your bond or money
market account, it will be returned marked
"uncollected." (The hold does not apply to
|
purchases paid for by bank wire; cashier's,
certified, or treasurer's checks; or
automatic purchases through your paycheck.)
Telephone Transactions. Telephone exchange
and redemption are established
automatically when you sign the New Account
Form unless you check the box which states
that you do not want these services. The
fund uses reasonable procedures (including
shareholder identity verification) to
confirm that instructions given by
telephone are genuine. If these procedures
are not followed, it is the opinion of
certain regulatory agencies that the fund
may be liable for any losses that may
result from acting on the instructions
given. All conversations are recorded, and
a confirmation is sent within five business
days after the telephone transaction.
Redemptions over $250,000. Large sales can
adversely affect the fund. If you redeem
(sell) more than $250,000, or your sales
amount to more than 1% of the fund's net
assets in any 90-day period, the fund has
the right to delay sending your proceeds
for up to five business days after
receiving your request, or to pay the
difference between the redemption amount
and the lesser of the two previously
mentioned figures with securities from the
fund.
_________________________ Excessive Trading
T. Rowe Price may bar Frequent trades involving either
excessive traders from substantial fund assets, or a substantial
purchasing shares. portion of your account or accounts
controlled by you, can disrupt management
of the fund and raise its expenses. We
define "excessive trading" as exceeding one
purchase and sale involving the same fund
within any 120-day period, excluding trades
between money funds.
For example, you are in fund A. You can
move substantial assets from A to fund B,
and, within the next 120 days, sell your
|
shares in fund B to return to fund A or
move to fund C.
If you exceed the number of trades
described above, you may be barred
indefinitely from further purchases of T.
Rowe Price funds.
Three types of transactions are exempt from
excessive trading guidelines: (1) trades
solely between money market funds, (2)
redemptions that are not part of exchanges,
and (3) systematic purchases or redemptions
(see "Shareholder Services").
Keeping Your Account Open
Due to the relatively high cost of
maintaining small accounts, we ask you to
maintain an account balance of at least
$1,000. If your balance is below $1,000 for
three months or longer, the fund has the
right to close your account after giving
you 60 days in which to increase your
balance. (These conditions may vary for
retirement plan accounts.)
_________________________ Signature Guarantees
A signature guarantee is You may need to have your signature
designed to protect you guaranteed in certain situations, such as:
and the fund from fraud o Written requests for redemptions over
by verifying your $50,000 or to wire redemption proceeds.
signature. o Remitting redemption proceeds to any
person, address, or bank account not on
record.
o Transferring redemption proceeds to a T.
Rowe Price fund account with a different
registration from yours.
o Establishing certain services after the
account is opened.
You can obtain a signature guarantee from
most banks, savings institutions,
broker/dealers and other guarantors
acceptable to T. Rowe Price. We cannot
accept guarantees from notaries public or
organizations that do not provide
reimbursement in the case of fraud.
|
3 More About the Funds
The Funds' Organization and Management
How are the Funds organized?
The Funds are "diversified, open-end
investment companies," or mutual funds.
Mutual funds pool money received from
shareholders and invest it to try to
achieve specified objectives.
_____________________
Shareholders benefit from What is meant by "shares"?
T. Rowe Price's 56 years As with all mutual funds, investors receive
of investment management "shares" when they put money in a Fund.
experience. These shares are part of the Fund's
authorized capital stock. (The Funds do not
issue share certificates to shareholders.)
Each share and fractional share entitles
the shareholder to:
0 receive a proportional interest in the
Fund's income and capital gain
distributions;
0 cast one vote per share on certain Fund
matters, including the election of Fund
directors or trustees, changes in
fundamental policies, or approval of the
Fund's management contract.
Does each Fund have an annual shareholder
meeting?
The Funds are not required to hold meetings
but will so when certain matters, such as a
change in the Fund's fundamental policies,
are to be decided. If a meeting is held and
you cannot attend, you can vote by proxy.
Well before the meeting, T. Rowe Price will
send you proxy materials that explain the
issues to be decided and include a voting
card for you to mail back.
Who runs the Funds?
_______________________
|
All decisions regarding General oversight. Each Fund is governed
the purchase and sale of by a Board of Directors or Trustees that
Fund investments are made meets regularly to review the Fund's
by T. Rowe Price investments, performance, expenses, and
Associates--specifically other business affairs. The Board elects
by the Funds' portfolio the Fund's officers.
managers. Marketing. T. Rowe Price Investment
Services, Inc., a wholly-owned subsidiary
of T. Rowe Price, distributes (sells)
shares of this and all other T. Rowe Price
funds.
Services. T. Rowe Price Services, Inc.,
another wholly-owned subsidiary, acts as
the Fund's transfer and dividend disbursing
agent and provides shareholder and
administrative services. The address for
each is 100 East Pratt St., Baltimore, MD
21202.
How are Fund expenses determined?
The management agreement spells out the
expenses to be paid by each Fund. In
addition to the management fee, the Fund
pays for the following: shareholder service
expenses; custodial, accounting, legal, and
audit fees; costs of preparing and printing
prospectuses and reports sent to
shareholders; registration fees and
expenses; proxy and annual meeting expenses
(if any); and director/trustee fees
(See Appendix) and expenses.
_________________________
Price Funds' assets The Management Fee. This fee has two parts
As of February 28, 1994 -- an "individual fund fee" (discussed on
$__ billion page ) which reflects the Fund's
particular investment management costs, and
a "group fee." The group fee, which
reflects the benefits each Fund derives
from sharing the resources of the T. Rowe
Price investment management complex, is
calculated monthly based on the net
combined assets of all T. Rowe Price funds
(except Equity Index and both Spectrum
Funds). The fee schedule (shown below) is
graduated, declining as the asset total
|
rises, so shareholders benefit from the overall growth in mutual fund assets.
0.48% of the first $1 billion 0.45% of the next $1 billion 0.42% of the next $1 billion 0.39% of the next $1 billion 0.37% of the next $1 billion 0.36% of the next $2 billion 0.35% of the next $2 billion 0.34% of the next $5 billion 0.33% of the next $10 billion 0.32% of the next $10 billion 0.31% thereafter
The Fund's portion of the Group fee is determined by the ratio of its daily net assets to the daily net assets of all the Price Funds as described above. Based on a February 28, 1994 asset total of approximately $__ billion, the group fee was 0.34%.
UNDERSTANDING PERFORMANCE INFORMATION
This section should help you understand the
terms used to describe the Fund's
performance. You will come across them in
shareholder reports you receive from us
four times a year, in our newsletter,
"Insights" reports, in T. Rowe Price
advertisements, and in the media.
_____________________
Total return is the most Total Return
widely used performance This tells you how much an investment in a
measure. Detailed fund has changed in value over a given time
performance information period. It reflects any net increase or
is included in the Funds' decrease in the share price and assumes
Annual Reports and that all dividends and capital gains (if
quarterly shareholder any) paid during the period were reinvested
reports. in additional shares. Reinvesting
distributions means that total return
numbers include the effect of compounding,
i.e., you receive income and capital gain
distributions on a rising number of shares.
|
Advertisements for a Fund may include
cumulative or compound average annual total
return figures, which may be compared with
various indices, other performance
measures, or other mutual funds.
Cumulative Total Return
This is the actual rate of return on an
investment for a specified period. A
cumulative return does not indicate how
much the value of the investment may have
fluctuated between the beginning and the
end of the period specified.
Average Annual Total Return
This is always hypothetical. Working
backward from the actual cumulative return,
it tells you what constant year-by-year
return would have been produced by the
actual, cumulative return. By smoothing out
all the variations in annual performance,
it gives you an idea of the investment's
annual contribution to your portfolio
provided you held it for the entire period
in question.
___________________
You will see frequent Yield
references to the Funds' The current or "dividend yield" on the Fund
yield and tax equivalent or any investment tells you the
yields in our reports, relationship between the investment's
advertisements, in media current level of annual income and its
stories, and so on. price on a particular day. For example, a
Fund providing $5 of annual income per
share and selling at $50 has a current
yield of 10%. Yields can be calculated for
any time period. The Money Fund may
advertise a "current yield", reflecting the
latest 7-day income annualized, or an
"effective yield" which assumes the income
has been reinvested in the Fund.
For the Bond Funds, the advertised or "SEC
yield" is found by determining the net
income per share (as defined by the SEC)
earned by the Fund during a 30-day base
|
period and dividing this amount by the per- share price on the last day of the base period. The "SEC yield" may differ from the dividend yield.
Investment Policies and Practices
This section takes a detailed look at some
of the types of securities the Funds may
hold in its portfolio and the various kinds
of investment practices that may be used in
day-to-day portfolio management. Each
Fund's investment program is subject to
further restrictions and risks described in
the "Statement of Additional Information."
_________________________ Shareholder approval is required to
Fund managers have substantively change each Fund's objective
considerable leeway in (stated on page ) and to change certain
choosing investment investment restrictions noted in the
strategies and selecting following section as "fundamental
securities they believe policies." The managers also follow certain
will help the Funds "operating policies" which can be changed
achieve their objectives. without shareholder approval. However,
significant changes are discussed with
shareholders in Fund reports.
Types of Portfolio Securities
In seeking to meet their investment
objectives, the Funds may invest in any
type of interest-bearing security whose
yield, credit quality, and maturity
characteristics are consistent with the
Funds' investment programs. These and some
of the other investment techniques the
Funds may use are described in the
following pages.
|
Municipal Securities. Each Fund's assets
are invested primarily in various
income-producing tax-free municipal debt
_________________________ securities. The issuers have a contractual
In purchasing municipals, obligation to pay interest at a stated rate
the Funds rely on the on specific dates and to repay principal
opinion of the issuer's (the bond's face value) on a specified date
bond counsel regarding or dates. An issuer may have the right to
the tax-exempt status of redeem or "call" a bond before maturity,
the investment. and the investor may have to reinvest the
proceeds at lower rates.
|
There are two broad categories of
municipal bonds. General obligation bonds
are backed by the issuer's "full faith and
credit," that is, its full taxing and
revenue raising power. Revenue bonds
usually rely exclusively on a specific
revenue source, such as charges for water
and sewer service, to generate money for
debt service.
Fundamental Policy. A Fund will not purchase a security if, as a result with respect to 75% of its total assets, more than 5% of its total assets would be invested in securities of that issuer.
Private Activity Bonds. While income from most municipals is exempt from federal income taxes, the income from certain types of so-called private activity bonds (a type of revenue bond) may be subject to the alternative minimum tax (AMT). However, only persons subject to AMT pay this tax. Private activity bonds may be issued for purposes such as housing or airports or to benefit a private company. (Being subject to the AMT does not mean the investor necessarily pays this tax. For further information, please see "Distributions and Taxes.")
Fundamental Policy. Under normal market conditions, the Funds will not purchase any security if, as a result, less than 80% of the funds' income would be exempt from federal income taxes. The income from
securities subject to AMT is not counted when determining whether 80% of the Fund's income is exempt from federal income tax.
Operating Policies. The income derived from securities subject to the AMT does not count in meeting the above referenced 80% test. During periods of abnormal market conditions, for temporary defensive purposes, the funds may invest without limit in high-quality, short-term securities whose income is subject to federal income tax.
In addition to general obligation and revenue bonds, the Funds' investments may include, but are not limited to, the following types of securities:
Municipal Lease Obligations. A lease is not a full faith and credit obligation of the issuer and is usually backed only by the borrowing government's unsecured pledge to make annual appropriation for lease payments. There have been challenges to the legality of lease financing in numerous states and, from time to time, certain municipalities have considered not appropriating money to make lease payments.
In deciding whether to purchase a lease
obligation, the Fund would assess the
financial condition of the borrower, the
merits of the project, the level of public
support for the project, and the
legislative history of lease financing in
the state. These securities may be less
readily marketable than other municipals.
The Fund may also purchase unrated
lease-obligations. Based on information
supplied by T. Rowe Price, the Fund's Board
of Directors will periodically review the
credit quality of non-rated leases and
assess the likelihood of their being
cancelled.
Operating Policy. Each Fund may invest no more than 20% of its assets in lease obligations.
Securities with "Puts" or other Demand Features. Some longer-term municipals give the investor the right to "put" or sell the security at par (face value) within a specified number of days following the investor's request--usually one to seven days. This demand feature enhances a security's liquidity by dramatically shortening its effective maturity and enables it to trade at a price equal to or very close to par. If the demand feature were terminated prior to being exercised, the Fund would hold the longer-term security.
Securities with Credit Enhancements.
0 Letters of Credit. Letters of credit
are issued by a third party, usually a
bank, to enhance liquidity and/or
ensure repayment of principal and any
accrued interest if the underlying
municipal security should default.
0 Municipal Bond Insurance. This
insurance, which is usually purchased
by the bond issuer from a private,
nongovernmental insurance company,
provides an unconditional and
irrevocable guarantee that the insured
bond's principal and interest will be
paid when due. Insurance does not
guarantee the price of a bond or the
share price of any Fund. The credit
rating of an insured bond reflects the
credit rating of the insurer, based on
its claims paying ability. T. Rowe
Price periodically reviews the credit
quality of the insurer.
The obligation of a municipal bond
insurance company to pay a claim
extends over the life of each insured
bond. Although defaults on insured
municipal bonds have been low to date and municipal insurers have met these claims, there is no assurance this will continue. A higher than expected default rate could strain the insurer's loss reserves and adversely affect its ability to pay claims to bondholders, such as the Funds. The number of municipal bond insurers is relatively small, and not all of them have the highest rating.
While all the Funds may buy insured bonds from time to time, such bonds will compose at least 65% of the total assets of the Insured Intermediate Fund. The Insured Intermediate Fund's purchase of insured bonds will be limited to those which, at the time of purchase, have the highest credit rating from a national rating agency.
There is no guarantee that this rating
will be maintained.
0 Standby Repurchase Agreements. A
Standby Bond Purchase Agreement is a
liquidity facility provided to pay the
purchase price of bonds that cannot be
remarketed. The obligation of the
liquidity provider (usually a bank) is
only to advance funds to purchase
tendered bonds which cannot be
remarketed and does not cover
principal or interest under any other
circumstances. The liquidity
provider's obligations under the SBPA
are usually subject to numerous
conditions, including the continued
creditworthiness of the underlying
borrower.
Synthetic or Derivative Securities.
These securities are created from
existing municipal bonds:
0 Residual Interest Bonds (Bond Funds).
The income stream provided by an
underlying bond is divided to create
two securities, one short-term and one long-term. The interest rate on the short-term component is reset by an index or auction process normally every seven to 35 days. After income is paid on the short-term securities at current rates, the residual income goes to the long-term securities.
Therefore, rising short-term interest
rates result in lower income for the
longer-term portion, and vice versa.
The longer-term bonds can be very
volatile and may be less liquid than
other municipals of comparable
maturity.
Operating Policy: Each Fund will
not invest more than 10% of its total
assets in residual interest bonds.
0 Participation Interests. This term covers various types of securities created by converting fixed-rate bonds into short-term, variable-rate certificates. These securities have been developed in the secondary market to meet the demand for short-term, tax-exempt securities. The Funds will invest only in securities deemed tax-exempt by a nationally recognized bond counsel, but there is no guarantee the interest will be exempt because the IRS has not issued a definitive ruling on the matter.
0 Embedded Interest Rate Swaps and Caps (Bond Funds). In a fixed-rate, long-term municipal bond with an interest rate swap attached to it, the bondholder usually receives the bond's fixed-coupon payment as well as a variable rate payment that represents the difference between a fixed rate for the term of the swap (which is typically shorter than the bond it is attached to) and a variable rate short-term municipal index. The bondholder receives excess income when
short-term rates remain below the fixed interest rate swap rate. If short-term rates rise above the fixed-income swap rate, the bondholder's income is reduced. At the end of the interest rate swap term, the bond reverts to a single fixed-coupon payment. Embedded interest rate swaps enhance yields, but also increase interest rate risk.
An embedded interest rate cap allows the bondholder to receive payments whenever short-term rates rise above a level established at the time of purchase. They normally are used to hedge against rising short-term interest rates.
Both instruments may be volatile and of limited liquidity and their use may adversely affect a Fund's total return.
Operating Policy: Each Fund will not invest more than 10% of its total assets in embedded interest rate swaps and caps.
The Funds may invest in other types of derivative instruments as they become available.
Private Placements. The Funds may seek to enhance their yield through the purchase of private placements. These securities are sold through private negotiations, usually to institutions or mutual funds, and may have resale restrictions. Their yields are usually higher than comparable public securities to compensate the investor for their limited marketability.
Operating Policy. Each Fund may not invest more than 15% of its net assets (10% for the Money Fund) in illiquid securities, including unmarketable private placements.
Types of Fund Management Practices
Cash Reserves (Bond Funds). Each Fund
_________________________ will hold a portion of its assets in
Cash reserves provide short-term, tax-exempt money market
flexibility and serve as securities maturing in one year or less.
a short-term defense The reserve position: provides flexibility
during periods of unusual in meeting redemptions, expenses, and the
market volatility. timing of new investments; can help in
structuring a Fund's weighted average
maturity; and serves as a short-term
defense during periods of unusual market
volatility. The Fund's cash reserve
position will be comprised of short-term,
investment-grade securities including
tax-exempt commercial paper, municipal
notes and short- term maturity bonds. Some
of these securities may have adjustable,
variable or floating rates.
When-Issued Securities (All Funds) and
Forwards (Bond Funds). New issues of
municipals are often sold on a
"when-issued" basis, that is, delivery and
payment take place 15-45 days after the
buyer has agreed to the purchase. Some
bonds, called "forwards," have longer than
standard settlement dates, in some cases
exceeding one to three years. When buying
these securities, the Fund identifies cash
or high-grade marketable securities held by
its custodian equal in value to its
commitment for these securities. The Funds
do not earn interest on when-issued and
forward securities until settlement, and
the value of the securities may fluctuate
between purchase and settlement. Municipal
"forwards" typically carry a substantial
yield premium to compensate the buyer for
their greater interest rate, credit, and
liquidity risks.
Interest Rate Futures (Bond Funds).
Futures are often used to manage risk,
because they enable the investor to buy or
sell an asset in the future at an agreed
upon price. Specifically, the Funds may use
|
futures (and options on futures) to hedge against a potentially unfavorable change in interest rates and to adjust their exposure to the municipal bond market. The use of futures for hedging and non-hedging purposes may not always be successful. Their prices can be highly volatile, using them could lower the fund's total return and the potential loss from their use could exceed the Fund's initial investment in such contracts. Operating Policy. Initial margin deposits on futures and premiums on options used for non-hedging purposes will not equal more than 5% of a Fund's net asset value. Borrowing Money and Transferring Assets. Each Fund can borrow money from banks as a temporary measure for emergency purposes, to facilitate redemption requests, or for other proper purposes consistent with the Fund's investment objective and program. Such borrowings may be collateralized with Fund assets, subject to restrictions. Fundamental Policy. Borrowings may not exceed 33 1/3% of total Fund assets. Operating Policy. Each Fund may not transfer as collateral any portfolio securities except as necessary in connection with permissible borrowings or investments and then such transfers may not exceed 33 1/3% of the Fund's total assets. Each Fund may not purchase additional securities when borrowings exceed 5% of total assets. Portfolio _____________________ Turnover (Bond Portfolio Turnover Funds). Each Fund Rates generally purchases securities with the 1992 1993 1994 intention of _____________________ holding them for Short- investment, Intermediate however, when |
market conditions 81.3% 38.5% 51.1% or other circumstances _____________________ warrant, securities Insured may be purchased Intermediate and sold without * 65.3% 74.8% regard to the _____________________ length of time Income held. Due to the 57.9% 76.7% 71.2% nature of each _____________________ Fund's investment High Yield program, a Fund's 51.0% 34.7% 59.3% portfolio turnover _____________________ rate may exceed *Prior to Fund's 100%. Although the inception. Funds do not expect _____________________ to generate any Table 6 taxable income, a high turnover rate may increase transaction costs and may affect taxes paid by shareholders to the extent short-term grains are distributed. The Funds' portfolio turnover rates for the previous three fiscal years are shown in Table 6. |
Sector Concentration. It is possible that each Fund could have a considerable amount of assets (25% or more) in securities that would tend to respond similarly to particular economic or political developments. An example would be, securities of issuers related to a single industry, such as health care or nuclear energy.
Operating Policy. Each Fund will not invest more than 25% of total assets in any single state or in industrial development bonds of
projects in the same industry (such as
solid waste, nuclear utility or airlines).
Bonds which are refunded with escrowed U.S.
Government securities are not subject to
the 25% limitation.
Credit Quality Considerations. The credit
quality of most bond issues is evaluated by
rating agencies such as Moody's and
Standard & Poor's. Credit quality refers to
the issuer's ability to meet all required
interest and principal payments. The
highest ratings are assigned to issuers
perceived to be the best credit risks. T.
Rowe Price research analysts also evaluate
all portfolio holdings of each Fund,
including those rated by outside agencies.
The lower the rating on a bond, the higher
the yield, other things being equal.
Table 7 shows the rating scale used by the
major rating agencies. T. Rowe Price
considers publicly available ratings, but
emphasizes its own credit analysis when
selecting investments.
___________________________________________
Ratings of Municipal Debt Securities
Moody's Standard Fitch Definition
Investors & Poor'sInvestors
Service, Corpora-Service,
Inc. tion Inc.
___________________________________________
Long-Term Aaa AAA AAA Highest
quality
_________________________________
Aa AA AA High
quality
_________________________________
A A A Upper
medium
grade
_________________________________
Baa BBB BBB Medium
grade
_________________________________
Ba BB BB Specula-
tive
|
_________________________________
B B B Highly
specula-
tive
_________________________________
Caa CCC,CC CCC,CC Vulner-
able to
default
_________________________________
Ca C C Default
is immi-
nent
_________________________________
C D DDD, Probably
DD, D in
default
_________________________________
Moody's S&P Fitch
___________________________________________
Short- MIG1/VMIG1 SP1+ Very F-1+
Term Best quality strong Exception-
quality ally
SP1 strong
Strong quality
grade F-1 Very
strong
quality
___________________________________
MIG2/VMIG2 SP2 F-2 Good
High quality Satisfac- credit
tory quality
grade
___________________________________
MIG3/VMIG3 Favorable F-3 Fair
quality credit
quality
___________________________________
MIG4/VMIG4 Adequate
quality
___________________________________
SG Specu- SP3 Specu-F-S Weak
lative grade lative credit
grade quality
___________________________________________
Commer- P-1 Superior A-1+ F-1+
cial quality Extremely Exception-
paper strong ally strong
quality quality
A-1 F-1 Very
Strong strong
quality quality
___________________________________
P-2 Strong A-2 F-2 Good
quality Satisfac- credit
tory quality
quality
___________________________________
P-3 A-3 F-3 Fair
Acceptable Adequate credit
quality quality quality
___________________________________
B Specu- F-S Weak
lative credit
quality quality
___________________________________
C Doubtful
quality
___________________________________________
Table 7
___________________________________________________________________________
Explanation of Quality Ratings
Bond
Rating Explanation
___________________________________________________________________________
Moody's Investors Aaa Highest quality, smallest degree of
Service, Inc. investment risk
________________________________________________
Aa High quality; together with Aaa bonds,
they compose the high-grade bond group.
________________________________________________
A Upper-medium grade obligations; many
favorable investment attributes.
________________________________________________
Baa Medium-grade obligations; neither highly
protected nor poorly secured. Interest
and principal appear adequate for the
present but certain protective elements
may be lacking or may be unreliable over
any great length of time.
_________________________________________________
Ba More uncertain, with speculative
elements. Protection of interest and
principal payments not well safeguarded
during good and bad times.
|
_________________________________________________
B Lack characteristics of desirable
investment; potentially low assurance of
timely interest and principal payments or
maintenance of other contract terms over
time.
_________________________________________________
Caa Poor standing, may be in default;
elements of danger with respect to
principal or interest payments.
_________________________________________________
Ca Speculative in a high degree; could be in
default or have other marked
shortcomings.
_________________________________________________
C Lowest-rated; extremely poor prospects of
ever attaining investment standing.
_________________________________________________
___________________________________________________________________________
Standard & Poor's AAA Highest rating; extremely strong capacity
Corporation to pay principal and interest.
_________________________________________________
AA High quality; very strong capacity to pay
principal and interest.
_________________________________________________
A Strong capacity to pay principal and
interest; somewhat more susceptible to
the adverse effects of changing
circumstances and economic conditions.
_________________________________________________
BBB Adequate capacity to pay principal and
interest; normally exhibit adequate
protection parameters, but adverse
economic conditions or changing
circumstances more likely to lead to a
weakened capacity to pay principal and
interest than for higher-rated bonds.
_________________________________________________
BB, B Predominantly speculative with respect to
CCC, the issuer's capacity to meet required
CC interest and principal payments. BB--
lowest degree of speculation; CC--the
highest degree of speculation. Quality
and protective characteristics outweighed
by large uncertainties or major risk
exposure to adverse conditions.
_________________________________________________
|
D In default.
_________________________________________________
__________________________________________________________________________
Fitch Investors AAA Highest quality; obligor has
Service, Inc. exceptionally strong ability to pay
interest and repay principal, which is
unlikely to be affected by reasonably
foreseeable events.
_________________________________________________
AA Very high quality; obligor's ability to
pay interest and repay principal is very
strong. Because bonds rated in the AAA
and AA categories are not significantly
vulnerable to foreseeable future
developments, short-term debt of these
issuers is generally rated F-1+.
_________________________________________________
A High quality; obligor's ability to pay
interest and repay principal is
considered to be strong, but may be more
vulnerable to adverse changes in economic
conditions and circumstances than higher-
rated bonds.
_________________________________________________
BBB Satisfactory credit quality; obligor's
ability to pay interest and repay
principal is considered adequate.
Unfavorable changes in economic
conditions and circumstances are more
likely to adversely affect these bonds
and impair timely payment. The
likelihood that the ratings of these
bonds will fall below investment grade is
higher than for higher-rated bonds.
_________________________________________________
BB, Not investment-grade; predominantly
CCC, speculative with respect to the issuer's
CC, C capacity to repay interest and repay
principal in accordance with the terms of
the obligation for bond issues not in
default. BB is least speculative. C is
the most speculative.
_________________________________________________________________
Table 8
_________________________ Credit Quality and _______________________
the High Yield Tax-Free High Yield
Fund. In seeking Fund: Asset Composition
|
Portfolio managers its primary TRPA's
diversify Fund assets to objective of high Assess-
lower risk. income, the Tax- Percent-
Free High Yield age Not
Fund invests a Standard of Rated
portion of its & Poor's Total Securi-
assets in bonds Rating* Assets ties
rated below- ______________________
investment-grade AAA 7.6 0.1
(BB or lower). ______________________
Such bonds are AA 10.7 0.0
regarded as ______________________
speculative with A 17.5 1.6
respect to the ______________________
issuer's ability to BBB 25.1 10.1
meet interest and ______________________
principal payments. BB 3.8 15.4
______________________
For the fiscal year B 0.3 2.2
ended February 28, ______________________
1994, the High CCC-D 0.0 0.4
Yield Fund's assets
(CC
were invested in ______________________
the credit Not
categories shown at Rated 29.8 --
right. Percentages ______________________
are computed on a Reserves 5.2 --
dollar-weighted ______________________
basis and are an 100.0% 29.8%
average of 12 ______________________
monthly *Equivalent ratings by
calculations. Moody's used in the
absence of a S&P
rating.
______________________
Table 9
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Note: Although each Fund offers only its own shares, it is possible that a Fund might become liable for a misstatement in this prospectus about another Fund. The Board of each Fund has considered this factor in approving the use of a single combined prospectus.
Investing with T. Rowe
Price
Meeting
Requirements for
New Accounts
_________________________ Tax Identification
Always verify your Number
transactions by carefully We must have your
reviewing the correct social
confirmation we send you. security or
Please report any corporate tax
discrepancies to identification
Shareholder Services. number and a signed
New Account Form or
W-9 Form.
Otherwise, federal
law requires the
fund to withhold a
percentage
(currently 31%) of
your dividends,
capital gain
distributions, and
redemptions, and
may subject you to
an IRS fine. You
will also be
prohibited from
opening another
account by
exchange. If this
information is not
received within 60
days after your
account is
established, your
account may be
redeemed, priced at
the NAV on the date
of redemption.
|
Unless you request
otherwise, one
shareholder report
will be mailed to
multiple account
owners with the
same tax
identification
number and same zip
code and to those
shareholders who
have requested that
their account be
combined with
someone else's for
financial
reporting.
_________________________
Regular Mail Opening a New
T. Rowe Price Account: $2,500
Account Services minimum initial
P.O. Box 17300 investment; $1,000
Baltimore, MD for gifts or
21298-9353 transfers to minors
(UGMA/UTMA)
accounts
Account
Registration
Mailgram, Express, If you own other T.
Registered, or Certified Rowe Price funds,
Mail be sure to register
T. Rowe Price any new account
Account Services just like your
10090 Red Run Blvd. existing accounts
Owings Mills, MD so you can exchange
21117 among them easily.
(The name and
account type would
have to be
identical.)
By Mail
Please make your
check payable to T.
Rowe Price Funds
(otherwise it may
be returned) and
|
send it together with the New Account Form to the address at left.
By Wire
o
Call Investor
Services for an
account number and
use the wire
address below.
o
Complete a New
Account Form and
mail it to one of
the appropriate
addresses listed at
left.
o
Give the following
wire address to
your bank: Morgan
Guaranty Trust Co.
of New York, ABA#
021000238, T. Rowe
Price [fund name],
AC-00153938.
Provide fund name,
account name(s),
and account number.
By Exchange
Call Shareholder
Services. The new
account will have
the same
registration as the
account from which
you are exchanging.
Services for the
new account may be
carried over by
telephone request
if preauthorized on
the existing
account. (See
explanation of
"Excessive Trading"
under "Transaction
Procedures.")
_________________________ In Person
Drop-off locations Drop off your New
101 East Lombard St. Account Form at any
Baltimore, MD of the locations
listed at left and
T. Rowe Price obtain a receipt.
Financial Center
10090 Red Run Blvd. Note: The fund and
Owings Mills, MD its agents have the
right to waive or
Farragut Square lower investment
900 17th Street, N.W. minimums, to accept
Washington, D.C. initial purchases
by telephone or
ARCO Tower mailgram, to cancel
31st Floor or reject any
515 S. Flower St. purchase or
Los Angeles, CA exchange if the
written
confirmation has
not been received
by the shareholder,
or to otherwise
modify the
conditions of
purchase or any
services at any
time.
Purchasing
Additional Shares:
$100 minimum
purchase; $5,000
minimum for
telephone purchases
By ACH Transfer
Use Tele*Access
(registered
trademark),
PC*Access
(registered
trademark) or call
|
Shareholder
Services if you
have established
electronic
transfers using the
ACH network ($100
minimum).
By Automatic Asset
Builder
Fill out the
Automatic Asset
Builder section on
the New Account or
Shareholder
Services Form.
______________________ By Wire
Regular Mail Call Shareholder
T. Rowe Price Funds Services or use the
Account Services wire address in
P. O. Box 89000 "Opening a New
Baltimore, MD Account."
21289-1500
By Mail
o
Provide your
account number and
the fund name on
your check.
o
Mail the check to
us at the address
shown at left with
either a
reinvestment slip
or a note
indicating the fund
and account number
in which you wish
to purchase shares.
By Phone
Call Shareholder
Services to lock in
that day's closing
|
price; payment is
due within five
days ($5,000
minimum).
Exchanging and
Redeeming Shares
By Phone
Call Shareholder
Services. If you
find our phones
busy during
unusually volatile
markets, please
consider placing
your order by
Tele*Access or
PC*Access (if you
have previously
authorized
telephone
services), or by
express mail or
mailgram. For
exchange policies,
please see
"Transaction
Procedures and
Special
Requirements -
Excessive Trading."
Redemption proceeds
can be mailed to
your account
address, sent by
ACH transfer, or
wired to your bank.
(For charges, see
"Electronic
Transfers - By
Wire" on the next
page.)
_________________________ By Mail
Regular Mail Provide account
T. Rowe Price name(s) and
|
Account Services numbers, fund
P.O. Box 89000 name(s), and
Baltimore, MD exchange or
21289-0220 redemption amount.
For exchanges, mail
Mailgram, Express, to the appropriate
Registered, or Certified address at left,
Mail indicate the fund
T. Rowe Price you are exchanging
Account Services from and the
10090 Red Run Blvd. fund(s) you are
Owings Mills, MD 21117 exchanging into. T.
Rowe Price requires
the signatures of
all owners exactly
as registered, and
possibly a
_________________________ signature guarantee
Investor Services (see "Transaction
1-800-977-1577 Procedures and
1-410-547-2308 Special
Requirements -
Shareholder Services Signature
1-800-225-5132 Guarantees").
1-410-625-6500
Note: Shareholders
holding
certificates must
conduct
transactions by
mail. If you lose
a stock
certificate, there
may be a charge to
replace it. Call
Shareholder
Services for
further
information.
Shareholder
Services
Many services are
available to you as
a T. Rowe Price
shareholder; some
you receive
|
automatically and others you must authorize on the New Account Form.
By signing up for
services on the New
Account Form rather
than later on, you
avoid having to
complete a separate
form and obtain a
signature
guarantee. This
section reviews
some of the
principal services
currently offered.
Our Services Guide
contains detailed
descriptions of
these and other
services. If you
are a new T. Rowe
Price investor, you
will receive a
Services Guide with
our Welcome Kit.
Exchange Service
You can move money
from one account to
an existing
identically
registered account,
or open a new
identically
registered account.
Remember, exchanges
are purchases and
sales for tax
purposes.
(Exchanges into a
state tax-free fund
are limited to
investors living in
states where the
funds are
registered.) Some
of the T. Rowe Price funds may impose a redemption fee of .50%-2%, payable to such funds, on shares held for less than one year, or in some funds, six months.
Telephone Services Tele*Access.
24-hour service via
toll-free number
provides
information such as
yields, prices,
dividends, account
balances, and your
latest transaction,
as well as the
ability to request
prospectuses and
account forms and
initiate purchase,
redemption and
exchange orders in
your accounts (see
"Electronic
Transfers" below).
PC*Access. 24-hour
service via dial-up
modem provides the
same information as
Tele*Access, but on
a personal
computer. Please
call Investor
Services for an
information guide.
Shareholder
Services. Buy,
sell, or exchange
shares by calling
one of our service
representatives or by visiting one of our four investor center locations.
Electronic Transfers By ACH. With no charges to pay, you can initiate a purchase or redemption for as little as $100 or as much as $100,000 between your bank account and fund account using the ACH network. Enter instructions via Tele*Access, PC*Access or call Shareholder Services.
By Wire. Electronic transfers can also be conducted via bank wire. There is currently a $5 fee for wire redemptions under $5,000, and your bank may charge for wire transfers regardless of size.
Checkwriting You may write an unlimited number of free checks on bond and money market funds, with a minimum of $500 per check. Keep in mind, however that a check results in
a redemption; a check written on a bond fund will create a taxable event which you and we must report to the IRS.
Automatic Investing You can invest automatically in several different ways, including:
o
Automatic Asset
Builder. You
instruct us to move
$50 or more once a
month or less often
from your bank
account, or you can
instruct your
employer to send
all or a portion of
your paycheck, to
the fund or funds
you designate.
o
Automatic Exchange.
Enables you to set
up systematic
investments from
one fund account
into another, such
as from a money
fund into a stock
fund.
Discount Brokerage
You can trade
stocks, bonds,
options, precious
metals and other
securities at a
substantial savings
over regular
commission rates.
Call Investor Services for information.
Note: If you buy or sell T. Rowe Price funds through anyone other than T. Rowe Price, such as broker-dealers or banks, you may be charged transaction or service fees by those institutions.
No such fees are
charged by T. Rowe
Price Investment
Services or the
fund for
transactions
conducted directly
with the fund.
PAGE
Prospectus
To Open an Account
Investor Services Tax-Free Funds
1-800-638-5660
1-410-547-2308
For Existing Accounts T. Rowe Price
Shareholder Services Tax-Free Funds,
1-800-225-5132 Inc. ______________
1-410-625-6500 To help you July 1, 1994 A family of
achieve your municipal bond
For Yields & Prices financial goals, and money
Tele*AccessR T. Rowe Price funds for
1-800-638-2587 offers a wide investors
1-410-625-7676 range of stock, seeking income
24 hours, 7 days bond, and money that is exempt
market from federal
Investor Centers investments, as income taxes.
well as
First Floor convenient
101 East Lombard St. services and
Baltimore, MD timely,
|
T. Rowe Price informative Financial Center reports. First Floor 10090 Red Run Blvd. Owings Mills, MD ARCO Tower 31st Floor 515 S. Flower St. Los Angeles, CA |
STATEMENT OF ADDITIONAL INFORMATION
T. Rowe Price Tax-Exempt Money Fund, Inc.
T. Rowe Price Tax-Free Short-Intermediate Fund, Inc.
T. Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc.
T. Rowe Price Tax-Free Income Fund, Inc.
T. Rowe Price Tax-Free High Yield Fund, Inc.
(the "Funds")
This Statement of Additional Information is not a prospectus but should be read in conjunction with the Funds' prospectus dated July 1, 1994, which may be obtained from T. Rowe Price Investment Services, Inc., 100 East Pratt Street, Baltimore, Maryland 21202.
The date of this Statement of Additional Information is July 1, 1994.
Page Page
Capital Stock. . . . . .52 Investment Restrictions . . 23
(page 14 in Prospectus) . .Legal Counsel54
Custodian. . . . . . . .37 Management of Funds . . . . 32
Determination of Maturity of
Municipal Securities . . 7
Securities. . . . . . .14 Net Asset Value Per Share . 44
Distributor for Funds. .37 Options . . . . . . . . . . 23
Dividends. . . . . . . .45 Participation Interests . . 11
Federal and State Registration
Portfolio Transactions .38
of Shares . . . . . . .54 Portfolio Turnover. . . . . 14
Forwards . . . . . . . .12 Pricing of Securities . . . 43
Futures Contracts. . . .15 Principal Holders of Securities34
General Information and History 51
Ratings of Commercial Paper 31
Independent Accountants.55 Ratings of Municipal Debt
Securities . . . . . . .29
Investment Management Services 34 Ratings of Municipal Notes
and Variable
(page 14 in Prospectus) Rate Securities31
Investment in Taxable Money Market
Residual Interest Bonds.31
|
Securities . . . . . .13 Risk Factors. . . . . . . . .4
Investment Objectives. . 3 Tax-Exempt vs. Taxable Yields47
(pages 1 and 16 in Prospectus)Tax Status (page 11 in
Prospectus)45
Investment Objectives and Policies 2Variable and Floating Rate
Investment Performance .47 Securities . . . . . . . 10
Investment Programs. . . 7 When-Issued Securities. . . 12
(pages 6-9 and 16-23 in Prospectus) Yield Information46
INVESTMENT OBJECTIVES AND POLICIES
The following information supplements the discussion of each Fund's investment objectives and policies discussed on pages 1 and 16, and 6 through 9 and 16 through 23 of the prospectus. The Funds will not make a material change in their investment objectives without obtaining shareholder approval. Unless otherwise specified, the investment programs and restrictions of the Funds are not fundamental policies. Each Fund's operating policies are subject to change by its Board of Directors without shareholder approval. However, shareholders will be notified of a material change in an operating policy. Each Fund's fundamental policies may not be changed without the approval of at least a majority of the outstanding shares of the Fund or, if it is less, 67% of the shares represented at a meeting of shareholders at which the holders of 50% or more of the shares are represented.
RISK FACTORS
All Funds
The Funds are designed for investors who, because of their tax bracket, can benefit from investment in municipal bonds whose income is exempt from federal taxes. The Funds are not appropriate for qualified retirement plans where income is already tax deferred.
Municipal Securities
There can be no assurance that the Funds will achieve their investment objectives. Yields on municipal securities are dependent on a variety of factors, including the general conditions of the money market and the municipal bond market, the size of a particular offering, the maturity of the obligation, and the rating of the issue. Municipal securities with longer maturities tend to produce higher yields and are generally subject to potentially greater capital appreciation and depreciation than obligations with shorter maturities and lower yields. The market prices of municipal securities usually vary, depending upon available yields. An increase in interest rates will generally reduce the value of portfolio investments, and a decline in interest rates will generally increase the value of portfolio investments. The ability of all the Funds to achieve their investment objectives is also dependent on the continuing ability of the issuers of municipal securities in which the Funds invest to meet their obligations for the payment of interest and principal when due. The ratings of Moody's, S&P, and Fitch represent their opinions as to the quality of municipal securities which they undertake to rate. Ratings are not absolute standards of quality; consequently, municipal securities with the same maturity, coupon, and rating may have different yields. There are variations in municipal securities, both within a particular classification and between classifications, depending on numerous factors. It should also be pointed out that, unlike other types of investments, municipal securities have traditionally not been subject to regulation by, or registration with, the SEC, although there have been proposals which would provide for regulation in the future.
The federal bankruptcy statutes relating to the debts of political subdivisions and authorities of states of the United States provide that, in certain circumstances, such subdivisions or authorities may be authorized to initiate bankruptcy proceedings without prior notice to or consent of creditors, which proceedings could result in material and adverse changes in the rights of holders of their obligations.
Proposals have been introduced in Congress to restrict or eliminate the federal income tax exemption for interest on municipal securities, and similar proposals may be introduced in the future. Some of the past proposals would have applied to interest on municipal securities issued before the date of enactment, which would have adversely affected their value to a material degree. If such a proposal were enacted, the availability of municipal securities for investment by the Funds and the value of a Fund's portfolio would be affected and, in such an event, a Fund would reevaluate its investment objectives and policies.
Although the banks and securities dealers with which the Fund will transact business will be banks and securities dealers that T. Rowe Price believes to be financially sound, there can be no assurance that they will be able to honor their obligations to the Fund with respect to such securities.
After purchase by a Fund, a security may cease to be rated or its rating may be reduced below the minimum required for purchase by the Fund.
For the Money Fund, the procedures set forth in Rule 2a-7, under the Investment Company Act of 1940, may require the prompt sale of any such security. For the other Funds, neither event would require a sale of such security by the Fund. However, T. Rowe Price Associates, Inc. ("T. Rowe Price") will consider such event in its determination of whether the Fund should continue to hold the security. To the extent that the ratings given by Moody's Investors Service, Inc. ("Moody's"), Standard & Poor's Corporation ("S&P"), or Fitch Investors Service, Inc. ("Fitch") may change as a result of changes in such organizations or their rating systems, the Fund will attempt to use comparable ratings as standards for investments in accordance with the investment policies contained in the prospectus. When purchasing unrated securities, T. Rowe Price, under the supervision of the Fund's Board of Directors, determines whether the unrated security is of a qualify comparable to that which the Fund is allowed to purchase.
Municipal Bond Insurance. All of the Funds may purchase insured bonds from time to time. Municipal bond insurance provides an unconditional and irrevocable guarantee that the insured bond's principal and interest will be paid when due. The guarantee is purchased from a private, non-governmental insurance company.
There are two types of insured securities that may be purchased by the Funds, bonds carrying either (1) new issue insurance or (2) secondary insurance. New issue insurance is purchased by the issuer of a bond in order to improve the bond's credit rating. By meeting the insurer's standards and paying an insurance premium based on the bond's principal value, the issuer is able to obtain a higher credit rating for the bond. Once purchased, municipal bond insurance cannot be cancelled, and the protection it affords continues as long as the bonds are outstanding and the insurer remains solvent.
The Funds may also purchase bonds which carry secondary insurance purchased by an investor after a bond's original issuance. Such policies insure a security for the remainder of its term. Generally, the Funds expect that portfolio bonds carrying secondary insurance will have been insured by a prior investor. However, the Funds may, on occasion, purchase secondary insurance on their own behalf.
Each of the municipal bond insurance companies has established reserves to cover estimated losses. Both the method of establishing these reserves and the amount of the reserves vary from company to company. The obligation of a municipal bond insurance company may have to pay a claim extends over the life of each insured bond. Municipal bond insurance companies are obligated to pay a bond's interest and principal when due if the issuing entity defaults on the insured bond. Although defaults on insured municipal bonds have been low to date and municipal insurers have met these claims, there is no assurance this low rate will continue in the future. A higher than expected default rate could deplete loss reserves and adversely affect the ability of a municipal bond insurer to pay claims to holders of insured bonds, such as the Fund.
Money Fund
The Fund will limit its purchases of portfolio instruments to those U.S. dollar-denominated securities which the Fund's Board of Directors determines present minimal credit risk, and which are Eligible Securities as defined in Rule 2a-7 under the Investment Company Act of 1940 (1940 Act). Eligible Securities are generally securities which have been rated (or whose issuer has been rated or whose issuer has comparable securities rated) in one of the two highest rating categories by nationally recognized statistical rating organizations or, in the case of any instrument that is not so rated, is of comparable high quality as determined by T. Rowe Price pursuant to written guidelines established in accordance with Rule 2a-7 under the Investment Company Act of 1940 under the supervision of the Fund's Board of Directors. In addition, the Funds may treat variable and floating rate instruments with demand features as short-term securities pursuant to Rule 2a-7 under the 1940 Act.
There can be no assurance that the Money Fund will achieve its investment objectives or be able to maintain its net asset value per share at $1.00. The price stability and liquidity of the Money Fund may not be equal to that of a taxable money market fund which exclusively invests in short-term taxable money market securities. The taxable money market is a broader and more liquid market with a greater number of investors, issuers, and market makers than the short-term municipal securities market. The weighted average maturity of the Fund varies: the shorter the average maturity of a portfolio, the less its price will be impacted by interest rate fluctuations.
Bond Funds
Because of their investment policies, the Bond Funds may not be suitable or appropriate for all investors. The Funds are designed for investors who wish to invest in non-money market funds for income, and who would benefit, because of their tax bracket, from receiving income that is exempt from federal income taxes. The Funds' investment programs permit the purchase of investment grade securities that do not meet the high quality standards of the Money Fund. Since investors generally perceive that there are greater risks associated with investment in lower quality securities, the yields from such securities normally exceed those obtainable from higher quality securities. In addition, the principal value of long term lower-rated securities generally will fluctuate more widely than higher quality securities. Lower quality investments entail a higher risk of default--that is, the nonpayment of interest and principal by the issuer than higher quality investments. The value of the portfolio securities of the Bond Funds will fluctuate based upon market conditions. Although these Funds seek to reduce credit risk by investing in a diversified portfolio, such diversification does not eliminate all risk. The Funds are also not intended to provide a vehicle for short-term trading purposes.
Special Risks of High Yield Investing.
Junk bonds are regarded as predominantly speculative with respect to the issuer's continuing ability to meet principal and interest payments. Because investment in low and lower- medium quality bonds involves greater investment risk, to the extent the Funds invest in such bonds, achievement of their investment objectives will be more dependent on T. Rowe Price's credit analysis than would be the case if the Funds were investing in higher quality bonds. High yield bonds may be more susceptible to real or perceived adverse economic conditions than investment grade bonds. A projection of an economic downturn, or higher interest rates, for example, could cause a decline in high yield bond prices because the advent of such events could lessen the ability of highly leverage issuers to make principal and interest payments on their debt securities. In addition, the secondary trading market for high yield bonds may be less liquid than the market for higher grade bonds, which can adversely affect the ability of a Fund to dispose of its portfolio securities. Bonds for which there is only a "thin" market can be more difficult to value inasmuch as objective pricing data may be less available and judgment may play a greater role in the valuation process.
Reference is also made to the sections entitled "Types of Securities" and "Portfolio Management Practices" for discussions of the risks associated with the investments and practices described therein.
INVESTMENT PROGRAMS
(Throughout the discussion on Investments, the term "the Fund" is intended to refer to each of the Funds eligible to invest in the security or engage in the practice being described)
Type of Securities
Municipal Securities
Subject to the investment objectives and programs described in the prospectus and the additional investment restrictions described in this Statement of Additional Information, each Fund's portfolio may consist of any combination of the various types of municipal securities described below or other types of municipal securities that may be developed. The amount of each Fund's assets invested in any particular type of municipal security can be expected to vary.
The term "municipal securities" means obligations issued by or on behalf of states, territories, and possessions of the United States and the District of Columbia and their political subdivisions, agencies and instrumentalities, as well as certain other persons and entities, the interest from which is exempt from federal income tax. In determining the tax-exempt status of a municipal security, the Fund relies on the opinion of the issuer's bond counsel at the time of the issuance of the security. However, it is possible this opinion could be overturned, and as a result, the interest received by the Fund from such a security might not be exempt from federal income tax.
Municipal securities are classified by maturity as notes, bonds, or adjustable rate securities.
Municipal Notes. Municipal notes generally are used to provide for short-term operating or capital needs and generally have maturities of one year or less. Municipal notes include:
Tax Anticipation Notes. Tax anticipation notes are issued to finance working capital needs of municipalities. Generally, they are issued in anticipation of various seasonal tax revenue, such as income, property, use and business taxes, and are payable from these specific future taxes.
Revenue Anticipation Notes. Revenue anticipation notes are issued in expectation of receipt of other types of revenue, such as federal or state revenues available under the revenue sharing or grant programs.
Bond Anticipation Notes. Bond anticipation notes are issued to provide interim financing until long-term financing can be arranged. In most cases, the long-term bonds then provide the money for the repayment of the notes.
Tax-Exempt Commercial Paper. Tax-exempt commercial paper is a short-term obligation with a stated maturity of 270 days or less. It is issued by state and local governments or their agencies to finance seasonal working capital needs or as short-term financing in anticipation of longer term financing.
Municipal Bonds. Municipal bonds, which meet longer term capital needs and generally have maturities of more than one year when issued, have two principal classifications: general obligation bonds and revenue bonds. Two additional categories of potential purchases are lease revenue bonds and pre- refunded/escrowed to maturity bonds. Another type of municipal bond is referred to as an Industrial Development Bond.
General Obligation Bonds. Issuers of general obligation bonds include states, counties, cities, towns, and special districts. The proceeds of these obligations are used to fund a wide range of public projects, including construction or improvement of schools, public buildings, highways and roads, and general projects not supported by user fees or specifically identified revenues. The basic security behind general obligation bonds is the issuer's pledge of its full faith and credit and taxing power for the payment of principal and interest. The taxes that can be levied for the payment of debt service may be limited or unlimited as to the rate or amount of special assessments. In many cases voter approval is required before an issuer may sell this type of bond.
Revenue Bonds. The principal security for a revenue bond is generally the net revenues derived from a particular facility, or enterprise, or in some cases, the proceeds of a special charge or other pledged revenue source. Revenue bonds are issued to finance a wide variety of capital projects including: electric, gas, water and sewer systems; highways, bridges, and tunnels; port and airport facilities; colleges and universities; and hospitals. Revenue bonds are sometimes used to finance various privately operated facilities provided they meet certain tests established for tax-exempt status.
Although the principal security behind these bonds may vary, many provide additional security in the form of a mortgage or debt service reserve fund. Some authorities provide further security in the form of the state's ability (without obligation) to make up deficiencies in the debt service reserve fund. Revenue bonds usually do not require prior voter approval before they may be issued.
Lease Revenue Bonds. Municipal borrowers may also finance capital improvements or purchases with tax-exempt leases. The security for a lease is generally the borrower's pledge to make annual appropriations for lease payments. The lease payment is treated as an operating expense subject to appropriation risk and not a full faith and credit obligation of the issuer. Lease revenue bonds are generally considered less secure than a general obligation or revenue bond and often do not include a debt service reserve fund. To the extent the Fund's Board determines such securities are illiquid, they will be subject to the Fund's 15% limit on illiquid securities (10% limit for the Money Fund). There have also been certain legal challenges to the use of lease revenue bonds in various states.
The liquidity of such securities will be determined
based on a variety of factors which may include, among
others: (1) the frequency of trades and quotes for the
obligation; (2) the number of dealers willing to
purchase or sell the security and the number of other
potential buyers; (3) the willingness of dealers to
undertake to make a market in the security; (4) the
nature of the marketplace trades, including, the time
needed to dispose of the security, the method of
soliciting offers, and the mechanics of transfer; and
(5) the rating assigned to the obligation by an
established rating agency or T. Rowe Price.
Pre-refunded/Escrowed to Maturity Bonds. Certain municipal bonds have been refunded with a later bond issue from the same issuer. The proceeds from the later issue are used to defease the original issue. In many cases the original issue cannot be redeemed or repaid until the first call date or original maturity date. In these cases, the refunding bond proceeds typically are used to buy U.S. Treasury securities that are held in an escrow account until the original call date or maturity date. The original bonds then become "pre-refunded" or "escrowed to maturity" and are considered as high quality investments. While still tax-exempt, the security is the proceeds of the escrow account. To the extent permitted by the Securities and Exchange Commission and the Internal Revenue Service, a Fund's investment in such securities refunded with U.S. Treasury securities will, for purposes of diversification rules applicable to the Fund, be considered as an investment in the U.S. Treasury securities.
Private Activity Bonds. Under current tax law all
municipal debt is divided broadly into two groups:
governmental purpose bonds and private activity bonds.
Governmental purpose bonds are issued to finance
traditional public purpose projects such as public
buildings and roads. Private activity bonds may be
issued by a state or local government or public
authority but principally benefit private users and are
considered taxable unless a specific exemption is
provided.
The tax code currently provides exemptions for certain private activity bonds such as not-for-profit hospital bonds, small-issue industrial development revenue bonds and mortgage subsidy bonds, which may still be issued as tax-exempt bonds. Some, but not all, private activity bonds are subject to alternative minimum tax.
Industrial Development Bonds. Industrial development bonds are considered Municipal Bonds if the interest paid is exempt from federal income tax. They are issued by or on behalf of public authorities to raise money to finance various privately operated facilities for business and manufacturing, housing, sports, and pollution control. These bonds are also used to finance public facilities such as airports, mass transit systems, ports, and parking. The payment of the principal and interest on such bonds is dependent solely on the ability of the facility's user to meet its financial obligations and the pledge, if any, of real and personal property so financed as security for such payment.
Adjustable Rate Securities. Municipal securities may be issued with adjustable interest rates that are reset periodically by pre-determined formulas or indexes in order to minimize movements in the principal value of the investment. Such securities may have long-term maturities, but may be treated as a short-term investment under certain conditions. Generally, as interest rates decrease or increase, the potential for capital appreciation or depreciation on these securities is less than for fixed-rate obligations. These securities may take the following forms:
Variable Rate Securities. Variable rate instruments are those whose terms provide for the adjustment of their interest rates on set dates and which, upon such adjustment, can reasonably be expected to have a market value that approximates its par value. Subject to the provisions of Rule 2a-7 under the Investment Company Act of 1940, (1) a variable rate instrument, the principal amount of which is scheduled to be paid in 397 days or less, is deemed to have a maturity equal to the period remaining until the next readjustment of the interest; (2) a variable rate instrument which is subject to a demand feature which entitles the purchaser to receive the principal amount of the underlying security or securities either (i) upon notice of usually 30 days, or (ii), at specified intervals not exceeding 397 days and upon no more than 30 days notice is deemed to have a maturity equal to the longer of the period remaining until the next readjustment of the interest rate or the period remaining until the principal amount can be recovered through demand; and (3) an instrument that is issued or guaranteed by the U.S. government or any agency thereof which has a variable rate of interest readjusted no less frequently than every 762 days may be deemed to have a maturity equal to the period remaining until the next readjustment of the interest rate. Should the provisions of Rule 2a-7 change, the Fund will determine the maturity of these securities in accordance with the amended provisions of such rule.
Floating Rate Securities. Floating rate instruments are those whose terms provide for the adjustment of their interest rates whenever a specified interest rate changes and which, at any time, can reasonably be expected to have a market value that approximates its par value. Subject to the provisions of Rule 2a-7 under the Investment Company Act of 1940, (1) the maturity of a floating rate instrument is deemed to be the period remaining until the date (noted on the face of the instrument) on which the principal amount must be paid, or in the case of an instrument called for redemption, the date on which the redemption payment must be made; and (2) floating rate instruments with demand features are deemed to have a maturity equal to the period remaining until the principal amount can be recovered through demand. Should the provisions of Rule 2a-7 change, the Fund will determine the maturity of these securities in accordance with the amended provisions of such rule.
Put Option Bonds. Long-term obligations with maturities longer than one year may provide purchasers an optional or mandatory tender of the security at par value at predetermined intervals, often ranging from one month to several years (e.g., a 30-year bond with a five-year tender period). These instruments are deemed to have a maturity equal to the period remaining to the put date.
Residual Interest Bonds (Bond Funds). The Funds may purchase municipal bond issues that are structured as two-part, residual interest bond and variable rate security offerings. The issuer is obligated only to pay a fixed amount of tax-free income that is to be divided among the holders of the two securities. The interest rate for the holders of the variable rate securities will be determined by an index or auction process held approximately every 7 to 35 days while the bond holders will receive all interest paid by the issuer minus the amount given to the variable rate security holders and a nominal auction fee. Therefore, the coupon of the residual interest bonds, and thus the income received, will move inversely with respect to short-term, 7 to 35 day tax-exempt interest rates. There is no assurance that the auction will be successful and that the variable rate security will provide short-term liquidity. The issuer is not obligated to provide such liquidity. In general, these securities offer a significant yield advantage over standard municipal securities, due to the uncertainty of the shape of the yield curve (i.e., short term versus long term rates) and consequent income flows.
Unlike many adjustable rate securities, residual interest bonds are not necessarily expected to trade at par and in fact present significant market risks. In certain market environments, residual interest bonds may carry substantial premiums or be at deep discounts. This is a relatively new product in the municipal market with limited liquidity to date.
Participation Interests. The Funds may purchase
from third parties participation interests in all
or part of specific holdings of municipal
securities. The purchase may take different forms:
in the case of short-term securities, the
participation may be backed by a liquidity facility
that allows the interest to be sold back to the
third party (such as a trust, broker or bank) for a
predetermined price of par at stated intervals.
The seller may receive a fee from the Funds in
connection with the arrangement.
In the case of longer term bonds, the Intermediate and Income Funds may purchase interests in a pool of municipal bonds or a single municipal bond or lease without the right to sell the interest back to the third party.
The Funds will not purchase participation interests unless a satisfactory opinion of counsel or ruling of the Internal Revenue Service has been issued that the interest earned from the municipal securities on which the Funds holds participation interests is exempt from federal income tax to the Funds. However, there is no guarantee the IRS would treat such interest income as tax-exempt.
Embedded Interest Rate Swaps and Caps (Bond Funds). In a fixed-rate, long-term municipal bond with an interest rate swap attached to it, the bondholder usually receives the bond's fixed-coupon payment as well as a variable rate payment that represents the difference between a fixed rate for the term of the swap (which is typically shorter than the bond it is attached to) and a variable rate short-term municipal index. The bondholder receives excess income when short-term rates remain below the fixed interest rate swap rate. If short-term rates rise above the fixed-income swap rate, the bondholder's income is reduced. At the end of the interest rate swap term, the bond reverts to a single fixed-coupon payment. Embedded interest rate swaps enhance yields, but also increase interest rate risk.
An embedded interest rate cap allows the bondholder to receive payments whenever short-term rates rise above a level established at the time of purchase. They normally are used to hedge against rising short-term interest rates.
Both instruments may be volatile and of limited liquidity and their use may adversely affect a fund's total return.
The Funds may invest in other types of derivative instruments as they become available.
There are, of course, other types of municipal securities that are, or may become, available, and the Funds reserve the right to invest in them.
For the purpose of the Funds' investment restrictions, the identification of the "issuer" of municipal securities which are not general obligation bonds is made by the Funds' investment manager, T. Rowe Price, on the basis of the characteristics of the obligation as described above, the most significant of which is the source of funds for the payment of principal and interest on such securities.
When-Issued Securities
New issues of municipal securities are often offered on a when-issued basis; that is, delivery and payment for the securities normally takes place 15 to 45 days or more after the date of the commitment to purchase. The payment obligation and the interest rate that will be received on the securities are each fixed at the time the buyer enters into the commitment. A Fund will only make a commitment to purchase such securities with the intention of actually acquiring the securities. However, a Fund may sell these securities before the settlement date if it is deemed advisable as a matter of investment strategy. Each Fund will maintain cash and/or high-grade marketable debt securities with its custodian bank equal in value to commitments for when-issued securities. Such securities either will mature or, if necessary, be sold on or before the settlement date. Securities purchased on a when-issued basis and the securities held in a Fund's portfolio are subject to changes in market value based upon the public perception of the creditworthiness of the issuer and changes in the level of interest rates (which will generally result in similar changes in value; i.e., both experiencing appreciation when interest rates decline and depreciation when interest rates rise). Therefore, to the extent a Fund remains fully invested or almost fully invested at the same time that it has purchased securities on a when-issued basis, there will be greater fluctuations in its net asset value than if it solely set aside cash to pay for when-issued securities. In the case of the Money Fund, this could increase the possibility that the market value of the Fund's assets could vary from $1.00 per share. In addition, there will be a greater potential for the realization of capital gains, which are not exempt from federal income tax. When the time comes to pay for when-issued securities, a Fund will meet its obligations from then-available cash flow, sale of securities or, although it would not normally expect to do so, from sale of the when-issued securities themselves (which may have a value greater or less than the payment obligation). The policies described in this paragraph are not fundamental and may be changed by a Fund upon notice to its shareholders.
Forwards
(Bond Funds)
The Funds may purchase bonds on a when-issued basis
with longer than standard settlement dates, in some cases
exceeding one to two years. In such cases, the Funds must
execute a receipt evidencing the obligation to purchase the bond
on the specified issue date, and must segregate cash internally
to meet that forward commitment. Municipal "forwards" typically
carry a substantial yield premium to compensate the buyer for the
risks associated with a long when-issued period, including:
shifts in market interest rates that could materially impact the
principal value of the bond, deterioration in the credit quality
of the issuer, loss of alternative investment options during the
when-issued period, changes in tax law or issuer actions that
would affect the exempt interest status of the bonds and prevent
delivery, failure of the issuer to complete various steps
required to issue the bonds, and limited liquidity for the buyer
to sell the escrow receipts during the when-issued period.
Investment in Taxable Money Market Securities
Although the Funds expect to be solely invested in municipal securities, for temporary defensive purposes they may elect to invest in the taxable money market securities listed below (without limitation) when such action is deemed to be in the best interests of shareholders. The interest earned on these money market securities is not exempt from federal income tax and may be taxable to shareholders as ordinary income.
U.S. Government Obligations - direct obligations of the government and its agencies and instrumentalities;
U.S. Government Agency Securities - obligations issued or guaranteed by U.S. government sponsored enterprises, federal agencies, and international institutions. Some of these securities are supported by the full faith and credit of the U.S. Treasury; others are supported by the right of the issuer; and the remainder are supported only by the credit of the instrumentality;
Bank Obligations - certificates of deposit, bankers' acceptances, and other short-term obligations of U.S. and Canadian banks and their foreign branches;
Commercial Paper - paper rated A-2 or better by S&P, Prime-2 or better by Moody's, or F-2 or better by Fitch, or, if not rated, is issued by a corporation having an outstanding debt issue rated A or better by Moody's, S&P or Fitch and, with respect to the Money Fund, is of equivalent investment quality as determined by the Board of Directors; and
Short-Term Corporate Debt Securities - short-term corporate debt securities rated at least AA by S&P, Moody's or Fitch.
Determination of Maturity of Money Market Securities
The Money Fund may only purchase securities which at the time of investment have remaining maturities of 397 calendar days or less, or with respect to U.S. government securities, have remaining maturities of 762 calendar days or less. The other Funds may also purchase money-market securities. In determining the maturity of money market securities, the Funds will follow the povisions of Rule 2a-7 under the Investment Company Act of 1940.
Futures Contracts
Bond Funds (Throughout the discussion on Futures Contracts, the Funds are referred to as "the Fund")
Transactions in Futures
The Fund may enter into interest rate futures contracts ("futures" or "futures contracts"). Interest rate futures contracts may be used as a hedge against changes in prevailing levels of interest rates in order to establish more definitely the effective return on securities held or intended to be acquired by the Fund. The Fund could sell interest rate futures as an offset against the effect of expected increases in interest rates and purchase such futures as an offset against the effect of expected declines in interest rates. Futures can also be used as an efficient means of regulating a Fund's exposure to the market.
The Fund will enter into futures contracts which are traded on national futures exchanges and are standardized as to maturity date and underlying financial instrument. A public market exists in futures contracts covering various taxable fixed income securities as well as municipal bonds. Futures exchanges and trading in the United States are regulated under the Commodity Exchange Act by the Commodity Futures Trading Commission ("CFTC"). Although techniques other than the sale and purchase of futures contracts could be used for the above- referenced purposes, futures contracts offer an effective and relatively low cost means of implementing the Fund's objectives in these areas.
Regulatory Limitations
The Fund will engage in futures contracts and options thereon only for bona fide hedging, yield enhancement, and risk management purposes, in each case in accordance with rules and regulations of the CFTC and applicable state law.
The Fund may not purchase or sell futures contracts or related options if, with respect to positions which do not quality as bona fide hedging under applicable CFTC rules, the sum of the amounts of initial margin deposits and premiums paid on those positions would exceed 5% of the net asset value of the Fund after taking into account unrealized profits and unrealized losses on any such contracts it has entered into; provided, however, that in the case of an option that is in-the-money at the time of purchase, the in-the-money amount may be excluded in calculating the 5% limitation. For purposes of this policy, options on futures contracts traded on a commodities exchange will be considered "related options." This policy may be modified by the Board of Directors without a shareholder vote and does not limit the percentage of the Fund's assets at risk to 5%.
In accordance with the rules of the State of California, the Fund will apply the above 5% test without excluding the value of initial margin and premiums paid for bona fide hedging purposes.
The Fund's use of futures will not result in leverage. Therefore, to the extent necessary, in instances involving the purchase of futures contracts or the writing of calls or put options thereon by the Fund, an amount of cash, U.S. government securities or other liquid, high-grade debt obligations, equal to the market value of the futures contracts and options thereon (less any related margin deposits), will be identified in an account with the Fund's custodian to cover the position, or alternative cover (such as owning an offsetting position) will be employed. Assets used as cover or held in an identified account cannot be sold while the position in the corresponding option or future is open, unless they are replaced with similar assets. As a result, the commitment of a large portion of a Fund's assets to cover or identified accounts could impede portfolio management or the Fund's ability to meet redemption requests or other current obligations.
If the CFTC or other regulatory authorities adopt different (including less stringent) or additional restrictions, the Fund would comply with such new restrictions.
Trading in Futures Contracts
A futures contract provides for the future sale by one party and purchase by another party of a specified amount of a specific financial instrument (e.g., units of a debt security) for a specified price, date, time and place designated at the time the contract is made. Brokerage fees are
incurred when a futures contract is bought or sold and margin deposits must be maintained. Entering into a contract to buy is commonly referred to as buying or purchasing a contract or holding a long position. Entering into a contract to sell is commonly referred to as selling a contract or holding a short position.
It is possible that the Fund's hedging activities will occur primarily through the use of municipal bond index futures contracts since the uniqueness of that index contract should better correlate with the Fund's portfolio and thereby be more effective. However, there may be times when it is deemed in the best interest of shareholders to engage in the use of Treasury bond futures, and the Fund reserves to right to use Treasury bond futures at any time. Use of these futures could occur, as an example, when both the Treasury bond contract and municipal bond index futures contract are correlating well with municipal bond prices, but the Treasury bond contract is trading at a more advantageous price making the hedge less expensive with the Treasury bond contract than would be obtained with the municipal bond index futures contract. The Fund's activity in futures contracts generally will be limited to municipal bond index futures contracts and Treasury bond and note contracts.
Unlike when the Fund purchases or sells a security, no price would be paid or received by the Fund upon the purchase or sale of a futures contract. Upon entering into a futures contract, and to maintain the Fund's open positions in futures contracts, the Fund would be required to deposit with its custodian in a segregated account in the name of the futures broker an amount of cash, U.S. government securities, suitable money market instruments, or liquid, high-grade debt securities, known as "initial margin." The margin required for a particular futures contract is set by the exchange on which the contract is traded, and may be significantly modified from time to time by the exchange during the term of the contract. Futures contracts are customarily purchased and sold on margins that may range upward from less than 5% of the value of the contract being traded.
If the price of an open futures contract changes (by increase in the case of a sale or by decrease in the case of a purchase) so that the loss on the futures contract reaches a point at which the margin on deposit does not satisfy margin requirements, the broker will require an increase in the margin. However, if the value of a position increases because of favorable price changes in the futures contract so that the margin deposit exceeds the required margin, the broker will pay the excess to the Fund.
These subsequent payments, called "variation margin," to and from the futures broker, are made on a daily basis as the price of the underlying assets fluctuate making the long and short positions in the futures contract more or less valuable, a process known as "marking to the market." The Fund expects to earn interest income on its margin deposits.
Although certain futures contracts, by their terms, require actual future delivery of and payment for the underlying instruments, in practice most futures contracts are usually closed out before the delivery date. Closing out an open futures contract purchase or sale is effected by entering into an offsetting futures contract sale or purchase, respectively, for the same aggregate amount of the identical securities and the same delivery date. If the offsetting purchase price is less than the original sale price, the Fund realizes a gain; if it is more, the Fund realizes a loss. Conversely, if the offsetting sale price is more than the original purchase price, the Fund realizes a gain; if it is less, the Fund realizes a loss. The transaction costs must also be included in these calculations. There can be
no assurance, however, that the Fund will be able to enter into an offsetting transaction with respect to a particular futures contract at a particular time. If the Fund is not able to enter into an offsetting transaction, the Fund will continue to be required to maintain the margin deposits on the futures contract.
As an example of an offsetting transaction in which the underlying instrument is not delivered, the contractual obligations arising from the sale of one contract of September municipal bond index futures on an exchange may be fulfilled at any time before delivery of the contract is required (i.e., on a specified date in September, the "delivery month") by the purchase of one contract of September municipal bond index futures on the same exchange. In such instance, the difference between the price at which the futures contract was sold and the price paid for the offsetting purchase, after allowance for transaction costs, represents the profit or loss to the Fund.
Special Risks of Transactions in Futures Contracts
Volatility and Leverage. The prices of futures contracts are volatile and are influenced, among other things, by actual and anticipated changes in the market and interest rates, which in turn are affected by fiscal and monetary policies and national and international political and economic events.
Most United States futures exchanges limit the amount of fluctuation permitted in futures contract prices during a single trading day. The daily limit establishes the maximum amount that the price of a futures contract may vary either up or down from the previous day's settlement price at the end of a trading session. Once the daily limit has been reached in a particular type of futures contract, no trades may be made on that day at a price beyond that limit. The daily limit governs only price movement during a particular trading day and therefore does not limit potential losses, because the limit may prevent the liquidation of unfavorable positions. Futures contract prices have occasionally moved to the daily limit for several consecutive trading days with little or no trading, thereby preventing prompt liquidation of futures positions and subjecting some futures traders to substantial losses.
Because of the low margin deposits required, futures trading involves an extremely high degree of leverage. As a result, a relatively small price movement in a futures contract may result in immediate and substantial loss, as well as gain, to the investor. For example, if at the time of purchase, 10% of the value of the futures contract is deposited as margin, a subsequent 10% decrease in the value of the futures contract would result in a total loss of the margin deposit, before any deduction for the transaction costs, if the account were then closed out. A 15% decrease would result in a loss equal to 150% of the original margin deposit, if the contract were closed out. Thus, a purchase or sale of a futures contract may result in losses in excess of the amount invested in the futures contract. However, the Fund would presumably have sustained comparable losses if, instead of the futures contract, it had invested in the underlying financial instrument and sold it after the decline. Furthermore, in the case of a futures contract purchase, in order to be certain that the Fund has sufficient assets to satisfy its obligations under a futures contract, the Fund earmarks to the futures contract money market instruments equal in value to the current value of the underlying instrument less the margin deposit.
Liquidity. The Fund may elect to close some or all of its futures positions at any time prior to their expiration. The Fund would do so to reduce exposure represented by long futures positions or short futures positions. The Fund may close its positions by taking opposite positions which would operate to terminate the Fund's position in the futures contracts. Final determinations of variation margin would then be made, additional cash would be required to be paid by or released to the Fund, and the Fund would realize a loss or a gain.
Futures contracts may be closed out only on the exchange or board of trade where the contracts were initially traded. Although the Fund intends to purchase or sell futures contracts only on exchanges or boards of trade where there appears to be an active market, there is no assurance that a liquid market on an exchange or board of trade will exist for any particular contract at any particular time. In such event, it might not be possible to close a futures contract, and in the event of adverse price movements, the Fund would continue to be required to make daily cash payments of variation margin. However, in the event futures contracts have been used to hedge the
underlying instruments, the Fund would continue to hold the underlying instruments subject to the hedge until the futures contracts could be terminated. In such circumstances, an increase in the price of underlying instruments, if any, might partially or completely offset losses on the futures contract. However, as described below, there is no guarantee that the price of the underlying instruments will, in fact, correlate with the price movements in the futures contract and thus provide an offset to losses on a futures contract.
Hedging Risk. A decision of whether, when, and how to hedge involves skill and judgment, and even a well-conceived hedge may be unsuccessful to some degree because of unexpected market behavior, market or interest rate trends. There are several risks in connection with the use by the Fund of futures contracts as a hedging device. One risk arises because of the imperfect correlation between movements in the prices of the futures contracts and movements in the prices of the underlying instruments which are the subject of the hedge. T. Rowe Price will, however, attempt to reduce this risk by entering into futures contracts whose movements, in its judgment, will have a significant correlation with movements in the prices of the Fund's underlying instruments sought to be hedged.
Successful use of futures contracts by the Fund for hedging purposes is also subject to T. Rowe Price's ability to correctly predict movements in the direction of the market. It is possible that, when the Fund has sold futures to hedge its portfolio against a decline in the market, the index, indices, or instruments underlying futures are written might advance and the value of the underlying instruments held in the Fund's portfolio might decline. If this were to occur, the Fund would lose money on the futures and also would experience a decline in value in its underlying instruments. However, while this might occur to a certain degree, T. Rowe Price believes that over time the value of the Fund's portfolio will tend to move in the same direction as the market indices used to hedge the portfolio. It is also possible that if the Fund were to hedge against the possibility of a decline in the market (adversely affecting the underlying instruments held in its portfolio) and prices instead increased, the Fund would lose part or all of the benefit of increased value of those underlying instruments that it has hedged, because it would have offsetting losses in its futures positions. In addition, in such situations, if the Fund had insufficient cash, it might have to sell underlying instruments to meet daily variation margin requirements. Such sales of underlying instruments might be, but would not necessarily be, at increased prices (which would reflect the rising market). The Fund might have to sell underlying instruments at a time when it would be disadvantageous to do so.
In addition to the possibility that there might be an imperfect correlation, or no correlation at all, between price movements in the futures contracts and the portion of the portfolio being hedged, the price movements of futures contracts might not correlate perfectly with price movements in the underlying instruments due to certain market distortions. First, all participants in the futures market are subject to margin deposit and maintenance requirements. Rather than meeting additional margin deposit requirements, investors might close futures contracts through offsetting transactions, which could distort the normal relationship between the underlying instruments and futures markets. Second, the margin requirements in the futures market are less onerous than margin requirements in the securities markets, and as a result the futures market might attract more speculators than the securities markets do. Increased participation by speculators in the futures market might also cause temporary price distortions. Due to the possibility of price distortion in the futures market
and also because of the imperfect correlation between price movements in the underlying instruments and movements in the prices of futures contracts, even a correct forecast of general market trends by T. Rowe Price might not result in a successful hedging transaction over a very short time period.
Options on Futures Contracts
The Fund might trade in municipal bond index option futures or similar options on futures developed in the future. In addition, the Fund may also trade in options on futures contracts on U.S. government securities and any U.S. government securities futures index contract which might be developed. In the opinion of T. Rowe Price, there is a high degree of correlation in the interest rate, and price movements of U.S. government securities and municipal securities. However, the U.S. government securities market and municipal securities markets are independent and may not move in tandem at any point in time.
The Fund will purchase put options on futures contracts to hedge its portfolio of municipal securities against the risk of rising interest rates, and the consequent decline in the prices of the municipal securities it owns. The Funds will also write call options on futures contracts as a hedge against a modest decline in prices of the municipal securities held in the Fund's portfolio. If the futures price at expiration of a written call option is below the exercise price, the Fund will retain the full amount of the option premium, thereby partially hedging against any decline that may have occurred in the Fund's holdings of debt securities. If the futures price when the option is exercised is above the exercise price, however, the Fund will incur a loss, which may be wholly or partially offset by the increase of the value of the securities in the Fund's portfolio which were being hedged.
Writing a put option on a futures contract serves as a partial hedge against an increase in the value of securities the Fund intends to acquire. If the futures price at expiration of the option is above the exercise price, the Fund will retain the full amount of the option premium which provides a partial hedge against any increase that may have occurred in the price of the debt securities the Fund intends to acquire. If the futures price when the option is exercised is below the exercise price, however, the Fund will incur a loss, which may be wholly or partially offset by the decrease in the price of the securities the Fund intends to acquire.
Options on futures are similar to options on underlying instruments except that options on futures give the purchaser the right, in return for the premium paid, to assume a position in a futures contract (a long position if the option is a call and a short position if the option is a put), rather than to purchase or sell the futures contract, at a specified exercise price at any time during the period of the option. Upon exercise of the option, the delivery of the futures position by the writer of the option to the holder of the option will be accompanied by delivery of the accumulated balance in the writer's futures margin account which represents the amount by which the market price of the futures contract, at exercise, exceeds (in the case of a call) or is less than (in the case of a put) the exercise price of the option on the futures contract. Purchasers of options who fail to exercise their options prior to the exercise date suffer a loss of the premium paid.
From time to time a single order to purchase or sell futures contracts (or options thereon) may be made on behalf of the Fund and other T.
Rowe Price Funds. Such aggregated orders would be allocated among the Fund and the other T. Rowe Price Funds in a fair and non-discriminatory manner.
Special Risks of Transactions in Options on Futures Contracts
The risks described under "Special Risks of Transactions on Futures Contracts" are substantially the same as the risks of using options on futures. In addition, where the Fund seeks to close out an option position by writing or buying an offsetting option covering the same index, underlying instrument or contract and having the same exercise price and expiration date, its ability to establish and close out positions on such options will be subject to the maintenance of a liquid secondary market. Reasons for the absence of a liquid secondary market on an exchange include the following: (i) there may be insufficient trading interest in certain options; (ii) restrictions may be imposed by an exchange on opening transactions or closing transactions or both; (iii) trading halts, suspensions or other restrictions may be imposed with respect to particular classes or series of options, or underlying instruments; (iv) unusual or unforeseen circumstances may interrupt normal operations on an exchange; (v) the facilities of an exchange or a clearing corporation may not at all times be adequate to handle current trading volume; or (vi) one or more exchanges could, for economic or other reasons, decide or be compelled at some future date to discontinue the trading of options (or a particular class or series of options), in which event the secondary market on that exchange (or in the class or series of options) would cease to exist, although outstanding options on the exchange that had been issued by a clearing corporation as a result of trades on that exchange would continue to be exercisable in accordance with their terms. There is no assurance that higher than anticipated trading activity or other unforeseen events might not, at times, render certain of the facilities of any of the clearing corporations inadequate, and thereby result in the institution by an exchange of special procedures which may interfere with the timely execution of customers' orders. In the event no such market exists for a particular contract in which the Fund maintains a position, in the case of a written option, the Fund would have to wait to sell the underlying securities or futures positions until the option expires or is exercised. The Fund would be required to maintain margin deposits on payments until the contract is closed. Options on futures are treated for accounting purposes in the same way as the analogous option on securities are treated.
In addition, the correlation between movements in the price of options on futures contracts and movements in the price of the securities hedged can only be approximate. This risk is significantly increased when an option on a U.S. government securities future or an option on a municipal securities index future is used to hedge a municipal bond portfolio. Another risk is that the movements in the price of options on futures contracts may not move inversely with changes in interest rates. If the Fund has written a call option on a futures contract and the value of the call increases by more than the increase in the value of the securities held as cover, the Fund may realize a loss on the call which is not completely offset by the appreciation in the price of the securities held as cover and the premium received for writing the call.
The successful use of options on futures contracts requires special expertise and techniques different from those involved in portfolio securities transactions. A decision of whether, when and how to hedge involves skill and judgment, and even a well-conceived hedge may be unsuccessful to some degree because of unexpected market behavior or interest rate trends. During periods when municipal securities market prices are
appreciating, the Fund may experience poorer overall performance than if it had not entered into any options on futures contracts.
General Considerations
Transactions by the Fund in options on futures will be subject to limitations established by each of the exchanges, boards of trade or other trading facilities governing the maximum number of options in each class which may be written or purchased by a single investor or group of investors acting in concert, regardless of whether the options are written on the same or different exchanges, boards of trade or other trading facilities or are held or written in one or more accounts or through one or more brokers. Thus, the number of contracts which the Fund may write or purchase may be affected by contracts written or purchased by other investment advisory clients of T. Rowe Price. An exchange, board of trade or other trading facility may order the liquidations of positions found to be in excess of these limits, and it may impose certain other sanctions.
Additional Futures and Options Contracts
Although the Fund has no current intention of engaging in futures or options transactions other than those described above, it reserves the right to do so. Such futures and options trading might involve risks which differ from those involved in the futures and options described above.
Federal Tax Treatment of Futures Contracts
Although the Fund invests almost exclusively in securities which generate income which is exempt from federal income taxes, the instruments described above are not exempt from such taxes. Therefore, use of the investment techniques described above could result in taxable income to shareholders of the Fund.
Generally, the Fund is required, for federal income tax purposes, to recognize as income for each taxable year its net unrealized gains and losses on futures contracts as of the end of the year as well as those actually realized during the year. Gain or loss recognized with respect to a futures contract will generally be 60% long-term capital gain or loss and 40% short- term capital gain or loss, without regard to the holding period of the contract.
Futures contracts which are intended to hedge against a change in the value of securities may be classified as "mixed straddles," in which case the recognition of losses may be deferred to a later year. In addition, sales of such futures contracts on securities may affect the holding period of the hedged security and, consequently, the nature of the gain or loss on such security on disposition.
In order for the Fund to continue to qualify for federal income tax treatment as a regulated investment company, at least 90% of its gross income for a taxable year must be derived from qualifying income; i.e., dividends, interest, income derived from loans of securities, and gains from the sale of securities. Gains realized on the sale or other disposition of securities, including futures contracts on securities held for less than three months, must be limited to less than 30% of the Fund's annual gross income. In order to avoid realizing excessive gains on securities held less than three months, the Fund may be required to defer the closing out of futures contracts beyond the time when it would otherwise be advantageous to do so. It is
anticipated that unrealized gains on futures contracts, which have been open for less than three months as of the end of the Fund's fiscal year and which are recognized for tax purposes, will not be considered gains on securities held less than three months for purposes of the 30% test.
The Fund will distribute to shareholders annually any net gains which have been recognized for federal income tax purposes from futures transactions (including unrealized gains at the end of the Fund's fiscal year). Such distributions will be combined with distributions of ordinary income or capital gains realized on the Fund's other investments. Shareholders will be advised of the nature of the payments. The Fund's ability to enter into transactions in options on futures contracts may be limited by the Internal Revenue Code's requirements for qualification as a regulated investment company.
Options on Securities
Bond Funds
The Funds have no current intention of investing in options on securities, although they reserve the right to do so. Appropriate disclosure would be added to the Funds' prospectus and Statement of Additional Information when and if the Funds decide to invest in options.
INVESTMENT RESTRICTIONS
All Funds
Fundamental policies may not be changed without the approval of the lesser of (1) 67% of a Fund's shares present at a meeting of shareholders if the holders of more than 50% of the outstanding shares are present in person or by proxy or (2) more than 50% of a Fund's outstanding shares. Other restrictions in the form of operating policies are subject to change by a Fund's Board of Directors without shareholder approval. Any investment restriction which involves a maximum percentage of securities or assets shall not be considered to be violated unless an excess over the percentage occurs immediately after, and is caused by, an acquisition of securities or assets of, or borrowings by, a Fund.
Fundamental Policies
As a matter of fundamental policy, the Fund may not:
(1) Borrowing. Borrow money except that the Fund may (i) borrow for non-leveraging, temporary or emergency purposes and (ii) engage in reverse repurchase agreements and make other investments or engage in other transactions, which may involve a borrowing, in a manner consistent with the Fund's investment objective and program, provided that the combination of (i) and (ii) shall not exceed 33 1/3% of the value of the Fund's total assets (including the amount borrowed) less liabilities (other than borrowings) or such other percentage permitted by law. Any borrowings which come to exceed this amount will be reduced in accordance with applicable law. The Fund may borrow from banks, other Price Funds or other persons to the extent permitted by applicable law.
(2) Commodities. Purchase or sell physical commodities; except that the Fund (other than the Money Fund) may enter into futures contracts and options thereon;
(3) Industry Concentration. Purchase the securities of any issuer if, as a result, more than 25% of the value of the Fund's total assets would be invested in the securities of issuers having their principal business activities in the same industry;
(4) Loans. Make loans, although the Fund may (i) lend portfolio securities and participate in an interfund lending program with other Price Funds provided that no such loan may be made if, as a result, the aggregate of such loans would exceed 33 1/3% of the value of the Fund's total assets; (ii) purchase money market securities and enter into repurchase agreements; and (iii) acquire publicly-distributed or privately-placed debt securities and purchase debt;
(5) Percent Limit on Assets Invested in Any One Issuer. Purchase a security if, as a result, with respect to 75% of the value of its total assets, more than 5% of the value of the Fund's total assets would be invested in the securities of a single issuer, except securities issued or guaranteed by the U.S. Government or any of its agencies or instrumentalities;
(6) Percent Limit on Share Ownership of Any One Issuer. Purchase a security if, as a result, with respect to 75% of the value of the Fund's total assets, more than 10% of the outstanding voting securities of any issuer would be held by the Fund (other than obligations issued or guaranteed by the U.S. Government, its agencies or instrumentalities);
(7) Real Estate. Purchase or sell real estate unless acquired as a result of ownership of securities or other instruments (but this shall not prevent the Fund from investing in securities or other instruments backed by real estate or securities of companies engaged in the real estate business);
(8) Senior Securities. Issue senior securities except in compliance with the Investment Company Act of 1940;
(9) Taxable Securities. During periods of normal market conditions, purchase any security if, as a result, less than 80% of the Fund's income would be exempt from federal income tax. The income from securities subject to the alternative minimum tax (AMT) is not counted when determining whether 80% of the Fund's income is exempt from federal income tax; or
(10) Underwriting. Underwrite securities issued by other persons, except to the extent that the Fund may be deemed to be an underwriter within the meaning of the Securities Act of 1933 in connection with the purchase and sale of its portfolio securities in the ordinary course of pursuing its investment program.
NOTES
The following Notes should be read in connection with the above-described fundamental policies. The Notes are not fundamental policies.
With respect to investment restrictions (1) and (4) the Fund will not borrow from or lend to any other T. Rowe Price Fund unless they apply for and receive an exemptive order from the SEC or the SEC issues rules permitting such transactions. The Fund has no current intention of engaging in any such activity and there is no assurance the SEC would grant any order requested by the Fund or promulgate any rules allowing the transactions.
With respect to investment restriction (1), the Money Fund has no current intention of engaging in any borrowing transactions.
With respect to investment restriction (2), the Fund does not consider hybrid instruments to be commodities.
For purposes of investment restriction (3), U.S., state or local governments, or related agencies or instrumentalities, are not considered an industry. Industrial development bonds issued by nongovernmental users are not considered municipal securities for purposes of this exception.
With respect to investment restriction (9), the income derived from securities subject to the alternative minimum tax does not count toward meeting this 80% test.
Operating Policies
As a matter of operating policy, the Fund may not:
(1) Borrowing. The Fund will not purchase additional securities when money borrowed exceeds 5% of its total assets.
(2) Control of Portfolio Companies. Invest in companies for the purpose of exercising management or control;
(3) Equity Securities. Purchase any equity security or security convertible into an equity security provided that the Fund (other than the Money Funds) may invest up to 10% of its total assets in equity securities which pay tax-exempt dividends and which are otherwise consistent with the Fund's investment objective and, further provided, that the Money Fund may invest up to 10% of its total assets in equity securities of other tax-free open-end money market funds;
(4) Futures Contracts. Purchase a futures contract or an option thereon if, with respect to positions in futures or options on futures which do not represent bona fide hedging, the aggregate initial margin and premiums on such positions would exceed 5% of the Fund's net asset value.
(5) Illiquid Securities. Purchase illiquid securities if, as a result, more than 15% (10% for the Money Fund) of its net assets would be invested in such securities;
(6) Investment Companies. Purchase securities of open- end or closed-end investment companies except in compliance with the Investment Company Act of 1940 and applicable state law provided that, the Money Fund may only purchase the securities of other open- end investment companies;
(7) Margin. Purchase securities on margin, except (i) for use of short-term credit necessary for clearance of purchases of portfolio securities and (ii) it may make margin deposits in connection with futures contracts or other permissible investments;
(8) Mortgaging. Mortgage, pledge, hypothecate or, in any manner, transfer any security owned by the Fund as security for indebtedness except as may be necessary in connection with permissible borrowings or investments and then such mortgaging, pledging or hypothecating may not exceed 33 1/3% of the Fund's total assets at the time of borrowing or investment;
(9) Oil and Gas Programs. Purchase participations or other direct interests or enter into leases with respect to, oil, gas, or other mineral exploration or development programs;
(10) Options, Etc. Invest in puts, calls, straddles, spreads, or any combination thereof, except to the extent permitted by the prospectus and Statement of Additional Information;
(11) Ownership of Portfolio Securities by Officers and Directors. Purchase or retain the securities of any issuer if, to the knowledge of the Fund's management, those officers and directors of the Fund, and of its investment manager, who each own beneficially more than .5% of the outstanding securities of such issuer, together own beneficially more than 5% of such securities.
(12) Short Sales. Effect short sales of securities;
(13) Unseasoned Issuers. Purchase a security (other than obligations issued or guaranteed by the U.S., any foreign, state or local government, their agencies or instrumentalities) if, as a result, more than 5% of the value of the Fund's total assets would be invested in the securities issuers which at the time of purchase had been in operation for less than three years (for this purpose, the period of operation of any issuer shall include the period of operation of any predecessor or unconditional guarantor of such issuer). This restriction does not apply to securities of pooled investment vehicles or mortgage or asset-backed securities; or
(14) Warrants. Invest in warrants if, as a result thereof, more than 2% of the value of the total assets of the Fund would be invested in warrants which are not listed on the New York Stock Exchange, the American Stock Exchange, or a recognized foreign exchange, or more than 5% of the value of the total assets of the Fund would be invested in warrants whether or not so listed. For purposes of these percentage limitations, the warrants will be valued at the lower of cost or market and warrants acquired by the Fund in units or attached to securities may be deemed to be without value.
For purposes of investment restriction (6), the Fund has no current intention of purchasing the securities of other investment companies. Duplicate fees could result from any such purchases.
For purposes of investment restriction (13), the Fund will not consider industrial development bonds issued by nongovernmental users as municipal securities.
RATINGS OF MUNICIPAL DEBT SECURITIES
Moody's Investors Service, Inc.
Aaa - Bonds rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk.
Aa - Bonds rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are
generally known as high grade bonds.
A - Bonds rated A possess many favorable investment attributes
and are to be considered as upper medium grade obligations.
Baa - Bonds rated Baa are considered as medium-grade obligations,
i.e., they are neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the
present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time.
Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.
Ba - Bonds rated Ba are judged to have speculative elements:
their future cannot be considered as well assured. Often the
protection of interest and principal payments may be very
moderate and thereby not well safeguarded during both good and
bad times over the future. Uncertainty of position characterize
bonds in this class.
B - Bonds rated B generally lack the characteristics of a
desirable investment. Assurance of interest and principal
payments or of maintenance of other terms of the contract over
any long period of time may be small.
Caa - Bonds rated Caa are of poor standing. Such issues may be
in default or there may be present elements of danger with
respect to principal or interest.
Ca - Bonds rated Ca represent obligations which are speculative
in a high degree. Such issues are often in default or have other
marked short-comings.
Standard & Poor's Corporation
AAA - This is the highest rating assigned by Standard & Poor's to a debt obligation and indicates an extremely strong capacity to pay principal and interest.
AA - Debt rated AA has a very strong capacity to pay principal
and interest and differs from highest rated issues only in a
small degree.
A - Bonds rated A have a strong capacity to pay principal and
interest, although they are somewhat more susceptible to the
adverse effects of changes in circumstances and economic
conditions.
BBB - Bonds rated BBB are regarded as having an adequate capacity
to pay principal and interest. Whereas they normally exhibit
adequate protection parameters, adverse economic conditions or
changing circumstances are more likely to lead to a weakened
capacity to pay principal and interest for bonds in this category
than for bonds in the A category.
BB, B, CCC, CC - Bonds rated BB, B, CCC, and CC are regarded on
balance, as predominantly speculative with respect to the
issuer's capacity to pay interest and repay principal. BB
indicates the lowest degree of speculation and CC the highest
degree of speculation. While such bonds will likely have some
quality and protective characteristics, these are outweighed by
large uncertainties or major risk exposures to adverse
conditions.
Fitch Investors Service, Inc.
AAA - Bonds rated AAA are considered to be investment grade and
of the highest credit quality. The obligor has an exceptionally
strong ability to pay interest and repay principal, which is
unlikely to be affected by reasonably foreseeable events.
AA - Bonds rated AA are considered to be investment grade and of
very high credit quality. The obligor's ability to pay interest
and repay principal is very strong, although not quite as strong
as bonds rated AAA. Because bonds rated in the AAA and AA
categories are not significantly vulnerable to foreseeable future
developments, short-term debt of these issuers is generally rate
F-1+.
A - Bonds rated A are considered to be investment grade and of
high credit quality. The obligor's ability to pay interest and
repay principal is considered to be strong, but may be more
vulnerable to adverse changes in economic conditions and
circumstances than bonds with higher ratings.
BBB - Bonds rated BBB are considered to be investment grade and
of satisfactory credit quality. The obligor's ability to pay
interest and repay principal is considered to be adequate.
Adverse changes in economic conditions and circumstances,
however, are more likely to have adverse impact on these bonds,
and therefore impair timely payment. The likelihood that the
ratings of these bonds will fall below investment grade is higher
than for bonds with higher ratings.
BB, B, CCC, CC, and C are regarded on balance as predominantly
speculative with respect to the issuer's capacity to repay
interest and repay principal in accordance with the terms of the
obligation for bond issues not in default. BB indicates the
lowest degree of speculation and C the highest degree of
speculation. The rating takes into consideration special
features of the issue, its relationship to other obligations of
the issuer, and the current and prospective financial condition
and operating performance of the issuer.
RATINGS OF MUNICIPAL NOTES AND VARIABLE RATE SECURITIES
MOODY'S INVESTORS SERVICE, INC. VMIG1/MIG-1: the best quality. VMIG2/MIG-2: high quality, with margins of protection ample though not so large as in the preceding group. VMIG3/MIG- 3: favorable quality, with all security elements accounted for, but lacking the undeniable strength of the preceding grades. Market access for refinancing, in particular, is likely to be less well established. VMIG4/MIG4: adequate quality but there is specific risk.
STANDARD & POOR'S CORPORATION. Note rating symbols are as
follows: SP-1: very strong or strong capacity to pay principal
and interest. Those issues determined to possess overwhelming
safety characteristics will be given a plus (+) designation. SP-
2: satisfactory capacity to pay interest and principal. SP-3:
speculative capacity to pay principal and interest.
FITCH INVESTORS SERVICE. F-1+: exceptionally strong credit
quality, strongest degree of assurance for timely payment. F-1:
Very strong credit quality. F-2: Good credit quality, having a
satisfactory degree of assurance for timely payment. F-3: Fair
credit quality, assurance for timely payment is adequate but
adverse changes could cause the securities to be rated below
investment grade. F-5: Weak credit quality, having
characteristics suggesting a minimal degree of assurance for
timely payment.
RATINGS OF COMMERCIAL PAPER
MOODY'S INVESTORS SERVICES, INC. P-1: superior capacity
for repayment. P-2: strong capacity for repayment. P-3:
acceptable capacity for repayment of short-term promissory
obligations.
STANDARD & POOR'S CORPORATION. A-1: highest category,
degree of safety regarding timely payment is strong. Those
issues determined to possess extremely strong safety
characteristics are denoted with a plus sign (+) designation. A-
2: satisfactory capacity to pay principal and interest. A-3:
adequate capacity for timely payment, but are vulnerable to
adverse effects of changes in circumstances than higher rated
issues. B and C: speculative capacity to pay principal and
interest.
FITCH INVESTORS SERVICE. F-1+: exceptionally strong credit
quality, strongest degree of assurance for timely payment. F-1:
Very strong credit quality. F-2: Good credit quality, having a
satisfactory degree of assurance for timely payment. F-3: Fair
credit quality, assurance for timely payment is adequate but
adverse changes could cause the securities to be rated below
investment grade. F-5: Weak credit quality, having
characteristics suggesting a minimal degree of assurance for
timely payment.
MANAGEMENT OF FUNDS
The officers and directors of each of the Funds are listed
below. Unless otherwise noted, the address of each is 100 East
Pratt Street, Baltimore, Maryland 21202. Except as indicated,
each has been an employee of T. Rowe Price for more than five
years. In the list below, the Funds' directors who are
considered "interested persons" of T. Rowe Price as defined under
Section 2(a)(19) of the Investment Company Act of 1940 are noted
with an asterisk (*). These directors are referred to as inside
directors by virtue of their officership, directorship, and/or
employment with T. Rowe Price.
ROBERT P. BLACK, Director--Retired; formerly President,
Federal Reserve Bank of
Richmond; Address: 10 Dahlgren Road, Richmond, Virginia
23233
CALVIN W. BURNETT, PH.D., Director--President, Coppin State
College; Director, Maryland
Chamber of Commerce and Provident Bank of Maryland;
President, Baltimore Area Council Boy Scouts of America;
Vice President, Board of Directors, The Walters Art
Gallery; Address: 2000 North Warwick Avenue, Baltimore,
Maryland 21216
@*GEORGE J. COLLINS, Chairman of the Board--President, Managing Director, and Chief
Executive Officer, T. Rowe Price; Director, Rowe
Price-Fleming International, Inc., T. Rowe Price Trust
Company and T. Rowe Price Retirement Plan Services, Inc.,
Chartered Investment Counselor
ANTHONY W. DEERING, Director--Director, President and Chief
Operating Officer, The
Rouse Company, real estate developers, Columbia, Maryland;
Advisory Director, Kleinwort, Benson (North America)
Corporation, a registered broker-dealer; Address: 10275
Little Patuxent Parkway, Columbia, Maryland 21044
F. PIERCE LINAWEAVER, Director--President, F. Pierce Linaweaver &
Associates, Inc.; formerly
(1987-1991) Executive Vice President, EA Engineering,
Science, and Technology, Inc., and (1987-1990) President,
EA Engineering, Inc., Baltimore, Maryland; Address: The
Legg Mason Tower, 111 South Calvert Street, Suite 2700,
Baltimore, Maryland 21202
+*MARY J. MILLER, President and Director--Managing Director, T.
Rowe Price
++*WILLIAM T. REYNOLDS, President and Director--Managing
Director, T. Rowe Price
@@*JAMES S. RIEPE, Vice President and Director--Managing
Director, T. Rowe Price; Chairman
of the Board, T. Rowe Price Services, Inc., T. Rowe Price
Retirement Plan Services, Inc. and T. Rowe Price Trust
Company; President and Director, T. Rowe Price Investment
Services, Inc.; Director, Rhone-Poulenc Rorer, Inc.
JOHN G. SCHREIBER, Director--President, Schreiber Investments, a
real estate investment
company; Director and formerly (1/80-12/90) Executive Vice
President, JMB Realty Corporation, a national real estate
investment manager and developer; Address: 1115 East
Illinois Road, Lake Forest, Illinois 60045
Anne Marie Whittemore, Director--Partner, law firm of McGuire,
Woods, Batte & Boothe;
formerly, Chairman and Director, Federal Reserve Bank of
Richmond; Director, Owens & Minor, Inc., USF&G Corporation,
Old Dominion University and nominated to the Board of James
River Corporation; Member, Richmond Bar Association and
American Bar Association; Address: One James Center, 901
East Cary Street, Richmond, Virginia 23219-4030
JANET G. ALBRIGHT, Vice President--Vice President, T. Rowe Price
+++PATRICE L. BERCHTENBREITER, Executive Vice President--Vice
President, T. Row Price
#C. STEPHEN WOLFE, II, Executive Vice President-- Vice President,
T. Rowe Price
##PAUL W. BOLTZ, Vice President--Vice President and Financial
Economist, T. Rowe Price
MICHAEL P. BUCKLEY, Vice President--Vice President, T. Rowe Price
PATRICIA S. DEFORD, Vice President--Vice President, T. Rowe Price
!CHARLES B. HILL, Vice President--Assistant Vice President, T.
Rowe Price; formerly (9/86-
11/91) managed municipal bonds at Riggs National Bank,
Washington, D.C.
CHARLES O. HOLLAND, Vice President--Vice President, T. Rowe Price
HENRY H. HOPKINS, Vice President--Managing Director, T. Rowe
Price; Vice President and
Director, T. Rowe Price Investment Services, Inc., T. Rowe
Price Services, Inc., and T. Rowe Price Trust Company; Vice
President, Rowe Price-Fleming International, Inc. and T.
Rowe Price Retirement Plan Services, Inc.; Director, ICI
Mutual Insurance Company
ALAN P. RICHMAN, Vice President--Vice President, T. Rowe Price;
formerly (10/89-6/91)
Manager, Public Finance, Credit Local de France, New York,
New York and Public Finance, Tokai Bank, New York, New York
LENORA V. HORNUNG, Secretary--Vice President, T. Rowe Price
CARMEN F. DEYESU, Treasurer--Vice President, T. Rowe Price, T.
Rowe Price Services, Inc.,
and T. Rowe Price Trust Company
DAVID S. MIDDLETON, Controller--Vice President, T. Rowe Price, T.
Rowe Price Services, Inc.,
and T. Rowe Price Trust Company
ROGER L. FIERY, Assistant Vice President--Vice President, Rowe
Price-Fleming International,
Inc.
!!KONSTANTINE B. MALLAS, Assistant Vice President--Assistant Vice
President, T. Rowe Price
!!!LAURA McAREE, Assistant Vice President--Assistant Vice
President, T. Rowe Price; formerly
(4/90-11/90) trader, Boeing Company, Seattle, Washington
and (8/87-3/90) financial analyst, Harvard Management
Company, Boston, Massachusetts
EDWARD T. SCHNEIDER, Assistant Vice President--Vice President, T.
Rowe Price Services, Inc.
INGRID I. VORDEMBERGE, Assistant Vice President--Employee, T.
Rowe Price
@ Mr. Collins is Chairman of the Board of the Money, Short-
Intermediate, Income, and High Yield Funds and a Director
of the Insured Intermediate Bond Fund.
@@ Mr. Riepe is a Vice President and Director of the Money,
Short-Intermediate, Income, and High Yield Funds and a
Director of Insured Intermediate Bond Fund.
+ Ms. Miller is President and Director of the Short-
Intermediate Fund only and a Vice President of the Money,
Insured Intermediate Bond, Income, and High Yield Funds.
++ Mr. Reynolds is President and Director of the Income,
Insured Intermediate Bond, and High Yield Funds, a Vice
President and Director of the Money Fund, and a Vice
President of the Short-Intermediate Fund.
+++ Ms. Berchtenbreiter is President of the Money Fund only and
a Vice President of the Short-Intermediate, Insured
Intermediate Bond, Income, and High Yield Funds.
# Mr. Wolfe is Executive Vice President of the High Yield
Fund only and a Vice President of the Money, Short-
Intermediate, Insured Intermediate Bond, and Income Funds.
## Mr. Boltz is a Vice President of the Money Fund only.
! Mr. Hill is a Vice President of the Short-Intermediate,
Insured Intermediate Bond, Income, and High Yield Funds.
!! Mr. Mallas is an Assistant Vice President of the Short-
Intermediate, Insured Intermediate Bond, Income, and High
Yield Funds.
!!! Ms. McAree is an Assistant Vice President of the Money and
Insured Intermediate Bond Funds only.
The Executive Committee of the Money, Income, and High Yield Funds, comprised of Messrs. Collins, Reynolds, and Riepe, the Executive Committee of the Short-Intermediate Fund, comprised of Mrs. Miller and Messrs. Collins and
Riepe, and the Executive Committee of the Insured Intermediate Bond Fund, comprised of Messrs. Collins and Riepe, have been authorized by their respective Board of Directors to exercise all powers of the Board to manage the Fund in the intervals between meetings of the Board, except the powers prohibited by statute from being delegated.
PRINCIPAL HOLDERS OF SECURITIES
As of the date of the prospectus, the officers and directors of the Funds, as a group, owned less than 1% of the outstanding shares of each Fund.
INVESTMENT MANAGEMENT SERVICES
Services Provided by T. Rowe Price
Under each Fund's Management Agreement, T. Rowe Price provides each Fund with discretionary investment services. Specifically, T. Rowe Price is responsible for supervising and directing the investments of each Fund in accordance with its investment objectives, programs, and restrictions as provided in the prospectus and this Statement of Additional Information. T. Rowe Price is also responsible for effecting all security transactions on behalf of each Fund, including the allocation of principal business and portfolio brokerage and the negotiation of commissions. In addition to these services, T. Rowe Price provides each Fund with certain corporate administrative services, including: maintaining the Fund's corporate existence, corporate records, and registering and qualifying the Fund's shares under federal and state laws; monitoring the financial, accounting, and administrative functions of each Fund; maintaining liaison with the agents employed by each Fund such as the Fund's custodian and transfer agent; assisting each Fund in the coordination of such agents' activities; and permitting T. Rowe Price's employees to serve as officers, directors, and committee members of each Fund without cost to the Fund.
Each Fund's Management Agreement also provides that T. Rowe Price, its directors, officers, employees, and certain other persons performing specific functions for the Fund will only be liable to the Fund for losses resulting from willful misfeasance, bad faith, gross negligence, or reckless disregard of duty.
Management Fee
Each Fund pays T. Rowe Price a fee ("Fee") which consists of two components: a Group Management Fee ("Group Fee") and an Individual Fund Fee ("Fund Fee"). The Fee is paid monthly to the T. Rowe Price on the first business day of the next succeeding calendar month and is calculated as described below.
The monthly Group Fee ("Monthly Group Fee") is the sum of the daily Group Fee accruals ("Daily Group Fee Accruals") for each month. The Daily Group Fee Accrual for any particular day is computed by multiplying the Price Funds' group fee accrual as determined below ("Daily Price Funds' Group Fee Accrual") by the ratio of the Fund's net assets for that day to the sum of the aggregate net assets of the Price Funds for that day. The Daily Price Funds' Group Fee Accrual for any particular day is calculated by multiplying the fraction of one (1) over the number of calendar days in the year by the annualized Daily Price Funds' Group Fee Accrual for that day as determined in accordance with the following schedule:
Price Funds'
0.480% First $1 billion 0.450% Next $1 billion 0.420% Next $1 billion 0.390% Next $1 billion 0.370% Next $1 billion 0.360% Next $2 billion 0.350% Next $2 billion 0.340% Next $5 billion 0.330% Next $10 billion 0.320% Next $10 billion 0.310% Thereafter |
For the purpose of calculating the Group Fee, the Price Funds include all the mutual funds distributed by T. Rowe Price Investment Services, Inc. (excluding T. Rowe Price Spectrum Fund, Inc. and any institutional or any private label mutual funds). For the purpose of calculating the Daily Price Funds' Group Fee Accrual for any particular day, the net assets of each Price Fund are determined in accordance with the Fund's prospectus as of the close of business on the previous business day on which the Fund was open for business.
The monthly Fund Fee ("Monthly Fund Fee") is the sum of the daily Fund Fee accruals ("Daily Fund Fee Accruals") for each month. The Daily Fund Fee Accrual for any particular day is computed by multiplying the fraction of one (1) over the number of calendar days in the year by the individual Fund Fee Rate and multiplying this product by the net assets of the Fund for that day, as determined in accordance with the Fund's prospectus as of the close of business on the previous business day on which the Fund was open for business. The individual fund fees for each Fund are listed in the chart below:
Individual Fund Fees
Money Fund 0.10%
Short-Intermediate Fund 0.10%
Insured Intermediate Bond Fund 0.05%
Income Fund 0.15%
High Yield 0.30%
|
Listed below are the total amounts paid to T. Rowe Price by the Money, Short-Intermediate, Income and High Yield Funds under the investment management contract which was in effect, for each of the last three fiscal years.
Insured
Short-IntermediateIntermediate High Yield
YearMoney Fund Fund Bond Fund Income Fund Fund
____ _______ ____________________________________ ________
1994 $ 3,132,000 $ 2,256,000 $ 9,000$
7,362,000 $ 5,954,000
1993 $ 3,404,000 $ 1,753,000 *$
6,609,000 $ 4,681,000
1992 $ 3,964,000 $ 1,308,000 *$
6,105,000 $ 3,809,000
|
* Due to the effect of the Insured Intermediate Bond Fund's expense limitation, for the fiscal periods ended February 28, 1993 and February 29, 1994, the Fund did not pay T. Rowe Price an investment management fee.
Limitation on Fund Expenses
The Management Agreement between each Fund and T. Rowe Price provides that each Fund will bear all expenses of its operations not specifically assumed by T. Rowe Price. However, in compliance with certain state regulations, T. Rowe Price will reimburse a Fund for any expenses (excluding interest, taxes, brokerage, other expenditures which are capitalized in accordance with generally accepted accounting principles, and extraordinary expenses) which in any year exceed the limits prescribed by any state in which a Fund's shares are qualified for sale. Presently, the most restrictive expense ratio limitation imposed by any state is 2.5% of the first $30 million of the Fund's average daily net assets, 2% of the next $70 million of such assets, and 1.5% of net assets in excess of $100 million.
Money, Short-Intermediate, Income, and High Yield Funds
For the purpose of determining whether a Fund is entitled to reimbursement, the expenses of a Fund are calculated on a monthly basis. If a Fund is entitled to reimbursement, that month's advisory fee will be reduced or postponed, with any adjustment made after the end of the year.
Insured Intermediate Bond Fund
Reimbursement by the Fund to T. Rowe Price of any expenses paid or assumed under a state expense limitation may not be made more than two years after the end of the fiscal year in which the expenses were paid or assumed.
The Management Agreement provides that T. Rowe Price may voluntarily agree to limit the expenses of the Fund. In the interest of limiting the expenses of the Fund during its initial period of operations, T. Rowe Price agreed to bear all expenses of the Fund through June 30, 1993. Thereafter, T. Rowe Price has agreed to bear any expenses through February 28, 1994, which would cause the Fund's ratio of expenses to average daily net assets to exceed 0.50%. Effective March 1, 1994, T. Rowe Price agreed to bear any expenses that would cause the Fund's ratio of expenses to average net assets to exceed 0.65%. Expenses paid or assumed under the second and third agreements are subject to reimbursement to T. Rowe Price by the Fund whenever its expense ratio is below 0.50% or 0.65%, respectively; however, no reimbursement will be made after February 29, 1996 (for the second agreement) or February 28, 1998 (for the third agreement), or if it would result in the expense ratio exceeding 0.50% or 0.65%, respectively.
DISTRIBUTOR FOR FUNDS
T. Rowe Price Investment Services, Inc. ("Investment Services"), a Maryland corporation formed in 1980 as a wholly- owned subsidiary of T. Rowe Price, serves as the distributor of the Funds. Investment Services is registered as a broker-dealer under the Securities Exchange Act of 1934 and is a member of the National Association of Securities Dealers, Inc. The offering of each Fund's shares is continuous.
Investment Services is located at the same address as the Funds and T. Rowe T. Rowe Price -- 100 East Pratt Street, Baltimore, Maryland 21202.
Investment Services serves as distributor to the Funds pursuant to individual Underwriting Agreements ("Underwriting Agreements"), which provide that each Fund will pay all fees and expenses in connection with: registering and qualifying its shares under the various state "blue sky" laws; preparing, setting in type, printing, and mailing its prospectuses and reports to shareholders; and issuing its shares, including expenses of confirming purchase orders.
The Underwriting Agreements provide that Investment
Services will pay all fees and expenses in connection with:
printing and distributing prospectuses and reports for use in
offering and selling shares for each Fund; preparing, setting in
type, printing, and mailing all sales literature and advertising;
Investment Services' federal and state registrations as a
broker-dealer; and offering and selling shares for each Fund,
except for those fees and expenses specifically assumed by the
Funds. Investment Services' expenses are paid by T. Rowe Price.
Investment Services acts as the agent of the Funds in connection with the sale of their shares in all states in which the shares are qualified and in which Investment Services is qualified as a broker-dealer. Under the Underwriting Agreement, Investment Services accepts orders for Fund shares at net asset value. No sales charges are paid by investors or the Funds.
CUSTODIAN
State Street Bank and Trust Company is the custodian for each Fund's securities and cash, but it does not participate in the Funds' investment decisions. The Funds have authorized the Bank to deposit certain portfolio securities in central depository systems as allowed by federal law. In addition, the Funds are authorized to maintain certain of their securities, in particular variable rate demand notes in uncertificated form in the proprietary deposit systems of various dealers in municipal securities. The Bank's main office is 225 Franklin Street, Boston, Massachusetts 02107.
PORTFOLIO TRANSACTIONS
Investment or Brokerage Discretion
Decisions with respect to the purchase and sale of portfolio securities on behalf of the Fund are made by T. Rowe Price. T. Rowe Price is also responsible for implementing these decisions, including the negotiation of commissions and the allocation of portfolio brokerage and principal business. The Fund's purchases and sales of portfolio securities are normally done on a principal basis and do not involve the payment of a commission although they may involve the designation of selling concessions. That part of the discussion below relating solely to brokerage commissions would not normally apply to the Funds. However, it is included because T. Rowe Price does manage a significant number of common stock portfolios which do engage in agency transactions and pay commissions and because some research and services resulting from the payment of such commissions may benefit the Fund.
How Brokers and Dealers are Selected
Fixed Income Securities
Fixed income securities are generally purchased from the issuer or a primary market-maker acting as principal for the securities on a net basis, with no brokerage commission being paid by the client although the price usually includes an undisclosed compensation. Transactions placed through dealers serving as primary market-makers reflect the spread between the bid and asked prices. Securities may also be purchased from underwriters at prices which include underwriting fees.
T. Rowe Price may effect principal transactions on behalf of the Fund with a broker or dealer who furnishes brokerage and/or research services, designate any such broker or dealer to receive selling concessions, discounts or other allowances, or otherwise deal with any such broker or dealer in connection with the acquisition of securities in underwritings. T. Rowe Price may receive brokerage and research services in connection with such designations in fixed price underwritings.
How Evaluations are Made of the Overall Reasonableness of Brokerage Commissions Paid
On a continuing basis, T. Rowe Price seeks to determine
what levels of commission rates are reasonable in the marketplace
for transactions executed on behalf of the Fund. In evaluating
the reasonableness of commission rates, T. Rowe Price considers:
(a) historical commission rates, both before and since rates have
been fully negotiable; (b) rates which other institutional
investors are paying, based on available public information; (c)
rates quoted by brokers and dealers; (d) the size of a particular
transaction, in terms of the number of shares, dollar amount, and
number of clients involved; (e) the complexity of a particular
transaction in terms of both execution and settlement; (f) the
level and type of business done with a particular firm over a
period of time; and (g) the extent to which the broker or dealer
has capital at risk in the transaction.
Description of Research Services Received from Brokers and Dealers
T. Rowe Price receives a wide range of research services from brokers and dealers. These services include information on the economy, industries, groups of securities, individual companies, statistical information, accounting and tax law interpretations, political developments, legal developments affecting portfolio securities, technical market action, pricing and appraisal services, credit analysis, risk measurement analysis, performance analysis and analysis of corporate responsibility issues. These services provide both domestic and international perspective. Research services are received primarily in the form of written reports, computer generated services, telephone contacts and personal meetings with security analysts. In addition, such services may be provided in the form of meetings arranged with corporate and industry spokespersons, economists, academicians and government representatives. In some cases, research services are generated by third parties but are provided to T. Rowe Price by or through broker-dealers.
Research services received from brokers and dealers are supplemental to T. Rowe Price's own research effort and, when utilized, are subject to internal analysis before being incorporated by T. Rowe Price into its investment process. As a practical matter, it would not be possible for T. Rowe Price's Equity Research Division to generate all of the information presently provided by brokers and dealers. T. Rowe Price pays cash for certain research services received from external sources. T. Rowe Price also allocates brokerage for research services which are available for cash. While receipt of research services from brokerage firms has not reduced T. Rowe Price's normal research activities, the expenses of T. Rowe Price could be
materially increased if it attempted to generate such additional information through its own staff. To the extent that research services of value are provided by brokers or dealers, T. Rowe Price may be relieved of expenses which it might otherwise bear.
T. Rowe Price has a policy of not allocating brokerage
business in return for products or services other than brokerage
or research services. In accordance with the provisions of
Section 28(e) of the Securities Exchange Act of 1934, T. Rowe
Price may from time to time receive services and products which
serve both research and non-research functions. In such event,
T. Rowe Price makes a good faith determination of the anticipated
research and non-research use of the product or service and
allocates brokerage only with respect to the research component.
Commissions to Brokers who Furnish Research Services
Certain brokers and dealers who provide quality brokerage and execution services also furnish research services to T. Rowe Price. With regard to the payment of brokerage commissions, T. Rowe Price has adopted a brokerage allocation policy embodying the concepts of Section 28(e) of the Securities Exchange Act of 1934, which permits an investment adviser to cause an account to pay commission rates in excess of those another broker or dealer would have charged for effecting the same transaction, if the adviser determines in good faith that the commission paid is reasonable in relation to the value of the brokerage and research services provided. The determination may be viewed in terms of either the particular transaction involved or the overall responsibilities of the adviser with respect to the accounts over which it exercises investment discretion. Accordingly, while T. Rowe Price cannot readily determine the extent to which commission rates or net prices charged by broker- dealers reflect the value of their research services, T. Rowe Price would expect to assess the reasonableness of commissions in light of the total brokerage and research services provided by each particular broker. T. Rowe Price may receive research, as defined in Section 28(e), in connection with selling concessions and designations in fixed price offerings in which the Funds participate.
Internal Allocation Procedures
T. Rowe Price has a policy of not precommitting a specific amount of business to any broker or dealer over any specific time period. Historically, the majority of brokerage placement has been determined by the needs of a specific transaction such as market-making, availability of a buyer or seller of a particular security, or specialized execution skills.
However, T. Rowe Price does have an internal brokerage allocation procedure for that portion of its discretionary client brokerage business where special needs do not exist, or where the business may be allocated among several brokers or dealers which are able to meet the needs of the transaction.
Each year, T. Rowe Price assesses the contribution of the brokerage and research services provided by brokers or dealers, and attempts to allocate a portion of its brokerage business in response to these assessments. Research analysts, counselors, various investment committees, and the Trading Department each seek to evaluate the brokerage and research services they receive from brokers or dealers and make judgments as to the level of business which would recognize such services. In addition, brokers or dealers sometimes suggest a level of business they would like to receive in return for the various brokerage and research services they provide. Actual brokerage received by any firm may be less than the suggested allocations but can, and often does, exceed the suggestions, because the total business is
allocated on the basis of all the considerations described above.
In no case is a broker or dealer excluded from receiving business from T. Rowe Price because it has not been identified as providing research services.
Miscellaneous
T. Rowe Price's brokerage allocation policy is consistently applied to all its fully discretionary accounts, which represent a substantial majority of all assets under management. Research services furnished by brokers or dealers through which T. Rowe Price effects securities transactions may be used in servicing all accounts (including non-Fund accounts) managed by T. Rowe Price. Conversely, research services received from brokers or dealers which execute transactions for the Fund are not necessarily used by T. Rowe Price exclusively in connection with the management of the Fund.
From time to time, orders for clients may be placed through a computerized transaction network.
The Fund does not allocate business to any broker- dealer on the basis of its sales of the Fund's shares. However, this does not mean that broker-dealers who purchase Fund shares for their clients will not receive business from the Fund.
Some of T. Rowe Price's other clients have investment objectives and programs similar to those of the Fund. T. Rowe Price may occasionally make recommendations to other clients which result in their purchasing or selling securities simultaneously with the Fund. As a result, the demand for securities being purchased or the supply of securities being sold may increase, and this could have an adverse effect on the price of those securities. It is T. Rowe Price's policy not to favor one client over another in making recommendations or in placing orders. T. Rowe Price frequently follows the practice of grouping orders of various clients for execution which generally results in lower commission rates being attained. In certain cases, where the aggregate order is executed in a series of transactions at various prices on a given day, each participating client's proportionate share of such order reflects the average price paid or received with respect to the total order. T. Rowe Price has established a general investment policy that it will ordinarily not make additional purchases of a common stock of a company for its clients (including the T. Rowe Price Funds) if, as a result of such purchases, 10% or more of the outstanding common stock of such company would be held by its clients in the aggregate.
To the extent possible, T. Rowe Price intends to recapture solicitation fees paid in connection with tender offers through T. Rowe Price Investment Services, Inc., the Fund's distributor. At the present time, T. Rowe Price does not recapture commissions or underwriting discounts or selling group concessions in connection with taxable securities acquired in underwritten offerings. T. Rowe Price does, however, attempt to negotiate elimination of all or a portion of the selling-group concession or underwriting discount when purchasing tax-exempt municipal securities on behalf of its clients in underwritten offerings.
Other
The Funds engaged in portfolio transactions involving broker-dealers in the following amounts for the fiscal years ended February 28, 1994, February 28, 1993, and February 29, 1992:
1994 1993 1992
Tax-Exempt Money Fund $3,848,865,486 $4,251,498,766
Tax-Free Short-Intermediate
Fund $1,368,139,000 1,111,763,067
1,080,195,909
Tax-Free Insured Intermediate
Bond Fund 883,604,000 75,345,466+ *
Tax-Free Income Fund 3,328,250,640 2,593,636,961
Tax-Free High Yield Fund 1,408,187,092 1,322,907,667
The following amounts consisted of principal transactions as to which the Funds have no knowledge of the profits or losses realized by the respective broker-dealers for the fiscal years ended February 28, 1994, February 28, 1993, and February 29, 1992:
1994 1993 1992
Tax-Exempt Money Fund $3,832,043,696 $4,231,418,766
Tax-Free Short-Intermediate Fund 1,250,892,000 1,111,763,067
1,080,195,909
Tax-Free Insured Intermediate
Bond Fund 843,890,000 70,657,019+ *
Tax-Free Income Fund 3,328,250,640 2,593,636,961
Tax-Free High Yield Fund 1,408,187,092 1,322,907,667
The following amounts involved trades with brokers acting as agents or underwriters for the fiscal years ended February 28, 1994, February 28, 1993, and February 29, 1992:
1994 1993 1992
Tax-Exempt Money Fund $16,821,790 $20,081,000
Tax-Free Short-Intermediate Fund 117,247,000 72,966,445
23,436,017
Tax-Free Insured Intermediate
Bond Fund 39,714,000 4,688,447+ *
Tax-Free Income Fund 430,457,963 136,376,415
|
Tax-Free High Yield Fund 172,407,132 51,825,895
The following amounts involved trades with brokers acting as agents or underwriters, in which such brokers received total commissions, including discounts received in connection with underwritings for the fiscal years ended February 28, 1994, February 28, 1993, and February 29, 1992:
1994 1993 1992
Tax-Exempt Money Fund $22,695 $15,000
Tax-Free Short-Intermediate
Fund 582,000 367,470 123,414
Tax-Free Insured Intermediate
Bond Fund 256,000 25,094+ *
Tax-Free Income Fund 3,068,760 970,894
Tax-Free High Yield Fund 1,281,863 398,343
|
Of all such portfolio transactions, none were placed with firms which provided research, statistical, or other services to T. Rowe Price in connection with the management of the Funds, or in some cases, to the Funds.
The portfolio turnover rates of the Funds for the fiscal years ended February 28, 1994, February 28, 1993, and February 29, 1992, have been as follows:
1994 1993 1992
Tax-Free Short-Intermediate Fund 51.1% 38.5% 81.3%
Tax-Free Insured Intermediate
Bond Fund 74.8% 65.3%+ *
Tax-Free Income Fund 71.2% 76.7% 57.9%
Tax-Free High Yield Fund 59.3% 34.7% 51.0%
|
+Fiscal period ended February 28, 1993. *Prior to commencement of operations.
PRICING OF SECURITIES
Fixed income securities are generally traded in the over- the-counter market. Investments in securities with remaining maturities of one year or more are stated at fair value using a bid-side valuation as furnished by dealers who make markets in such securities or by an independent pricing service, which considers yield or price of bonds of comparable quality, coupon, maturity, and type, as well as prices quoted by dealers who make markets in such securities.
Except with respect to certain securities held by the Money Fund, securities with remaining maturities less than one year are stated at fair value which is determined by using a matrix system that establishes a value for each security based on bid-side money market yields. Securities originally purchased by the Money Fund with remaining maturities of 60 days or less are valued at amortized cost. In addition, securities purchased by the Money Fund with maturities in excess of 60 days, but which currently have maturities of 60 days or less, are valued at their amortized cost for the 60 days prior to maturity--such amortization being based on the fair value of the securities on the 61st day prior to maturity.
There are a number of pricing services available, and the Directors of the Funds, on the basis of ongoing evaluation of these services, may use or may discontinue the use of any pricing service in whole or in part.
Securities or other assets for which the above valuation procedures are deemed not to reflect fair value will be appraised at prices deemed best to reflect their fair value. Such determinations will be made in good faith by or under the supervision of officers of each Fund as authorized by the Board of Directors.
Maintenance of Money Fund's Net Asset Value Per Share at $1.00
It is the policy of the Fund to attempt to maintain a net asset value of $1.00 per share by rounding to the nearest one cent. This method of valuation is commonly referred to as "penny rounding" and is permitted by Rule 2a-7 under the Investment Company Act of 1940. Under Rule 2a-7:
(a)The Board of Directors of the Fund must undertake to assure, to the extent reasonably practical taking into account current market conditions affecting the Fund's investment objectives, that the Fund's net asset value will not deviate from $1.00 per share;
(b)The Fund must (i) maintain a dollar-weighted average portfolio maturity appropriate to its objective of maintaining a stable price per share, (ii) not purchase any instrument with a remaining maturity greater than 397 days (or in the case of U.S. government securities greater than 762 days), and (iii) maintain a dollar-weighted average portfolio maturity of 90 days or less;
(c)The Fund must limit its purchase of portfolio instruments, including repurchase agreements, to those U.S. dollar-denominated instruments which the Fund's Board of Directors determines present minimal credit risks, and which are eligible securities as defined by Rule 2a-7 (eligible Securities are generally securities which have been rated or whose issuer has been rated or whose issuer has comparable securities rated in one of the two highest rating categories by nationally recognized statistical rating organizations or, in the case of any instrument that is not so rated, is of comparable quality as determined by procedures adopted by the Fund's Board of Directors); and
(d)The Board of Directors must determine that (i) it is in the best interest of the Fund and its shareholders to maintain a stable net asset value per share or stable price per share under the penny rounding method; and (ii) the Fund will continue to use the penny rounding method only so long as the Board of Directors believes that it fairly reflects the market based net asset value per share.
Although the Fund believes that it will be able to maintain its net asset value at $1.00 per share under most conditions, there can be no absolute assurance that it will be able to do so on a continuous basis. If the Fund's net asset value per share declined, or was expected to decline, below $1.00 (rounded to the nearest one cent), the Board of Directors of the Fund might temporarily reduce or suspend dividend payments in an effort to maintain the net asset value at $1.00 per share. As a result of such reduction or suspension of dividends, an investor would receive less income during a given period than if such a reduction or suspension had not taken place. Such action could result in an investor receiving no dividend for the period during which he holds his shares and in his receiving, upon redemption, a price per share lower than that which he paid. On the other hand, if the Fund's net asset value per share were to increase, or were anticipated to increase above $1.00 (rounded to the nearest one cent), the Board of Directors of the Fund might supplement dividends in an effort to maintain the net asset value at $1.00 per share.
NET ASSET VALUE PER SHARE
The purchase and redemption price of the Funds' shares is equal to the Funds' net asset value per share or share price. Each Fund determines its net asset value per share by subtracting the Funds' liabilities (including accrued expenses and dividends payable) from its total assets (the market value of the securities the Fund holds plus cash and other assets, including income accrued but not yet received) and dividing the result by the total number of shares outstanding. The net asset value per share of each Fund is calculated as of the close of trading on the New York Stock Exchange ("NYSE") every day the NYSE is open for trading. The net asset value of the Money Fund is also calculated as of 12:00 noon (Eastern time) every day the NYSE is open for trading. The NYSE is closed on the following days: New Year's Day,
Washington's Birthday, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day.
Determination of net asset value (and the offering, sale redemption and repurchase of shares) for a Fund may be suspended at times (a) during which the NYSE is closed, other than customary weekend and holiday closings, (b) during which trading on the NYSE is restricted, (c) during which an emergency exists as a result of which disposal by a Fund of securities owned by it is not reasonably practicable or it is not reasonably practicable for the Fund fairly to determine the value of its net assets, or (d) during which a governmental body having jurisdiction over the Fund may by order permit such a suspension for the protection of the Fund's shareholders; provided that applicable rules and regulations of the Securities and Exchange Commission (or any succeeding governmental authority) shall given as to whether the conditions prescribed in (b), (c), or (d) exist.
DIVIDENDS
Unless you elect otherwise, the Fund's annual capital gain distributions, if any, will be reinvested on the reinvestment date using the NAV per share of that date. The reinvestment date normally precedes the payment date by about 10 days although the exact timing is subject to change.
TAX STATUS
Each Fund intends to qualify as a "regulated investment company" under Subchapter M of the Internal Revenue Code of 1986, as amended ("Code").
Dividends and distributions paid by any of the Funds are not eligible for the dividends-received deduction for corporate shareholders. For tax purposes, it does not make any difference whether dividends and capital gain distributions are paid in cash or in additional shares. Each Fund must declare dividends equal to at least 90% of net tax-exempt income (as of its year-end) to permit pass-through of tax-exempt income to shareholders, and 98% of capital gains (as of October 31) in order to avoid a federal excise tax and 100% of capital gains (as of its tax year-end) to avoid federal income tax.
At the time of your purchase, a Fund's net asset value may reflect undistributed capital gains or net unrealized appreciation of securities held by the Fund. A subsequent distribution to you of such amounts, although constituting a return of your investment, would be taxable as a capital gain distribution. For federal income tax purposes, a Fund is permitted to carry forward its net realized capital losses, if any, for eight years and realize net capital gains up to the amount of such losses without being required to pay taxes on, or distribute such gains. On May 31, 1994, the books of each Fund indicated that the Fund's aggregate net assets included:
Realized Capital Unrealized
Gains/(Losses)
Appreciation
________________
____________
Tax-Exempt Money Fund $ $
Tax-Free Short-Intermediate Fund
|
Tax-Free Insured Intermediate Bond Fund
Tax-Free Income Fund
Tax-Free High Yield Fund
If, in any taxable year, the Funds should not qualify as regulated investment companies under the Code: (i) each Fund would be taxed at normal
corporate rates on the entire amount of its taxable income, if any, without deduction for dividends or other distributions to shareholders; and (ii) each Fund's distributions to the extent made out of the Fund's current or accumulated earnings and profits would be taxable to shareholders as ordinary dividends (regardless of whether they would otherwise have been considered capital gain dividends).
The Funds anticipate acquiring bonds after initial issuance at a price less than the principal amount of such bonds ("market discount bonds"). Gain on the disposition of such bonds is treated as taxable ordinary income to the extent of accrued market discount. Such gains cannot be offset by losses on the sale of other securities but must be distributed to shareholders annually and taxed as ordinary income.
Each year, the Funds will mail you information on the tax status of dividends and distributions. The Funds anticipate that substantially all of the dividends to be paid by each Fund will be exempt from federal income taxes. If any portion of a Fund's dividends is not exempt from federal income taxes, you will receive a Form 1099 stating the taxable portion. The Funds will also advise you of the percentage of your dividends, if any, which should be included in the computation of alternative minimum tax. Social security recipients who receive interest from tax-exempt securities may have to pay taxes on a portion of their social security benefit.
Because the interest on municipal securities is tax
exempt, any interest on money you borrow that is directly or
indirectly used to purchase Fund shares is not deductible. (See
Section 265(2) of the Internal Revenue Code.) Further, entities
or persons who are "substantial users" (or persons related to
"substantial users") of facilities financed by industrial
development bonds should consult their tax advisers before
purchasing shares of a Fund. The income from such bonds may not
be tax exempt for such substantial users.
YIELD INFORMATION
Money Fund
The Fund's current and historical yield for a period is calculated by dividing the net change in value of an account (including all dividends accrued and dividends reinvested in additional shares) by the account value at the beginning of the period to obtain the base period return. This base period return is divided by the number of days in the period then multiplied by 365 to arrive at the annualized yield for that period. The Fund's annualized compound yield for such period is compounded by dividing the base period return by the number of days in the period, and compounding that figure over 365 days.
Bond Funds
From time to time, a Fund may advertise a yield figure calculated in the following manner:
An income factor is calculated for each security in the portfolio based upon the security's market value at the beginning of the period and yield as determined in conformity with regulations of the Securities and Exchange Commission. The income factors are then totalled for all securities in the portfolio. Next, expenses of the Fund for the period net of expected reimbursements are deducted from the income to arrive at net income, which is
then converted to a per-share amount by dividing net income by the average number of shares outstanding during the period. The net income per share is divided by the net asset value on the last day of the period to produce a monthly yield which is then annualized. A taxable equivalent yield is calculated by dividing this yield by one minus the effective federal income tax rate. Quoted yield factors are for comparison purposes only, and are not intended to indicate future performance or forecast the dividend per share of the Fund.
The yield of each Fund calculated under the above- described method for the month ended May 31, 1994 was:
Tax-Free Short-Intermediate ____% Tax-Free Insured Intermediate Bond____% Tax-Free Income ____% Tax-Free High Yield ____%
The tax equivalent yields for these funds for the same period were _____% (Short-Intermediate), _____% (Insured Intermediate) _____% (Income), and ______% (High Yield). This assumes a federal tax bracket of 31.0%. Assuming a federal tax bracket of 28.0%, the tax-equivalent yields for the period would be _____% (Short-Intermediate), _____% (Insured Intermediate), _____% (Income), and _____% (High Yield).
From time to time, a Fund may also illustrate the effect of tax equivalent yields using information such as that set forth below:
TAX-EXEMPT VS. TAXABLE YIELDS
Joint Return Single Return
Federal
Tax Rates+
_________________________________________________________________
__________
$38,001- $91,850 $22,751- $55,100 28.0%
91,851- 140,000 55,101- 115,000 31.0
140,001- 250,000 115,001- 250,000 36.0
250,001 and above 250,001 and above 39.6
_________________________________________________________________
______
|
______ 4.2 5.6 6.9 8.3 9.7 11.1 12.5 13.9 15.3 4.3 5.8 7.2 8.7 10.1 11.6 13.0 14.5 15.9 4.7 6.3 7.8 9.4 10.9 12.5 14.1 15.6 17.2 5.0 6.6 8.3 9.9 11.6 13.2 14.9 16.6 18.2 |
* Net amount subject to federal income tax after deductions and
exemptions.
+ Federal rates may vary depending on family size and amount and
nature of itemized deductions.
INVESTMENT PERFORMANCE
Total Return Performance
Each Fund's calculation of total return performance includes the reinvestment of all capital gain distributions and income dividends for the period or periods indicated, without regard to tax consequences to a shareholder in the Fund. Total return is calculated as the percentage change between the beginning value of a static account in the Fund and the ending value of that account measured by the then current net asset value, including all shares acquired through reinvestment of income and capital gains dividends. The results shown are historical and should not be considered indicative of the future performance of the Fund. Each average annual compound rate of return is derived from the cumulative performance of the Fund over the time period specified. The annual compound rate of return for the Fund over any other period of time will vary from the average.
Cumulative Performance Percentage Change
1 Yr. 5 Yrs. 10 Yrs. Since
Ended Ended Ended Inception
2/28/94 2/28/94 2/28/94 2/28/94
Short-Intermediate Fund 3.49 36.75 85.70 86.88%
12/23/83
Insured Intermediated Bond Fund 5.49 12.67
11/30/92
Income Fund 5.50 56.54 139.86 249.81
10/26/76
High Yield Fund 7.49 60.10 149.82
3/01/85
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Average Annual Compound Rates of Return
1 Yr. 5 Yrs. 10 Yrs. Since
Ended Ended Ended Inception
2/28/94 2/28/94 2/28/94 2/28/94
Short-Intermediate Fund 3.49 6.46 6.39 6.33%
12/23/83
Insured Intermediated Bond Fund 5.49 10.05
11/30/92
Income Fund 5.50 9.38 9.14 7.49
10/26/76
High Yield Fund 7.49 9.87 10.71 3/01/85
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All Funds
From time to time, in reports and promotional literature, the Funds' performance will be compared to (1) indices of broad groups of managed and unmanaged securities considered to be representative of or similar to Fund portfolio holdings (2) other mutual funds, or (3) other measures of performance set forth in publications such as:
Bond Buyer 20 - an estimation of the yield which would be offered on 20-year general obligation bonds with a composite rating of approximately "A." Published weekly by The Bond Buyer, a trade paper of the municipal securities industry;
Shearson Lehman/American Express Municipal Bond Index - a composite measure of the total return performance of the municipal bond market. Based upon approximately 1500 bonds;
Lipper General Purpose Municipal Bond Avg. - an average of municipal mutual funds which invest 60% or more of their assets in the top four tax-exempt credit ratings;
Lipper Analytical Services, Inc. - a widely used independent research firm which ranks mutual funds by overall performance, investment objectives, and assets;
Lipper Intermediate Municipal Avg. - an average of municipal mutual funds which restrict their holdings to bonds with maturities between 5 and 10 years;
Lipper Insured Municipal Avg. - an average of municipal mutual funds which utilize insured municipal securities for 65% of their portfolios.
Lipper High-Yield Municipal Bond Avg. - an average of municipal mutual funds which may utilize lower rated bonds for 50% of their portfolio;
Lipper Insured Municipal Avg. - an average of municipal mutual funds which utilize insured municipal securities for 65% of their portfolios.
Donoghue's Tax-Exempt Money Fund Avg. - an average of municipal money market funds as reported in Donoghue's Money Fund Report, which tracks the performance of all money market mutual funds;
Prime General Obligations - bonds with maturities from 1-30 years which are secured by the full faith and credit of issuers with taxing power;
MIG 1 - Moody's Investment Grade 1 - a short-term note with a top quality rating from Moody's Investors Service, Inc.; and
Morningstar, Inc. - a widely used independent research firm which rates mutual funds by overall performance, investment objectives, and assets.
Indices prepared by the research departments of such financial organizations as Merrill Lynch, Pierce, Fenner & Smith, Inc., will be used, as well as information provided by the Federal Reserve Board.
Information reported in the Bank Rate Monitor, an independent publication which tracks the performance of certain bank products, such as money market deposit accounts and certificates of deposit, will also be used. Bank certificates of deposit differ from mutual funds in several ways: the interest rate established by the sponsoring bank is fixed for the term of a CD; there are penalties for early withdrawal from CDs; and the principal on a CD is insured.
Performance rankings and ratings reported periodically in national financial publications such as MONEY, FORBES, BUSINESS WEEK, BARRON'S, etc. may also be used.
Other Features and Benefits
Each Fund is a member of the T. Rowe Price Family of Funds and may help investors achieve various long-term investment goals, such as saving for a down payment on a home or paying college costs. To explain how a Fund could be used to assist investors in planning for these goals and to illustrate basic principles of investing, various worksheets and guides prepared by T. Rowe Price and/or T. Rowe Price Investment Services, Inc. may be made available. These currently include: the Asset Mix Worksheet which is designed to show shareholders how to reduce their investment risk by developing a diversified investment plan and the College Planning Guide which discusses various aspects of financial planning to meet college expenses and assists parents in projecting the costs of a college education for their children. From time to time, other worksheets and guides may be made available as well. Of course, an investment in a Fund cannot guarantee that such goals will be met.
From time to time, Insights, a T. Rowe Price publication of reports on specific investment topics and strategies, may be included in the Fund's fulfillment kit. Such reports may include information concerning: calculating taxable gains and losses on mutual fund transactions, coping with stock market volatility, benefiting from dollar cost averaging, understanding international markets, investing in high-yield "junk" bonds, growth stock investing, conservative stock investing, value investing, investing in small companies, tax- free investing, fixed income investing, investing in mortgage- backed securities, as well as other topics and strategies.
CAPITAL STOCK
Shareholders are entitled to one vote for each full share held (and fractional votes for fractional shares held) and will vote in the election of or removal of directors (to the extent hereinafter provided) and on other matters submitted to the vote of shareholders. There will normally be no meetings of shareholders for the purpose of electing directors unless and until such time as less than a majority of the directors holding office have been elected by shareholders, at which time the directors then in office will call a shareholders' meeting for the election of directors. Except as set forth above, the directors shall continue to hold office and may appoint successor directors. Voting rights are not cumulative, so that the holders of more than 50% of the shares voting in the election of directors can, if they choose to do so, elect all the directors of the Fund, in which event the holders of the remaining shares will be unable to elect any person as director. The Board of Directors of each Fund may increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series authorized to be issued without shareholder approval.
As set forth in the By-Laws of each Fund, a special meeting of shareholders of a Fund shall be called by the Secretary of the Fund on the written request of shareholders entitled to cast at least 10% of all the votes of the Fund entitled to be cast at such meeting. Shareholders requesting such a meeting must pay to the Fund the reasonably estimated costs of preparing and mailing the notice of the meeting. Each Fund, however, will otherwise assist the shareholders seeking to hold the special meeting in communicating to the other shareholders of the Fund to the extent required by Section 16(c) of the Investment Company Act of 1940.
Short-Intermediate, Insured Intermediate Bond, Income and High Yield Funds
Each Fund's Charter authorizes the Board of Directors to classify and reclassify any and all shares which are then unissued, including unissued shares of capital stock into any number of classes or series, each class or series consisting of such number of shares and having such designations, such powers, preferences, rights, qualifications, limitations, and restrictions, as shall be determined by the Board subject to the Investment Company Act and other applicable law. The shares of any such additional classes or series might therefore differ from the shares of the present class and series of capital stock and from each other as to preferences, conversions or other rights, voting powers, restrictions, limitations as to dividends, qualifications or terms or conditions of redemption, subject to applicable law, and might thus be superior or inferior to the capital stock or to other classes or series in various characteristics. The Board of Directors may increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that the Fund has authorized to issue without shareholder approval.
Except to the extent that the Boards of Directors of these three Funds might provide by resolution that holders of shares of a particular class are entitled to vote as a class on specified matters presented for a vote of the holders of all shares entitled to vote on such matters, there would be no right of class vote unless and to the extent that such a right might be construed to exist under Maryland law. The Funds' Charters contain no provision entitling the holders of the present class of capital stock to a vote as a class on any matter. Accordingly, the preferences, rights, and other characteristics attaching to any class of shares, including the present class of capital stock, might be altered or eliminated, or the class might be combined with another class or classes, by action approved by the vote of the holders of a majority of all the shares of all classes entitled to be voted on the proposal, without any additional right of vote as a class by the holders of the capital stock or of another affected class or classes.
Redemptions in Kind
In the unlikely event a shareholder were to receive an in kind redemption of portfolio securities of the Funds, brokerage fees could be incurred by the shareholder in a subsequent sale of such securities.
Issuance of Fund Shares for Securities
Transactions involving issuance of Fund shares for securities or assets other than cash will be limited to (1) bona fide reorganizations; (2) statutory mergers; or (3) other acquisitions of portfolio securities that: (a) meet the investment objectives and policies of the Funds; (b) are acquired for investment and not for resale except in accordance with applicable law; (c) have a value that is readily ascertainable via listing on or trading in a recognized United States or international exchange or market; and (d) are not illiquid.
GENERAL INFORMATION AND HISTORY
Money Fund
The Money Fund, which commenced operation under the name Rowe Price Prime Reserve Fund II, Inc., was organized as a money market mutual fund with an investment objective and program substantially identical to that of the T. Rowe Price Prime Reserve Fund, Inc. ("Prime Reserve Fund"), another T.
Rowe Price Fund. The Fund was initially established to make available shares of a money market fund to those investors who were not eligible to invest in the Prime Reserve Fund because of the restrictions placed by the Board of the Prime Reserve Fund on the sale of its shares as a result of the Credit Control Program adopted by the Federal Reserve Board on March 14, 1980. When that program was discontinued on July 28, 1980, the Board of Directors concluded that the continued operation of the Fund as a general purpose money market fund was unnecessary. On August 11, 1980, the sale of the Fund's shares was suspended and the shares of all shareholders of the Fund (except T. Rowe Price) were exchanged for shares in the Prime Reserve Fund. Subsequently, T. Rowe Price, the sole shareholder of the Fund, recommended to the Board of Directors of the Fund that the Fund's name be changed to T. Rowe Price Tax-Exempt Money Fund, Inc. and that its investment objective and investment program be amended for the purpose of changing the Fund from a money market fund to a tax-exempt money market fund. Such changes were approved by the Fund's sole shareholder, T. Rowe Price, on January 8, 1981. The Fund commenced operation as a tax-exempt money market fund on March 30, 1981.
FEDERAL AND STATE REGISTRATION OF SHARES
The Funds' shares are registered for sale under the Securities Act of 1933 and the Fund or their shares are registered under the laws of all states which require registration, as well as the District of Columbia and Puerto Rico.
LEGAL COUNSEL
Shereff, Friedman, Hoffman & Goodman, whose address is 919 Third Avenue, New York, New York 10022, is legal counsel to each of the Funds.
Money, Insured Intermediate Bond, and High Yield Funds. Coopers & Lybrand, 217 East Redwood Street, Baltimore, Maryland 21202, are independent accountants to the Funds. The financial statements of the Funds for the fiscal year ended February 28, 1994 and the report of independent accountants are included in each Fund's Annual Report on pages 2 - 12, pages 1-11, and pages 2 - 18, respectively. A copy of each Annual Report accompanies this Statement of Additional Information. The following financial statements and the report of independent accountants appearing in each Annual Report for the fiscal year ended February 28, 1994, are incorporated into this Statement of Additional Information by reference:
Money Fund High Yield Fund
Annual Annual
Report Page Report Page
___________ _______________
Report of Independent Accountants 12 18
Statement of Net Assets, February 28, 1994 2-82-13
Statement of Operations, year ended
February 28, 1994 9 14
Statement of Changes in Net Assets,
years ended February 28, 1994 and
February 28, 1993 10 15
Notes to Financial Statements,
February 28, 1994 10-11 16-17
Financial Highlights 11 17
Insured
Intermediate
Bond Fund
Annual Report Page
___________
Report of Independent Accountants 11
Portfolio Investments, February 28, 1994 1-5
Statement of Assets and Liabilities
February 28, 1994 6
Statement of Operations, year ended, February 28, 1994 7
Statement of Changes in Net Assets, year ended
February 28, 1994 and November 30, 1992
(Commencement of Operations) to February 28, 1993 8
Notes to Financial Statements, February 28, 1994 9-10
Financial Highlights, February 28, 1994
|
Short-Intermediate and Income Funds. Price Waterhouse, 7 St. Paul Street, Suite 1700, Baltimore, Maryland 21202, are independent accountants to each Fund. The financial statements of the Funds for the fiscal year ended February 28, 1994, and the report of independent accountants are included in each Fund's Annual Report for the year ended February 28, 1994, on pages 2-15 and 2-16, respectively. A copy of each Annual Report accompanies this Statement of Additional Information. The following financial statements and the report of independent accountants appearing in each Annual Report for the fiscal year ended February 28, 1994 are incorporated into this Statement of Additional Information by reference:
Short-Intermediate
Fund
Annual
Report Page
___________
Report of Independent Accountants 15
Portfolio of Investments, February 28, 1994 2-9
Statement of Assets and Liabilities,
February 28, 1994 10
Statement of Operations, year ended
February 28, 1994 11
Statement of Changes in Net Assets,
years ended February 28, 1994 and
February 28, 1993 12
Notes to Financial Statements,
February 28, 1994 12-13
Financial Highlights 14
Income Fund
Annual
Report Page
_______________
Report of Independent Accountants 16
Statement of Net Assets, February 28, 1994 2-12
Statement of Operations, year ended
February 28, 1994 12
Statement of Changes in Net Assets,
years ended February 28, 1994 and
|
February 28, 1993 13
Notes to Financial Statements,
February 28, 1994 14-15
Financial Highlights 15
PAGE 65
PART C-TAX-EXEMPT MONEY FUND
OTHER INFORMATION
|
Item 24. Financial Statements and Exhibits.
(a) Financial Statements. The Condensed Financial
Information (Financial
Highlights table) is included in Part A of the
Registration
Statement.
Statement of Net Assets, Statement of Operations, and
Statement of
Changes in Net Assets are included in the Annual Report
to
Shareholders, the pertinent portions of which are
incorporated in Part
B of the Registration Statement.
(b) Exhibits.
(1) Articles of Incorporation of Registrant, dated March 25, 1980
(1.1)
Articles of Amendment of Articles of Incorporation
(2) By-Laws of Registrant, as amended July 1, 1991
(3) Inapplicable
(4) Specimen Stock Certificate (filed with Amendment No. 1)
(5) Investment Management Agreement between Registrant and T. Rowe Price Associates, Inc.
(6) Underwriting Agreement between Registrant and T.
Rowe Price
Investment Services, Inc.
(7) Inapplicable
(8) Custodian Agreement between the Price Funds and State Street Bank and Trust Company, dated September 28, 1987, amended to June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, November 3, 1992, December 16, 1992, December 21, 1992, January 28, 1993, April 21, 1993, September 16, 1993, November 3, 1993, and March 1, 1994
(8a) Subcustodian Agreements between T. Rowe Price Tax-Free Funds and Irving Trust Company and Morgan Guaranty Trust Company (filed with Amendment No. 8)
(8a) Subcustodian Agreement between Irving Trust Company and State Street Bank and Trust Company (filed with Amendment No. 12)
(8b) Global Custody Agreement between the Chase
Manhattan Bank, N.A.
and the T. Rowe Price Funds, dated January 3, 1994
(9)(a)
Transfer Agency and Service Agreement between T.
Rowe Price
Services, Inc. and T. Rowe Price Funds, dated
January 1, 1994,
as amended March 1, 1994
(9)(b)
Agreement between T. Rowe Price Associates, Inc.
and T.Rowe
Price Funds for Fund Accounting Services, dated
January 1, 1994,
as amended March 1, 1994
(10) Inapplicable
(11) Consent of Independent Accountants
(12) Inapplicable
(13) Inapplicable
(14) Inapplicable
(15) Inapplicable
(16) The Registrant hereby incorporates by reference
the methodology
used in calculating the performance information
included in
Post-Effective Amendment No. 36 and Amendment No.
20 of the T.
Rowe Price Tax-Free Income Fund, Inc. (SEC. File
Nos. 2-57265
and 811-2684 and CIK 202927) dated April 22, 1994.
Item 25.Persons Controlled by or Under Common Control With Registrant.
None.
Item 26.Number of Holders of Securities.
As of February 28, 1994, there were 19,000 shareholders
in the T. Rowe
Price Tax-Exempt Money Fund, Inc.
Item 27.Indemnification.
The Registrant maintains comprehensive Errors and Omissions
and Officers and
Directors insurance policies written by the Evanston Insurance
Company, The
Chubb Group and ICI Mutual Insurance Co. These policies
provide coverage for the named insureds, which include T. Rowe
Price Associates,
Inc. ("Manager"), Rowe Price-Fleming International, Inc.
("Price-Fleming"), T.
Rowe Price Investment Services, Inc., T. Rowe Price Services,
Inc., T. Rowe
Price Trust Company, T. Rowe Price Stable Asset Management, Inc.,
RPF
International Bond Fund and thirty-five other investment
companies, namely, T.
Rowe Price Growth Stock Fund, Inc., T. Rowe Price New Horizons
Fund, Inc., T.
Rowe Price New Era Fund, Inc., T. Rowe Price New Income Fund,
Inc., T. Rowe
Price Prime Reserve Fund, Inc., T. Rowe Price Tax-Free Income
Fund, Inc.,
T. Rowe Price International Funds, Inc., T. Rowe Price Growth &
Income Fund,
Inc., T. Rowe Price Tax-Free Short-Intermediate Fund, Inc., T.
Rowe Price
Short-Term Bond Fund,
Inc., T. Rowe Price High Yield Fund, Inc., T. Rowe Price Tax-Free
High Yield
Fund, Inc., T. Rowe Price New America Growth Fund, T. Rowe Price
Equity Income
Fund, T. Rowe Price GNMA Fund, T. Rowe Price Capital Appreciation
Fund, T. Rowe
Price State Tax-Free Income Trust, T. Rowe Price California
Tax-Free Income
Trust, T. Rowe Price Science & Technology Fund, Inc., T. Rowe
Price Small-Cap
Value Fund, Inc., Institutional International Funds, Inc., T.
Rowe Price U.S.
Treasury Funds, Inc., T. Rowe Price Index Trust, Inc., T. Rowe
Price Spectrum
Fund, Inc., T. Rowe Price Balanced Fund, Inc., T. Rowe Price
Adjustable Rate
U.S. Government Fund, Inc., T. Rowe Price Mid-Cap Growth Fund,
Inc., T. Rowe
Price OTC Fund, Inc., T. Rowe Price Tax-Free Insured Intermediate
Bond Fund,
Inc., T. Rowe Price Dividend Growth Fund, Inc., T. Rowe Price
Blue Chip Growth
Fund, Inc., T. Rowe Price Summit Income Funds, Inc., T. Rowe
Price Summit
Municipal Funds, Inc., T. Rowe Price Equity Series, Inc., and T.
Rowe Price
International Series, Inc. The Registrant and the thirty-five
investment
companies listed above, with the exception of Institutional
International Funds,
Inc., T. Rowe Price Equity Series, Inc., and T. Rowe Price
International Series,
Inc., will be collectively referred to as the Price Funds. The
investment
manager for the Price Funds, including T. Rowe Price Equity
Series, Inc. is the
Manager. Price-Fleming is the investment manager to T. Rowe
Price International
Funds, Inc., Institutional International Funds, Inc., and T. Rowe
Price
International Series, Inc., and is 50% owned by TRP Finance,
Inc., a wholly-
owned subsidiary of the Manager, 25% owned by Copthall Overseas
Limited, a
wholly-owned subsidiary of Robert Fleming Holdings Limited, and
25% owned by
Jardine Fleming Holdings Limited. In addition to the corporate
insureds, the
policies also cover the officers, directors, and employees of
each of the named
insureds. The premium is allocated among the named corporate
insureds in
accordance with the provisions of Rule 17d-1(d)(7) under the
Investment Company
Act of 1940.
Article X, Section 10.0l of the Registrant's By-Laws provides as follows:
Section 10.01. Indemnification and Payment of Expenses in
Advance. The
Corporation shall indemnify any individual ("Indemnitee") who is
a present or
former director, officer, employee, or agent of the Corporation,
or who is or
has been serving at the request of the Corporation, as a
director, officer,
employee or agent of the Corporation, or who is or has been
serving at the
request of the Corporation as a director, officer, employee or
agent of another
corporation, partnership, joint venture, trust or other
enterprise, who, by
reason of his position was, is, or is threatened to be made a
party to any
threatened, pending, or completed action, suit, or proceeding,
whether civil,
criminal, administrative, or investigative (hereinafter
collectively referred to
as a "Proceeding") against any judgments, penalties, fines,
settlements, and
reasonable expenses (including attorneys' fees) incurred by such
Indemnitee in
connection with any Proceeding, to the fullest extent that such
indemnification
may be lawful under applicable Maryland law, as from time to time
amended. The
Corporation shall pay any reasonable expenses so incurred by such
Indemnitee in
defending a Proceeding in advance of the final disposition
thereof to the
fullest extent that such advance payment may be lawful under
applicable Maryland
law, as from time to time amended. Subject
to any applicable limitations and requirements set forth in the
Corporation's
Articles of Incorporation and in these By-Laws, any payment of
indemnification
or advance of expenses shall be made in accordance with the
procedures set forth
in applicable Maryland law, as from time to time amended.
Notwithstanding the foregoing, nothing herein shall protect
or purport to
protect any Indemnitee against any liability to which he would
otherwise be
subject by reason of willful misfeasance, bad faith, gross
negligence, or
reckless disregard of the duties involved in the conduct of his
office
("Disabling Conduct").
Anything in this Article X to the contrary
notwithstanding, no
indemnification shall be made by the Corporation to any
Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors
who are
neither "interested persons" of the Corporation
as defined in
Section 2(a)(19) of the Investment Company Act
of 1940, nor
parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Anything in this Article X to the contrary
notwithstanding, any advance
of expenses by the Corporation to any Indemnitee shall be
made only upon
the undertaking by such Indemnitee to repay the advance
unless it is
ultimately determined that such Indemnitee is entitled to
indemnification
as above provided, and only if one of the following
conditions is met:
(a)
the Indemnitee provides a security for his undertaking; or
(b)
the Corporation shall be insured against losses
arising by reason
of any lawful advances; or
there is a determination, based on a review of readily
available facts,
that there is reason to believe that the Indemnitee will
ultimately be
found entitled to indemnification, which determination
shall be made
by:
(i) a majority of a quorum of directors who are
neither "interested
persons" of the Corporation as defined in Section
2(a)(19) of
the Investment Company Act of 1940, nor parties
to the
Proceeding; or
an independent legal counsel in a written opinion.
Section 10.02 of the Registrant's By-Laws provides as follows:
Section 10.02. Insurance of Officers, Directors,
Employees and Agents.
To the fullest extent permitted by applicable Maryland law
and by Section
17(h) of the Investment Company Act of 1940, as from time to
time amended,
the Corporation may purchase and maintain insurance on behalf
of any person
who is or was a director, officer, employee, or agent of the
Corporation,
or who is or was serving at the request of the Corporation as
a director,
officer, employee, or agent of another corporation,
partnership, joint
venture, trust or other enterprise, against any liability
asserted against
him and incurred by him in or arising out of his position,
whether or not
the Corporation would have the power to indemnify him against
such
liability.
Insofar as indemnification for liability arising under the
Securities Act
of 1933 may be permitted to directors, officers and
controlling persons of
the Registrant pursuant to the foregoing provisions, or
otherwise, the
registrant has been advised that in the opinion of the
Securities and
Exchange Commission such indemnification is against public
policy as
expressed in the Act and is, therefore, unenforceable. In
the event that a
claim for indemnification against such liabilities (other
than the payment
by the Registrant of expenses incurred or paid by a director,
officer or
controlling person of the Registrant in the successful
defense of any
action, suit or proceeding) is asserted by such director,
officer or
controlling person in connection with the securities being
registered, the
Registrant will, unless in the opinion of its counsel the
matter has been
settled by controlling precedent, submit to a court of
appropriate
jurisdiction the question whether such indemnification by it
is against
public policy as expressed in the Act and will be governed by
the final
adjudication of such issue.
Item 28.Business and Other Connections of Investment Manager.
Rowe Price-Fleming International, Inc. ("Price-Fleming"), a
Maryland
corporation, is a corporate joint venture 50% owned by TRP
Finance, Inc., a
wholly-owned subsidiary of the Manager, and was organized in 1979
to provide
investment counsel service with respect to foreign securities for
institutional
investors in the United States. Price-Fleming, in addition to
managing private
counsel client accounts, also sponsors registered investment
companies which
invest in foreign securities, serves as general partner of RPFI
International
Partners, Limited Partnership, and provides investment advice to
the T. Rowe
Price Trust Company, trustee of the International Common Trust
Fund.
T. Rowe Price Investment Services, Inc. ("Investment Services"),
a wholly- owned
subsidiary of the Manager, is a Maryland corporation organized in
1980 for the
purpose of acting as the principal underwriter and distributor
for the Price
Funds. Investment Services is registered as a broker-dealer
under the
Securities Exchange Act of 1934 and is a member of the National
Association of
Securities Dealers, Inc. In 1984, Investment Services expanded
its activities
to include a discount brokerage service.
TRP Distribution, Inc., a wholly-owned subsidiary of Investment
Services, is a
Maryland corporation organized in 1991. It was organized for and
engages in the
sale of certain investment related products prepared by
Investment Services.
T. Rowe Price Associates Foundation, Inc., was organized in 1981
for the purpose
of making charitable contributions to religious, charitable,
scientific,
literary and educational organizations. The Foundation (which is
not a
subsidiary of the Manager) is funded solely by contributions from
the Manager
and income from investments.
T. Rowe Price Services, Inc. ("Price Services"), a wholly-owned
subsidiary of
the Manager, is a Maryland corporation organized in 1982 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. Price
Services
provides transfer agent, dividend disbursing, and certain other
services,
including shareholder services, to the Price Funds.
T. Rowe Price Retirement Plan Services, Inc. ("RPS"), a
wholly-owned subsidiary
of the Manager, was incorporated in Maryland in 1991 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. RPS
provides
administrative, recordkeeping, and subaccounting services to
administrators of
employee benefit plans.
T. Rowe Price Trust Company ("Trust Company"), a wholly-owned
subsidiary of the
Manager, is a Maryland chartered limited purpose trust company,
organized
in 1983 for the purpose of providing fiduciary services. The
Trust Company
serves as trustee/custodian for employee benefit plans, common
trust funds and a
few trusts.
T. Rowe Price Threshold Fund II, L.P., a Delaware limited
partnership, was
organized in 1986 by the Manager, and invests in private
financings of small
companies with high growth potential; the Manager is the General
Partner of the
partnership.
RPFI International Partners, Limited Partnership, is a Delaware
limited
partnership organized in 1985 for the purpose of investing in a
diversified
group of small and medium-sized rapidly growing non-U.S.
companies.
Price-Fleming is the general partner of this partnership, and
certain clients of
Price-Fleming are its limited partners.
T. Rowe Price Real Estate Group, Inc. ("Real Estate Group"), is a
Maryland
corporation and a wholly-owned subsidiary of the Manager
established in 1986 to
provide real estate services. Subsidiaries of Real Estate Group
are: T. Rowe
Price Realty Income Fund I Management, Inc., a Maryland
corporation (General
Partner of T. Rowe Price Realty Income Fund I, A No-Load Limited
Partnership),
T. Rowe Price Realty Income Fund II Management, Inc., a Maryland
corporation
(General Partner of T. Rowe Price Realty Income Fund II,
America's
Sales-Commission-Free Real Estate Limited Partnership), T. Rowe
Price Realty
Income Fund III Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund III, America's
Sales-Commission-Free Real Estate
Limited Partnership, a Delaware limited partnership), and T. Rowe
Price Realty
Income Fund IV Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund IV, America's Sales-Commission-Free
Real Estate
Limited Partnership). Real Estate Group serves as investment
manager to T. Rowe
Price Renaissance Fund, Ltd., A Sales-Commission-Free Real Estate
Investment,
established in 1989 as a Maryland corporation which qualifies as
a REIT.
T. Rowe Price Stable Asset Management, Inc. ("Stable Asset
Management") is a
Maryland corporation organized in 1988 as a wholly-owned
subsidiary of the
Manager. Stable Asset Management, which is registered as an
investment adviser
under the Investment Advisers Act of 1940, specializes in the
management of
investment portfolios which seek stable and consistent investment
returns
through the use of guaranteed investment contracts, bank
investment contracts,
structured or synthetic investment contracts, and short-term
fixed-income
securities.
T. Rowe Price Recovery Fund Associates, Inc., a Maryland
corporation, is a
wholly-owned subsidiary of the Manager organized in 1988 for the
purpose of
serving as the General Partner of T. Rowe Price Recovery Fund,
L.P., a Delaware
limited partnership which invests in financially distressed
companies.
T. Rowe Price (Canada), Inc. is a Maryland corporation organized
in 1988 as a
wholly-owned subsidiary of the Manager. This entity is
registered as an
investment adviser under the Investment Advisers Act of 1940, and
may apply for
registration as an investment manager under the Securities Act of
Ontario in
order to be eligible to provide certain services to the RPF
International Bond Fund, a trust (whose shares are sold in
Canada) which
Price-Fleming serves as investment adviser.
Since 1983, the Manager has organized several distinct Maryland
limited
partnerships, which are informally called the Pratt Street
Ventures
partnerships, for the purpose of acquiring interests in
growth-oriented
businesses.
Tower Venture, Inc., a wholly-owned subsidiary of the Manager, is
a Maryland
corporation organized in 1989 for the purpose of serving as a
general partner of
100 East Pratt St., L.P., a Maryland limited partnership whose
limited partners
also include the Manager. The purpose of the partnership is to
further develop
and improve the property at 100 East Pratt Street, the site of
the Manager's
headquarters, through the construction of additional office,
retail and parking
space.
TRP Suburban, Inc. is a Maryland corporation organized in 1990 as
a wholly-owned
subsidiary of the Manager. TRP Suburban has entered into
agreements with
McDonogh School and CMANE-McDonogh-Rowe Limited Partnership to
construct an
office building in Owings Mills, Maryland, which houses the
Manager's transfer
agent, plan administrative services, retirement plan services and
operations
support functions.
TRP Finance, Inc. and TRP Finance MRT, Inc., wholly-owned
subsidiaries of the
Manager, are Delaware corporations organized in 1990 to manage
certain passive
corporate investments and other intangible assets. TRP Finance
MRT, Inc. was
dissolved on October 4, 1993.
T. Rowe Price Strategic Partners Fund, L.P. is a Delaware limited
partnership
organized in 1990 for the purpose of investing in small public
and private
companies seeking capital for expansion or undergoing a
restructuring of
ownership. The general partner of the Fund is T. Rowe Price
Strategic Partners,
L.P., a Delaware limited partnership whose general partner is T.
Rowe Price
Strategic Partners Associates, Inc., ("Strategic Associates"), a
Maryland
corporation which is a wholly-owned subsidiary of the Manager.
Strategic
Associates also serves as the general partner of T. Rowe Price
Strategic
Partners II, L.P., a Delaware limited partnership established in
1992, which in
turn serves as general partner of T. Rowe price Strategic
Partners Fund II,
L.P., a Delaware limited partnership organized in 1992.
Listed below are the directors of the Manager who have other
substantial
businesses, professions, vocations, or employment aside from that
of Director of
the Manager:
JAMES E. HALBKAT, JR., Director of the Manager. Mr. Halbkat is
President of
U.S. Monitor Corporation, a provider of public response systems.
Mr. Halbkat's
address is: P.O. Box 23109, Hilton Head Island, South Carolina
29925.
JOHN W. ROSENBLUM, Director of the Manager. Mr. Rosenblum is the
Tayloe Murphy
Professor at the University of Virginia, and a director of:
Chesapeake
Corporation, a manufacturer of paper products, Cadmus
Communications Corp., a
provider of printing and communication services; Comdial
Corporation, a
manufacturer of telephone systems for businesses; and Cone Mills
Corporation, a
textiles producer. Mr. Rosenblum's address is: P.O. Box 6550,
Charlottesville,
Virginia 22906.
ROBERT L. STRICKLAND, Director of the Manager. Mr. Strickland is
Chairman of
Lowe's Companies, Inc., a retailer of specialty home supplies.
Mr. Strickland's
address is 604 Two Piedmont Plaza Building, Winston-Salem, North
Carolina 27104.
PHILIP C. WALSH, Director of the Manager. Mr. Walsh is a
Consultant to Cyprus
Amax Minerals Company, Englewood, Colorado, and a director of
Piedmont Mining
Company, Inc., Charlotte, North Carolina. Mr. Walsh's address
is: Blue Mill
Road, Morristown, New Jersey 07960.
With the exception of Messrs. Halbkat, Rosenblum, Strickland, and
Walsh, all of
the directors of the Manager are employees of the Manager.
George J. Collins, who is Chief Executive Officer, President, and
a Managing
Director of the Manager, is a Director of Price-Fleming.
George A. Roche, who is Chief Financial Officer and a Managing
Director of the
Manager, is a Vice President and a Director of Price-Fleming.
M. David Testa, who is a Managing Director of the Manager, is
Chairman of the
Board of Price-Fleming.
Henry H. Hopkins, Charles P. Smith, and Peter Van Dyke, who are
Managing
Directors of the Manager, are Vice Presidents of Price-Fleming.
Robert P. Campbell, Roger L. Fiery, III, Robert C. Howe, Veena A.
Kutler, George
A. Murnaghan, William F. Wendler, II, and Edward A. Wiese, who
are Vice
Presidents of the Manager, are Vice Presidents of Price-Fleming.
Alvin M. Younger, Jr., who is a Managing Director and the
Secretary and
Treasurer of the Manager, is Secretary and Treasurer of
Price-Fleming.
Nolan L. North, who is a Vice President and Assistant Treasurer
of the Manager,
is Assistant Treasurer of Price-Fleming.
Leah P. Holmes, who is an Assistant Vice President of the
Manager, is a Vice
President of Price-Fleming.
Barbara A. Van Horn, who is Assistant Secretary of the Manager,
is Assistant
Secretary of Price-Fleming.
Certain directors and officers of the Manager are also officers
and/or directors
of one or more of the Price Funds and/or one or more of the
affiliated entities
listed herein.
See also "Management of Fund," in Registrant's Statement of
Additional
Information.
Item 29.Principal Underwriters.
(a) The principal underwriter for the Registrant is Investment
Services.
Investment Services acts as the principal underwriter for the
other thirty-five
Price Funds. Investment Services is a wholly-owned subsidiary of
the Manager is
registered as a broker-dealer under the Securities Exchange Act
of 1934 and is a
member of the National Association of Securities Dealers, Inc.
Investment
Services has been formed for the limited purpose of distributing
the shares of
the Price Funds and will not engage in the general securities
business. Since
the Price Funds are sold on a no-load basis, Investment Services
will not
receive any commission or other compensation for acting as
principal
underwriter.
(b) The address of each of the directors and officers of Investment Services listed below is 100 East Pratt Street, Baltimore, Maryland 21202.
Positions and Name and Principal Positions and Offices Offices with
Business Address With Underwriter Registrant
__________________ _____________________ _____________
James Sellers Riepe President and Director Vice President
and
Director
Henry Holt Hopkins Vice President and Vice President
Director
Mark E. Rayford Director None
Charles E. Vieth Vice President and None
Director
Patricia M. Archer Vice President None
Edward C. Bernard Vice President None
Joseph C. Bonasorte Vice President None
Meredith C. Callanan Vice President None
Laura H. Chasney Vice President None
Victoria C. Collins Vice President None
Christopher W. Dyer Vice President None
Forrest R. Foss Vice President None
Patricia O'Neil Goodyear Vice President None
James W. Graves Vice President None
Andrea G. Griffin Vice President None
Thomas Grizzard Vice President None
David J. Healy Vice President None
Joseph P. Healy Vice President None
Walter J. Helmlinger Vice President None
Eric G. Knauss Vice President None
Douglas G. Kremer Vice President None
Sharon Renae Krieger Vice President None
Keith Wayne Lewis Vice President None
David L. Lyons Vice President None
Sarah McCafferty Vice President None
Maurice Albert Minerbi Vice President None
Nancy M. Morris Vice President None
George A. Murnaghan Vice President None
Steven Ellis Norwitz Vice President None
Kathleen M. O'Brien Vice President None
Charles S. Peterson Vice President None
|
Pamela D. Preston Vice President None Lucy Beth Robins Vice President None John Richard Rockwell Vice President None Monica R. Tucker Vice President None William F. Wendler, II Vice President None Terri L. Westren Vice President None Jane F. White Vice President None Thomas R. Woolley Vice President None Alvin M. Younger, Jr. Secretary and Treasurer None Mark S. Finn Controller None Richard J. Barna Assistant Vice President None Catherine L. Berkenkemper Assistant Vice President None Ronae M. Brock Assistant Vice President None Brenda E. Buhler Assistant Vice President None Patricia Sue Butcher Assistant Vice President None John A. Galateria Assistant Vice President None Janelyn A. Healey Assistant Vice President None Keith J. Langrehr Assistant Vice President None C. Lillian Matthews Assistant Vice President None Janice D. McCrory Assistant Vice President None Sandra J. McHenry Assistant Vice President None JeanneMarie B. Patella Assistant Vice President None Kristin E. Seeberger Assistant Vice President None Arthur J. Silber Assistant Vice President None Linda C. Wright Assistant Vice President None |
Nolan L. North Assistant Treasurer None Barbara A. VanHorn Assistant Secretary None
Item 30. Location of Accounts and Records.
All accounts, books, and other documents required to be
maintained by the T.
Rowe Price Tax-Exempt Money Fund, Inc. under Section 31(a) of the
Investment
Company Act of 1940 and the rules thereunder will be maintained
by T. Rowe Price
Tax-Exempt Money Fund, Inc. at its offices at 100 East Pratt
Street, Baltimore,
Maryland 21202. Transfer, dividend disbursing, and shareholder
service
activities are performed by T. Rowe Price Services, Inc. at 100
East Pratt
Street, Baltimore, Maryland 21202. Custodian activities for T.
Rowe Price Tax-
Exempt Money Fund, Inc. are performed at State Street Bank and
Trust Company's
Service Center (State Street South), 1776 Heritage Drive, Quincy,
Massachusetts
02171.
Item 31. Management Services.
Registrant is not a party to any management-related
service contract,
other than as set forth in the Prospectus.
Item 32. Undertakings
(a) The Fund agrees to furnish, upon request and without charge, a copy of its Annual Report to each person to whom a prospectus is delivered.
Pursuant to the requirements of the Securities Act of 1933,
as amended, and
the Investment Company Act of 1940, as amended, the Registrant
has duly caused
this Registration Statement to be signed on its behalf by the
undersigned,
thereunto duly authorized, in the City of Baltimore, State of
Maryland, this
22nd day of April, 1994.
T. ROWE PRICE TAX-EXEMPT MONEY FUND,
INC.
/s/George J. Collins
By:George J. Collins, Chairman of the
Board
|
Pursuant to the requirements of the Securities Act of 1933,
as amended,
this Registration Statement has been signed below by the
following persons in
the capacities and on the dates indicated:
SIGNATURE TITLE DATE ________ _____ ____ /s/George J. Collins Chairman of the Board April 22, 1994 George J. Collins (Chief Executive Officer) /s/Carmen F. Deyesu Treasurer April 22, 1994 Carmen F. Deyesu (Chief Financial Officer) /s/Calvin W. Burnett Director April 22, 1994 Calvin W. Burnett /s/Anthony W. Deering Director April 22, 1994 Anthony W. Deering /s/F. Pierce Linaweaver DirectorApril 22, 1994 F. Pierce Linaweaver /s/William T. Reynolds President and Director April 22, 1994 William T. Reynolds /s/James S. Riepe Vice President and DirectorApril 22, 1994 James S. Riepe /s/John Sagan Director April 22, 1994 John Sagan /s/John G. Schrieber Director April 22, 1994 John G. Schreiber |
Item 24. Financial Statements and Exhibits.
(a) Financial Statements. Condensed Financial Information
(Financial
Highlights table) is included in Part A of the
Registration Statement.
Portfolio of Investments, Statement of Assets and
Liabilities,
Statement of Operations, and Statement of Changes in Net
Assets are
included in the Annual Report to Shareholders, the
pertinent portions
of which are incorporated by reference in Part B of the
Registration
Statement.
(b) Exhibits.
(1) Articles of Incorporation of Registrant, dated October 7, 1983
(2) By-Laws of Registrant, as amended July 1, 1991
(3) Inapplicable
(4) Specimen Stock Certificate (filed with Amendment No. 1)
(5) Investment Management Agreement between Registrant and T. Rowe Price Associates, Inc.
(6) Underwriting Agreement between Registrant and T.
Rowe Price
Investment Services, Inc.
(7) Inapplicable
(8) Custodian Agreement between the T. Rowe Price Funds and State Street Bank and Trust Company, dated September 28, 1987, amended to June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, and November 3, 1992, December 16, 1992, December 21, 1992, January 28, 1993, April 21, 1993, September 16, 1993, November 3, 1993, and March 1, 1994
(8)(a)
Subcustodian Agreements between T. Rowe Price
Tax-Free Funds
and Irving Trust Company and Morgan Guaranty
Trust Company
(filed with Amendment No. 4)
(8) Subcustodian Agreement between Irving Trust Company and State Street Bank and Trust Company (filed with Amendment No. 11)
(8)(b)
Global Custody Agreement between The Chase Manhattan Bank,
N.A. and T. Rowe
Price Funds, dated January 3, 1994
(9)(a)
Transfer Agency and Service Agreement between T.
Rowe Price
Services, Inc. and T. Rowe Price Funds, dated
January 1, 1994,
as amended March 1, 1994
(9)(b)
Agreement between T. Rowe Price Associates, Inc.
and T.Rowe
Price Funds for Fund Accounting Services, dated
January 1,
1994, as amended March 1, 1994
(10) Inapplicable
(11) Consent of Independent Accountants
(12) Inapplicable
(13) Inapplicable
(14) Inapplicable
(15) Inapplicable
(16) The Registrant hereby incorporates by reference
the methodology
used in calculating the performance information
included in
Post-Effective Amendment No. 36 and Amendment No.
20 of the T.
Rowe Price Tax-Free Income Fund, Inc. (SEC. File
Nos. 2-57265
and 811-2684 and CIK 202927) dated April 22,
1994.
Item 25. Persons Controlled by or Under Common Control With
Registrant.
None.
Item 26. Number of Holders of Securities.
As of February 28, 1994, there were 13,000 shareholders
in the T. Rowe
Price Tax-Free Short-Intermediate Fund, Inc.
Item 27. Indemnification.
The Registrant maintains comprehensive Errors and Omissions
and Officers and
Directors insurance policies written by the Evanston Insurance
Company, The
Chubb Group and ICI Mutual Insurance Co. These policies
provide coverage for the named insureds, which include T. Rowe
Price Associates,
Inc. ("Manager"), Rowe Price-Fleming International, Inc.
("Price-Fleming"), T.
Rowe Price Investment Services, Inc., T. Rowe Price Services,
Inc., T. Rowe
Price Trust Company, T. Rowe Price Stable Asset Management, Inc.,
RPF
International Bond Fund and thirty-five other investment
companies, namely, T.
Rowe Price Growth Stock Fund, Inc., T. Rowe Price New Horizons
Fund, Inc., T.
Rowe Price New Era Fund, Inc., T. Rowe Price New Income Fund,
Inc., T. Rowe
Price Prime Reserve Fund, Inc., T. Rowe Price Tax-Free Income
Fund, Inc.,
T. Rowe Price International Funds, Inc., T. Rowe Price Tax-Exempt
Money Fund,
Inc., T. Rowe Price Growth & Income Fund, Inc., T. Rowe Price
Short-Term Bond
Fund,
Inc., T. Rowe Price High Yield Fund, Inc., T. Rowe Price Tax-Free
High Yield
Fund, Inc., T. Rowe Price New America Growth Fund, T. Rowe Price
Equity Income
Fund, T. Rowe Price GNMA Fund, T. Rowe Price Capital Appreciation
Fund, T. Rowe
Price State Tax-Free Income Trust, T. Rowe Price California
Tax-Free Income
Trust, T. Rowe Price Science & Technology Fund, Inc., T. Rowe
Price Small-Cap
Value Fund, Inc., Institutional International Funds, Inc., T.
Rowe Price U.S.
Treasury Funds, Inc., T. Rowe Price Index Trust, Inc., T. Rowe
Price Spectrum
Fund, Inc., T. Rowe Price Balanced Fund, Inc., T. Rowe Price
Adjustable Rate
U.S. Government Fund, Inc., T. Rowe Price Mid-Cap Growth Fund,
Inc., T. Rowe
Price OTC Fund, Inc., T. Rowe Price Tax-Free Insured Intermediate
Bond Fund,
Inc., T. Rowe Price Dividend Growth Fund, Inc., T. Rowe Price
Blue Chip Growth
Fund, Inc., T. Rowe Price Summit Income Funds, Inc., T. Rowe
Price Summit
Municipal Funds, Inc., T. Rowe Price Equity Series, Inc., and T.
Rowe Price
International Series, Inc. The Registrant and the thirty-five
investment
companies listed above, with the exception of Institutional
International Funds,
Inc., T. Rowe Price Equity Series, Inc., and T. Rowe Price
International Series,
Inc., will be collectively referred to as the Price Funds. The
investment
manager for the Price Funds, including T. Rowe Price Equity
Series, Inc. is the
Manager. Price-Fleming is the investment manager to T. Rowe
Price International
Funds, Inc., T. Rowe Price International Series, Inc., and
Institutional
International Funds, Inc., and is 50% owned by TRP Finance, Inc.,
a wholly-owned
subsidiary of the Manager, 25% owned by Copthall Overseas
Limited, a wholly-
owned subsidiary of Robert Fleming Holdings Limited, and 25%
owned by Jardine
Fleming Holdings Limited. In addition to the corporate insureds,
the policies
also cover the officers, directors, and employees of each of the
named
insureds.
The premium is allocated among the named corporate insureds in
accordance with
the provisions of Rule 17d-1(d)(7) under the Investment Company
Act of 1940.
Article X, Section 10.0l of the Registrant's By-Laws provides as follows:
Section 10.01. Indemnification and Payment of Expenses in
Advance. The
Corporation shall indemnify any individual ("Indemnitee") who is
a present or
former director, officer, employee, or agent of the Corporation,
or who is or
has been serving at the request of the Corporation, as a
director, officer,
employee or agent of the Corporation, or who is or has been
serving at the
request of the Corporation as a director, officer, employee or
agent of another
corporation, partnership, joint venture, trust or other
enterprise, who, by
reason of his position was, is, or is threatened to be made a
party to any
threatened, pending, or completed action, suit, or proceeding,
whether civil,
criminal, administrative, or investigative (hereinafter
collectively referred to
as a "Proceeding") against any judgments, penalties, fines,
settlements, and
reasonable expenses (including attorneys' fees) incurred by such
Indemnitee in
connection with any Proceeding, to the fullest extent that such
indemnification
may be lawful under applicable Maryland law, as from time to time
amended. The
Corporation shall pay any reasonable expenses so incurred by such
Indemnitee in defending a Proceeding in advance of the final
disposition thereof
to the fullest extent that such advance payment may be lawful
under
applicable Maryland law, as from time to time amended. Subject
to any
applicable limitations and requirements set forth in the
Corporation's Articles
of Incorporation and in these By-Laws, any payment of
indemnification or advance
of expenses shall be made in accordance with the procedures set
forth in
applicable Maryland law, as from time to time amended.
Notwithstanding the foregoing, nothing herein shall protect
or purport to
protect any Indemnitee against any liability to which he would
otherwise be
subject by reason of willful misfeasance, bad faith, gross
negligence, or
reckless disregard of the duties involved in the conduct of his
office
("Disabling Conduct").
Anything in this Article X to the contrary notwithstanding,
no
indemnification shall be made by the Corporation to any
Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act of 1940, nor parties to the Proceeding; or
an independent legal counsel in a written opinion.
Anything in this Article X to the contrary notwithstanding,
any advance of
expenses by the Corporation to any Indemnitee shall be made only
upon the
undertaking by such Indemnitee to repay the advance unless it is
ultimately
determined that such Indemnitee is entitled to indemnification as
above
provided, and only if one of the following conditions is met:
(a) the Indemnitee provides a security for his undertaking; or
(b) the Corporation shall be insured against losses arising by reason of any lawful advances; or
(c) there is a determination, based on a review of readily available facts, that there is reason to believe that the Indemnitee will ultimately be found entitled to indemnification, which determination shall be made by:
(i) a majority of a quorum of directors who are
neither
"interested persons" of the Corporation as
defined in
Section 2(a)(19) of the Investment Company Act
of 1940, nor
parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Section 10.02 of the Registrant's By-Laws provides as follows:
Section 10.02. Insurance of Officers, Directors, Employees
and Agents. To
the fullest extent permitted by applicable Maryland law and by
Section 17(h) of
the Investment Company Act of 1940, as from time to time amended,
the
Corporation may purchase and maintain insurance on behalf of any
person who is
or was a director, officer, employee, or agent of the
Corporation, or who is or
was serving at the request of the Corporation as a director,
officer, employee,
or agent of another corporation, partnership, joint venture,
trust or other
enterprise, against any liability asserted against him and
incurred by him in or
arising out of his position, whether or not the Corporation would
have the power
to indemnify him against such liability.
Insofar as indemnification for liability arising under the
Securities Act
of 1933 may be permitted to directors, officers and controlling
persons of the
Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant
has been advised that in the opinion of the Securities and
Exchange Commission
such indemnification is against public policy as expressed in the
Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against
such liabilities (other than the payment by the Registrant of
expenses incurred
or paid by a director, officer or controlling person of the
registrant in the
successful defense of any action, suit, or proceeding) is
asserted by such
director, officer or controlling person in connection with the
securities being
registered, the registrant will, unless in the opinion of its
counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate
jurisdiction the question whether such indemnification by it is
against public
policy as expressed in the Act and will be governed by the final
adjudication of
such issue.
Item 28. Business and Other Connections of Investment Manager.
Rowe Price-Fleming International, Inc. ("Price-Fleming"), a
Maryland
corporation, is a corporate joint venture 50% owned by TRP
Finance, Inc., a
wholly-owned subsidiary of the Manager, and was organized in 1979
to provide
investment counsel service with respect to foreign securities for
institutional
investors in the United States. Price-Fleming, in addition to
managing private
counsel client accounts, also sponsors registered investment
companies which
invest in foreign securities, serves as general partner of RPFI
International
Partners, Limited Partnership, and provides investment advice to
the T. Rowe
Price Trust Company, trustee of the International Common Trust
Fund.
T. Rowe Price Investment Services, Inc. ("Investment Services"),
a wholly- owned
subsidiary of the Manager, is a Maryland corporation organized in
1980 for the
purpose of acting as the principal underwriter and distributor
for the Price
Funds. Investment Services is registered as a broker-dealer
under the
Securities Exchange Act of 1934 and is a member of the National
Association of
Securities Dealers, Inc. In 1984, Investment Services expanded
its activities
to include a discount brokerage service.
TRP Distribution, Inc., a wholly-owned subsidiary of Investment
Services, is a
Maryland corporation organized in 1991. It was organized for and
engages in the
sale of certain investment related products prepared by
Investment Services.
T. Rowe Price Associates Foundation, Inc., was organized in 1981
for the purpose
of making charitable contributions to religious, charitable,
scientific,
literary and educational organizations. The Foundation (which is
not a
subsidiary of the Manager) is funded solely by contributions from
the Manager
and income from investments.
T. Rowe Price Services, Inc. ("Price Services"), a wholly-owned
subsidiary of
the Manager, is a Maryland corporation organized in 1982 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. Price
Services
provides transfer agent, dividend disbursing, and certain other
services,
including shareholder services, to the Price Funds.
T. Rowe Price Retirement Plan Services, Inc. ("RPS"), a
wholly-owned subsidiary
of the Manager, was incorporated in Maryland in 1991 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. RPS
provides
administrative, recordkeeping, and subaccounting services to
administrators of
employee benefit plans.
T. Rowe Price Trust Company ("Trust Company"), a wholly-owned
subsidiary of the
Manager, is a Maryland chartered limited purpose trust company,
organized
in 1983 for the purpose of providing fiduciary services. The
Trust Company
serves as trustee/custodian for employee benefit plans, common
trust funds and a
few trusts.
T. Rowe Price Threshold Fund II, L.P., a Delaware limited
partnership, was
organized in 1986 by the Manager, and invests in private
financings of small
companies with high growth potential; the Manager is the General
Partner of the
partnership.
RPFI International Partners, Limited Partnership, is a Delaware
limited
partnership organized in 1985 for the purpose of investing in a
diversified
group of small and medium-sized rapidly growing non-U.S.
companies.
Price-Fleming is the general partner of this partnership, and
certain clients of
Price-Fleming are its limited partners.
T. Rowe Price Real Estate Group, Inc. ("Real Estate Group"), is a
Maryland
corporation and a wholly-owned subsidiary of the Manager
established in 1986 to
provide real estate services. Subsidiaries of Real Estate Group
are: T. Rowe
Price Realty Income Fund I Management, Inc., a Maryland
corporation (General
Partner of T. Rowe Price Realty Income Fund I, A No-Load Limited
Partnership),
T. Rowe Price Realty Income Fund II Management, Inc., a Maryland
corporation
(General Partner of T. Rowe Price Realty Income Fund II,
America's
Sales-Commission-Free Real Estate Limited Partnership), T. Rowe
Price Realty
Income Fund III Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund III, America's
Sales-Commission-Free Real Estate
Limited Partnership, a Delaware limited partnership), and T. Rowe
Price Realty
Income Fund IV Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund IV, America's Sales-Commission-Free
Real Estate
Limited Partnership). Real Estate Group serves as investment
manager to T. Rowe
Price Renaissance Fund, Ltd., A Sales-Commission-Free Real Estate
Investment,
established in 1989 as a Maryland corporation which qualifies as
a REIT.
T. Rowe Price Stable Asset Management, Inc. ("Stable Asset
Management") is a
Maryland corporation organized in 1988 as a wholly-owned
subsidiary of the
Manager. Stable Asset Management, which is registered as an
investment adviser
under the Investment Advisers Act of 1940, specializes in the
management of
investment portfolios which seek stable and consistent investment
returns
through the use of guaranteed investment contracts, bank
investment contracts,
structured or synthetic investment contracts, and short-term
fixed-income
securities.
T. Rowe Price Recovery Fund Associates, Inc., a Maryland
corporation, is a
wholly-owned subsidiary of the Manager organized in 1988 for the
purpose of
serving as the General Partner of T. Rowe Price Recovery Fund,
L.P., a Delaware
limited partnership which invests in financially distressed
companies.
T. Rowe Price (Canada), Inc. is a Maryland corporation organized
in 1988 as a
wholly-owned subsidiary of the Manager. This entity is
registered as an
investment adviser under the Investment Advisers Act of 1940, and
may apply for
registration as an investment manager under the Securities Act of
Ontario in
order to be eligible to provide certain services to the RPF
International Bond Fund, a trust (whose shares are sold in
Canada) which
Price-Fleming serves as investment adviser.
Since 1983, the Manager has organized several distinct Maryland
limited
partnerships, which are informally called the Pratt Street
Ventures
partnerships, for the purpose of acquiring interests in
growth-oriented
businesses.
Tower Venture, Inc., a wholly-owned subsidiary of the Manager, is
a Maryland
corporation organized in 1989 for the purpose of serving as a
general partner of
100 East Pratt St., L.P., a Maryland limited partnership whose
limited partners
also include the Manager. The purpose of the partnership is to
further develop
and improve the property at 100 East Pratt Street, the site of
the Manager's
headquarters, through the construction of additional office,
retail and parking
space.
TRP Suburban, Inc. is a Maryland corporation organized in 1990 as
a wholly-owned
subsidiary of the Manager. TRP Suburban has entered into
agreements with
McDonogh School and CMANE-McDonogh-Rowe Limited Partnership to
construct an
office building in Owings Mills, Maryland, which houses the
Manager's transfer
agent, plan administrative services, retirement plan services and
operations
support functions.
TRP Finance, Inc. and TRP Finance MRT, Inc., wholly-owned
subsidiaries of the
Manager, are Delaware corporations organized in 1990 to manage
certain passive
corporate investments and other intangible assets. TRP Finance
MRT, Inc. was
dissolved on October 4, 1993.
T. Rowe Price Strategic Partners Fund, L.P. is a Delaware limited
partnership
organized in 1990 for the purpose of investing in small public
and private
companies seeking capital for expansion or undergoing a
restructuring of
ownership. The general partner of the Fund is T. Rowe Price
Strategic Partners,
L.P., a Delaware limited partnership whose general partner is T.
Rowe Price
Strategic Partners Associates, Inc., ("Strategic Associates"), a
Maryland
corporation which is a wholly-owned subsidiary of the Manager.
Strategic
Associates also serves as the general partner of T. Rowe Price
Strategic
Partners II, L.P., a Delaware limited partnership established in
1992, which in
turn serves as general partner of T. Rowe price Strategic
Partners Fund II,
L.P., a Delaware limited partnership organized in 1992.
Listed below are the directors of the Manager who have other
substantial
businesses, professions, vocations, or employment aside from that
of Director of
the Manager:
JAMES E. HALBKAT, JR., Director of the Manager. Mr. Halbkat is
President of
U.S. Monitor Corporation, a provider of public response systems.
Mr. Halbkat's
address is: P.O. Box 23109, Hilton Head Island, South Carolina
29925.
JOHN W. ROSENBLUM, Director of the Manager. Mr. Rosenblum is the
Tayloe Murphy
Professor at the University of Virginia, and a director of:
Chesapeake
Corporation, a manufacturer of paper products, Cadmus
Communications Corp., a
provider of printing and communication services; Comdial
Corporation, a
manufacturer of telephone systems for businesses; and Cone Mills
Corporation, a
textiles producer. Mr. Rosenblum's address is: P.O. Box 6550,
Charlottesville,
Virginia 22906.
ROBERT L. STRICKLAND, Director of the Manager. Mr. Strickland is
Chairman of
Lowe's Companies, Inc., a retailer of specialty home supplies.
Mr. Strickland's
address is 604 Two Piedmont Plaza Building, Winston-Salem, North
Carolina 27104.
PHILIP C. WALSH, Director of the Manager. Mr. Walsh is a
Consultant to Cyprus
Amax Minerals Company, Englewood, Colorado, and a director of
Piedmont Mining
Company, Inc., Charlotte, North Carolina. Mr. Walsh's address
is: Blue Mill
Road, Morristown, New Jersey 07960.
With the exception of Messrs. Halbkat, Rosenblum, Strickland, and
Walsh, all of
the directors of the Manager are employees of the Manager.
George J. Collins, who is Chief Executive Officer, President, and
a Managing
Director of the Manager, is a Director of Price-Fleming.
George A. Roche, who is Chief Financial Officer and a Managing
Director of the
Manager, is a Vice President and a Director of Price-Fleming.
M. David Testa, who is a Managing Director of the Manager, is
Chairman of the
Board of Price-Fleming.
Henry H. Hopkins, Charles P. Smith, and Peter Van Dyke, who are
Managing
Directors of the Manager, are Vice Presidents of Price-Fleming.
Robert P. Campbell, Roger L. Fiery, III, Robert C. Howe, Veena A.
Kutler, George
A. Murnaghan, William F. Wendler, II, and Edward A. Wiese, who
are Vice
Presidents of the Manager, are Vice Presidents of Price-Fleming.
Alvin M. Younger, Jr., who is a Managing Director and the
Secretary and
Treasurer of the Manager, is Secretary and Treasurer of
Price-Fleming.
Nolan L. North, who is a Vice President and Assistant Treasurer
of the Manager,
is Assistant Treasurer of Price-Fleming.
Leah P. Holmes, who is an Assistant Vice President of the
Manager, is a Vice
President of Price-Fleming.
Barbara A. Van Horn, who is Assistant Secretary of the Manager,
is Assistant
Secretary of Price-Fleming.
Certain directors and officers of the Manager are also officers
and/or directors
of one or more of the Price Funds and/or one or more of the
affiliated entities
listed herein.
See also "Management of Fund," in Registrant's Statement of
Additional
Information.
Item 29. Principal Underwriters.
(a) The principal underwriter for the Registrant is Investment
Services.
Investment Services acts as the principal underwriter for the
other thirty-five
Price Funds. Investment Services is a wholly-owned subsidiary of
the Manager is
registered as a broker-dealer under the Securities Exchange Act
of 1934 and is a
member of the National Association of Securities Dealers, Inc.
Investment
Services has been formed for the limited purpose of distributing
the shares of
the Price Funds and will not engage in the general securities
business. Since
the Price Funds are sold on a no-load basis, Investment Services
will not
receive any commission or other compensation for acting as
principal
underwriter.
(b) The address of each of the directors and officers of Investment Services listed below is 100 East Pratt Street, Baltimore, Maryland 21202.
Positions and Name and Principal Positions and Offices Offices with
Business Address With Underwriter Registrant
__________________ _____________________ _____________
James Sellers Riepe President and Director Vice President
and
Director
Henry Holt Hopkins Vice President and Vice President
Director
Mark E. Rayford Director None
Charles E. Vieth Vice President and None
Director
Patricia M. Archer Vice President None
Edward C. Bernard Vice President None
Joseph C. Bonasorte Vice President None
Meredith C. Callanan Vice President None
Laura H. Chasney Vice President None
Victoria C. Collins Vice President None
Christopher W. Dyer Vice President None
Forrest R. Foss Vice President None
Patricia O'Neil Goodyear Vice President None
James W. Graves Vice President None
Andrea G. Griffin Vice President None
Thomas Grizzard Vice President None
David J. Healy Vice President None
Joseph P. Healy Vice President None
Walter J. Helmlinger Vice President None
Eric G. Knauss Vice President None
Douglas G. Kremer Vice President None
Sharon Renae Krieger Vice President None
Keith Wayne Lewis Vice President None
David L. Lyons Vice President None
Sarah McCafferty Vice President None
Maurice Albert Minerbi Vice President None
Nancy M. Morris Vice President None
George A. Murnaghan Vice President None
Steven Ellis Norwitz Vice President None
Kathleen M. O'Brien Vice President None
Charles S. Peterson Vice President None
|
Pamela D. Preston Vice President None Lucy Beth Robins Vice President None John Richard Rockwell Vice President None Monica R. Tucker Vice President None William F. Wendler, II Vice President None Terri L. Westren Vice President None Jane F. White Vice President None Thomas R. Woolley Vice President None Alvin M. Younger, Jr. Secretary and Treasurer None Mark S. Finn Controller None Richard J. Barna Assistant Vice President None Catherine L. Berkenkemper Assistant Vice President None Ronae M. Brock Assistant Vice President None Brenda E. Buhler Assistant Vice President None Patricia Sue Butcher Assistant Vice President None John A. Galateria Assistant Vice President None Janelyn A. Healey Assistant Vice President None Keith J. Langrehr Assistant Vice President None C. Lillian Matthews Assistant Vice President None Janice D. McCrory Assistant Vice President None Sandra J. McHenry Assistant Vice President None JeanneMarie B. Patella Assistant Vice President None Kristin E. Seeberger Assistant Vice President None Arthur J. Silber Assistant Vice President None Linda C. Wright Assistant Vice President None |
Nolan L. North Assistant Treasurer None Barbara A. VanHorn Assistant Secretary None
(c) Not applicable. Investment Services will not receive any compensation with respect to its activities as underwriter for the Price Funds since the Price Funds are sold on a no-load basis.
Item 30. Location of Accounts and Records.
All accounts, books, and other documents required to be
maintained by T. Rowe
Price Tax-Free Short-Intermediate Fund, Inc. under Section 31(a)
of the
Investment Company Act of 1940 and the rules thereunder will be
maintained by T.
Rowe Price Tax-Free Short-Intermediate Fund, Inc. at its offices
at 100 East
Pratt Street, Baltimore, Maryland 21202. Transfer, dividend
disbursing, and
shareholder service activities are performed by T. Rowe Price
Services, Inc., at
100 East Pratt Street, Baltimore, Maryland 21202. Custodian
activities for T.
Rowe Price Tax-Free Short-Intermediate Fund, Inc. are performed
at State Street
Bank and Trust Company's Service Center (State Street South),
1776 Heritage
Drive, Quincy, Massachusetts 02171.
Item 31. Management Services.
Registrant is not a party to any management-related
service contract,
other than as set forth in the Prospectus.
Item 32. Undertakings.
(a) The Fund agrees to furnish, upon request and without charge, a copy of its Annual Report to each person to whom a prospectus is delivered.
Pursuant to the requirements of the Securities Act of 1933,
as amended, and
the Investment Company Act of 1940, as amended, the Registrant
has duly caused
this Registration Statement to be signed on its behalf by the
undersigned,
thereunto duly authorized, in the City of Baltimore, State of
Maryland, this
22nd day of April, 1994.
T. ROWE PRICE TAX-FREE
SHORT-INTERMEDIATE
FUND, INC.
/s/George J. Collins
By:George J. Collins, Chairman of the
Board
Pursuant to the requirements of the Securities Act of 1933,
as amended,
this Registration Statement has been signed below by the
following persons in
the capacities and on the dates indicated:
SIGNATURE TITLE DATE
________ _____ ____
/s/George J. Collins Chairman of the Board April 22, 1994
George J. Collins (Chief Executive Officer)
/s/Carmen F. Deyesu Treasurer April 22, 1994
Carmen F. Deyesu (Chief Financial Officer)
/s/Calvin W. Burnett Director April 22, 1994
Calvin W. Burnett
/s/Anthony W. Deering Director April 22, 1994
Anthony W. Deering
/s/F. Pierce Linaweaver DirectorApril 22,
1994
F. Pierce Linaweaver
/s/Mary J. Miller President and Director April 22, 1994
William T. Reynolds
/s/James S. Riepe Vice President and DirectorApril 22, 1994
James S. Riepe
/s/John Sagan Director April 22, 1994
John Sagan
/s/John G. Schrieber Director April 22, 1994
John G. Schreiber
|
Item 24. Financial Statements and Exhibits
(a) Financial Statements. The Condensed Financial Information (Financial Highlights table) is included in Part A of the Registration Statement. Portfolio of Investments, Statement of Assets and Liabilities, Statement of Operations, and Statement of Changes in Net Assets are included in the Annual Report to Shareholders, the pertinent portions of which are incorporated by reference in Part B of the Registration Statement.
(b) Exhibits
(1) Articles of Incorporation of Registrant, dated
October 14, 1992
(filed with initial Registration Statement)
(2) By-Laws of Registrant (filed with initial Registration Statement)
(3) Inapplicable
(4) Inapplicable
(5) Investment Management Agreement between Registrant and T. Rowe Price Associates, Inc., dated November 3, 1992 (filed with Amendment No. 1)
(6) Underwriting Agreement between Registrant and T.
Rowe Price
Investment Services, Inc., dated November 3, 1992
(filed with
Amendment No. 1)
(7) Inapplicable
(8)(a) Custodian Agreement between T. Rowe
Price Funds
and State Street Bank and Trust
Company, dated
September 28, 1987, as amended to
June 24, 1988,
October 19, 1988, February 22,
1989, July 19,
1989, September 15, 1989, December
15, 1989,
December 20, 1989, January 25,
1990, February 21,
1990, June 12, 1990, July 18, 1990,
October 15,
1990, February 13, 1991, March 6,
1991, September
12, 1991, November 6, 1991, April
23, 1992,
September 2, 1992, and November 3,
1992, December
16, 1992, December 21, 1992,
January 28, 1993,
April 21, 1993, September 16, 1993,
November 3,
1993, and March 1, 1994
|
(8)(b) Global Custody Agreement between
The Chase
Manhattan Bank, N.A. and the T.
Rowe Price Funds,
dated January 3, 1994
(9)(a) Transfer Agency and Service
Agreement between T.
Rowe Price Services, Inc. and T.
Rowe Price Funds,
dated January 1, 1994, as amended
to March 1, 1994
(9)(b) Agreement between T. Rowe Price
Associates, Inc.
and T.Rowe Price Funds for Fund
Accounting
Services, dated January 1, 1994, as
amended March
1, 1994
|
(10) Inapplicable
(11) Consent of Independent Accountants
(12) Inapplicable
(13) Inapplicable
(14) Inapplicable
(15) Inapplicable
(16) The Registrant hereby incorporates by reference the methodology used in calculating the performance information included in Post- Effective Amendment No. 36 and Amendment No. 20 of the T. Rowe Price Tax-Free Income Fund, Inc. (SEC. File Nos. 2-57265 and 811- 2684 and CIK 202927) dated April 22, 1994.
Item 25. Persons Controlled by or Under Common Control.
None.
Item 26. Number of Holders of Securities
As of February 28, 1994, there were 4,000 shareholders in the T.
Rowe Price Tax-
Free Insured Intermediate Bond Fund, Inc.
Item 27. Indemnification
If approved by the other named insureds the Registrant intends
to become a
named insured on comprehensive Errors and Omissions and Officers
and Directors
insurance policies written by the Evanston Insurance Company, The
Chubb Group
and ICI Mutual. These policies provide coverage for the named
insureds, which
include T. Rowe Price Associates, Inc. ("Manager"), Rowe
Price-Fleming
International, Inc. ("Price-Fleming"), T. Rowe Price Investment
Services, Inc.,
T. Rowe Price Services, Inc., T. Rowe Price Trust Company, T.
Rowe Price Stable
Asset Management, Inc., RPF International Bond Fund and
thirty-five other
investment companies, namely, T. Rowe Price Growth Stock Fund,
Inc., T. Rowe
Price New Horizons Fund, Inc., T. Rowe Price New Era Fund, Inc.,
T. Rowe Price
New Income Fund, Inc., T. Rowe Price Prime Reserve Fund, Inc., T.
Rowe Price
Tax-Free Income Fund, Inc., T. Rowe Price Tax-Exempt Money Fund,
Inc., T. Rowe
Price International Funds, Inc., T. Rowe Price Growth & Income
Fund,Inc., T.
Rowe Price Tax-Free Short-Intermediate Fund, Inc., T. Rowe Price
Short-Term Bond
Fund, Inc., T. Rowe Price High Yield Fund, Inc., T. Rowe Price
Tax-Free High
Yield Fund, Inc., T. Rowe Price New America Growth Fund, T. Rowe
Price Equity
Income Fund, T. Rowe Price GNMA Fund, T. Rowe Price Capital
Appreciation Fund,
T. Rowe Price State Tax-Free Income Trust, T. Rowe Price
California Tax-Free
Income Trust, T. Rowe Price Science & Technology Fund, Inc., T.
Rowe Price
Small-Cap Value Fund, Inc., Institutional International Funds,
Inc., T. Rowe
Price U.S. Treasury Funds, Inc., T. Rowe Price Index Trust, Inc.,
T. Rowe Price
Spectrum Fund, Inc., T. Rowe Price Balanced Fund, Inc., T. Rowe
Price Adjustable
Rate U.S. Government Fund, Inc., T. Rowe Price Mid-Cap Growth
Fund, Inc., T.
Rowe Price OTC Fund, Inc., T. Rowe Price Dividend Growth Fund,
Inc., T. Rowe
Price Blue Chip Growth Fund, Inc., T. Rowe Price Summit Income
Funds, Inc., T.
Rowe Price Summit Municipal Funds, Inc., T. Rowe Price Equity
Series, Inc., and
T. Rowe Price International Series, Inc. The Registrant and the
thirty-
five investment companies listed above, with the exception of T.
Rowe Price
Equity Series, Inc., T. Rowe Price International Series, Inc.,
and Institutional
International Funds, Inc., will be collectively referred to as
the Price Funds.
The investment manager for the Price Funds, including T. Rowe
Price Equity
Series, Inc., is the Manager. Price-Fleming is the investment
manager to the T.
Rowe Price International Funds, Inc., T. Rowe Price International
Series, Inc.,
and Institutional International Funds, Inc. and is 50% owned by
TRP Finance,
Inc., a wholly-owned subsidiary of the Manager, 25% owned by
Copthall Overseas
Limited, a wholly-owned subsidiary of Robert Fleming Holdings
Limited, and 25%
owned by Jardine Fleming International Holdings Limited. In
addition to the
corporate insureds, the policies also cover the officers,
directors, and
employees of each of the named insureds. The premium is
allocated among the
named corporate insureds in accordance with the provisions of
Rule l7d-1(d)(7)
under the Investment Company Act of 1940.
Article X, Section 10.01 of the Registrant's By-Laws provides as follows:
Section 10.01 Indemnification and Payment of Expenses in
Advance. The
Corporation shall indemnify any individual ("Indemnitee") who is
a present or
former director, officer, employee, or agent of the Corporation,
or who is or
has been serving at the request of the Corporation as a director,
officer,
employee or agent of another corporation, partnership, joint
venture, trust or
other enterprise, who, by reason of his position was, is, or is
threatened to
be made a party to any threatened, pending, or completed action,
suit, or
proceeding, whether civil, criminal, administrative, or
investigative
(hereinafter collectively referred to as a "Proceeding") against
any judgments,
penalties, fines, settlements, and reasonable expenses (including
attorneys' fees) incurred by such Indemnitee in connection with
any
Proceeding, to the fullest extent that such indemnification may
be lawful
under applicable Maryland law, as from time to time amended. The
Corporation
shall pay any reasonable expenses so incurred by such Indemnitee
in defending
a Proceeding in advance of the final disposition thereof to the
fullest extent
that such advance payment may be lawful under applicable Maryland
law, as from
time to time amended. Subject to any applicable limitations and
requirements
set forth in the Corporation's Articles of Incorporation and in
these By-Laws,
any payment of indemnification or advance of expenses shall be
made in
accordance with the procedures set forth in applicable Maryland
law, as from
time to time amended.
Notwithstanding the foregoing, nothing herein shall
protect or purport
to protect any Indemnitee against any liability to which he
would otherwise
be subject by reason of willful misfeasance, bad faith, gross
negligence,
or reckless disregard of the duties involved in the conduct
of his office
("Disabling Conduct").
Anything in this Article X to the contrary
notwithstanding, no
indemnification shall be made by the Corporation to any
Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act of 1940, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Anything in this Article X to the contrary
notwithstanding, any advance
of expenses by the Corporation to any Indemnitee shall be
made only upon
the undertaking by such Indemnitee to repay the advance
unless it is
ultimately determined that such Indemnitee is entitled to
indemnification
as above provided, and only if one of the following
conditions is met:
(a) the Indemnitee provides a security for his undertaking; or
(b) the Corporation shall be insured against losses arising by reason of any lawful advances; or
(c) there is a determination, based on a review of readily available facts, that there is reason to believe that the Indemnitee will ultimately be found entitled to indemnification, which determination shall be made by:
(i) a majority of a quorum of directors who are
neither
"interested persons" of the Corporation as
defined in
Section 2(a)(19) of the Investment Company
Act of 1940, nor
parties to the Proceeding; or
opinion.
Section 10.02 of the Registrant's By-Laws provides as follows:
Section 10.02 Insurance of Officers, Directors, Employees
and Agents. To
the fullest extent permitted by applicable Maryland law and by
Section 17(h) of
the Investment Company Act of 1940, as from time to time amended,
the
Corporation may purchase and maintain insurance on behalf of any
person who is
or was a director, officer, employee, or agent of the
Corporation, or who is or
was serving at the request of the Corporation as a director,
officer, employee,
or agent of another corporation, partnership, joint venture,
trust, or other
enterprise, against any liability asserted against him and
incurred by him in or
arising out of his position, whether or not the Corporation would
have the power
to indemnify him against such liability.
Insofar as indemnification for liability arising under the
Securities Act of
1933 may be permitted to directors, officers and controlling
persons of the
registrant pursuant to the foregoing provisions, or otherwise,
the registrant
has been advised that in the opinion of the Securities and
Exchange Commission
such indemnification is against public policy as expressed in the
Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against
such liabilities (other than the payment by the registrant of
expenses incurred
or paid by a director, officer or controlling person of the
registrant in the
successful defense of any action, suit proceeding) is asserted by
such director,
officer or controlling person in connection with the securities
being
registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court
of appropriate jurisdiction the question whether such
indemnification by it is
against public policy as expressed in the Act and will be
governed by the final
adjudication of such issue.
Item 28. Business and Other Connections of Investment
Manager.
Rowe Price-Fleming International, Inc. ("Price-Fleming"), a
Maryland
corporation, is a corporate joint venture 50% owned by TRP
Finance, Inc., a
wholly-owned subsidiary of the Manager, and was organized in 1979
to provide
investment counsel service with respect to foreign securities for
institutional
investors in the United States. Price-Fleming, in addition to
managing private
counsel client accounts, also sponsors registered investment
companies which
invest in foreign securities, serves as general partner of RPFI
International
Partners, Limited Partnership, and provides investment advice to
the T. Rowe
Price Trust Company, trustee of the International Common Trust
Fund.
T. Rowe Price Investment Services, Inc. ("Investment Services"),
a wholly- owned
subsidiary of the Manager, is a Maryland corporation organized in
1980 for the
purpose of acting as the principal underwriter and distributor
for the Price
Funds. Investment Services is registered as a broker-dealer
under the
Securities Exchange Act of 1934 and is a member of the National
Association of
Securities Dealers, Inc. In 1984, Investment Services expanded
its activities
to include a discount brokerage service.
TRP Distribution, Inc., a wholly-owned subsidiary of Investment
Services, is a
Maryland corporation organized in 1991. It was organized for and
engages in the
sale of certain investment related products prepared by
Investment Services.
T. Rowe Price Associates Foundation, Inc., was organized in 1981
for the purpose
of making charitable contributions to religious, charitable,
scientific,
literary and educational organizations. The Foundation (which is
not a
subsidiary of the Manager) is funded solely by contributions from
the Manager
and income from investments.
T. Rowe Price Services, Inc. ("Price Services"), a wholly-owned
subsidiary of
the Manager, is a Maryland corporation organized in 1982 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. Price
Services
provides transfer agent, dividend disbursing, and certain other
services,
including shareholder services, to the Price Funds.
T. Rowe Price Retirement Plan Services, Inc. ("RPS"), a
wholly-owned subsidiary
of the Manager, was incorporated in Maryland in 1991 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. RPS
provides
administrative, recordkeeping, and subaccounting services to
administrators of
employee benefit plans.
T. Rowe Price Trust Company ("Trust Company"), a wholly-owned
subsidiary of the
Manager, is a Maryland chartered limited purpose trust company,
organized
in 1983 for the purpose of providing fiduciary services. The
Trust Company
serves as trustee/custodian for employee benefit plans, common
trust funds and a
few trusts.
T. Rowe Price Threshold Fund II, L.P., a Delaware limited
partnership, was
organized in 1986 by the Manager, and invests in private
financings of small
companies with high growth potential; the Manager is the General
Partner of the
partnership.
RPFI International Partners, Limited Partnership, is a Delaware
limited
partnership organized in 1985 for the purpose of investing in a
diversified
group of small and medium-sized rapidly growing non-U.S.
companies.
Price-Fleming is the general partner of this partnership, and
certain clients of
Price-Fleming are its limited partners.
T. Rowe Price Real Estate Group, Inc. ("Real Estate Group"), is a
Maryland
corporation and a wholly-owned subsidiary of the Manager
established in 1986 to
provide real estate services. Subsidiaries of Real Estate Group
are: T. Rowe
Price Realty Income Fund I Management, Inc., a Maryland
corporation (General
Partner of T. Rowe Price Realty Income Fund I, A No-Load Limited
Partnership),
T. Rowe Price Realty Income Fund II Management, Inc., a Maryland
corporation
(General Partner of T. Rowe Price Realty Income Fund II,
America's
Sales-Commission-Free Real Estate Limited Partnership), T. Rowe
Price Realty
Income Fund III Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund III, America's
Sales-Commission-Free Real Estate
Limited Partnership, a Delaware limited partnership), and T. Rowe
Price Realty
Income Fund IV Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund IV, America's Sales-Commission-Free
Real Estate
Limited Partnership). Real Estate Group serves as investment
manager to T. Rowe
Price Renaissance Fund, Ltd., A Sales-Commission-Free Real Estate
Investment,
established in 1989 as a Maryland corporation which qualifies as
a REIT.
T. Rowe Price Stable Asset Management, Inc. ("Stable Asset
Management") is a
Maryland corporation organized in 1988 as a wholly-owned
subsidiary of the
Manager. Stable Asset Management, which is registered as an
investment adviser
under the Investment Advisers Act of 1940, specializes in the
management of
investment portfolios which seek stable and consistent investment
returns
through the use of guaranteed investment contracts, bank
investment contracts,
structured or synthetic investment contracts, and short-term
fixed-income
securities.
T. Rowe Price Recovery Fund Associates, Inc., a Maryland
corporation, is a
wholly-owned subsidiary of the Manager organized in 1988 for the
purpose of
serving as the General Partner of T. Rowe Price Recovery Fund,
L.P., a Delaware
limited partnership which invests in financially distressed
companies.
T. Rowe Price (Canada), Inc. is a Maryland corporation organized
in 1988 as a
wholly-owned subsidiary of the Manager. This entity is
registered as an
investment adviser under the Investment Advisers Act of 1940, and
may apply for registration as an investment manager under the
Securities Act of
Ontario in order to be eligible to provide certain services to
the RPF
International Bond Fund, a trust (whose shares are sold in
Canada) which
Price-Fleming serves as investment adviser.
Since 1983, the Manager has organized several distinct Maryland
limited
partnerships, which are informally called the Pratt Street
Ventures
partnerships, for the purpose of acquiring interests in
growth-oriented
businesses.
Tower Venture, Inc., a wholly-owned subsidiary of the Manager, is
a Maryland
corporation organized in 1989 for the purpose of serving as a
general partner of
100 East Pratt St., L.P., a Maryland limited partnership whose
limited partners
also include the Manager. The purpose of the partnership is to
further develop
and improve the property at 100 East Pratt Street, the site of
the Manager's
headquarters, through the construction of additional office,
retail and parking
space.
TRP Suburban, Inc. is a Maryland corporation organized in 1990 as
a wholly-owned
subsidiary of the Manager. TRP Suburban has entered into
agreements with
McDonogh School and CMANE-McDonogh-Rowe Limited Partnership to
construct an
office building in Owings Mills, Maryland, which houses the
Manager's transfer
agent, plan administrative services, retirement plan services and
operations
support functions.
TRP Finance, Inc. and TRP Finance MRT, Inc., wholly-owned
subsidiaries of the
Manager, are Delaware corporations organized in 1990 to manage
certain passive
corporate investments and other intangible assets. TRP Finance
MRT, Inc. was
dissolved on October 4, 1993.
T. Rowe Price Strategic Partners Fund, L.P. is a Delaware limited
partnership
organized in 1990 for the purpose of investing in small public
and private
companies seeking capital for expansion or undergoing a
restructuring of
ownership. The general partner of the Fund is T. Rowe Price
Strategic Partners,
L.P., a Delaware limited partnership whose general partner is T.
Rowe Price
Strategic Partners Associates, Inc., ("Strategic Associates"), a
Maryland
corporation which is a wholly-owned subsidiary of the Manager.
Strategic
Associates also serves as the general partner of T. Rowe Price
Strategic
Partners II, L.P., a Delaware limited partnership established in
1992, which in
turn serves as general partner of T. Rowe price Strategic
Partners Fund II,
L.P., a Delaware limited partnership organized in 1992.
Listed below are the directors of the Manager who have other
substantial
businesses, professions, vocations, or employment aside from that
of Director of
the Manager:
JAMES E. HALBKAT, JR., Director of the Manager. Mr. Halbkat is
President of
U.S. Monitor Corporation, a provider of public response systems.
Mr. Halbkat's
address is: P.O. Box 23109, Hilton Head Island, South Carolina
29925.
JOHN W. ROSENBLUM, Director of the Manager. Mr. Rosenblum is the
Tayloe Murphy
Professor at the University of Virginia, and a director of:
Chesapeake
Corporation, a manufacturer of paper products, Cadmus
Communications Corp., a
provider of printing and communication services; Comdial
Corporation, a
manufacturer of telephone systems for businesses; and Cone Mills
Corporation, a
textiles producer. Mr. Rosenblum's address is: P.O. Box 6550,
Charlottesville,
Virginia 22906.
ROBERT L. STRICKLAND, Director of the Manager. Mr. Strickland is
Chairman of
Lowe's Companies, Inc., a retailer of specialty home supplies.
Mr. Strickland's
address is 604 Two Piedmont Plaza Building, Winston-Salem, North
Carolina 27104.
PHILIP C. WALSH, Director of the Manager. Mr. Walsh is a
Consultant to Cyprus
Amax Minerals Company, Englewood, Colorado, and a director of
Piedmont Mining
Company, Inc., Charlotte, North Carolina. Mr. Walsh's address
is: Blue Mill
Road, Morristown, New Jersey 07960.
With the exception of Messrs. Halbkat, Rosenblum, Strickland, and
Walsh, all of
the directors of the Manager are employees of the Manager.
George J. Collins, who is Chief Executive Officer, President, and
a Managing
Director of the Manager, is a Director of Price-Fleming.
George A. Roche, who is Chief Financial Officer and a Managing
Director of the
Manager, is a Vice President and a Director of Price-Fleming.
M. David Testa, who is a Managing Director of the Manager, is
Chairman of the
Board of Price-Fleming.
Henry H. Hopkins, Charles P. Smith, and Peter Van Dyke, who are
Managing
Directors of the Manager, are Vice Presidents of Price-Fleming.
Robert P. Campbell, Roger L. Fiery, III, Robert C. Howe, Veena A.
Kutler, George
A. Murnaghan, William F. Wendler, II, and Edward A. Wiese, who
are Vice
Presidents of the Manager, are Vice Presidents of Price-Fleming.
Alvin M. Younger, Jr., who is a Managing Director and the
Secretary and
Treasurer of the Manager, is Secretary and Treasurer of
Price-Fleming.
Nolan L. North, who is a Vice President and Assistant Treasurer
of the Manager,
is Assistant Treasurer of Price-Fleming.
Leah P. Holmes, who is an Assistant Vice President of the
Manager, is a Vice
President of Price-Fleming.
Barbara A. Van Horn, who is Assistant Secretary of the Manager,
is Assistant
Secretary of Price-Fleming.
Certain directors and officers of the Manager are also officers
and/or directors
of one or more of the Price Funds and/or one or more of the
affiliated entities
listed herein.
See also "Management of Fund," in Registrant's Statement of
Additional
Information.
Item 29. Principal Underwriters.
(a) The principal underwriter for the Registrant is Investment
Services.
Investment Services acts as the principal underwriter for the
other thiry-five
Price Funds. Investment Services is a wholly-owned subsidiary of
the Manager is
registered as a broker-dealer under the Securities Exchange Act
of 1934 and is a
member of the National Association of Securities Dealers, Inc.
Investment
Services was formed for the limited purpose of distributing the
shares of the
Price Funds and will not engage in the general securities
business. Since the
Price Funds are sold on a no-load basis, Investment Services does
not receive
any commission or other compensation for acting as principal
underwriter.
(b) The address of each of the directors and officers of Investment Services listed below is 100 East Pratt Street, Baltimore, Maryland 21202.
Positions and Name and Principal Positions and Offices Offices with
Business Address With Underwriter Registrant
__________________ _____________________ _____________
James Sellers Riepe President and Director Vice President
and
Director
Henry Holt Hopkins Vice President and Vice President
Director
Mark E. Rayford Director None
Charles E. Vieth Vice President and None
Director
Patricia M. Archer Vice President None
Edward C. Bernard Vice President None
Joseph C. Bonasorte Vice President None
Meredith C. Callanan Vice President None
Laura H. Chasney Vice President None
Victoria C. Collins Vice President None
Christopher W. Dyer Vice President None
Forrest R. Foss Vice President None
|
Patricia O'Neil Goodyear Vice President None James W. Graves Vice President None
PAGE 105 Andrea G. Griffin Vice President None Thomas Grizzard Vice President None David J. Healy Vice President None Joseph P. Healy Vice President None Walter J. Helmlinger Vice President None Eric G. Knauss Vice President None Douglas G. Kremer Vice President None Sharon Renae Krieger Vice President None Keith Wayne Lewis Vice President None David L. Lyons Vice President None Sarah McCafferty Vice President None Maurice Albert Minerbi Vice President None Nancy M. Morris Vice President None George A. Murnaghan Vice President None Steven Ellis Norwitz Vice President None Kathleen M. O'Brien Vice President None Charles S. Peterson Vice President None Pamela D. Preston Vice President None Lucy Beth Robins Vice President None John Richard Rockwell Vice President None Monica R. Tucker Vice President None William F. Wendler, II Vice President None Terri L. Westren Vice President None Jane F. White Vice President None Thomas R. Woolley Vice President None Alvin M. Younger, Jr. Secretary and Treasurer None Mark S. Finn Controller None Richard J. Barna Assistant Vice President None Catherine L. Berkenkemper Assistant Vice President None Ronae M. Brock Assistant Vice President None Brenda E. Buhler Assistant Vice President None Patricia Sue Butcher Assistant Vice President None John A. Galateria Assistant Vice President None Janelyn A. Healey Assistant Vice President None Keith J. Langrehr Assistant Vice President None C. Lillian Matthews Assistant Vice President None Janice D. McCrory Assistant Vice President None Sandra J. McHenry Assistant Vice President None JeanneMarie B. Patella Assistant Vice President None Kristin E. Seeberger Assistant Vice President None |
Arthur J. Silber Assistant Vice President None Linda C. Wright Assistant Vice President None Nolan L. North Assistant Treasurer None Barbara A. VanHorn Assistant Secretary None
(c) Not applicable. Investment Services will not receive any compensation with respect to its activities as underwriter for the Price Funds since the Price Funds are sold on a no-load basis.
PAGE
Item 30. Location of Accounts and Records.
All accounts, books, and other documents required to be
maintained by T. Rowe
Price Tax-Free Insured Intermediate Bond Fund, Inc. under Section
31(a) of the
Investment Company Act of 1940 and the rules thereunder will be
maintained by T.
Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc., at its
offices at 100
East Pratt Street, Baltimore, Maryland 21202. Transfer, dividend
disbursing,
and shareholder service activities are performed by T. Rowe Price
Services,
Inc., at 100 East Pratt Street, Baltimore, Maryland 21202.
Custodian activities
for T. Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc.
are performed at
State Street Bank and Trust Company's Service Center (State
Street South), 1776
Heritage Drive, Quincy, Massachusetts 02171.
Item 31. Management Services.
The Registrant is not a party to any management-related service
contract, other
than as set forth in the Prospectus.
Item 32. Undertakings.
(a) The Fund agrees to furnish, upon request and without charge, a copy of its Annual Report to each person to whom a prospectus is delivered.
Pursuant to the requirements of the Securities Act of 1933,
as amended, and
the Investment Company Act of 1940, as amended, the Registrant
has duly caused
this Registration Statement to be signed on its behalf by the
undersigned,
thereunto duly authorized, in the City of Baltimore, State of
Maryland, this
22nd day of April, 1994.
T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE
BOND FUND, INC.
/s/George J. Collins
By: George J. Collins, Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933,
as amended,
this Registration Statement has been signed below by the
following persons in
the capacities and on the dates indicated:
SIGNATURE TITLE DATE
____________ _________ ________
/s/George J. Collins Chairman of the Board April 22, 1994
George J. Collins (Chief Executive Officer)
/s/Carmen F. Deyesu Treasurer
|
Carmen F. Deyesu (Chief Financial Officer)April 22, 1994
/s/Calvin W. Burnett Director April 22, 1994 Calvin W. Burnett /s/Anthony W. Deering Director April 22, 1994 Anthony W. Deering /s/F. Pierce Linaweaver Director April 22, 1994 F. Pierce Linaweaver /s/James S. Riepe Vice President and DirectorApril 22, 1994 James S. Riepe /s/John Sagan Director April 22, 1994 John Sagan /s/John G. Schreiber Director April 22, 1994 John G. Schreiber |
Item 24. Financial Statements and Exhibits.
(a) Financial Statements. Condensed Financial Information
(Financial
Highlights table) is included in Part A of the
Registration Statement.
Statement of Net Assets, Statement of Operations, and
Statement of
Changes in Net Assets are included in the Annual Report
to
Shareholders, the pertinent portions of which are
incorporated by
reference in Part B of the Registration Statement.
(b) Exhibits.
(1) Articles of Incorporation of Registrant
(2) By-Laws of Registrant, as amended July 1, 1991
(3) Inapplicable
(4) Specimen Stock Certificate (filed with Amendment No. 2)
(5) Investment Management Agreement between Registrant and T. Rowe Price Associates, Inc.
(6) Underwriting Agreement between Registrant and T. Rowe Price
Investment Services, Inc.
(7) Inapplicable
(8) Custodian Agreement between the Price Funds and
State Street
Bank and Trust Company, dated September 28, 1987,
|
amended to
June 24, 1988, October 19, 1988, February 22,
1989, July 19,
1989, September 15, 1989, December 15, 1989,
December 20, 1989,
January 25, 1990, February 21, 1990, June 12,
1990, July 18,
1990, October 15, 1990, February 13, 1991, March
6, 1991,
September 12, 1991, November 6, 1991, April 23,
1992, September
2, 1992, and November 3, 1992, December 16, 1992,
December 21,
1992, January 28, 1993, April 21, 1993, September
16, 1993,
November 3, 1993, and March 1, 1994
(8)(a)
Subcustodian Agreements between T. Rowe Price
Tax-Free Funds
and Irving Trust Company, and Morgan Guaranty
Trust Company
(filed with Amendment No. 10)
(8) Subcustodian Agreement between Irving Trust Company and State Street Bank and Trust Company, dated November 30, 1987 (filed with Amendment No. 19)
Global Custody Agreement between The Chase Manhattan Bank,
N.A. and the T.
Rowe Price Funds, dated January 3, 1994
(9)(a)
Transfer Agency and Service Agreement between T.
Rowe Price
Services, Inc. and T. Rowe Price Funds, dated
January 1, 1994,
as amended March 1, 1994
(9)(b)
Agreement between T. Rowe Price Associates, Inc.
and T.Rowe
Price Funds for Fund Accounting Services, dated
January 1,
1994, as amended March 1, 1994
(10) Inapplicable
(11) Consent of Independent Accountants
(12) Inapplicable
(13) Inapplicable
(14) Inapplicable
(15) Inapplicable
(16) Total Return Performance
Item 25. Persons Controlled by or Under Common Control With Registrant.
None.
Item 26. Number of Holders of Securities.
As of February 28, 1994, there were 34,000 shareholders
in the T. Rowe
Price Tax-Free Income Fund, Inc.
Item 27. Indemnification.
The Registrant maintains comprehensive Errors and Omissions
and Officers and
Directors insurance policies written by the Evanston Insurance
Company, The
Chubb Group and ICI Mutual Insurance Co. These policies provide
coverage for
the named insureds, which include T. Rowe Price Associates, Inc.
("Manager"),
Rowe Price-Fleming International, Inc. ("Price-Fleming"), T. Rowe
Price
Investment Services, Inc., T. Rowe Price Services, Inc., T. Rowe
Price Trust
Company, T. Rowe Price Stable Asset Management, Inc., RPF
International Bond
Fund and thirty-five other investment companies, namely, T. Rowe
Price Growth
Stock Fund, Inc., T. Rowe
Price New Horizons Fund, Inc., T. Rowe Price New Era Fund, Inc.,
T. Rowe Price
New Income Fund, Inc., T. Rowe Price Prime Reserve Fund, Inc., T.
Rowe Price
International Funds, Inc., T. Rowe Price Tax-Exempt Money Fund,
Inc., T. Rowe
Price Growth & Income Fund, Inc., T. Rowe Price Tax-Free
Short-Intermediate
Fund, Inc., T. Rowe Price Short-Term Bond Fund,
Inc., T. Rowe Price High Yield Fund, Inc., T. Rowe Price Tax-Free
High Yield
Fund, Inc., T. Rowe Price New America Growth Fund, T. Rowe Price
Equity Income
Fund, T. Rowe Price GNMA Fund, T. Rowe Price Capital Appreciation
Fund, T. Rowe
Price State Tax-Free Income Trust, T. Rowe Price California
Tax-Free Income
Trust, T. Rowe Price Science & Technology Fund, Inc., T. Rowe
Price Small-Cap
Value Fund, Inc., Institutional International Funds, Inc., T.
Rowe Price U.S.
Treasury Funds, Inc., T. Rowe Price Index Trust, Inc., T. Rowe
Price Spectrum
Fund, Inc., T. Rowe Price Balanced Fund, Inc., T. Rowe Price
Adjustable Rate
U.S. Government Fund, Inc., T. Rowe Price Mid-Cap Growth Fund,
Inc., T. Rowe
Price OTC Fund, Inc., T. Rowe Price Tax-Free Insured Intermediate
Bond Fund,
Inc., T. Rowe Price Dividend Growth Fund, Inc., T. Rowe Price
Blue Chip Growth
Fund, Inc., T. Rowe Price Summit Income Funds, Inc., T. Rowe
Price Summit
Municipal Funds, Inc., T. Rowe Price Equity Series, Inc., and T.
Rowe Price
International Series, Inc. The Registrant and the thirty-five
investment
companies listed above, with the exception of Institutional
International Funds,
Inc., T. Rowe Price Equity Series, Inc., and T. Rowe Price
International Series,
Inc., will be collectively referred to as the Price Funds. The
investment
manager for the Price Funds, including T. Rowe Price Equity
Series, Inc. is the
Manager. Price-Fleming is the investment manager to T. Rowe
Price International
Funds, Inc., T. Rowe Price International Series, Inc., and
Institutional
International Funds, Inc., and is 50% owned by TRP Finance, Inc.,
a wholly-owned
subsidiary of the Manager, 25% owned by Copthall Overseas
Limited, a wholly-
owned subsidiary of Robert Fleming Holdings Limited, and 25%
owned by Jardine
Fleming Holdings Limited. In addition to the corporate insureds,
the policies
also cover the officers, directors, and employees of each of the
named insureds.
The premium is allocated among the named corporate insureds in
accordance with
the provisions of Rule 17d-1(d)(7) under the Investment Company
Act of 1940.
Article X, Section 10.0l of the Registrant's By-Laws provides as follows:
Section 10.01. Indemnification and Payment of Expenses in
Advance. The
Corporation shall indemnify any individual ("Indemnitee") who is
a present or
former director, officer, employee, or agent of the Corporation,
or who is or
has been serving at the request of the Corporation, as a
director, officer,
employee or agent of the Corporation, or who is or has been
serving at the
request of the Corporation as a director, officer, employee or
agent of another
corporation, partnership, joint venture, trust or other
enterprise, who, by
reason of his position was, is, or is threatened to be made a
party to any
threatened, pending, or completed action, suit, or proceeding,
whether civil,
criminal, administrative, or investigative (hereinafter
collectively referred to
as a "Proceeding") against any judgments, penalties, fines,
settlements, and
reasonable expenses (including attorneys' fees) incurred by such
Indemnitee in
connection with any Proceeding, to the fullest extent that such
indemnification
may be lawful under applicable Maryland law, as from time to time
amended. The
Corporation shall pay any reasonable expenses so incurred by such
Indemnitee in
defending a Proceeding in advance of the final disposition
thereof to the
fullest extent that
such advance payment may be lawful under applicable Maryland law,
as from time
to time amended. Subject to any applicable limitations and
requirements set
forth in the Corporation's Articles of Incorporation and in these
By-Laws, any
payment of indemnification or advance of expenses shall be made
in accordance
with the procedures set forth in applicable Maryland law, as from
time to time
amended.
Notwithstanding the foregoing, nothing herein shall protect or
purport to
protect any Indemnitee against any liability to which he would
otherwise be
subject by reason of willful misfeasance, bad faith, gross
negligence, or
reckless disregard of the duties involved in the conduct of his
office
("Disabling Conduct").
Anything in this Article X to the contrary notwithstanding, no indemnification shall be made by the Corporation to any Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act of 1940, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Anything in this Article X to the contrary notwithstanding,
any advance of
expenses by the Corporation to any Indemnitee shall be made only
upon the
undertaking by such Indemnitee to repay the advance unless it is
ultimately
determined that such Indemnitee is entitled to indemnification as
above
provided, and only if one of the following conditions is met:
(a) the Indemnitee provides a security for his undertaking; or
(b) the Corporation shall be insured against losses arising by reason of any lawful advances; or
(c) there is a determination, based on a review of readily available facts, that there is reason to believe that the Indemnitee will ultimately be found entitled to indemnification, which determination shall be made by:
(i) a majority of a quorum of directors who are
neither "interested
persons" of the Corporation as defined in Section
2(a)(19) of
the Investment Company Act of 1940, nor parties
to the
Proceeding; or
(ii) an independent legal counsel in a written opinion.
Section 10.02 of the Registrant's By-Laws provides as follows:
Section 10.02. Insurance of Officers, Directors, Employees
and Agents. To
the fullest extent permitted by applicable Maryland law and by
Section 17(h) of
the Investment Company Act of 1940, as from time to time amended,
the
Corporation may purchase and maintain insurance on behalf of any
person who is
or was a director, officer, employee, or agent of the
Corporation, or who is or
was serving at the request of the Corporation as a director,
officer, employee,
or agent of another corporation, partnership, joint venture,
trust or other
enterprise, against any liability asserted against him and
incurred by him in or
arising out of his position, whether or not the Corporation would
have the power
to indemnify him against such liability.
Insofar as indemnification for liability arising under the
Securities Act of
1933 may be permitted to directors, officers and controlling
persons of the
Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant
has been advised that in the opinion of the Securities and
Exchange Commission
such indemnification is against public policy as expressed in the
Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against
such liabilities (other than the payment by the Registrant of
expenses incurred
or paid by a director, officer or controlling person of the
registrant is in the
successful defense of any action, suit or proceeding) is asserted
by such
director, officer or controlling person in connection with the
securities being
registered, the Registrant will, unless in the opinion of its
counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate
jurisdiction the question whether such indemnification by it is
against public
policy as expressed in the Act and will be governed by the final
adjudication of
such issue.
Item 28. Business and Other Connections of Investment Manager.
Rowe Price-Fleming International, Inc. ("Price-Fleming"), a
Maryland
corporation, is a corporate joint venture 50% owned by TRP
Finance, Inc., a
wholly-owned subsidiary of the Manager, and was organized in 1979
to provide
investment counsel service with respect to foreign securities for
institutional
investors in the United States. Price-Fleming, in addition to
managing private
counsel client accounts, also sponsors registered investment
companies which
invest in foreign securities, serves as general partner of RPFI
International
Partners, Limited Partnership, and provides investment advice to
the T. Rowe
Price Trust Company, trustee of the International Common Trust
Fund.
T. Rowe Price Investment Services, Inc. ("Investment Services"),
a wholly- owned
subsidiary of the Manager, is a Maryland corporation organized in
1980 for the
purpose of acting as the principal underwriter and distributor
for the Price
Funds. Investment Services is registered as a broker-dealer
under the
Securities Exchange Act of 1934 and is a member of the National
Association of
Securities Dealers, Inc. In 1984, Investment Services expanded
its activities
to include a discount brokerage service.
TRP Distribution, Inc., a wholly-owned subsidiary of Investment
Services, is a
Maryland corporation organized in 1991. It was organized for and
engages in the
sale of certain investment related products prepared by
Investment Services.
T. Rowe Price Associates Foundation, Inc., was organized in 1981
for the purpose
of making charitable contributions to religious, charitable,
scientific,
literary and educational organizations. The Foundation (which is
not a
subsidiary of the Manager) is funded solely by contributions from
the Manager
and income from investments.
T. Rowe Price Services, Inc. ("Price Services"), a wholly-owned
subsidiary of
the Manager, is a Maryland corporation organized in 1982 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. Price
Services
provides transfer agent, dividend disbursing, and certain other
services,
including shareholder services, to the Price Funds.
T. Rowe Price Retirement Plan Services, Inc. ("RPS"), a
wholly-owned subsidiary
of the Manager, was incorporated in Maryland in 1991 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. RPS
provides
administrative, recordkeeping, and subaccounting services to
administrators of
employee benefit plans.
T. Rowe Price Trust Company ("Trust Company"), a wholly-owned
subsidiary of the
Manager, is a Maryland chartered limited purpose trust company,
organized
in 1983 for the purpose of providing fiduciary services. The
Trust Company
serves as trustee/custodian for employee benefit plans, common
trust funds and a
few trusts.
T. Rowe Price Threshold Fund II, L.P., a Delaware limited
partnership, was
organized in 1986 by the Manager, and invests in private
financings of small
companies with high growth potential; the Manager is the General
Partner of the
partnership.
RPFI International Partners, Limited Partnership, is a Delaware
limited
partnership organized in 1985 for the purpose of investing in a
diversified
group of small and medium-sized rapidly growing non-U.S.
companies.
Price-Fleming is the general partner of this partnership, and
certain clients of
Price-Fleming are its limited partners.
T. Rowe Price Real Estate Group, Inc. ("Real Estate Group"), is a
Maryland
corporation and a wholly-owned subsidiary of the Manager
established in 1986 to
provide real estate services. Subsidiaries of Real Estate Group
are: T. Rowe
Price Realty Income Fund I Management, Inc., a Maryland
corporation (General
Partner of T. Rowe Price Realty Income Fund I, A No-Load Limited
Partnership),
T. Rowe Price Realty Income Fund II Management, Inc., a Maryland
corporation
(General Partner of T. Rowe Price Realty Income Fund II,
America's
Sales-Commission-Free Real Estate Limited Partnership), T. Rowe
Price Realty
Income Fund III Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund III, America's
Sales-Commission-Free Real Estate
Limited Partnership, a Delaware limited partnership), and T. Rowe
Price Realty
Income Fund IV Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund IV, America's Sales-Commission-Free
Real Estate
Limited Partnership). Real Estate Group serves as investment
manager to T. Rowe
Price Renaissance Fund, Ltd., A Sales-Commission-Free Real Estate
Investment,
established in 1989 as a Maryland corporation which qualifies as
a REIT.
T. Rowe Price Stable Asset Management, Inc. ("Stable Asset
Management") is a
Maryland corporation organized in 1988 as a wholly-owned
subsidiary of the
Manager. Stable Asset Management, which is registered as an
investment adviser
under the Investment Advisers Act of 1940, specializes in the
management of
investment portfolios which seek stable and consistent investment
returns
through the use of guaranteed investment contracts, bank
investment contracts,
structured or synthetic investment contracts, and short-term
fixed-income
securities.
T. Rowe Price Recovery Fund Associates, Inc., a Maryland
corporation, is a
wholly-owned subsidiary of the Manager organized in 1988 for the
purpose of
serving as the General Partner of T. Rowe Price Recovery Fund,
L.P., a Delaware
limited partnership which invests in financially distressed
companies.
T. Rowe Price (Canada), Inc. is a Maryland corporation organized
in 1988 as a
wholly-owned subsidiary of the Manager. This entity is
registered as an
investment adviser under the Investment Advisers Act of 1940, and
may apply for
registration as an investment manager under the Securities Act of
Ontario in
order to be eligible to provide certain services to the RPF
International Bond Fund, a trust (whose shares are sold in
Canada) which
Price-Fleming serves as investment adviser.
Since 1983, the Manager has organized several distinct Maryland
limited
partnerships, which are informally called the Pratt Street
Ventures
partnerships, for the purpose of acquiring interests in
growth-oriented
businesses.
Tower Venture, Inc., a wholly-owned subsidiary of the Manager, is
a Maryland
corporation organized in 1989 for the purpose of serving as a
general partner of
100 East Pratt St., L.P., a Maryland limited partnership whose
limited partners
also include the Manager. The purpose of the partnership is to
further develop
and improve the property at 100 East Pratt Street, the site of
the Manager's
headquarters, through the construction of additional office,
retail and parking
space.
TRP Suburban, Inc. is a Maryland corporation organized in 1990 as
a wholly-owned
subsidiary of the Manager. TRP Suburban has entered into
agreements with
McDonogh School and CMANE-McDonogh-Rowe Limited Partnership to
construct an
office building in Owings Mills, Maryland, which houses the
Manager's transfer
agent, plan administrative services, retirement plan services and
operations
support functions.
TRP Finance, Inc. and TRP Finance MRT, Inc., wholly-owned
subsidiaries of the
Manager, are Delaware corporations organized in 1990 to manage
certain passive
corporate investments and other intangible assets. TRP Finance
MRT, Inc. was
dissolved on October 4, 1993.
T. Rowe Price Strategic Partners Fund, L.P. is a Delaware limited
partnership
organized in 1990 for the purpose of investing in small public
and private
companies seeking capital for expansion or undergoing a
restructuring of
ownership. The general partner of the Fund is T. Rowe Price
Strategic Partners,
L.P., a Delaware limited partnership whose general partner is T.
Rowe Price
Strategic Partners Associates, Inc., ("Strategic Associates"), a
Maryland
corporation which is a wholly-owned subsidiary of the Manager.
Strategic
Associates also serves as the general partner of T. Rowe Price
Strategic
Partners II, L.P., a Delaware limited partnership established in
1992, which in
turn serves as general partner of T. Rowe price Strategic
Partners Fund II,
L.P., a Delaware limited partnership organized in 1992.
Listed below are the directors of the Manager who have other
substantial
businesses, professions, vocations, or employment aside from that
of Director of
the Manager:
JAMES E. HALBKAT, JR., Director of the Manager. Mr. Halbkat is
President of
U.S. Monitor Corporation, a provider of public response systems.
Mr. Halbkat's
address is: P.O. Box 23109, Hilton Head Island, South Carolina
29925.
JOHN W. ROSENBLUM, Director of the Manager. Mr. Rosenblum is the
Tayloe Murphy
Professor at the University of Virginia, and a director of:
Chesapeake
Corporation, a manufacturer of paper products, Cadmus
Communications Corp., a
provider of printing and communication services; Comdial
Corporation, a
manufacturer of telephone systems for businesses; and Cone Mills
Corporation, a
textiles producer. Mr. Rosenblum's address is: P.O. Box 6550,
Charlottesville,
Virginia 22906.
ROBERT L. STRICKLAND, Director of the Manager. Mr. Strickland is
Chairman of
Lowe's Companies, Inc., a retailer of specialty home supplies.
Mr. Strickland's
address is 604 Two Piedmont Plaza Building, Winston-Salem, North
Carolina 27104.
PHILIP C. WALSH, Director of the Manager. Mr. Walsh is a
Consultant to Cyprus
Amax Minerals Company, Englewood, Colorado, and a director of
Piedmont Mining
Company, Inc., Charlotte, North Carolina. Mr. Walsh's address
is: Blue Mill
Road, Morristown, New Jersey 07960.
With the exception of Messrs. Halbkat, Rosenblum, Strickland, and
Walsh, all of
the directors of the Manager are employees of the Manager.
George J. Collins, who is Chief Executive Officer, President, and
a Managing
Director of the Manager, is a Director of Price-Fleming.
George A. Roche, who is Chief Financial Officer and a Managing
Director of the
Manager, is a Vice President and a Director of Price-Fleming.
M. David Testa, who is a Managing Director of the Manager, is
Chairman of the
Board of Price-Fleming.
Henry H. Hopkins, Charles P. Smith, and Peter Van Dyke, who are
Managing
Directors of the Manager, are Vice Presidents of Price-Fleming.
Robert P. Campbell, Roger L. Fiery, III, Robert C. Howe, Veena A.
Kutler, George
A. Murnaghan, William F. Wendler, II, and Edward A. Wiese, who
are Vice
Presidents of the Manager, are Vice Presidents of Price-Fleming.
Alvin M. Younger, Jr., who is a Managing Director and the
Secretary and
Treasurer of the Manager, is Secretary and Treasurer of
Price-Fleming.
Nolan L. North, who is a Vice President and Assistant Treasurer
of the Manager,
is Assistant Treasurer of Price-Fleming.
Leah P. Holmes, who is an Assistant Vice President of the
Manager, is a Vice
President of Price-Fleming.
Barbara A. Van Horn, who is Assistant Secretary of the Manager,
is Assistant
Secretary of Price-Fleming.
Certain directors and officers of the Manager are also officers
and/or directors
of one or more of the Price Funds and/or one or more of the
affiliated entities
listed herein.
See also "Management of Fund," in Registrant's Statement of
Additional
Information.
Item 29. Principal Underwriters.
(a) The principal underwriter for the Registrant is
Investment Services.
Investment Services acts as the principal underwriter for the
other thirty-five
Price Funds. Investment Services is a wholly-owned subsidiary of
the Manager is
registered as a broker-dealer under the Securities Exchange Act
of 1934 and is a
member of the National Association of Securities Dealers, Inc.
Investment
Services has been formed for the limited purpose of distributing
the shares of
the Price Funds and will not engage in the general securities
business. Since
the Price Funds are sold on a no-load basis, Investment Services
will not
receive any commission or other compensation for acting as
principal
underwriter.
(b) The address of each of the directors and officers of Investment Services listed below is 100 East Pratt Street, Baltimore, Maryland 21202.
Positions and Name and Principal Positions and Offices Offices with
Business Address With Underwriter Registrant
__________________ _____________________ _____________
James Sellers Riepe President and Director Vice President
and
Director
Henry Holt Hopkins Vice President and Vice President
Director
Mark E. Rayford Director None
Charles E. Vieth Vice President and None
Director
Patricia M. Archer Vice President None
Edward C. Bernard Vice President None
Joseph C. Bonasorte Vice President None
Meredith C. Callanan Vice President None
Laura H. Chasney Vice President None
Victoria C. Collins Vice President None
Christopher W. Dyer Vice President None
Forrest R. Foss Vice President None
Patricia O'Neil Goodyear Vice President None
James W. Graves Vice President None
Andrea G. Griffin Vice President None
Thomas Grizzard Vice President None
David J. Healy Vice President None
Joseph P. Healy Vice President None
Walter J. Helmlinger Vice President None
Eric G. Knauss Vice President None
Douglas G. Kremer Vice President None
Sharon Renae Krieger Vice President None
Keith Wayne Lewis Vice President None
David L. Lyons Vice President None
Sarah McCafferty Vice President None
Maurice Albert Minerbi Vice President None
Nancy M. Morris Vice President None
George A. Murnaghan Vice President None
Steven Ellis Norwitz Vice President None
Kathleen M. O'Brien Vice President None
Charles S. Peterson Vice President None
|
Pamela D. Preston Vice President None Lucy Beth Robins Vice President None John Richard Rockwell Vice President None Monica R. Tucker Vice President None William F. Wendler, II Vice President None Terri L. Westren Vice President None Jane F. White Vice President None Thomas R. Woolley Vice President None Alvin M. Younger, Jr. Secretary and Treasurer None Mark S. Finn Controller None Richard J. Barna Assistant Vice President None Catherine L. Berkenkemper Assistant Vice President None Ronae M. Brock Assistant Vice President None Brenda E. Buhler Assistant Vice President None Patricia Sue Butcher Assistant Vice President None John A. Galateria Assistant Vice President None Janelyn A. Healey Assistant Vice President None Keith J. Langrehr Assistant Vice President None C. Lillian Matthews Assistant Vice President None Janice D. McCrory Assistant Vice President None Sandra J. McHenry Assistant Vice President None JeanneMarie B. Patella Assistant Vice President None Kristin E. Seeberger Assistant Vice President None Arthur J. Silber Assistant Vice President None Linda C. Wright Assistant Vice President None |
Nolan L. North Assistant Treasurer None Barbara A. VanHorn Assistant Secretary None
(c) Not applicable. Investment Services will not receive any compensation with respect to its activities as underwriter for the Price Funds since the Price Funds are sold on a no-load basis.
Item 30. Location of Accounts and Records.
All accounts, books, and other documents required to be
maintained by T.
Rowe Price Tax-Free Income Fund, Inc. under Section 31(a) of the
Investment
Company Act of 1940 and the rules thereunder will be maintained
by T. Rowe Price
Tax-Free Income Fund, Inc. at its offices at 100 East Pratt
Street, Baltimore,
Maryland 21202. Transfer, dividend disbursing, and shareholder
service
activities are performed by T. Rowe Price Services, Inc., at 100
East Pratt
Street, Baltimore, Maryland 21202. Custodian activities for T.
Rowe
Price Tax-Free Income Fund, Inc. are performed at State Street
Bank and Trust
Company's Service Center (State Street South), 1776 Heritage
Drive, Quincy,
Massachusetts 02171.
Item 31. Management Services.
Registrant is not a party to any management-related
service contract,
other than as set forth in the Prospectus.
Item 32. Undertakings.
(a) The Fund agrees to furnish, upon request and without charge, a copy of its Annual Report to each person to whom a prospectus is delivered.
Pursuant to the requirements of the Securities Act of 1933, as
amended, and
the Investment Company Act of 1940, as amended, the Registrant
has duly caused
this Registration Statement to be signed on its behalf by the
undersigned,
thereunto duly authorized in the City of Baltimore, State of
Maryland, this 22nd
day of April, 1994.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
/s/William T. Reynolds
By: William T. Reynolds, President and
Director
|
Pursuant to the requirements of the Securities Act of 1933,
as amended,
this Registration Statement has been signed below by the
following persons in
the capacities and on the dates indicated:
SIGNATURE TITLE DATE ________ _____ ____ /s/George J. Collins Chairman of the Board April 22, 1994 George J. Collins (Chief Executive Officer) /s/Carmen F. Deyesu Treasurer April 22, 1994 Carmen F. Deyesu (Chief Financial Officer) /s/Calvin W. Burnett Director April 22, 1994 Calvin W. Burnett /s/Anthony W. Deering Director April 22, 1994 Anthony W. Deering /s/F. Pierce Linaweaver DirectorApril 22, 1994 F. Pierce Linaweaver /s/William T. Reynolds President and Director April 22, 1994 William T. Reynolds /s/James S. Riepe Vice President and DirectorApril 22, 1994 James S. Riepe /s/John Sagan Director April 22, 1994 John Sagan /s/John G. Schreiber Director April 22, 1994 John G. Schreiber |
Item 24. Financial Statements and Exhibits.
(a) Financial Statements. Condensed Financial Information (Financial Highlights table) is included in Part A of the Registration Statement. Statement of Net Assets, Statement of Operations, and Statement of Changes in Net Assets are included in the Annual Report to Shareholders, the pertinent portions of which are incorporated by reference in Part B of the Registration Statement.
(b) Exhibits.
(1) Articles of Incorporation of Registrant, dated November 30, 1984
(2) By-Laws of Registrant, as amended July 1, 1991
(3) Inapplicable
(4) Specimen Stock Certificate (filed with Amendment No. 1)
(5) Investment Management Agreement between Registrant and T. Rowe Price Associates, Inc.
(6) Underwriting Agreement between Registrant and T.
Rowe Price
Investment Services, Inc.
(7) Inapplicable
(8) Custodian Agreement between the Price Funds and State Street Bank and Trust Company, dated September 28, 1987, amended to June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, and November 3, 1992, December 16, 1992, December 21, 1992, January 28, 1993, April 21, 1993, September 16, 1993, November 3, 1993, and March 1, 1994
(8)(a)
Subcustodian Agreements between T. Rowe Price
Tax-Free Funds
and Irving Trust Company and Morgan Guaranty
Trust Company
(filed with Amendment No. 7)
(8) Subcustodian Agreement between Irving Trust Company and State Street Bank and Trust Company, dated November 30, 1987 (filed with Amendment No. 13)
(8)(b)
Global Custody Agreement between The Chase Manhattan Bank,
N.A. and the T.
Rowe Price Funds, dated January 3, 1994
(9)(a)
Transfer Agency and Service Agreement between T.
Rowe Price
Services, Inc. and T. Rowe Price Funds, dated
January 1, 1994,
as amended March 1, 1994
(9)(b)
Agreement between T. Rowe Price Associates, Inc.
and T.Rowe
Price Funds for Fund Accounting Services, dated
January 1,
1994, as amended March 1, 1994
(10) Inapplicable
(11) Consent of Independent Accountants
(12) Inapplicable
(13) Inapplicable
(14) Inapplicable
(15) Inapplicable
(16) The Registrant hereby incorporates by reference
the methodology
used in calculating the performance information
included in
Post-Effective Amendment No. 36 and Amendment No.
20 of the T.
Rowe Price Tax-Free Income Fund, Inc. (SEC. File
Nos. 2-57265
and 811-2684 and CIK 202927) dated April 22,
1994.
Item 25. Persons Controlled by or Under Common Control.
None
Item 26. Number of Holders of Securities.
As of February 28, 1994, there were 26,000 shareholders
in the T.
Rowe Price Tax-Free High Yield Fund, Inc.
Item 27. Indemnification.
The Registrant maintains comprehensive Errors and Omissions
and Officers and
Directors insurance policies written by the Evanston Insurance
Company, The
Chubb Group and ICI Mutual Insurance Co. These policies provide
coverage for
the named insureds, which include T. Rowe Price Associates, Inc.
("Manager"),
Rowe Price-Fleming International, Inc. ("Price-Fleming"), T. Rowe
Price
Investment Services, Inc., T. Rowe Price Services, Inc., T. Rowe
Price Trust
Company, T. Rowe Price Stable Asset Management, Inc., RPF
International Bond
Fund and thirty-five other investment companies, namely, T. Rowe
Price Growth
Stock Fund, Inc., T. Rowe Price New Horizons Fund, Inc., T. Rowe
Price New Era
Fund, Inc., T. Rowe Price New Income Fund, Inc., T. Rowe Price
Prime Reserve
Fund, Inc., T. Rowe Price Tax-Free Income Fund, Inc., T. Rowe
Price
International
Funds, Inc., T. Rowe Price Tax-Exempt Money Fund, Inc., T. Rowe
Price Growth &
Income Fund, Inc., T. Rowe Price Tax-Free Short-Intermediate
Fund, Inc., T. Rowe
Price Short-Term Bond Fund, Inc., T. Rowe Price High Yield Fund,
Inc., T. Rowe
Price New America Growth Fund, T. Rowe Price Equity Income Fund,
T. Rowe Price
GNMA Fund, T. Rowe Price Capital Appreciation Fund, T. Rowe Price
State Tax-Free
Income Trust, T. Rowe Price California Tax-Free Income Trust, T.
Rowe Price
Science & Technology Fund, Inc., T. Rowe Price Small-Cap Value
Fund, Inc.,
Institutional International Funds, Inc., T. Rowe Price U.S.
Treasury Funds,
Inc., T. Rowe Price Index Trust, Inc., T. Rowe Price Spectrum
Fund, Inc., T.
Rowe Price Balanced Fund, Inc., T. Rowe Price Adjustable Rate
U.S. Government
Fund, Inc., T. Rowe Price Mid-Cap Growth Fund, Inc., T. Rowe
Price OTC Fund,
Inc., T. Rowe Price Tax-Free Insured Intermediate Bond Fund,
Inc., T. Rowe Price
Dividend Growth Fund, Inc., T. Rowe Price Blue Chip Growth Fund,
Inc., T. Rowe
Price Summit Income Funds, Inc., T. Rowe Price Summit Municipal
Funds, Inc., T.
Rowe Price Equity Series, Inc., and T. Rowe Price International
Series, Inc.
The Registrant and the thirty-five investment companies listed
above, with the
exception of Institutional International Funds, Inc., T. Rowe
Price Equity
Series, Inc., and T. Rowe Price International Series, Inc., will
be collectively
referred to as the Price Funds. The investment manager for the
Price Funds,
including T. Rowe Price Equity Series, Inc. is the Manager.
Price-Fleming is
the investment manager to T. Rowe Price International Funds,
Inc., T. Rowe Price
International Series, Inc., and Institutional International
Funds, Inc., and is
50% owned by TRP Finance, Inc., a wholly owned subsidiary of the
Manager, 25%
owned by Copthall Overseas Limited, a wholly-owned subsidiary of
Robert Fleming
Holdings Limited, and 25% owned by Jardine Fleming Holdings
Limited. In
addition to the corporate insureds, the policies also cover the
officers,
directors, and employees of each of the named insureds. The
premium is
allocated among the named corporate insureds in accordance with
the provisions
of Rule 17d-1(d)(7) under the Investment Company Act of 1940.
Article X, Section 10.01 of the Registrant's By-Laws provides as follows:
Section 10.01. Indemnification and Payment of Expenses in
Advance. The
Corporation shall indemnify any individual ("Indemnitee") who is
a present or
former director, officer, employee, or agent of the Corporation,
or who is or
has been serving at the request of the Corporation as a director,
officer,
employee or agent of another corporation, partnership, joint
venture, trust or
other enterprise, who, by reason of his position was, is, or is
threatened to be
made a party to any threatened, pending, or completed action,
suit, or
proceeding, whether civil, criminal, administrative, or
investigative
(hereinafter collectively referred to as a "Proceeding") against
any judgments,
penalties, fines, settlements, and reasonable expenses (including
attorneys'
fees) incurred by such Indemnitee in connection with any
Proceeding, to the
fullest extent that such indemnification may be lawful under
applicable Maryland
law, as
from time to time amended. The Corporation shall pay any
reasonable expenses so
incurred by such Indemnitee in defending a Proceeding in advance
of the final
disposition thereof to the fullest extent that such advance
payment may be
lawful under applicable Maryland law, as from time to time
amended. Subject to
any applicable limitations and requirements set
forth in the Corporation's Articles of Incorporation and in these
By-Laws, any
payment of indemnification or advance of expenses shall be made
in accordance
with the procedures set forth in applicable Maryland law, as from
time to time
amended.
Notwithstanding the foregoing, nothing herein shall protect
or purport to
protect any Indemnitee against any liability to which he would
otherwise be
subject by reason of willful misfeasance, bad faith, gross
negligence, or
reckless disregard of the duties involved in the conduct of his
office
("Disabling Conduct").
Anything in this Article X to the contrary notwithstanding,
no
indemnification shall be made by the Corporation to any
Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors
who are
neither "interested persons" of the Corporation
as defined in
Section 2(a)(19) of the Investment Company Act
of 1940, nor
parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Anything in this Article X to the contrary notwithstanding,
any advance of
expenses by the Corporation to any Indemnitee shall be made only
upon the
undertaking by such Indemnitee to repay the advance unless it is
ultimately
determined that such Indemnitee is entitled to indemnification as
above
provided, and only if one of the following conditions is met:
(a) the Indemnitee provides a security for his undertaking; or
(b) the Corporation shall be insured against losses arising by reason of any lawful advances; or
(c) there is a determination, based on a review of readily available facts, that there is reason to believe that the Indemnitee will ultimately be found entitled to indemnification, which determination shall be made by:
(i) a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(l9) of the Investment Company Act of l940, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Section 10.02 of the Registrant's By-Laws provides as follows:
Section 10.02. Insurance of Officers, Directors, Employees
and Agents. To
the fullest extent permitted by applicable Maryland law and by
Section 17(h) of
the Investment Company Act of 1940, as from time to time amended,
the
Corporation may purchase and maintain insurance on behalf of any
person who is
or was a director, officer, employee, or agent of the
Corporation, or who is or
was serving at the request of the Corporation as a director,
officer, employee,
or agent of another corporation, partnership, joint venture,
trust, or other
enterprise, against any liability asserted against him and
incurred by him in or
arising out of his position, whether or not the Corporation would
have the power
to indemnify him against such liability.
Insofar as indemnification for liability under the Securities
Act of 1933
may be permitted to directors, officers and controlling
persons of the
Registrant pursuant to the foregoing provisions, or
otherwise, the
Registrant has been advised that in the opinion of the
Securities and
Exchange Commission such indemnification is against public
policy as
expressed in the Act and is, therefore, unenforceable. In
the event that a
claim for indemnification against such liabilities (other
than the payment
by the Registrant of expenses incurred or paid by a director,
officer or
controlling person of the Registrant in the successful
defense of any
action, suit or proceeding) is asserted by such director,
officer or
controlling person in connection with the securities being
registered, the
Registrant will, unless in the opinion of its counsel the
matter has been
settled by controlling precedent, submit to a court of
appropriate
jurisdiction the question whether such indemnification by it
is against
public policy as expressed in the Act and will be governed by
the final
adjudication of such issue.
Item 28. Business and Other Connections of Investment Manager.
Rowe Price-Fleming International, Inc. ("Price-Fleming"), a
Maryland
corporation, is a corporate joint venture 50% owned by TRP
Finance, Inc., a
wholly-owned subsidiary of the Manager, and was organized in 1979
to provide
investment counsel service with respect to foreign securities for
institutional
investors in the United States. Price-Fleming, in addition to
managing private
counsel client accounts, also sponsors registered investment
companies which
invest in foreign securities, serves as general partner of RPFI
International
Partners, Limited Partnership, and provides investment advice to
the T. Rowe
Price Trust Company, trustee of the International Common Trust
Fund.
T. Rowe Price Investment Services, Inc. ("Investment Services"),
a wholly- owned
subsidiary of the Manager, is a Maryland corporation organized in
1980 for the
purpose of acting as the principal underwriter and distributor
for the Price
Funds. Investment Services is registered as a broker-dealer
under the
Securities Exchange Act of 1934 and is a member of the National
Association of
Securities Dealers, Inc. In 1984, Investment Services expanded
its activities
to include a discount brokerage service.
TRP Distribution, Inc., a wholly-owned subsidiary of Investment
Services, is a
Maryland corporation organized in 1991. It was organized for and
engages in the
sale of certain investment related products prepared by
Investment Services.
T. Rowe Price Associates Foundation, Inc., was organized in 1981
for the purpose
of making charitable contributions to religious, charitable,
scientific,
literary and educational organizations. The Foundation (which is
not a
subsidiary of the Manager) is funded solely by contributions from
the Manager
and income from investments.
T. Rowe Price Services, Inc. ("Price Services"), a wholly-owned
subsidiary of
the Manager, is a Maryland corporation organized in 1982 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. Price
Services
provides transfer agent, dividend disbursing, and certain other
services,
including shareholder services, to the Price Funds.
T. Rowe Price Retirement Plan Services, Inc. ("RPS"), a
wholly-owned subsidiary
of the Manager, was incorporated in Maryland in 1991 and is
registered as a
transfer agent under the Securities Exchange Act of 1934. RPS
provides
administrative, recordkeeping, and subaccounting services to
administrators of
employee benefit plans.
T. Rowe Price Trust Company ("Trust Company"), a wholly-owned
subsidiary of the
Manager, is a Maryland chartered limited purpose trust company,
organized
in 1983 for the purpose of providing fiduciary services. The
Trust Company
serves as trustee/custodian for employee benefit plans, common
trust funds and a
few trusts.
T. Rowe Price Threshold Fund II, L.P., a Delaware limited
partnership, was
organized in 1986 by the Manager, and invests in private
financings of small
companies with high growth potential; the Manager is the General
Partner of the
partnership.
RPFI International Partners, Limited Partnership, is a Delaware
limited
partnership organized in 1985 for the purpose of investing in a
diversified
group of small and medium-sized rapidly growing non-U.S.
companies.
Price-Fleming is the general partner of this partnership, and
certain clients of
Price-Fleming are its limited partners.
T. Rowe Price Real Estate Group, Inc. ("Real Estate Group"), is a
Maryland
corporation and a wholly-owned subsidiary of the Manager
established in 1986 to
provide real estate services. Subsidiaries of Real Estate Group
are: T. Rowe
Price Realty Income Fund I Management, Inc., a Maryland
corporation (General
Partner of T. Rowe Price Realty Income Fund I, A No-Load Limited
Partnership),
T. Rowe Price Realty Income Fund II Management, Inc., a Maryland
corporation
(General Partner of T. Rowe Price Realty Income Fund II,
America's
Sales-Commission-Free Real Estate Limited Partnership), T. Rowe
Price Realty
Income Fund III Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund III, America's
Sales-Commission-Free Real Estate
Limited Partnership, a Delaware limited partnership), and T. Rowe
Price Realty
Income Fund IV Management, Inc., a Maryland corporation (General
Partner of T.
Rowe Price Realty Income Fund IV, America's Sales-Commission-Free
Real Estate
Limited Partnership). Real Estate Group serves as investment
manager to T. Rowe
Price Renaissance Fund, Ltd., A Sales-Commission-Free Real Estate
Investment,
established in 1989 as a Maryland corporation which qualifies as
a REIT.
T. Rowe Price Stable Asset Management, Inc. ("Stable Asset
Management") is a
Maryland corporation organized in 1988 as a wholly-owned
subsidiary of the
Manager. Stable Asset Management, which is registered as an
investment adviser
under the Investment Advisers Act of 1940, specializes in the
management of
investment portfolios which seek stable and consistent investment
returns
through the use of guaranteed investment contracts, bank
investment contracts,
structured or synthetic investment contracts, and short-term
fixed-income
securities.
T. Rowe Price Recovery Fund Associates, Inc., a Maryland
corporation, is a
wholly-owned subsidiary of the Manager organized in 1988 for the
purpose of
serving as the General Partner of T. Rowe Price Recovery Fund,
L.P., a Delaware
limited partnership which invests in financially distressed
companies.
T. Rowe Price (Canada), Inc. is a Maryland corporation organized
in 1988 as a
wholly-owned subsidiary of the Manager. This entity is
registered as an
investment adviser under the Investment Advisers Act of 1940, and
may apply for
registration as an investment manager under the Securities Act of
Ontario in
order to be eligible to provide certain services to the RPF
International Bond Fund, a trust (whose shares are sold in
Canada) which
Price-Fleming serves as investment adviser.
Since 1983, the Manager has organized several distinct Maryland
limited
partnerships, which are informally called the Pratt Street
Ventures
partnerships, for the purpose of acquiring interests in
growth-oriented
businesses.
Tower Venture, Inc., a wholly-owned subsidiary of the Manager, is
a Maryland
corporation organized in 1989 for the purpose of serving as a
general partner of
100 East Pratt St., L.P., a Maryland limited partnership whose
limited partners
also include the Manager. The purpose of the partnership is to
further develop
and improve the property at 100 East Pratt Street, the site of
the Manager's
headquarters, through the construction of additional office,
retail and parking
space.
TRP Suburban, Inc. is a Maryland corporation organized in 1990 as
a wholly-owned
subsidiary of the Manager. TRP Suburban has entered into
agreements with
McDonogh School and CMANE-McDonogh-Rowe Limited Partnership to
construct an
office building in Owings Mills, Maryland, which houses the
Manager's transfer
agent, plan administrative services, retirement plan services and
operations
support functions.
TRP Finance, Inc. and TRP Finance MRT, Inc., wholly-owned
subsidiaries of the
Manager, are Delaware corporations organized in 1990 to manage
certain passive
corporate investments and other intangible assets. TRP Finance
MRT, Inc. was
dissolved on October 4, 1993.
T. Rowe Price Strategic Partners Fund, L.P. is a Delaware limited
partnership
organized in 1990 for the purpose of investing in small public
and private
companies seeking capital for expansion or undergoing a
restructuring of
ownership. The general partner of the Fund is T. Rowe Price
Strategic Partners,
L.P., a Delaware limited partnership whose general partner is T.
Rowe Price
Strategic Partners Associates, Inc., ("Strategic Associates"), a
Maryland
corporation which is a wholly-owned subsidiary of the Manager.
Strategic
Associates also serves as the general partner of T. Rowe Price
Strategic
Partners II, L.P., a Delaware limited partnership established in
1992, which in
turn serves as general partner of T. Rowe price Strategic
Partners Fund II,
L.P., a Delaware limited partnership organized in 1992.
Listed below are the directors of the Manager who have other
substantial
businesses, professions, vocations, or employment aside from that
of Director of
the Manager:
JAMES E. HALBKAT, JR., Director of the Manager. Mr. Halbkat is
President of
U.S. Monitor Corporation, a provider of public response systems.
Mr. Halbkat's
address is: P.O. Box 23109, Hilton Head Island, South Carolina
29925.
JOHN W. ROSENBLUM, Director of the Manager. Mr. Rosenblum is the
Tayloe Murphy
Professor at the University of Virginia, and a director of:
Chesapeake
Corporation, a manufacturer of paper products, Cadmus
Communications Corp., a
provider of printing and communication services; Comdial
Corporation, a
manufacturer of telephone systems for businesses; and Cone Mills
Corporation, a
textiles producer. Mr. Rosenblum's address is: P.O. Box 6550,
Charlottesville,
Virginia 22906.
ROBERT L. STRICKLAND, Director of the Manager. Mr. Strickland is
Chairman of
Lowe's Companies, Inc., a retailer of specialty home supplies.
Mr. Strickland's
address is 604 Two Piedmont Plaza Building, Winston-Salem, North
Carolina 27104.
PHILIP C. WALSH, Director of the Manager. Mr. Walsh is a
Consultant to Cyprus
Amax Minerals Company, Englewood, Colorado, and a director of
Piedmont Mining
Company, Inc., Charlotte, North Carolina. Mr. Walsh's address
is: Blue Mill
Road, Morristown, New Jersey 07960.
With the exception of Messrs. Halbkat, Rosenblum, Strickland, and
Walsh, all of
the directors of the Manager are employees of the Manager.
George J. Collins, who is Chief Executive Officer, President, and
a Managing
Director of the Manager, is a Director of Price-Fleming.
George A. Roche, who is Chief Financial Officer and a Managing
Director of the
Manager, is a Vice President and a Director of Price-Fleming.
M. David Testa, who is a Managing Director of the Manager, is
Chairman of the
Board of Price-Fleming.
Henry H. Hopkins, Charles P. Smith, and Peter Van Dyke, who are
Managing
Directors of the Manager, are Vice Presidents of Price-Fleming.
Robert P. Campbell, Roger L. Fiery, III, Robert C. Howe, Veena A.
Kutler, George
A. Murnaghan, William F. Wendler, II, and Edward A. Wiese, who
are Vice
Presidents of the Manager, are Vice Presidents of Price-Fleming.
Alvin M. Younger, Jr., who is a Managing Director and the
Secretary and
Treasurer of the Manager, is Secretary and Treasurer of
Price-Fleming.
Nolan L. North, who is a Vice President and Assistant Treasurer
of the Manager,
is Assistant Treasurer of Price-Fleming.
Leah P. Holmes, who is an Assistant Vice President of the
Manager, is a Vice
President of Price-Fleming.
Barbara A. Van Horn, who is Assistant Secretary of the Manager,
is Assistant
Secretary of Price-Fleming.
Certain directors and officers of the Manager are also officers
and/or directors
of one or more of the Price Funds and/or one or more of the
affiliated entities
listed herein.
See also "Management of Fund," in Registrant's Statement of
Additional
Information.
Item 29. Principal Underwriters.
(a) The principal underwriter for the Registrant is Investment
Services.
Investment Services acts as the principal underwriter for the
other thirty-five
Price Funds. Investment Services is a wholly-owned subsidiary of
the Manager is
registered as a broker-dealer under the Securities Exchange Act
of 1934 and is a
member of the National Association of Securities Dealers, Inc.
Investment
Services has been formed for the limited purpose of distributing
the shares of
the Price Funds and will not engage in the general securities
business. Since
the Price Funds are sold on a no-load basis, Investment Services
will not
receive any commission or other compensation for acting as
principal
underwriter.
(b) The address of each of the directors and officers of Investment Services listed below is 100 East Pratt Street, Baltimore, Maryland 21202.
Positions and Name and Principal Positions and Offices Offices with
Business Address With Underwriter Registrant
__________________ _____________________ _____________
James Sellers Riepe President and Director Vice President
and
Director
Henry Holt Hopkins Vice President and Vice President
Director
Mark E. Rayford Director None
Charles E. Vieth Vice President and None
Director
Patricia M. Archer Vice President None
Edward C. Bernard Vice President None
Joseph C. Bonasorte Vice President None
Meredith C. Callanan Vice President None
Laura H. Chasney Vice President None
Victoria C. Collins Vice President None
Christopher W. Dyer Vice President None
Forrest R. Foss Vice President None
Patricia O'Neil Goodyear Vice President None
James W. Graves Vice President None
Andrea G. Griffin Vice President None
Thomas Grizzard Vice President None
David J. Healy Vice President None
Joseph P. Healy Vice President None
Walter J. Helmlinger Vice President None
Eric G. Knauss Vice President None
Douglas G. Kremer Vice President None
Sharon Renae Krieger Vice President None
Keith Wayne Lewis Vice President None
David L. Lyons Vice President None
Sarah McCafferty Vice President None
Maurice Albert Minerbi Vice President None
Nancy M. Morris Vice President None
George A. Murnaghan Vice President None
Steven Ellis Norwitz Vice President None
Kathleen M. O'Brien Vice President None
Charles S. Peterson Vice President None
|
Pamela D. Preston Vice President None Lucy Beth Robins Vice President None John Richard Rockwell Vice President None Monica R. Tucker Vice President None William F. Wendler, II Vice President None Terri L. Westren Vice President None Jane F. White Vice President None Thomas R. Woolley Vice President None Alvin M. Younger, Jr. Secretary and Treasurer None Mark S. Finn Controller None Richard J. Barna Assistant Vice President None Catherine L. Berkenkemper Assistant Vice President None Ronae M. Brock Assistant Vice President None Brenda E. Buhler Assistant Vice President None Patricia Sue Butcher Assistant Vice President None John A. Galateria Assistant Vice President None Janelyn A. Healey Assistant Vice President None Keith J. Langrehr Assistant Vice President None C. Lillian Matthews Assistant Vice President None Janice D. McCrory Assistant Vice President None Sandra J. McHenry Assistant Vice President None JeanneMarie B. Patella Assistant Vice President None Kristin E. Seeberger Assistant Vice President None Arthur J. Silber Assistant Vice President None Linda C. Wright Assistant Vice President None |
Nolan L. North Assistant Treasurer None Barbara A. VanHorn Assistant Secretary None
(c) Not applicable. Investment Services will not receive any compensation with respect to its activities as underwriter for the Price Funds since the Price Funds are sold on a no-load basis.
Item 30. Location of Accounts and Records.
All accounts, books, and other documents required to be
maintained by
T. Rowe Price Tax-Free High Yield Fund, Inc. under
Section 31(a) of the
Investment Company Act of 1940 and the rules thereunder
will be
maintained by T. Rowe Price Tax-Exempt Money Fund, Inc.
at its offices
at 100 East Pratt Street, Baltimore, Maryland 21202.
Transfer,
dividend disbursing, and shareholder service activities
are performed
by T. Rowe Price Services, Inc., at 100 East Pratt
Street, Baltimore,
Maryland 21202. Custodian activities for T. Rowe Price
Tax-Exempt
Money Fund, Inc. are performed at State Street Bank and
Trust Company's
Service Center (State Street South), 1776 Heritage Drive,
Quincy,
Massachusetts 02171.
Item 31. Management Services.
Registrant is not a party to any management related
service contract,
other than as set forth in the Prospectus.
Item 32. Undertakings.
(a) The Fund agrees to furnish, upon request and without charge, a copy of its Annual Report to each person to whom a prospectus is delivered.
Pursuant to the requirements of the Securities Act of 1933, as
amended, and
the Investment Company Act of 1940, as amended, the Registrant
has duly caused
this Registration Statement to be signed on its behalf by the
undersigned,
thereunto duly authorized, in the City of Baltimore, State of
Maryland, this rd
day of April 22, 1994.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND,
INC.
/s/William T. Reynolds
By: William T. Reynolds, President and
Director
|
Pursuant to the requirements of the Securities Act of 1933,
as amended,
this Registration Statement has been signed below by the
following persons in
the capacities and on the dates indicated:
SIGNATURE TITLE DATE ___________ ______ ______ /s/George J. Collins Chairman of the Board April 22, 1994 George J. Collins (Chief Executive Officer) /s/Carmen F. Deyesu Treasurer April 22, 1994 Carmen F. Deyesu (Chief Financial Officer) /s/Calvin W. Burnett Director April 22, 1994 Calvin W. Burnett /s/Anthony W. Deering Director April 22, 1994 Anthony W. Deering /s/F. Pierce Linaweaver DirectorApril 22, 1994 F. Pierce Linaweaver /s/William T. Reynolds President and DirectorApril 22, 1994 William T. Reynolds /s/James S. Riepe Vice President and DirectorApril 22, 1994 James S. Riepe /s/John Sagain Director April 22, 1994 John Sagan /s/John G. Schrieber Director April 22, 1994 John G. Schreiber |
OF
ROWE PRICE PRIME RESERVE FUND II, INC.
FIRST: The undersigned, Henry H. Hopkins
and Edward A.
Taber, each of whose post office address is 100 East Pratt
Street, Baltimore,
Maryland 21202, and each being at least eighteen (18) years of
age, do hereby
form a corporation under the General Laws of the State of
Maryland.
SECOND: The name of the Corporation is:
ROWE PRICE PRIME RESERVE FUND II, INC.
THIRD: The purposes for which the
Corporation is formed
are as follows:
(1) To operate as and carry on the business of an investment company, and exercise all the powers necessary and appropriate to the conduct of such operations.
(2) To invest in, hold for investment, or reinvest in, securities, including but not limited to common and preferred stocks; warrants, bonds, debentures, bills, time notes and all other evidences of indebtedness; negotiable or non-negotiable instruments; government securities; and money market instruments including bank certificates of deposit, finance paper, commercial paper, bankers acceptances and all kinds of repurchase agreements, of any corporation, company, trust, association, firm or other business organization however established, and of any country, state, municipality or other political subdivision, or of any other governmental or quasi-governmental agency or instrumentality.
(3) To acquire (by purchase, subscription, or otherwise), to hold, to trade in and deal in, to sell or otherwise dispose of, to lend, and to pledge any such securities and repurchase agreements.
(4) To exercise all rights, powers, and privileges of ownership or interest in all securities and repurchase agreements held by the Corporation, including the right to vote thereon and otherwise act with respect thereto and to do all acts for the preservation, protection, improvement, and enhancement in value of all such securities and repurchase agreements.
(5) To aid by further investment any corporation, company, trust, association, firm or other business organization, any obligation of or interest in which is held by the Corporation or in the affairs of which the Corporation has any direct or indirect interest, and to do anything designed to protect, preserve, improve, or enhance the value of such obligation or interest.
(6) To promote or aid the incorporation of any organization or enterprise under the laws of any
country, state, municipality, or other political subdivision, and
to cause the
same to be dissolved, wound up, liquidated, merged, or
consolidated.
(7) In general, to carry on any other business in connection with or incidental to any of the foregoing objects and purposes, to have and exercise all the powers conferred upon corporations by the laws of the State of Maryland as in force from time to time, to do everything necessary, suitable or proper for the accomplishment of any purpose or the attainment of any object or the furtherance of any power hereinbefore set forth, either alone or in association with others, and to take any action incidental or appurtenant to or growing out of or connected with the aforesaid business or purposes, objects, or powers.
The Corporation shall have the power to
conduct and carry
on its business, or any part thereof, and to have one or more
offices, and to
exercise any or all of its corporate powers and rights, in the
State of
Maryland, in any other states, territories, districts, colonies,
and
dependencies of the United States, and in any or all foreign
countries.
The foregoing clauses shall be constructed
both as
objects and powers, and the foregoing enumeration of specific
powers shall not
be held to limit or restrict in any manner the general powers of
the
Corporation.
FOURTH: The post office address of the
principal office
of the Corporation in the State of Maryland is:
100 East Pratt Street Baltimore, Maryland 21202
The name and post office address of the resident agent of the
Corporation in the
State of Maryland is:
Henry Holt Hopkins 100 East Pratt Street Baltimore, Maryland 21202
Said resident agent is a citizen of the State of Maryland, and
actually resides
therein.
FIFTH: The total number of shares of all
classes of
Capital Stock which the Corporation has authority to issue is Two
Hundred
Million (200,000,000) shares of a single class of the par value
of One Dollar
($1.00) per share, such shares having an aggregate par value of
Two Hundred
Million Dollars ($200,000,000).
SIXTH: The number of directors of the
Corporation shall
be seven (7), or such other number as may from time to time be
fixed by the By-
Laws of the Corporation, or pursuant to authorization contained
in such By-Laws,
but the number of directors shall never be less than three (3).
The names of
the directors who shall act as such until the first annual
meeting of
shareholders and until their successors are duly chosen and
qualify are as
follows:
George J. Collins Anthony W. Deering Carter O. Hoffman Karen N. Horn F. Pierce Linaweaver Edward A. Taber, III
SEVENTH: Regulation of the Powers of the
Corporation and
Its Directors and Shareholders.
SECTION I
ISSUE OF THE CORPORATION'S SHARES
1.01 General. The Board of Directors may from time to time issue and sell or cause to be issued and sold any of the Corporation's authorized shares, including any additional shares hereafter authorized and any shares redeemed or repurchased by the Corporation, except that only shares previously contracted to be sold may be issued during any period when the determination of net asset value is suspended pursuant to the provisions of Section III hereof. All such authorized shares, when issued in accordance with the terms of this Section I, shall be fully paid and non- assessable. No holder of any shares of the Corporation shall be entitled, by reason of holding or owning such shares, to any prior, preemptive or other right to subscribe to, purchase or otherwise acquire any additional shares of the Corporation subsequently issued for cash or other consideration or by way of a dividend or otherwise.
1.02 Price. No shares of the Corporation shall be issued or sold by the Corporation, except as a stock dividend distributed to shareholders, for less than an amount which would result in proceeds to the Corporation, before taxes payable by the Corporation in connection with such transaction, of at least the net asset value per share determined as set forth in Section III hereof as of such time as the Board of Directors shall have by resolution theretofore prescribed, but not earlier than the close of business on the business day (which term, as used herein, shall be defined to mean a day on which the New York Stock Exchange is open all or part of the day for unrestricted trading, or such other definition as the Board of Directors shall have by resolution theretofore prescribed pursuant to Section 6.01 hereof), next preceding the date of receipt of an unconditional purchase order for such shares. In the absence of a resolution of the Board of Directors applicable to the transaction, such net asset value shall be that next determined after receipt of such purchase order. For this purpose, the time of receipt of such an unconditional order shall be the time it is first received by the principal underwriter, the custodian or depository of the Corporation's assets, the transfer agent of the Corporation, or by another agent of the Corporation designated for the purpose.
1.03 On Merger or Consolidation. In connection with the acquisition of all or substantially all the assets or stock of another investment company or investment trust, the Board of Directors may issue or cause to be issued shares of the Corporation and accept in payment therefor, in lieu of cash, such assets at their market value, or such stock at the market value of the as sets held by such investment company or investment trust, either with or without adjustment for contingent costs or liabilities, provided that the funds of the Corporation are permitted by law to be invested in such assets or stock.
1.04 Fractional Shares. The Board of Directors may issue and sell fractions of shares having pro rata all the rights of full shares, including, without limitation, the right to vote and to receive dividends.
SECTION II
2.01 Redemption of
Shares. The
Corporation shall redeem its shares, subject to the conditions
and at the price
determined as hereinafter set forth, upon proper application of
the record
holder thereof at such office or agency as may be designated from
time to time
for that purpose by the Board of Directors. Any such application
must be
accompanied by the certificate or certificates, if any,
evidencing such shares,
duly endorsed or accompanied by a proper instrument of transfer.
The Board of
Directors shall have power to determine or to delegate to the
proper officers of
the Corporation the power to determine from time to time the form
and the other
accompanying documents which shall be necessary to constitute a
proper
application for redemption.
2.02 Price. Such
shares shall be
redeemed at their net asset value determined as set forth in
Section III hereof
as of such time as the Board of Directors shall have theretofore
prescribed by
resolution, which time shall not be later than the close of
business on the next
business day succeeding, and not earlier than the close of
business on the next
business day preceding, the date on which proper application is
made for
redemption. In the absence of such resolution, the redemption
price of shares
deposited shall be the net asset value of such shares next
determined as set
forth in Section III hereof after receipt of such application.
2.03 Payment. Payment
for such
shares shall be made to the shareholder of record within seven
(7) days after
the date upon which proper application is received, subject to
the provisions of
Section 2.04 hereof. Such payment shall be made in cash or other
assets of the
Corporation or both, as the Board of Directors shall prescribe.
For the
purposes of such payment for shares redeemed, the value of assets
delivered
shall be determined as set forth in Section III hereof as of the
same time as of
which the per share net asset value of such shares is determined.
2.04 Effect of Suspension of Determination of Net Asset Value. If, pursuant to Section 3.03 hereof, the Board of Directors shall declare a suspension of the determination of net asset value, the rights of shareholders (including those who shall have applied for redemption pursuant to Section 2.01 hereof but who shall not yet have received payment) to have shares redeemed and paid for by the Corporation shall be suspended until the termination of such suspension is declared. Any record holder whose redemption right is so suspended may, during the period of such suspension, by appropriate written notice of revocation to the office or agency where application was made, revoke his application and withdraw any share certificates which accompanied such application. The redemption price of shares for which redemption applications have not been revoked shall be the net asset value of such shares next determined as set forth in Section III after the termination of such suspension, and payment shall be made within seven (7) days after the date upon which the application was made plus the period after such application during which the determination of net asset value was suspended.
2.05 Repurchase by Agreement. The Corporation may repurchase shares of the Corporation directly, or through its principal underwriter or other agent designated for the purpose, by agreement with the owner thereof, at a price not exceeding the net asset value per share determined as of the time when the purchase or contract
of purchase is made or the net asset value as of any time which
may be later
determined pursuant to Section III hereof, provided payment is
not made for the
shares prior to the time as of which such net asset value is
determined.
2.06 Corporation's Option to Redeem Shares
(a) The Corporation shall have the right at any time and without prior notice to the shareholder to redeem all shares in any account for their then-current net asset value per share if all shares in the account have an aggregate net asset value of less than $1,000, or such lesser amount as the Board of Directors may from time to time determine;
(b) The Corporation shall have the right at any time and without prior notice to the shareholder to redeem shares in any account for their then-current net asset value per share if and to the extent it shall be necessary to reimburse the Corporation for any loss sustained by the Corporation by reason of the failure of the shareholder in whose name such account is registered to make full payment for shares of the Corporation purchased by such shareholder.
(c) The right of redemption provided by each of the foregoing subsections of this Section 2.06 shall be subject to such terms and conditions as the Board of Directors may from time to time approve, and subject to the Corporation's giving general notice of its intention to avail itself of such right, either by publication in the Corporation's prospectus or by such means as the Board of Directors shall determine.
SECTION III
NET ASSET VALUE OF SHARES
3.01 By Whom Determined. The Board of Directors shall have the power and duty to determine from time to time the net asset value per share of the outstanding shares of the Corporation. It may delegate such power and duty to one or more of the directors and officers of the Corporation, to the custodian or depository of the Corporation's assets, or to another agent of the Corporation appointed for such purpose. Any determination made pursuant to this section by the Board of Directors, or its delegate, shall be binding on all parties concerned.
3.02 When Determined. The net asset value shall be determined at such times as the Board of Directors shall prescribe by resolution, provided that such net asset value shall be determined at least once each week as of the close of business on a business day. In the absence of a resolution of the Board of Directors, the net asset value shall be determined as of the close of trading on the New York Stock Exchange on each business day.
3.03 Suspension of Determination of Net Asset Value. The Board of Directors may declare a suspension of the determination of net asset value for the whole or any part of any period (a) during which the New York Stock Exchange is closed other than customary weekend and holiday closings, (b) during which trading on the New York Stock Exchange is restricted, (c) during which an emergency exists as a result of which disposal by the Corporation of securities owned by it is not reasonably practicable or it is not reasonably practicable for the Corporation fairly to determine the value of its net assets, or (d) during which a governmental body having jurisdiction over the Corporation may by order permit
for the protection of the security holders of the Corporation.
Such suspension
shall take effect at such time as the Board of Directors shall
specify, which
shall not be later than the close of business on the business day
next following
the declaration, and thereafter there shall be no determination
of net asset
value until the Board of Directors shall declare the suspension
at an end,
except that the suspension shall terminate in any event on the
first day on
which (1) the condition giving rise to the suspension shall have
ceased to exist
and (2) no other condition exists under which suspension is
authorized under
this Section 3.03. Each declaration by the Board of Directors
pursuant to this
Section 3.03 shall be consistent with such official rules and
regulations, if
any, relating to the subject matter thereof as shall have been
promulgated by
the Securities and Exchange Commission or any other governmental
body having
jurisdiction over the Corporation and as shall be in effect at
the time. To the
extent not inconsistent with such official rules and regulations,
the
determination of the Board of Directors shall be conclusive.
3.04 Computation of Per Share Net Asset Value.
a. Net Asset Value Per Share. Except as hereinafter provided in Section 3.05, the net asset value of each share as of any particular time shall be the quotient obtained by dividing the value of the net assets of the Corporation by the total number of shares outstanding.
b. Value of Corporation's Net Assets. The value of the Corporation's net assets as of any particular time shall be the value of the Corporation's assets less its liabilities, determined and computed as follows:
(1) Corporation's Assets. The Corporation's assets shall be deemed to include: (A) all cash on hand or on deposit, including any interest accrued thereon, (B) all bills and demand notes and accounts receivable, (C) all securities owned or contracted for by the Corporation, (D) all stock and cash dividends and cash distributions payable to but not yet received by the Corporation (when the valuation of the underlying security is being determined exdividend), (E) all interest accrued on any interest-bearing securities owned by the Corporation (except accrued interest included in the valuation of the underlying security), (F) all repurchase agreements, and (G) all other property of every kind and nature, including prepaid expenses.
(2) Valuation of Assets. The value of such assets is to be determined as follows:
(i)Cash and Prepaid Expenses. The value of any cash on hand and of any prepaid expenses shall be deemed to be their full amount.
(ii)Other Current Assets. The value of any cash on deposit, bills, demand notes, accounts receivable, and cash dividends and interest declared or accrued as aforesaid and not yet received shall be deemed to be the full amount thereof, unless the Board of Directors or its delegates shall determine that any such item is not worth its full amount. In such case, the value of the item shall be deemed to be its reasonable value, as determined by the Board of Directors or its delegates.
(iii) Securities. The short-term money market securities in which the Fund invests are traded primarily in the over-the-counter market. Securities for which representative market quotations are readily available are valued at the most recent bid price or yield equivalent as quoted by one or more dealers who make markets in such securities. Other securities are appraised at values deemed best to reflect their fair value as determined in good faith by or under the supervision of officers of the Fund specifically authorized by the Board of Directors.
(3)The
Corporation's
Liabilities. The Corporation's liabilities shall not be deemed
to include
outstanding shares and surplus. They shall be deemed to include:
(A) all bills
and accounts payable, (B) all administrative expenses accrued,
(C) all
contractual obligations for the payment of money or property,
including the
amount of any declared but unpaid dividends upon the
Corporation's shares, (D)
all reserves authorized or approved by the Board of Directors for
taxes or
contingencies, and (E) all other liabilities of whatsoever kind
and nature
except any liabilities represented by the Corporation's
outstanding shares and
surplus.
3.05 Interim Determinations. Any determination of net asset value other than as of the close of trading on the New York Stock Exchange may be made either by appraisal or by calculation or estimate. Any such calculation or estimate shall be based on changes in the market value of representative or selected securities or on changes in recognized market averages since the last closing appraisal and made in a manner which in the opinion of the Board of Directors, or its delegate, will fairly reflect the changes in the net asset value.
3.06 Miscellaneous. For the purposes of Section
III:
a. Shares of the
Corporation sold
|
shall be deemed to be outstanding as of the time, not before an
unconditional
purchase order therefor has been received by the Corporation
(directly or
through one of its agents) or by one of its underwriters and the
sale price in
currency has been determined, when the sale is reported to the
Corporation or to
its agent for determining net asset value, and the net sale price
thereof to the
Corporation (less commission, if any, and less any stamp or other
tax payable by
the Corporation in connection with the issue and sale thereof)
shall be
thereupon deemed to be an asset of the Corporation.
b. Shares of the Corporation for which an application for redemption has been made or which are subject to repurchase by the Corporation shall be deemed to be outstanding up to and including the time as of which the redemption or repurchase price is determined. After such time, they shall be deemed to be no longer outstanding and the price until paid shall be deemed to be a liability of the Corporation.
c. Funds on deposit and contractual obligations payable to the Corporation in foreign currency and liabilities and contractual obligations payable by the Corporation in foreign currency shall be taken at the current cable rate of exchange as nearly as practicable at the time as of which the net asset value is computed.
SECTION IV
COMPLIANCE WITH INVESTMENT
COMPANY ACT OF 1940
4.01 Notwithstanding
any of the
foregoing provisions of this Article SEVENTH, the Board of
Directors may
prescribe, in its absolute discretion, such other bases and times
for
determining the per share net asset value of the Corporation's
shares as it
shall deem necessary or desirable to enable the Corporation to
comply with any
provision of the Investment Company Act of 1940, or any rule or
regulation
thereunder, including any rule or regulation adopted pursuant to
Section 22 of
the Investment Company Act of 1940 by the Securities and Exchange
Commission or
any securities association registered under the Securities Act of
1934, all as
in effect now or as hereafter amended or added.
SECTION V
MISCELLANEOUS
5.01 Compensation of Directors. The Board of Directors shall have power from time to time to authorize payment of compensation to the directors for services to the Corporation, including fees for attendance at meetings of the Board of Directors and of committee.
5.02 Inspection of Corporation's Books. The Board of Director shall have power from time to time to determine whether and to what extent, and at what times and places, and under what conditions and regulations the accounts and books of the Corporation (other than the stock ledger) or any of them shall be open to the inspection of shareholders; and no shareholder shall have any right of inspecting any account, book or document of the Corporation except as at the time conferred by statute, unless authorized by a resolution of the shareholders or the Board of Directors.
5.03 Majority Vote of Shareholders. Notwithstanding any provision of the laws of the State of Maryland requiring a greater proportion than a majority of the votes of all classes or of any class of stock entitled to be cast, to take or authorize any action, such action may, subject to other applicable provisions of law, these Articles of Incorporation and the By-Laws, be taken or authorized upon the concurrence of a majority of the aggregate number of the votes entitled to be cast thereon.
5.04 Name. The Corporation acknowledges that it is adopting its corporate name through permission of T. Rowe Price Associates, Inc., a Maryland corporation, and agrees that T. Rowe Price Associates, Inc. reserves to itself and any successor to its business the right to grant the nonexclusive right to use the name "Rowe Price" or any similar name to any other corporation or entity, including, but not limited to, any investment company of which T. Rowe Price Associates, Inc. or any subsidiary or affiliate thereof or any successor to the business of any thereof shall be the investment adviser.
5.05 Reservation of Right to Amend. The Corporation reserves the right to make any amendment of its charter, now or hereafter authorized by law, including any amendment which alters the contract rights, as expressly set forth in its charter, of any outstanding stock, and all rights herein conferred upon shareholders are granted subject to such reservation.
5.06 Determination of Net Profits, Etc.; Dividends. The Board of Directors is expressly authorized to determine in accordance with generally accepted accounting principles and practices what constitutes net profits, earnings, surplus, or net assets in excess of capital, and to
determine what accounting periods shall be used by the
Corporation for any
purpose, whether annual or any other period, including daily; to
set apart out
of any funds of the Corporation such reserves for such purposes
as it shall
determine and to abolish the same; to declare and pay dividends
and
distributionS in cash, securities, or other property from surplus
or any funds
legally available therefor, at such intervals (which may be as
frequently as
daily) or on such other periodic basis, as it shall determine; to
declare such
dividends or distributions by means of a formula or other method
of
determination, at meetings held less frequently than the
frequency of the
effectiveness of such declarations; to establish payment dates
for dividends or
any other distributions on any basis, including dates occurring
less frequently
than the effectiveness of the declaration thereof; and to provide
for the
payment of declared dividends on a date earlier than the
specified payment date
in the case of shareholders of the Corporation redeeming their
entire ownership
of shares of the Corporation.
5.07 Contracts. The Board of Directors may in its discretion from time to time enter into an exclusive or nonexclusive underwriting contract or contracts providing for the sale of the shares of Capital Stock of the Corporation to net the Corporation not less than the amount provided for in Section 1.02 of Article SEVENTH hereof, whereby the Corporation may either agree to sell the shares to the other party to the contract or appoint such other party its sales agent for such shares (such other party being herein sometimes called the "underwriter"), and in either case, on such terms and conditions as may be prescribed in the By-Laws, if any, and such further terms and conditions as the Board of Directors may in its discretion determine not inconsistent with the provisions of Article SEVENTH hereof or of the By-Laws; and such contract may also provide for the repurchase of shares of the Corporation by such other party as agent of the Corporation.
The Board of
Directors may in
its discretion from time to time enter into an investment
advisory or management
contract whereby the other party to such contract shall undertake
to furnish to
the Corporation such management, investment advisory, statistical
and research
facilitieS and services and such other facilities and services,
if any, and all
upon such terms and conditions, as the Board of Directors may in
its discretion
determine.
Any contract of
the character
described in the paragraphs above or for services as custodian,
transfer agent,
or disbursing agent or related services may be entered into with
any
corporation, firm, trust, or association, although one or more of
the directors
or officers of the Corporation may be an officer, director,
trustee,
shareholder, or member of such other party to the contract, and
no such contract
shall be invalidated or rendered voidable by reason of the
existence of any such
relationship, nor shall any person holding such relationship be
liable merely by
reason of such relationship for any loss or expense to the
Corporation under or
by reason of said contract or accountable for any profit realized
directly or
indirectly therefrom, provided that the contract, when entered
into, was
reasonable and fair and not inconsistent with the provisions of
this Section
5.07. The same person (including a firm, corporation, trust, or
association)
may be the other party to contracts entered into pursuant to the
above
paragraphs, and any individual may be financially interested or
otherwise
affiliated with persons who are parties to any or all of the
contracts mentioned
in this paragraph.
Any contract entered into pursuant to the
first two
paragraphs of this Section 5.07 shall be consistent with and
subject to the
requirements of Section 15 of the investment Company Act of 1940
(including any
amendment thereof or other applicable Act of Congress hereafter
enacted) with
respect to its continuance in effect, its termination and the
method of
authorization and approval of such contract or renewal thereof.
IN WITNESS WHEREOF, we have signed these
Articles of
Incorporation and acknowledge the same to be our act on this 21st
day of March,
1980.
/s/Henry H. Hopkins Henry H. Hopkins /s/Edward A. Taber, III Edward A. Taber, III |
STATE OF MARYLAND )
) ss:
CITY OF BALTIMORE )
|
I HEREBY CERTIFY, that on this 21st day of
March, 1980,
before me, the subscriber, a Notary Public of the State of
Maryland, in and for
the City of Baltimore, personally appeared HENRY H. HOPKINS and
EDWARD A. TABER,
III, and they acknowledged the foregoing Articles of
Incorporation to be their
act.
WITNESS my hand and Notarial Seal this 21st
day of March,
1980.
/s/Elizabeth R. Thompson
Elizabeth R. Thompson
Notary Public
My Commission expires:
July 1, 1982
|
ARTICLES OF AMENDMENT
Rowe Price Prime Reserve Fund II, Inc., a
Maryland
corporation having its principal office in the City of Baltimore,
Maryland
(hereinafter called the "Corporation"), hereby certifies to the
State Department
of Assessments and Taxation of Maryland that:
FIRST: The Charter of the Corporation is
hereby amended
by deleting there from Article Second and inserting in lieu
thereof a new
Article Second to read in full as follows:
"SECOND: The name
of the
Corporation is:
T. ROWE PRICE
TAX-EXEMPT MONEY
FUND, INC."
SECOND: The Charter of the Corporation is
hereby amended
by deleting therefrom Section (2) of Article Third and inserting
in lieu thereof
a new section (2) to read in full as follows:
"(2) to invest and reinvest its funds in
and hold for
investment the securities (including but
not limited to
bonds, debentures, time notes, repurchase
agreements, and
all other evidences of indebtedness and
shares, stock,
subscription rights, profit sharing
interests or
participations in other contracts for or
evidences of
equity interests) of any corporation,
company, trust,
association, firm or other business
organization however
established, and of any country, state,
municipality or
other political subdivision, or of any
other governmental
or quasi-governmental agency or
instrumentality."
THIRD: The Charter of the Corporation is
hereby amended
by deleting therefrom Article Fourth and inserting in lieu
thereof a new Article
Fourth to read in full as follows:
"FOURTH: The post
office
address of the principal office of the
Corporation in the
State of Maryland is:
100 East Pratt
Street
Baltimore,
Maryland 21202
The name and post office address of the resident agent of the
Corporation in the
State of Maryland is:
Henry Holt
Hopkins
100 East Pratt
Street
Baltimore,
Maryland 21202
Said resident agent is a citizen of the State of Maryland and
actually resides
therein."
FOURTH: The Charter of the Corporation is hereby amended by
deleting therefrom
Article Fifth and inserting in lieu thereof a new Article Fifth
to read in full
as follows:
"FIFTH: The total number of shares of all classes of Capital
Stock which the
Corporation has authority to issue is Five Billion
(5,000,000,000) shares of a
single class of the par value of One Cent ($.01) per share, such
shares having
an aggregate par value of Fifty Million Dollars ($50,000,000)."
FIFTH: The Charter of the Corporation is hereby amended by
deleting therefrom
subsection 3.04b. (2) (iii) of Article Seventh and inserting in
lieu thereof a
new subsection 3.04b. (2) (iii) to read in full as follows:
"(iii) Securities. The securities in which the Fund may invest
are traded
primarily in the over-the-counter market. Municipal securities
which have
remaining maturities of more than 60 days are valued at the mean
between the
quoted bid and asked prices when representative market quotations
are readily
available. Money market securities which have remaining
maturities of more than
60 days are valued at the bid price or yield equivalent when
representative
market quotations are readily available. Both municipal and
money market
securities originally purchased witch remaining maturities of 60
days or less
are valued at their amortized cost value. The value of
securities originally
purchased with maturities in excess of 60 days, but which
currently have
maturities of 60 days or less is also determined by using
amortized cost
valuation for the 60 days prior to maturity--such amortization
being based on
the market or fair value of the securities on the 61st day prior
to maturity.
Securities and other assets for which such procedures are not
deemed to reflect
fair value, or for which representative quotations are not
readily available,
are appraised at prices deemed best to reflect their fair value
as determined in
good faith by or under the supervision of officers of the
Corporation in a
manner specifically authorized by the Board of Directors and
applied on a
consistent basis. The Board of Directors may by resolution adopt
the use of such
other system process, pricing service or such other means as may
be deemed
appropriate for valuing the portfolio securities of the
Corporation from time to
time, provided the Board determines that such manner of pricing
will reflect the
fair value of the Corporation's portfolio securities."
SIXTH: The Board of Directors of the
Corporation, on
January 8, 1981, duly adopted resolutions in which were set forth
the foregoing
amendments to the Charter of the Corporation, declaring that the
said amendments as proposed was advisable and directing that they
be submitted
for action thereon by the sole shareholder of the Corporation.
SEVENTH: The amendments of the Charter as
hereinabove
set forth were approved by T. Rowe Price Associates, Inc., the
sole shareholder
of the Corporation, on January 9, 1981, and a written consent
which sets forth
the Charter amendments and is duly executed on behalf of T. Rowe
Price
Associates, Inc. is filed with the records of the Corporation.
EIGHTH: The amendments of the Charter as
hereinabove set
forth have been duly advised by the Board of Directors and
approved by T. Rowe
Price Associates, Inc., the sole shareholder of the Corporation.
IN WITNESS WHEREOF, ROWE PRICE PRIME
RESERVE FUND II,
INC. has caused these presents to be signed in its name and on
its behalf by its
Vice President, and its corporate seal to be affixed hereto and
attested by its
Secretary, on January 9, 1981.
ROWE PRICE PRIME
RESERVE FUND
II, INC.
/s/Henry H.
Hopkins
Henry H. Hopkins,
Vice
President
|
ATTEST:
/s/Lenora V. Hornung Lenora V. Hornung, Secretary |
STATE OF MARYLAND )
) SS.:
CITY OF BALTIMORE )
|
I HEREBY CERTIFY that on January 9, 1981,
before me the
subscriber, a Notary public of the State of Maryland, in and for
the City of
Baltimore, personally appeared Henry H. Hopkins, Vice President
of ROWE PRICE
PRIME RESERVE FUND II, INC., a Maryland corporation, and in the
name and on
behalf of said Corporation acknowledged the foregoing Articles of
Amendment to
be the corporate act of said Corporation; and at the same time
made oath in due
form of law that the matters and facts set forth in said Articles
of Amendment
with respect to the approval of the said amendments are true to
the best of his
knowledge, information and belief.
WITNESS my hand and notarial seal, the day
and year last
above written.
/s/Catherine L.
Boch
Catherine L. Boch
|
Notary Public
My commission expires: July 1, 1982
OF
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
FIRST: The undersigned, Henry H. Hopkins and James S.
Riepe, each of
whose post office address is 100 East Pratt Street, Baltimore,
Maryland 21202,
and each being at least eighteen (18) years of age, do hereby
form a corporation
under the General laws of the State of Maryland.
SECOND: The name of the Corporation is:
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.
THIRD: The purposes for which the Corporation is
formed are as
follows:
(1) To operate as and carry on the business of an investment company, and exercise all the powers necessary and appropriate to the conduct of such operations.
(2) In general, to carry on any other business in connection with or incidental to the foregoing purpose, to have and exercise all the powers conferred upon corporations by the laws of the State of Maryland as in force from time to time, to do everything necessary, suitable or proper for the accomplishment of any purpose or the attainment of any object or the furtherance of any power not inconsistent with Maryland law, either alone or in association with others, and to take any action incidental or appurtenant to or growing out of or connected with the the Corporation's business or purposes, objects, or powers.
The Corporation shall have the power to conduct and
carry on its
business, or
any part thereof, and to have one or more offices, and to
exercise any or
all of its
corporate powers and rights, in the State of Maryland, in any
other states,
territories,
districts, colonies, and dependencies of the United States, and
in any or
all foreign
countries.
The foregoing clauses shall be construed both as
objects and powers,
and the
foregoing enumeration of specific powers shall not be held to
limit or
restrict in any
manner the general powers of the Corporation.
FOURTH: The post office address of the principal
office of the
Corporation in
the State of Maryland is:
100 East Pratt Street Baltimore, Maryland 21202
The name and post office address of the resident agent of the
Corporation in
the State of
Maryland is:
Said resident agent is a citizen of the State of Maryland, and actually resides therein.
FIFTH: (a) The total number of shares of stock which the
Corporation, by
resolution or resolutions of the Board of Directors,
shall have authority to
issue is One Billion (1,000,000,000) shares, par value
One Cent ($0.01) per
share, such shares having an aggregate par value of Ten
Million Dollars
($10,000,000). All of such shares may be issued as
shares of a class
designated Capital Stock, subject, however, to the
authority hereinafter
granted to the Board of Directors to classify or
reclassify any such shares
and, incident to such classification or reclassification,
to increase or
decrease such number of shares.
(b) The balance of shares authorized but unissued may be issued as Capital Stock, or in any new class or classes, each consisting of such number of shares and having such designations, such powers, preferences and rights and such qualifications, limitations and restrictions as shall be fixed and determined from time to time by resolution or resolutions providing for the issuance of such stock adopted by the Board of Directors, to whom authority so to fix and determine the same is hereby expressly granted.
(c) Without limiting the generality of the foregoing, the dividends and distributions of investment income and capital gains with respect to Capital Stock and with respect to each class that may hereafter be created shall be in such amount as may be declared from time to time by the Board of Directors, and such dividends and distributions may vary from class to class to such extent and for such purposes as the Board of Directors may deem appropriate, including, but not limited to, the purpose of complying with requirements of regulatory or legislative authorities.
(d) The Board of Directors is hereby expressly
granted authority to
(1) classify or reclassify any unissued stock (whether
now or hereafter
authorized and whether of Capital Stock or any other
class) from time to time
by setting or changing the preferences, conversion or
other rights, voting
powers, restrictions, limitations as to dividends,
qualifications, or terms
or conditions of redemption of the stock and (2) pursuant
to such
classification or reclassification to increase or
decrease the number of
authorized shares of any class, but the number of shares
of any class shall
not be decreased by the Board of Directors below the
number of shares thereof
then outstanding and the total number of authorized
shares of stock shall not
be increased above
1,000,000,000 shares except by amendment to the Corporation's
charter.
SIXTH: The number of directors of the Corporation
shall be three (3), or such
other number as may from time to time be fixed by the By-Laws of
the Corporation, or
pursuant to authorization contained in such By-Laws, but
the number of directors shall never be less than (i) three (3) or
(ii) the number of
shareholders of the Corporation, whichever is less. George J.
Collins, Peter J. D.
Gordon, and James S. Riepe shall serve as directors until the
first meeting of
shareholders and until their successors are duly chosen and
qualify.
SEVENTH: Regulation of the Powers of the Corporation
and Its Directors and
Shareholders.
SECTION I
ISSUE OF THE CORPORATION'S SHARES
1.01General. The Board of Directors may from time to
time issue and sell or
cause to be issued and sold any of the Corporation's authorized
shares, including any
additional shares hereafter authorized and any shares redeemed or
repurchased by the
Corporation, except that only shares previously contracted to be
sold may be issued during
any period when the determination of net asset value is suspended
pursuant to the
provisions of Section III hereof. All such authorized shares,
when issued in accordance
with the terms of this Section I, shall be fully paid and
nonassessable. No holder of any
shares of the Corporation shall be entitled, by reason of holding
or owning such shares,
to any prior, preemptive or other right to subscribe to, purchase
or otherwise acquire any
additional shares of the Corporation subsequently issued for cash
or other consideration
or by way of a dividend or otherwise.
1.02Price. No shares of the Corporation shall be
issued or sold by the
Corporation, except as a stock dividend distributed to
shareholders, for less than an
amount which would result in proceeds to the Corporation, before
taxes payable by the
Corporation in connection with such transaction, of at least the
net asset value per share
determined as set forth in Section III hereof as of such time as
the Board of Directors
shall have by resolution theretofore prescribed, but not earlier
than the close of
business on the business day (which term, as used herein, shall
be defined to mean a day
on which the New York Stock Exchange is open all or part of the
day for unrestricted
trading, or such other definition as the Board of Directors shall
have by resolution
theretofore prescribed pursuant to Section 2.02 hereof) next
preceding the date of receipt
of an unconditional purchase order for such shares. In the
absence of a resolution of the
Board of Directors applicable to the transaction, such net asset
value shall be that next
determined after receipt of such purchase order. For this
purpose, the time of receipt of
such an unconditional order shall be the time it is first
received by the principal
underwriter, the custodian or depository of the Corporation's
assets, the transfer agent
of the Corporation, or by another agent of the Corporation
designated for the purpose.
1.03On Merger or Consolidation. In connection with the
acquisition of all or
substantially all the assets or stock of another investment
company or investment trust,
the Board of Directors may issue or cause to be issued shares of
the Corporation and
accept in payment therefor, in lieu of cash, such assets at their
market value, or such
stock at the market value of the assets held by such investment
company or investment
trust, either with or without adjustment for contingent costs or
liabilities, provided
that the funds of the Corporation are permitted by law to be
invested in such assets or
stock.
1.04Fractional Shares. The Board of Directors may
issue and sell fractions of
shares having pro rata all the rights of full shares, including,
without limitation, the
right to vote and to receive dividends.
REDEMPTION AND REPURCHASE OF
THE CORPORATION'S SHARES
2.01Redemption of Shares. The Corporation shall redeem
its shares, subject to
the conditions and at the price determined as hereinafter set
forth, upon proper
application of the record holder thereof at such office or agency
as may be designated
from time to time for that purpose by the Board of Directors.
Any such application must
be accompanied by the certificate or certificates, if any,
evidencing such shares, duly
endorsed or accompanied by a proper instrument of transfer. The
Board of Directors shall
have power to determine or to delegate to the proper officers of
the Corporation the power
to determine from time to time the form and the other
accompanying documents which shall
be necessary to constitute a proper application for redemption.
2.02Price. Such shares shall be redeemed at their net
asset value determined as
set forth in Section III hereof as of such time as the Board of
Directors shall have
theretofore prescribed by resolution. In the absence of such
resolution, the redemption
price of shares deposited shall be the net asset value of such
shares next determined as
set forth in Section III hereof after receipt of such
application.
2.03Payment. Payment for such shares shall be made to
the shareholder of record
within seven (7) days after the date upon which proper
application is received, subject to
the provisions of Section 2.04 hereof. Such payment shall be
made in cash or other assets
of the Corporation or both, as the Board of Directors shall
prescribe.
2.04Effect of Suspension of Determination of Net Asset
Value. If, pursuant to
Section 3.03 hereof, the Board of Directors shall declare a
suspension of the
determination of net asset value, the rights of shareholders
(including those who shall
have applied for redemption pursuant to Section 2.01 hereof but
who shall not yet have
received payment) to have shares redeemed and paid for by the
Corporation shall be
suspended until the termination of such suspension is declared.
Any record holder whose
redemption right is so suspended may, during the period of such
suspension, by appropriate
written notice of revocation to the office or agency where
application was made, revoke
his application and withdraw any share certificates which
accompanied such application.
The redemption price of shares for which redemption applications
have not been revoked
shall be the net asset value of such shares next determined as
set forth in Section III
after the termination of such suspension, and payment shall be
made within seven (7) days
after the date upon which the application was made plus the
period after such application
during which the determination of net asset value was suspended.
2.05Repurchase by Agreement. The Corporation may
repurchase shares of the
Corporation directly, or through its principal underwriter or
other agent designated for
the purpose, by agreement with the owner thereof, at a price not
exceeding the net asset
value per share determined as of the time when the purchase or
contract of purchase is
made or the net asset value as of any time which may be later
determined pursuant to
Section III hereof, provided payment is not made for the shares
prior to the time as of
which such net asset value is determined.
2.06Corporation's Option to Redeem Shares.
(a) The Corporation shall have the right at any time and without prior notice to the shareholder to redeem all shares in any account for their then-current net asset value per share if all shares in the account have an aggregate net asset value of less than $10,000, or such lesser amount as the Board of Directors may from time to time determine;
(b) The Corporation shall have the right at any time and without prior notice to the shareholder to redeem shares in any account for their then-current net asset value per share if and to the extent it shall be necessary to reimburse the Corporation or its principal underwriter or distributor for any loss sustained by the Corporation by reason of the failure of the shareholder in whose name such account is registered to make full payment for shares of the Corporation purchased by such shareholder.
(c) The right of redemption provided by each of the foregoing subsections of this Section 2.06 shall be subject to such terms and conditions as the Board of Directors may from time to time approve, and subject to the Corporation's giving general notice of its intention to avail itself of such right, either by publication in the Corporation's prospectus or by such means as the Board of Directors shall determine.
SECTION III
NET ASSET VALUE OF SHARES
3.01By Whom Determined. The Board of Directors shall
have the power and duty to
determine from time to time the net asset value per share of the
outstanding shares of the
Corporation. It may delegate such power and duty to one or more
of the directors and
officers of the Corporation, to the custodian or depository of
the Corporation's assets,
or to another agent of the Corporation appointed for such
purpose. Any determination made
pursuant to this section by the Board of Directors, or its
delegate, shall be binding on
all parties concerned.
3.02When Determined. The net asset value shall be
determined at such times as
the Board of Directors shall prescribe by resolution, provided
that such net asset value
shall be determined at least once each week as of the close of
business on a business day.
In the absence of a resolution of the Board of Directors, the net
asset value shall be
determined as of the close of trading on the New York Stock
Exchange on each business day.
3.03Suspension of Determination of Net Asset Value.
The Board of Directors may
declare a suspension of the determination of net asset value for
the whole or any part of
any period (a) during which the New York Stock Exchange is closed
other than customary
weekend and holiday closings, (b) during which trading on the New
York Stock Exchange is
restricted, (c) during which an emergency exists as a result of
which disposal by the
Corporation of securities owned by it is not reasonably
practicable or it is not
reasonably practical for the Corporation fairly to determine the
value of its net assets,
or (d) during which a governmental body having jurisdiction over
the Corporation may by
order permit for the protection of the security holders of the
Corporation. Such
suspension shall take effect at such time as the Board of
Directors shall specify, which
shall not be later than the close of business on the business day
next following the
declaration, and thereafter there shall be no determination of
net asset value until the
Board of Directors shall declare the suspension at an end, except
that the suspension
shall terminate in any event on the first day on which (1) the
condition
giving rise to the suspension shall have ceased to exist and (2)
no other condition exists
under which suspension is authorized under this Section 3.03.
Each declaration by the
Board of Directors pursuant to this Section 3.03 shall be
consistent with such official
rules and regulations, if any, relating to the subject matter
thereof as shall have been
promulgated by the Securities and Exchange Commission or any
other governmental body
having jurisdiction over the Corporation and as shall be in
effect at the time. To the
extent not inconsistent with such official rules and regulations,
the determination of the
Board of Directors shall be conclusive.
3.04Computation of Per Share Net Asset Value.
(a) Net Asset Value Per Share. The net asset value of each share as of any particular time shall be the quotient obtained by dividing the value of the net assets of the Corporation by the total number of shares outstanding.
(b) Value of Corporation's Net Assets. The value of the Corporation's net assets as of any particular time shall be the value of the Corporation's assets less its liabilities, determined and computed as prescribed by the Board of Directors.
SECTION IV
COMPLIANCE WITH INVESTMENT
COMPANY ACT OF 1940
Notwithstanding any of the foregoing provisions of this
Article SEVENTH, the
Board of Directors may prescribe, in its absolute discretion,
such other bases and times
for determining the per share net asset value of the
Corporation's shares as it shall deem
necessary or desirable to enable the Corporation to comply with
any provision of the
Investment Company Act of 1940, or any rule or regulation
thereunder, including any rule
or regulation adopted pursuant to Section 22 of the Investment
Company Act of 1940 by the
Securities and Exchange Commission or any securities association
registered under the
Securities Exchange Act of 1934, all as in effect now or as
hereafter amended or added.
SECTION V
MISCELLANEOUS
5.01 Compensation of Directors. The Board of Directors shall have power from time to time to authorize payment of compensation to the directors for services to the Corporation, including fees for attendance at meetings of the Board of Directors and of committees.
5.02 Inspection of Corporation's Books. The Board of Directors shall have power from time to time to determine whether and to what extent, and at what times and places, and under what conditions and regulations the accounts and books of the Corporation (other than the stock ledger) or any of them shall be open to the inspection of shareholders; and no shareholder shall have any right of inspecting any account, book or document of the Corporation except as at the time conferred by statute, unless authorized by a resolution of the shareholders or the Board of Directors.
5.03 Majority Vote of Shareholders. Notwithstanding any provision of the laws of the State of Maryland requiring a greater proportion than a majority of the votes of all classes or of any class of stock entitled to be cast, to take or authorize any action, such action may, subject to other applicable provisions of law, these Articles of Incorporation and the By-Laws, be taken or authorized upon the concurrence of a majority of the aggregate number of the votes entitled to be cast thereon.
5.04 Name. The Corporation acknowledges that it is adopting its corporate name through permission of T. Rowe Price Associates, Inc., a Maryland corporation, and agrees that T. Rowe Price Associates, Inc. reserves to itself and any successor to its business the right to grant the nonexclusive right to use the name "T. Rowe Price" or any similar name to any other corporation or entity, including, but not limited to, any investment company of which T. Rowe Price Associates, Inc. or any subsidiary or affiliate thereof or any successor to the business of any thereof shall be the investment adviser.
5.05 Reservation of Right to Amend. The Corporation reserves the right to make any amendment of its charter, now or hereafter authorized by law, including any amendment which alters the contract rights, as expressly set forth in its charter, of any outstanding stock, and all rights herein conferred upon shareholders are granted subject to such reservation.
5.06 Determination of Net Profits, Etc.; Dividends. The Board of Directors is expressly authorized to determine in accordance with generally accepted accounting principles and practices what constitutes net profits, earnings, surplus, or net assets in excess of capital, and to determine what accounting periods shall be used by the Corporation for any purpose, whether annual or any other period, including daily; to set apart out of any funds of the Corporation such reserves for such purposes as it shall determine and to abolish the same; to declare and pay dividends and distributions in cash, securities, or other property from surplus or any funds legally available therefor, at such intervals (which may be as frequently as daily) or on such other periodic basis, as it shall determine; to declare such dividends or distributions by means of a formula or other method of determination, at meetings held less frequently than the frequency of the effectiveness of such declarations; to establish payment dates for dividends or any other distributions on any basis, including dates occurring less frequently than the effectiveness of the declaration thereof; and to provide for the payment of declared dividends on a date earlier than the specified payment date in the case of shareholders of the Corporation redeeming their entire ownership of shares of the Corporation.
5.07 Contracts. The Board of Directors may in its discretion from time to time enter into an exclusive or nonexclusive underwriting contract or contracts providing for the sale of the shares of Capital Stock of the Corporation to net the Corporation not less than the amount provided for in Section 1.02 of Article SEVENTH hereof, whereby the Corporation may either agree to sell the shares to the other party to the contract or appoint such other party its sales agent for such shares (such other party being herein sometimes called the "underwriter"), and in either case, on such terms and conditions as may be prescribed in the By-Laws, if any, and such further terms and conditions as the Board of Directors may in its discretion determine not inconsistent with the provisions of Article SEVENTH hereof or of the By-Laws; and such contract may also provide for the repurchase of shares of the Corporation by such other party as agent of the Corporation.
The Board of Directors may in its discretion from time
to time enter into an
investment advisory or management contract whereby the other
party to such contract shall
undertake to furnish to the Corporation such management,
investment advisory, statistical
and research facilities and services and such other facilities
and services, if any, and
all upon such terms and conditions, as the Board of Directors may
in its discretion
determine.
Any contract of the character described in the
paragraphs above or for services
as custodian, transfer agent, or disbursing agent or related
services may be entered into
with any corporation, firm, trust, or association, although one
or more of the directors
or officers of the Corporation may be an officer, director,
trustee, shareholder, or
member of such other party to the contract, and no such contract
shall be invalidated or
rendered voidable by reason of the existence of any such
relationship, nor shall any
person holding such relationship be liable merely by reason of
such relationship for any
loss or expense to the Corporation under or by reason of said
contract or accountable for
any profit realized directly or indirectly therefrom, provided
that the contract, when
entered into, was reasonable and fair and not inconsistent with
the provisions of this
Section 5.07. The same person (including a firm, corporation,
trust, or association) may
be the other party to contracts entered into pursuant to the
above paragraphs, and any
individual may be financially interested or otherwise affiliated
with persons who are
parties to any or all of the contracts mentioned in this
paragraph.
Any contract entered into pursuant to the first two
paragraphs of this Section
5.07 shall be consistent with and subject to the requirements of
Section 15 of the
Investment Company Act of 1940 (including any amendment thereof
or other applicable Act of
Congress hereafter enacted) with respect to its continuance in
effect, its termination and
the method of authorization and approval of such contract or
renewal thereof.
IN WITNESS WHEREOF, we have signed these Articles of
Incorporation and
acknowledge the same to be our act on this 7th day of October,
1983.
Henry H. Hopkins
James S. Riepe
STATE OF MARYLAND )
) ss:
CITY OF BALTIMORE )
I HEREBY CERTIFY, that on this 7th day of October,
1983, before me, the
subscriber, a Notary Public of the State of Maryland, in and for
the City of Baltimore,
personally appeared HENRY H. HOPKINS and JAMES S. RIEPE, and they
acknowledged the
foregoing Articles of Incorporation to be their act.
WITNESS my hand and Notarial Seal this 7th day of October, 1983.
Notary Public
My Commission expires:
OF
ROWE PRICE TAX-FREE INCOME FUND, INC.
FIRST: The undersigned, Henry H. Hopkins and H.
Spencer Everett, Jr., each of
whose post office address is 100 East Pratt Street, Baltimore,
Maryland 21202, and each
being at least eighteen years of age, do hereby form a
corporation under the General Laws
of the State of Maryland.
SECOND: The name of the Corporation is:
ROWE PRICE TAX-FREE INCOME FUND, INC.
THIRD: The purposes for which the Corporation is formed are as follows:
(1) To operate as and carry on the business of an investment company, and exercise all the powers necessary and appropriate to the conduct of such operations.
(2) To invest and reinvest its funds in and hold for investment the securities (including but not limited to bonds, debentures, time notes, repurchase agreements, and all other evidences of indebtedness and shares, stock, subscription rights, profit-sharing interests or participations and all other contracts for or evidences of equity interests) of any corporation, company, trust, association, firm or other business organization however established, and of any country, state, municipality or other political subdivision, or of any other governmental or quasi-governmental agency or instrumentality.
(3) To acquire (by purchase, subscription or otherwise), to hold, to trade in and deal in, to sell or otherwise dispose of, to lend, and to pledge any such securities and repurchase agreements.
(4) To exercise all rights, powers and privileges of ownership or interest in all securities and repurchase agreements held by the Corporation, including the right to vote thereon and otherwise act with respect thereto and to do all acts for the preservation, protection, improvement and enhancement in value of all such securities and repurchase agreements.
(5) To aid by further investment any corporation, company, trust, association, firm or other business organization, any obligation of or interest in which is held by the Corporation or in the affairs of which the Corporation has any direct or indirect interest, and to do anything designed to protect, preserve, improve or enhance the value of such obligation or interest.
(6) To promote or aid the incorporation of any organization or enterprise under the laws of any country, state, municipality or other political subdivision, and to cause the same to be dissolved, wound up, liquidated, merged or consolidated.
(7) In general, to carry on any other business in connection with or incidental to any of the foregoing objects and purposes, to have and exercise all the powers conferred upon corporations by the laws of the State of Maryland as in force from time to time, to do everything necessary, suitable or proper for the accomplishment of any purpose or the attainment of any object or the furtherance of any power hereinbefore set
forth, either alone or in association with others, and to take
any action incidental or
appurtenant to or growing out of or connected with the aforesaid
business or purposes,
objects or powers.
The Corporation shall have the power to conduct and
carry on its business, or
any part thereof, and to have one or more offices, and to
exercise any or all of its
corporate powers and rights, in the State of Maryland, in any
other states, territories,
districts, colonies and dependencies of the United States, and in
any or all foreign
countries.
The foregoing clauses shall be construed both as
objects and powers, and the
foregoing enumeration of specific powers shall not be held to
limit or restrict in any
manner the general powers of the Corporation.
FOURTH: The post office address of the principal
office of the Corporation in
the State of Maryland is:
100 East Pratt Street
Baltimore, Maryland
21202
The name and post office address of the resident agent of the
Corporation in the State of
Maryland is:
H. Spencer Everett,
Jr.
100 East Pratt Street
Baltimore, Maryland
21202
FIFTH: The total number of shares of stock which the
Corporation has authority
to issue is Two Hundred Million (200,000,000) shares of a single
class of the par value of
One Dollar ($1.00) per share, such shares having an aggregate par
value of Two Hundred
Million Dollars ($200,000,000).
SIXTH: The number of directors of the Corporation
shall be five, or such other
number as may from time to time be fixed by the By-Laws of the
Corporation or pursuant to
authorization contained in such By-Laws, but the number of
directors shall never be less
than three. The names of the directors who shall act as such
until the first annual
meeting of stockholders and until their successors are duly
chosen and qualify are as
follows:
Donald E. Bowman
George J. Collins
Carter O. Hoffman
W. Ernest Issel
Lawrence P. Naylor,
III
SEVENTH: Regulation of the Powers of the Corporation
and Its Directors and
Shareholders.
SECTION I
ISSUE OF THE CORPORATION'S SHARES
1.01 General. The Board of Directors may from time to time issue and sell or cause to be issued and sold any of the Corporation's authorized shares, including any additional shares hereafter authorized and any shares redeemed or repurchased by the Corporation, except that only shares previously contracted to be sold may be issued during any period when the determination of net asset value is suspended pursuant to the provisions of Section III hereof. All such authorized shares, when issued in accordance with the terms of this Section I, shall be fully paid and nonassessable. No holder of any shares of the Corporation shall be entitled, by reason of holding or owning such shares, to any prior, preemptive or other right to
subscribe to, purchase or otherwise acquire any additional shares
of the Corporation
subsequently issued for cash or other consideration or by way of
a dividend or otherwise.
1.02 Price. No shares of the Corporation shall be issued or sold by the Corporation, except as a stock dividend distributed to shareholders, for less than an amount which would result in proceeds to the Corporation, before taxes payable by the Corporation in connection with such transaction, of at least the net asset value per share determined as set forth in Section III hereof as of such time as the Board of Directors shall have by resolution theretofore prescribed but not earlier than the close of business on the business day (which term, as used herein, shall mean a day on which the New York Stock Exchange is open all or part of the day for unrestricted trading) next preceding the date of receipt of an unconditional purchase order for such shares. In the absence of a resolution of the Board of Directors applicable to the transaction, such net asset value shall be that next determined after receipt of such purchase order. For this purpose, the time of receipt of such an unconditional order shall be the time it is first received by the Corporation, its principal underwriter, the custodian or depository of the Corporation's assets, the transfer agent of the Corporation, or by another agent of the Corporation designated for the purpose.
1.03 On Merger or Consolidation. In connection with the acquisition of all or substantially all the assets or stock of another investment company or investment trust, the Board of Directors may issue or cause to be issued shares of the Corporation and accept in payment therefor, in lieu of cash, such assets at their market value, or such stock at the market value of the assets held by such investment company or investment trust, either with or without adjustment for contingent costs or liabilities, provided that the funds of the Corporation are permitted by law to be invested in such assets or stock.
1.04 Fractional Shares. The Board of Directors may issue and sell fractions of shares having pro rata all the rights of full shares, including, without limitation, the right to vote and to receive dividends.
SECTION II
REDEMPTION AND REPURCHASE OF
THE CORPORATION'S SHARES
2.01 Redemption of Shares. The Corporation shall redeem its shares, subject to the conditions and at the price determined as hereinafter set forth, upon proper application of the record holder thereof at such office or agency as may be designated from time to time for that purpose by the Board of Directors. Any such application must be accompanied by the certificate or certificates, if any, evidencing such shares, duly endorsed or accompanied by a proper instrument of transfer. The Board of Directors shall have power to determine from time to time the form and the other accompanying documents which shall be necessary to constitute a proper application for redemption.
2.02 Price. Such shares shall be redeemed at their
net asset value
determined as set forth in Section III hereof as of such time as
the Board of Directors
shall have theretofore prescribed by resolution, which time shall
not be later than the
close of business on the next business day succeeding, and not
earlier than the close of
business on the next business day preceding, the date on which
proper application is made
for redemption. In the absence of such resolution, the
redemption price of shares
deposited shall be the net asset value of such shares next
determined as set forth in
Section III hereof after receipt of such application.
2.03 Payment. Payment for such shares shall be made to the shareholder of record within seven days after the date upon which proper application is received, subject to the provisions of Section 2.04 hereof. Such payment shall be made in cash or other assets of the Corporation or both, as the Board of Directors shall prescribe. For the purposes of such payment for shares redeemed, the value of assets delivered shall be determined as set forth in Section III hereof as of the same time as of which the per share net asset value of such shares is determined.
2.04 Effect of Suspension of Determination of Net Asset Value. If, pursuant to Section 3.03 hereof, the Board of Directors shall declare a suspension of the determination of net asset value, the rights of shareholders (including those who shall have applied for redemption pursuant to Section 2.01 hereof but who shall not yet have received payment) to have shares redeemed and paid for by the Corporation shall be suspended until the termination of such suspension is declared. Any record holder whose redemption right is so suspended may, during the period of such suspension, by appropriate written notice of revocation to the office or agency where application was made, revoke his application and withdraw any share certificates which accompanied such application. The redemption price of shares for which redemption applications have not been revoked shall be the net asset value of such shares next determined as set forth in Section III after the termination of such suspension, and payment shall be made within seven days after the date upon which the application was made plus the period after such application during which the determination of net asset value was suspended.
2.05 Repurchase by Agreement. The Corporation may
repurchase shares of the
Corporation directly, or through its principal underwriter or
other agent designated for
the purpose, by agreement with the owner thereof, at a price not
exceeding the net asset
value per share determined as of the time when the purchase or
contract of purchase is
made or the net asset value as of any time which may be later
determined pursuant to
Section III hereof, provided payment is not made for the shares
prior to the time as of
which such net asset value is determined.
2.06 Corporation's Option to Redeem Shares. The Corporation shall have the right at any time and without prior notice to the shareholder to redeem shares in any account for their then-current net asset value per share if and to the extent it shall be necessary to reimburse the Corporation for any loss sustained by the Corporation by reason of the failure of the shareholder in whose name such account is registered to make full payment for shares of the Corporation purchased by such shareholder.
The right of redemption provided by this
Section 2.06 shall be subject
to such terms and conditions as the Board of Directors may from
time to time approve, and
subject to the Corporation's giving general notice of its
intention to avail itself of
such right, either by publication in the Corporation's prospectus
or by such means as the
Board of Directors shall determine.
SECTION III
NET ASSET VALUE OF SHARES
3.01 By Whom Determined. The Board of Directors shall have the power and duty to determine from time to time the net asset value per share of the outstanding shares of the Corporation. It may delegate such power and duty to one or more of the directors and officers of the Corporation, to the custodian or depository of the Corporation's assets, or to another agent of the Corporation appointed for such purpose. Any
determination made pursuant to this Section by the Board of
Directors or its delegate
shall be binding on all parties concerned.
3.02 When Determined. The net asset value shall be determined at such times as the Board of Directors shall prescribe by resolution, provided that such net asset value shall be determined at least once each week as of the close of business on a business day. In the absence of a resolution of the Board of Directors, the net asset value shall be determined as of the close of trading on the New York Stock Exchange on each business day.
3.03 Suspension of Determination of Net Asset Value. The Board of Directors may declare a suspension of the determination of net asset value for the whole or any part of any period (a) during which the New York Stock Exchange is closed other than customary weekend and holiday closings, (b) during which trading on the New York Stock Exchange is restricted, (c) during which an emergency exists as a result of which disposal by the Corporation of securities owned by it is not reasonably practicable or it is not reasonably practicable for the Corporation fairly to determine the value of its net assets, or (d) during which a governmental body having jurisdiction over the Corporation may by order permit for the protection of the security holders of the Corporation. Such suspension shall take effect at such time as the Board of Directors shall specify, which shall not be later than the close of business on the business day next following the declaration, and thereafter there shall be no determination of net asset value until the Board of Directors shall declare the suspension at an end, except that the suspension shall terminate in any event on the first day on which (1) the condition giving rise to the suspension shall have ceased to exist and (2) no other condition exists under which suspension is authorized under this Section 3.03. Each declaration by the Board of Directors pursuant to this Section 3.03 shall be consistent with such official rules and regulations, if any, relating to the subject matter thereof as shall have been promulgated by the securities and Exchange Commission or any other governmental body having jurisdiction over the Corporation and as shall be in effect at the time. To the extent not inconsistent with such official rules and regulations, the determination of the Board of Directors shall be conclusive.
3.04 Computation of Per Share Net Asset Value.
a. Net Asset Value Per Share. The net asset value of each share as of any particular time shall be the quotient obtained by dividing the value of the net assets of the Corporation by the total number of shares outstanding.
b. Value of Corporation's Net Assets. The value of the Corporation's net assets as of any particular time shall be the value of the Corporation's assets less its liabilities, determined and computed as follows:
(1) Corporation's Assets.
The Corporation's
assets shall be deemed to include: (A) all cash on hand
or on deposit, including
any interest accrued thereon, (B) all bills and demand
notes and accounts
receivable, (C) all securities owned or contracted for
by the Corporation, (D)
all stock and cash dividends and cash distributions
payable to but not yet
received by the Corporation (when the valuation of the
underlying security is
being determined exdividend), (E) all interest accrued
on any interest-bearing
securities owned by the Corporation (except accrued
interest included in the
valuation of the underlying security), (F) all
repurchase agreements, and (G)
all other property of every kind and nature, including
prepaid expenses.
(2) Valuation of Assets.
The value of such assets
is to be determined as follows:
(i)Cash and Prepaid
Expenses. The value of
|
any cash on hand and of any prepaid expenses
shall be deemed to be
their full amount.
(ii)Other Current Assets. The value of any cash on deposit, bills, demand notes, accounts receivable, and cash dividends and interest declared or accrued as aforesaid and not yet received shall be deemed to be the full amount thereof, unless the Board of Directors shall determine that any such item is not worth its full amount. In such case, the value of the item shall be deemed to be its reasonable value, as determined by the Board of Directors.
(iii) Securities. The securities in which the Fund may invest are traded primarily in the over-the-counter market. Portfolio securities are valued at quoted bid prices when representative quotes are readily available. Securities and other assets for which representative quotes are not readily available are appraised at prices deemed best to reflect their fair market value as determined in good faith by or under the supervision of officers of the Fund in a manner specifically authorized by the Board of Directors.
(3) The Corporation's Liabilities. The Corporation's liabilities shall not be deemed to include outstanding shares and surplus. They shall be deemed to include: (A) all bills and accounts payable, (B) all administrative expenses accrued, (C) all contractual obligations for the payment of money or property, including the amount of any declared but unpaid dividends upon the Corporation's shares, (D) all reserves authorized or approved by the Board of Directors for taxes or contingencies and (E) all other liabilities of whatsoever kind and nature except any liabilities represented by the Corporation's outstanding shares and surplus.
3.05 Interim Determinations. Any determination of net asset value other than as of the close of trading on the New York Stock Exchange may be made either by appraisal or by calculation or estimate. Any such calculation or estimate shall be based on changes in the market value of representative or selected securities or on changes in recognized market averages since the last closing appraisal and made in a manner which in the opinion of the Board of Directors or its delegate will fairly reflect the changes in the net asset value.
3.06 Miscellaneous. For the purposes of the
Section III:
a. Shares of the Corporation sold shall be deemed to be outstanding as of the time, not before an unconditional purchase order therefor has been received by the Corporation (directly or through one of its agents) or by one of its underwriters and the sale price in currency has been determined, when the sale is reported to the Corporation or to its agent for determining net asset value, and the net sale price thereof to the Corporation (less commission, if any, and less any stamp or other tax payable by the Corporation in connection with
the issue and sale thereof) shall be thereupon deemed to be an asset of the Corporation.
b. Shares of the Corporation for which an application for redemption has been made or which are subject to repurchase by the Corporation shall be deemed to be outstanding up to and including the time as of which the redemption or repurchase price is determined. After such time, they shall be deemed to be no longer outstanding and the price until paid shall be deemed to be a liability of the Corporation.
c. Funds on deposit and contractual obligations payable to the Corporation in foreign currency and liabilities and contractual obligations payable by the Corporation in foreign currency shall be taken at the current cable rate of exchange as nearly as practicable at the time as of which the net asset value is computed.
SECTION IV
COMPLIANCE WITH INVESTMENT
COMPANY ACT OF 1940
Notwithstanding any of the foregoing
provisions of this Article
SEVENTH, the Board of Directors may prescribe, in its absolute
discretion, such other
bases and times for determining the per share net asset value of
the Corporation's shares
as it shall deem necessary or desirable to enable the Corporation
to comply with any
provision of the Investment Company Act of 1940, or any rule or
regulation thereunder,
including any rule or regulation adopted pursuant to Section 22
of the Investment Company
Act of 1940 by the Securities and Exchange Commission or any
securities association
registered under the Securities Act of 1934, all as in effect now
or as hereafter amended
or added.
SECTION V
MISCELLANEOUS
5.01 Compensation of Directors. The Board of Directors shall have power from time to time to authorize payment of compensation to the directors for services to the Corporation, including fees for attendance at meetings of the Board of Directors and of committees.
5.02 Inspection of Corporation's Books. The Board of Directors shall have power from time to time to determine whether and to what extent, and at what times and places and under what conditions and regulations the accounts and books of the Corporation (other than the stock ledger) or any of them shall be open to the inspection of shareholders; and no shareholder shall have any right of inspecting any account, book or document of the Corporation except as at the time conferred by statute, unless authorized by a resolution of the shareholders or the Board of Directors.
5.03 Majority Vote of Shareholders. Notwithstanding any provision of the laws of the State of Maryland requiring a greater proportion than a majority of the votes of all classes or of any class of stock entitled to be cast, to take or authorize any action, such action may, subject to other applicable provisions of law, these Articles of Incorporation and the By-Laws, be taken or authorized upon the concurrence of a majority of the aggregate number of the votes entitled to be cast thereon.
5.04 Name. The Corporation acknowledges that it is adopting its corporate name through permission of T. Rowe Price Associates, Inc., a
Maryland corporation, and agrees that T. Rowe Price Associates,
Inc. reserves to itself
and any successor to its business the right to grant the
nonexclusive right to use the
name "Rowe Price" or any similar name to any other corporation or
entity, including but
not limited to any investment company of which T. Rowe Price
Associates, Inc. or any
subsidiary or affiliate thereof or any successor to the business
of any thereof shall be
the investment adviser.
5.05 Reservation of Right to Amend. The Corporation reserves the right to make any amendment of its charter, now or hereafter authorized by law, including any amendment which alters the contract rights, as expressly set forth in its charter, of any outstanding stock, and all rights herein conferred upon stockholders are granted subject to such reservation.
5.06 Determination of Net Profits, etc.; Dividends.
The Board of Directors
is expressly authorized to determine in accordance with generally
accepted accounting
principles and practices what constitutes net profits, earnings,
surplus or net assets in
excess of capital, and to determine what accounting periods shall
be used by the
Corporation for any purpose, whether annual or any other period,
including daily; to set
apart out of any funds of the Corporation such reserves for such
purposes as it shall
determine and to abolish the same; to declare and pay dividends
and distributions in cash,
securities or other property from surplus or any funds legally
available therefor, at such
intervals (which may be as frequently as daily) or on such other
periodic basis, as it
shall determine; to declare such dividends or distributions by
means of a formula or other
method of determination, at meetings held less frequently than
the frequency of the
effectiveness of such declarations; to establish payment dates
for dividends or any other
distributions on any basis, including dates occurring less
frequently than the
effectiveness of the declaration thereof; and to provide for the
payment of declared
dividends on a date earlier than the specified payment date in
the case of stockholders of
the Corporation redeeming their entire ownership of shares of the
Corporation.
5.07 Contracts. The Board of Directors may in its discretion from time to time enter into an exclusive or non-exclusive underwriting contract or contracts providing for the sale of the shares of Capital Stock of the Corporation to net the Corporation not less than the amount provided for in Section 1.02 of Article SEVENTH hereof, whereby the Corporation may either agree to sell the shares to the other party to the contract or appoint such other party its sales agent for such shares (such other party being herein sometimes called the "underwriter"), and in either case on such terms and conditions as may be prescribed in the By-Laws, if any, and such further terms and conditions as the Board of Directors may in its discretion determine not inconsistent with the provisions of Article SEVENTH hereof or of the By-Laws; and such contract may also provide for the repurchase of shares of the Corporation by such other party as agent of the Corporation.
The Board of Directors may in its discretion
from time to time enter
into an investment advisory or management contract whereby the
other party to such
contract shall undertake to furnish to the Corporation such
management, investment
advisory, statistical and research facilities and services and
such other facilities and
services, if any, and all upon such terms and conditions, as the
Board of Directors may in
its discretion determine.
Any contract of the character described in the
paragraphs above or for
services as custodian, transfer agent or disbursing agent or
related services may be
entered into with any corporation, firm, trust or association,
although one or more of the
directors or officers of the
Corporation may be an officer, director, trustee, shareholder or
member of such other
party to the contract, and no such contract shall be invalidated
or rendered voidable by
reason of the existence of any such relationship, nor shall any
person holding such
relationship be liable merely by reason of such relationship for
any loss or expense to
the Corporation under or by reason of said contract or
accountable for any profit realized
directly or indirectly there from, provided that the contract
when entered into was
reasonable and fair and not inconsistent with the provisions of
this Section 5.07. The
same person (including a firm, corporation, trust or association)
may be the other party
to any contract entered into pursuant to the above paragraphs,
and any individual may be
financially interested or otherwise affiliated with persons who
are parties to any or all
of the contracts mentioned in this paragraph.
Any contract entered into pursuant to the
first two paragraphs of this
Section 5.07 shall be consistent with and subject to the
requirements of Section 15 of the
Investment Company Act of 1940 (including any amendment thereof
or other applicable Act of
Congress hereafter enacted) with respect to its continuance in
effect, its termination and
the method of authorization and approval of such contract or
renewal thereof.
IN WITNESS WHEREOF, we have signed these Articles of
Incorporation and
acknowledge the same to be our act on this 24th
day of September, 1976.
/s/H. Spencer
Everett, Jr.
H. Spencer Everett,
Jr.
/s/Henry H. Hopkins
Henry H. Hopkins
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STATE OF MARYLAND )
: to wit:
CITY OF BALTIMORE )
|
I hereby certify that on this 24th day of September,
1976, before me, the
subscriber, a Notary Public of the State of Maryland in and for
the City of Baltimore,
personally appeared H. Spencer Everett, Jr. and Henry H. Hopkins
and acknowledged the
foregoing Articles of Incorporation to be their act.
Witness my hand and notarial seal this 24th day of September, 1976.
/s/Elizabeth R.
Thomason
Elizabeth R. Thomason
Notary Public
Baltimore, Maryland
|
ARTICLES OF AMENDMENT
Rowe Price Tax-Free income Fund, Inc., a Maryland
corporation having its
principal office in the City of Baltimore, Maryland (hereinafter
called the
"Corporation"), hereby certifies to the State Department of
Assessments and Taxation of
Maryland that:
FIRST: The Charter of the Corporation is hereby
amended by deleting therefrom
Subsection 3.04(b) (2) (iii) of Section III of Article SEVENTH
and inserting in lieu
thereof a new Subsection 3.04(b) (2) (iii) to read in full as
follows:
"(iii) Securities. The securities in which
the Fund may invest are
traded primarily in the over-the-counter market.
Portfolio securities are
valued at the mean between quoted bid and asked prices
when representative
quotes are readily available. Securities and other
assets for which (a) such
procedure is deemed not to reflect fair market value or
(b) representative
quotes are not readily available, are appraised at
prices deemed best to reflect
their fair market value as determined in good faith by
or under the supervision
of officers of the Fund in a manner specifically
authorized by the Board of
Directors. The Board of Directors may by resolution
adopt the use of such other
system process, pricing service or such other means as
may be deemed appropriate
for valuing the portfolio securities of the Fund from
time to time, provided the
Board determines that such manner of pricing will
actually reflect the fair
market value of the Fund's portfolio securities."
SECOND: The Board of Directors of the Corporation, on
November 3, 1976, duly
adopted a resolution in which was set forth the foregoing
amendment to the Charter of the
Corporation, declaring that the said amendment as proposed was
advisable and directing
that it be submitted for action thereon by the stockholders of
the Corporation.
THIRD: The amendment of the Charter as hereinabove set
forth was approved by T.
Rowe Price Associates, Inc., the sole stockholder of the
Corporation, on November 4, 1976,
and a written consent which sets forth the Charter amendment and
is duly executed on
behalf of T. Rowe Price Associates, Inc. is filed with the
records of the Corporation.
FOURTH: The amendment of the Charter as hereinabove
set forth has been duly
advised by the Board of Directors and approved by the
stockholders of the Corporation.
IN WITNESS WHEREOF, ROWE PRICE TAX-FREE INCOME FUND,
INC. has caused these
presents to be signed in its name and on its behalf by one of its
Vice Presidents, and its
corporate seal to be hereunto affixed and attested by its
Secretary, on November 4, 1976.
ROWE PRICE TAX-FREE
INCOME FUND, INC.
/s/William B.
Thompson
William B. Thompson,
Vice President
ATTEST:
/s/Lenora V. Hornung
Lenora V. Hornung, Secretary
|
STATE OF MARYLAND )
) SS:
CITY OF BALTIMORE )
|
I HEREBY CERTIFY that on November 4, 1976, before me
the subscriber, a Notary
Public of the State of Maryland, in and for the City of
Baltimore, personally appeared
William B. Thompson, Vice President of ROWE PRICE TAX-FREE INCOME
FUND, INC., a Maryland
corporation, and in the name and on behalf of said Corporation
acknowledged the foregoing
Articles of Amendment to be the corporate act of said
Corporation; and at the same time
made oath in due form of law that she matters and facts set forth
in said Articles of
Amendment with respect to the approval of the said amendment are
true to the best of his
knowledge, information and belief.
WITNESS my hand and notarial seal, the day and year
last above written.
/s/Carolynn Kendall Carolynn Kendall Notary Public |
My commission expires July l, 1978
ARTICLES OF AMENDMENT
Rowe Price Tax-Free Income Fund, Inc., a Maryland
corporation having its
principal office in the City of Baltimore, Maryland (hereinafter
called the
"Corporation"), hereby certifies to the State Department of
Assessments and Taxation of
Maryland that:
FIRST: The Charter of the Corporation is hereby
amended by deleting therefrom
Article SECOND and inserting in lieu thereof a new Article SECOND
to read in full as
follows:
"SECOND: The name of the Corporation is:
T. ROWE PRICE TAX-FREE INCOME FUND, INC."
SECOND: The Board of Directors of the Corporation, on
January 22, 1981, duly
adopted resolutions in which were set forth the foregoing
amendment to Article SECOND of
the Charter of the Corporation, declaring that the said amendment
as proposed was
advisable and directing that it be submitted for action thereon
by the shareholders of the
Corporation at the annual meeting of shareholders to be held on
April 7, 1981.
THIRD: Notice setting forth a summary of the changes
to be effected by said
amendments of the Charter, and stating that a purpose of said
meeting of shareholders
Would be to take action thereon, was given, as required by law,
to all shareholders
entitled to vote thereon.
FOURTH: The amendment to Article SECOND of the Charter
as hereinabove set forth
was approved by the shareholders of the Corporation at said
meeting on April 7, 1981, by
the affirmative vote of 19,568,663.901 shares of the
32,999,129.147 shares of common stock
issued and outstanding, or 59.32% of the votes entitled to be
cast thereon, which vote was
sufficient to approve such amendment pursuant to the provisions
of the Charter of the
Corporation which requires the approval of a majority of the
votes entitled to be cast on
any such amendment, notwithstanding any provision of the law
requiring a greater
proportion.
FIFTH: The amendment of the Charter as hereinabove set
forth has been duly
advised by the Board of Directors and approved by the
shareholders of the Corporation.
IN WITNESS WHEREOF, ROWE PRICE TAX-FREE INCOME FUND,
INC. has caused these
presents to be signed in its name and on its behalf by its Vice
President, and its
corporate seal to be hereunto affixed and attested by its
Secretary, on May l, 1981.
ROWE PRICE TAX-FREE
INCOME FUND, INC.
/s/Howard P. Colhoun
Howard P. Colhoun,
Vice President
ATTEST:
/s/Lenora V. Hornung
Lenora V. Hornung, Secretary
|
STATE OF MARYLAND )
) SS.:
CITY OF BALTIMORE )
|
I HEREBY CERTIFY that on May l, 1981, before me the
subscriber, a Notary Public
of the State of Maryland, in and for the City of Baltimore,
personally appeared Howard P.
Colhoun, Vice President of ROWE PRICE TAX-FREE INCOME FUND, INC.,
a Maryland corporation,
and in the name and on behalf of said Corporation acknowledged
the foregoing Articles of
Amendment to be the corporate act of said Corporation; and at the
same time made
oath in due form of law that the matters and facts set forth in
said Articles of Amendment
with respect to the approval of the said amendments are true to
the best of his knowledge,
information and belief.
WITNESS my hand and notarial seal, the day and year
last above written.
/s/Catherine L. Boch Catherine L. Boch Notary Public |
My commission expires: July 1, 1982
ARTICLES OF AMENDMENT
T. Rowe Price Tax-Free Income Fund, Inc., a Maryland
corporation, having its
principal office in the City of Baltimore, Maryland (hereinafter
called the
"Corporation"), hereby certifies to the State Department of
Assessments and Taxation of
Maryland that:
FIRST: The Charter of the Corporation is hereby
amended by deleting therefrom
Article FIFTH and inserting in lieu thereof a new Article FIFTH
to read in full as
follows:
"FIFTH: (a) The total number of shares of
stock which the Corporation
shall have authority to issue is Five Hundred
Million (500,000,000)
shares of a single class of the par value of
One Dollar ($1.00) per
share, such shares having an aggregate par
value of Five Hundred
Million Dollars ($500,000,000).
(b) The balance of shares authorized but unissued may be issued as Capital Stock, or in any new class or classes, each consisting of such number of shares and having such designations, such powers, preferences and rights and such qualifications, limitations and restrictions as shall be fixed and determined from time to time by resolution or resolutions providing for the issuance of such stock adopted by the Board of Directors, to whom authority so to fix and determine the same is hereby expressly granted.
(c) Without limiting the generality of the foregoing, the dividends and distributions of investment income and capital gains with respect to Capital Stock and with respect to each class that may hereafter be created shall be in such amount as may be declared from time to time by the Board of Directors, and such dividends and distributions may vary from class to class to such extent and for such purposes as the Board of Directors may deem appropriate, including but not limited to, the purpose of complying with requirements of regulatory or legislative authorities.
(d) The Board of
Directors is hereby expressly
wanted authority to (1) classify or reclassify
an unissued stock
(whether now or hereafter authorized and
whether of Capital Stock or
any other class) from time to time by setting
or changing the
preferences, conversion or other rights,
voting powers, restrictions,
limitations as to dividends, qualifications,
or terms or conditions of
redemption of the stock and (2) pursuant to
such classification or
reclassification to increase or decrease the
number of authorized
shares of any class, but the number of shares
of any class shall not be
decreased by the Board of Directors below the
number of shares thereof
then outstanding and the total number of
authorized shares of stock
shall not be increased above the number of
shares authorized in
subsection (a) of this Article FIFTH except by
amendment to the
Corporation's charter.
SECOND: The Board of Directors of the Corporation, on
January 19, 1983, duly
adopted a resolution which set forth the foregoing amendment to
subsection (a) of Article
FIFTH of the Charter of the Corporation, declaring that said
amendment as proposed was
advisable and directing that it be submitted for action thereon
by the shareholders of the
Corporation at the annual meeting of shareholders to be held on
June 8, 1983.
THIRD: The Board of Directors of the Corporation, on
April 14, 1983, duly
adopted a resolution which set forth the addition of subsections
(b), (c), and (d) to
Article FIFTH of the Charter of the Corporation, declaring that
said additions were
advisable and directing that they be submitted for action thereon
by the shareholders of
the Corporation at the annual meeting of shareholders to be held
on June 8, 1983.
FOURTH: Notice setting forth a summary of the changes
to be effected by said
amendments of the Charter, and stating that a purpose of said
meeting of shareholders
would be to take action thereon, was given, as required by law,
to all shareholders
entitled to vote thereon.
FIFTH: The amendment to subsection (a) of Article
FIFTH of the Charter as
hereinabove set forth was approved by the shareholders of the
Corporation at said meeting
on June 8, 1983, by the affirmative vote of 72,676,929.215 shares
of the 106,299,338.147
shares of common stock issued and outstanding, or 68.37% of the
votes entitled to be cast
thereon, which vote was sufficient to approve such amendment
pursuant to the provisions of
the Charter of the Corporation which require the approval of a
majority of the votes
entitled to be cast on any such amendment, notwithstanding any
provision of the law
requiring a greater proportion.
SIXTH: The addition of subsections (b), (c), and (d)
of Article FIFTH of the
Charter as hereinabove set forth was approved by the shareholders
of the Corporation at
said meeting on June 8, 1983, by the affirmative vote of
66,392,632.584 shares of the 106,299,338.147 shares of common
stock issued and
outstanding, or 62.46% of the votes entitled to be cast thereon,
which vote was sufficient
to approve such amendment pursuant to the provisions of the
Charter of the Corporation
which require the approval of a majority of the votes entitled to
be cast on any such
amendment, notwithstanding any provision of the law requiring a
greater proportion.
SEVENTH: The amendments of the Charter as hereinabove
set forth have been duly
advised by the Board of Directors and approved by the
shareholders of the Corporation.
EIGHTH: (a) The total number of shares of stock which
the Corporation was
heretofore authorized by its Charter to issue was One Hundred
Million (100,000,000)
shares, all of one class, of the par value of One Dollar ($1.00)
each, having an aggregate
par value of One Hundred Million Dollars ($100,000,000).
(b) The total number
of shares of stock which
the Corporation is to be hereafter authorized to issue is Five
Hundred Million
(500,000,000) shares, all of one class, of the par value of One
Dollar ($1.00) each,
having an aggregate par value of Five Hundred Million Dollars
($500,000,000).
(c) The stock of the
Corporation is not
currently divided into classes.
IN WITNESS WHEREOF, T. ROWE PRICE TAX-FREE INCOME FUND,
INC. has caused these
presents to be signed in its name and on its behalf by its Vice
President, and its
corporate seal to be hereunto affixed and attested by its
Secretary, on July 1, 1983.
T. ROWE PRICE
TAX-FREE INCOME
FUND, INC.
/s/James S. Riepe
James S. Riepe, Vice
President
ATTEST:
/s/Lenora V. Hornung
Lenora V. Hornung, Secretary
|
STATE OF MARYLAND )
) SS.:
CITY OF BALTIMORE )
|
I HEREBY CERTIFY that on July 1, 1983, before me the
subscriber, a Notary Public
of the State of Maryland, in and for the City of Baltimore,
personally appeared James S.
Riepe, Vice President of T. ROWE PRICE TAX-FREE INCOME FUND,
INC., a Maryland corporation,
and in the name and on behalf of said Corporation acknowledged
the foregoing Articles of
Amendment to be the corporate act of said Corporation; and at the
same time made oath in
due form of law that the matters and facts set forth in said
Articles of Amendment with
respect to the approval of the said amendments are true to the
best of his knowledge,
information and belief.
WITNESS my hand and notarial seal, the day and year
last above written.
/s/Ingrid Vordemberge Ingrid Vordemberge Notary Public |
My commission expires: July 1, 1986
OF
T. ROWE PRICE TAX-FREE HIGH-YIELD FUND,
INC.
FIRST: The undersigned, Henry H. Hopkins and James S.
Riepe, each of whose post
office address is 100 East Pratt Street, Baltimore, Maryland
21202, and each being at
least eighteen (18) years of age, do hereby form a corporation
under the General laws of
the State of Maryland.
SECOND: The name of the Corporation is:
T. ROWE PRICE TAX-FREE HIGH-YIELD FUND, INC.
THIRD: The purposes for which the Corporation is formed are as follows:
(1) To operate as and carry on the business of an investment company, and exercise all the powers necessary and appropriate to the conduct of such operations.
(2) In general, to carry on any other business in connection with or incidental to the foregoing purpose, to have and exercise all the powers conferred upon corporations by the laws of the State of Maryland as in force from time to time, to do everything necessary, suitable or proper for the accomplishment of any purpose or the attainment of any object or the furtherance of any power not inconsistent with Maryland law, either alone or in association with others, and to take any action incidental or appurtenant to or growing out of or connected with the the Corporation's business or purposes, objects, or powers.
The Corporation shall have the power to conduct and
carry on its business, or
any part thereof, and to have one or more offices, and to
exercise any or all of its
corporate powers and rights, in the State of Maryland, in any
other states, territories,
districts, colonies, and dependencies of the United States, and
in any or all foreign
countries.
The foregoing clauses shall be construed both as
objects and powers, and the
foregoing enumeration of specific powers shall not be held to
limit or restrict in any
manner the general powers of the Corporation.
FOURTH: The post office address of the principal
office of the Corporation in
the State of Maryland is:
100 East Pratt Street
Baltimore, Maryland 21202
The name and post office address of the resident agent of the
Corporation in the State of
Maryland is:
Henry Holt Hopkins
100 East Pratt Street
Baltimore, Maryland 21202
Said resident agent is a citizen of the State of Maryland, and actually resides therein.
FIFTH: (a) The total number of shares of stock which the
Corporation, by
resolution or resolutions of the Board of Directors,
shall have authority to
issue is One Billion (1,000,000,000) shares, par value
One Cent ($0.01) per
share, such shares having an aggregate par value of Ten
Million Dollars
($10,000,000). All of such shares may be issued as
shares of a class
designated Capital Stock, subject, however, to the
authority hereinafter
granted to the Board of Directors to classify or
reclassify any such shares
and, incident to such classification or reclassification,
to increase or
decrease such number of shares.
(b) The balance of shares authorized but unissued may be issued as Capital Stock, or in any new class or classes, each consisting of such number of shares and having such designations, such powers, preferences and rights and such qualifications, limitations and restrictions as shall be fixed and determined from time to time by resolution or resolutions providing for the issuance of such stock adopted by the Board of Directors, to whom authority so to fix and determine the same is hereby expressly granted.
(c) Without limiting the generality of the foregoing, the dividends and distributions of investment income and capital gains with respect to Capital Stock and with respect to each class that may hereafter be created shall be in such amount as may be declared from time to time by the Board of Directors, and such dividends and distributions may vary from class to class to such extent and for such purposes as the Board of Directors may deem appropriate, including, but not limited to, the purpose of complying with requirements of regulatory or legislative authorities.
(d) The Board of Directors is hereby expressly
granted authority to
(1) classify or reclassify any unissued stock (whether
now or hereafter
authorized and whether of Capital Stock or any other
class) from time to time
by setting or changing the preferences, conversion or
other rights, voting
powers, restrictions, limitations as to dividends,
qualifications, or terms
or conditions of redemption of the stock and (2) pursuant
to such
classification or reclassification to increase or
decrease the number of
authorized shares of any class, but the number of shares
of any class shall
not be decreased by the Board of Directors below the
number of shares thereof
then outstanding and the total number of authorized
shares of stock shall not
be increased above
1,000,000,000 shares except by amendment to the Corporation's
charter.
SIXTH: The number of directors of the Corporation
shall be three (3), or such
other number as may from time to time be fixed by the By-Laws of
the Corporation, or
pursuant to authorization contained in such By-Laws, but the
number of directors shall
never be less than (i) three (3) or (ii) the number of
shareholders of the Corporation,
whichever is less. Peter J.D. Gordon, George J. Collins, and
James S. Riepe shall serve
as directors until the first meeting of shareholders and until
their successors are duly
chosen and qualify.
SEVENTH: Regulation of the Powers of the Corporation
and Its Directors and
Shareholders.
ISSUE OF THE CORPORATION'S SHARES
1.01General. The Board of Directors may from time to
time issue and sell or
cause to be issued and sold any of the Corporation's authorized
shares, including any
additional shares hereafter authorized and any shares redeemed or
repurchased by the
Corporation, except that only shares previously contracted to be
sold may be issued during
any period when the determination of net asset value is suspended
pursuant to the
provisions of Section III hereof. All such authorized shares,
when issued in accordance
with the terms of this Section I, shall be fully paid and
nonassessable. No holder of any
shares of the Corporation shall be entitled, by reason of holding
or owning such shares,
to any prior, preemptive or other right to subscribe to, purchase
or otherwise acquire any
additional shares of the Corporation subsequently issued for cash
or other consideration
or by way of a dividend or otherwise.
1.02Price. No shares of the Corporation shall be
issued or sold by the
Corporation, except as a stock dividend distributed to
shareholders, for less than an
amount which would result in proceeds to the Corporation, before
taxes payable by the
Corporation in connection with such transaction, of at least the
net asset value per share
determined as set forth in Section III hereof as of such time as
the Board of Directors
shall have by resolution theretofore prescribed, but not earlier
than the close of
business on the business day (which term, as used herein, shall
be defined to mean a day
on which the New York Stock Exchange is open all or part of the
day for unrestricted
trading, or such other definition as the Board of Directors shall
have by resolution
theretofore prescribed pursuant to Section 2.02 hereof) next
preceding the date of receipt
of an unconditional purchase order for such shares. In the
absence of a resolution of the
Board of Directors applicable to the transaction, such net asset
value shall be that next
determined after receipt of such purchase order. For this
purpose, the time of receipt of
such an unconditional order shall be the time it is first
received by the principal
underwriter, the custodian or depository of the Corporation's
assets, the transfer agent
of the Corporation, or by another agent of the Corporation
designated for the purpose.
1.03On Merger or Consolidation. In connection with the
acquisition of all or
substantially all the assets or stock of another investment
company or investment trust,
the Board of Directors may issue or cause to be issued shares of
the Corporation and
accept in payment therefor, in lieu of cash, such assets at their
market value, or such
stock at the market value of the assets held by such investment
company or investment
trust, either with or without adjustment for contingent costs or
liabilities, provided
that the funds of the Corporation are permitted by law to be
invested in such assets or
stock.
1.04Fractional Shares. The Board of Directors may
issue and sell fractions of
shares having pro rata all the rights of full shares, including,
without limitation, the
right to vote and to receive dividends.
SECTION II
REDEMPTION AND REPURCHASE OF
THE CORPORATION'S SHARES
2.01Redemption of Shares. The Corporation shall redeem
its shares, subject to
the conditions and at the price determined as hereinafter set
forth, upon proper
application of the record holder thereof at such office or agency
as may be designated
from time to time for that purpose by the Board of Directors.
Any such application must
be accompanied by the certificate or certificates, if any,
evidencing such shares, duly
endorsed or accompanied by a proper instrument of transfer. The
Board of Directors shall
have power to determine or to delegate
to the proper officers of the Corporation the power to determine
from time to time the
form and the other accompanying documents which shall be
necessary to constitute a proper
application for redemption.
2.02Price. Such shares shall be redeemed at their net
asset value determined as
set forth in Section III hereof as of such time as the Board of
Directors shall have
theretofore prescribed by resolution. In the absence of such
resolution, the redemption
price of shares deposited shall be the net asset value of such
shares next determined as
set forth in Section III hereof after receipt of such
application.
2.03Payment. Payment for such shares shall be made to
the shareholder of record
within seven (7) days after the date upon which proper
application is received, subject to
the provisions of Section 2.04 hereof. Such payment shall be
made in cash or other assets
of the Corporation or both, as the Board of Directors shall
prescribe.
2.04Effect of Suspension of Determination of Net Asset
Value. If, pursuant to
Section 3.03 hereof, the Board of Directors shall declare a
suspension of the
determination of net asset value, the rights of shareholders
(including those who shall
have applied for redemption pursuant to Section 2.01 hereof but
who shall not yet have
received payment) to have shares redeemed and paid for by the
Corporation shall be
suspended until the termination of such suspension is declared.
Any record holder whose
redemption right is so suspended may, during the period of such
suspension, by appropriate
written notice of revocation to the office or agency where
application was made, revoke
his application and withdraw any share certificates which
accompanied such application.
The redemption price of shares for which redemption applications
have not been revoked
shall be the net asset value of such shares next determined as
set forth in Section III
after the termination of such suspension, and payment shall be
made within seven (7) days
after the date upon which the application was made plus the
period after such application
during which the determination of net asset value was suspended.
2.05Repurchase by Agreement. The Corporation may
repurchase shares of the
Corporation directly, or through its principal underwriter or
other agent designated for
the purpose, by agreement with the owner thereof, at a price not
exceeding the net asset
value per share determined as of the time when the purchase or
contract of purchase is
made or the net asset value as of any time which may be later
determined pursuant to
Section III hereof, provided payment is not made for the shares
prior to the time as of
which such net asset value is determined.
2.06Corporation's Option to Redeem Shares.
(a) The Corporation shall have the right at any time and without prior notice to the shareholder to redeem all shares in any account for their then-current net asset value per share if all shares in the account have an aggregate net asset value of less than $10,000, or such lesser amount as the Board of Directors may from time to time determine;
(b) The Corporation shall have the right at any time and without prior notice to the shareholder to redeem shares in any account for their then-current net asset value per share if and to the extent it shall be necessary to reimburse the Corporation or its principal underwriter or distributor for any loss sustained by the Corporation by reason of the failure of the shareholder in whose name such account is registered to make full payment for shares of the Corporation purchased by such shareholder.
(c) The right of redemption provided by each of the foregoing subsections of this Section 2.06 shall be subject to such terms and conditions as the Board of Directors may from time to time approve, and subject to the Corporation's giving general notice of its intention to avail itself of such right, either by publication in the Corporation's prospectus or by such means as the Board of Directors shall determine.
SECTION III
NET ASSET VALUE OF SHARES
3.01By Whom Determined. The Board of Directors shall
have the power and duty to
determine from time to time the net asset value per share of the
outstanding shares of the
Corporation. It may delegate such power and duty to one or more
of the directors and
officers of the Corporation, to the custodian or depository of
the Corporation's assets,
or to another agent of the Corporation appointed for such
purpose. Any determination made
pursuant to this section by the Board of Directors, or its
delegate, shall be binding on
all parties concerned.
3.02When Determined. The net asset value shall be
determined at such times as
the Board of Directors shall prescribe by resolution, provided
that such net asset value
shall be determined at least once each week as of the close of
business on a business day.
In the absence of a resolution of the Board of Directors, the net
asset value shall be
determined as of the close of trading on the New York Stock
Exchange on each business day.
3.03Suspension of Determination of Net Asset Value.
The Board of Directors may
declare a suspension of the determination of net asset value for
the whole or any part of
any period (a) during which the New York Stock Exchange is closed
other than customary
weekend and holiday closings, (b) during which trading on the New
York Stock Exchange is
restricted, (c) during which an emergency exists as a result of
which disposal by the
Corporation of securities owned by it is not reasonably
practicable or it is not
reasonably practicable for the Corporation fairly to determine
the value of its net
assets, or (d) during which a governmental body having
jurisdiction over the Corporation
may by order permit for the protection of the security holders of
the Corporation. Such
suspension shall take effect at such time as the Board of
Directors shall specify, which
shall not be later than the close of business on the business day
next following the
declaration, and thereafter there shall be no determination of
net asset value until the
Board of Directors shall declare the suspension at an end, except
that the suspension
shall terminate in any event on the first day on which (1) the
condition giving rise to
the suspension shall have ceased to exist and (2) no other
condition exists under which
suspension is authorized under this Section 3.03. Each
declaration by the Board of
Directors pursuant to this Section 3.03 shall be consistent with
such official rules and
regulations, if any, relating to the subject matter thereof as
shall have been promulgated
by the Securities and Exchange Commission or any other
governmental body having
jurisdiction over the Corporation and as shall be in effect at
the time. To the extent
not inconsistent with such official rules and regulations, the
determination of the Board
of Directors shall be conclusive.
3.04Computation of Per Share Net Asset Value.
(a) Net Asset Value Per Share. The net asset value of each share as of any particular time shall be the quotient obtained by dividing the value of the net assets of the Corporation by the total number of shares outstanding.
(b) Value of Corporation's Net Assets. The value of the Corporation's net assets as of any particular time shall be the value of the Corporation's assets less its liabilities, determined and computed as prescribed by the Board of Directors.
SECTION IV
COMPLIANCE WITH INVESTMENT
COMPANY ACT OF 1940
Notwithstanding any of the foregoing provisions of this
Article SEVENTH, the
Board of Directors may prescribe, in its absolute discretion,
such other bases and times
for determining the per share net asset value of the
Corporation's shares as it shall deem
necessary or desirable to enable the Corporation to comply with
any provision of the
Investment Company Act of 1940, or any rule or regulation
thereunder, including any rule
or regulation adopted pursuant to Section 22 of the Investment
Company Act of 1940 by the
Securities and Exchange Commission or any securities association
registered under the
Securities Exchange Act of 1934, all as in effect now or as
hereafter amended or added.
SECTION V
MISCELLANEOUS
5.01 Compensation of Directors. The Board of Directors shall have power from time to time to authorize payment of compensation to the directors for services to the Corporation, including fees for attendance at meetings of the Board of Directors and of committees.
5.02 Inspection of Corporation's Books. The Board of Directors shall have power from time to time to determine whether and to what extent, and at what times and places, and under what conditions and regulations the accounts and books of the Corporation (other than the stock ledger) or any of them shall be open to the inspection of shareholders; and no shareholder shall have any right of inspecting any account, book or document of the Corporation except as at the time conferred by statute, unless authorized by a resolution of the shareholders or the Board of Directors.
5.03 Majority Vote of Shareholders. Notwithstanding any provision of the laws of the State of Maryland requiring a greater proportion than a majority of the votes of all classes or of any class of stock entitled to be cast, to take or authorize any action, such action may, subject to other applicable provisions of law, these Articles of Incorporation and the By-Laws, be taken or authorized upon the concurrence of a majority of the aggregate number of the votes entitled to be cast thereon.
5.04 Name. The Corporation acknowledges that it is adopting its corporate name through permission of T. Rowe Price Associates, Inc., a Maryland corporation, and agrees that T. Rowe Price Associates, Inc. reserves to itself and any successor to its business the right to grant the nonexclusive right to use the name "T. Rowe Price" or any similar name to any other corporation or
entity, including, but not limited to, any investment company of
which T. Rowe Price
Associates, Inc. or any subsidiary or affiliate thereof or any
successor to the business
of any thereof shall be the investment adviser.
5.05 Reservation of Right to Amend. The Corporation reserves the right to make any amendment of its charter, now or hereafter authorized by law, including any amendment which alters the contract rights, as expressly set forth in its charter, of any outstanding stock, and all rights herein conferred upon shareholders are granted subject to such reservation.
5.06 Determination of Net Profits, Etc.; Dividends. The Board of Directors is expressly authorized to determine in accordance with generally accepted accounting principles and practices what constitutes net profits, earnings, surplus, or net assets in excess of capital, and to determine what accounting periods shall be used by the Corporation for any purpose, whether annual or any other period, including daily; to set apart out of any funds of the Corporation such reserves for such purposes as it shall determine and to abolish the same; to declare and pay dividends and distributions in cash, securities, or other property from surplus or any funds legally available therefor, at such intervals (which may be as frequently as daily) or on such other periodic basis, as it shall determine; to declare such dividends or distributions by means of a formula or other method of determination, at meetings held less frequently than the frequency of the effectiveness of such declarations; to establish payment dates for dividends or any other distributions on any basis, including dates occurring less frequently than the effectiveness of the declaration thereof; and to provide for the payment of declared dividends on a date earlier than the specified payment date in the case of shareholders of the Corporation redeeming their entire ownership of shares of the Corporation.
5.07 Contracts. The Board of Directors may in its discretion from time to time enter into an exclusive or nonexclusive underwriting contract or contracts providing for the sale of the shares of Capital Stock of the Corporation to net the Corporation not less than the amount provided for in Section 1.02 of Article SEVENTH hereof, whereby the Corporation may either agree to sell the shares to the other party to the contract or appoint such other party its sales agent for such shares (such other party being herein sometimes called the "underwriter"), and in either case, on such terms and conditions as may be prescribed in the By-Laws, if any, and such further terms and conditions as the Board of Directors may in its discretion determine not inconsistent with the provisions of Article SEVENTH hereof or of the By-Laws; and such contract may also provide for the repurchase of shares of the Corporation by such other party as agent of the Corporation.
The Board of Directors may in its discretion from time
to time enter into an
investment advisory or management contract whereby the other
party to such contract shall
undertake to furnish to the Corporation such management,
investment advisory, statistical
and research facilities and services and such other facilities
and services, if any, and
all upon such terms and conditions, as the Board of Directors may
in its discretion
determine.
Any contract of the character described in the
paragraphs above or for services
as custodian, transfer agent, or disbursing agent or related
services may be entered into
with any corporation, firm, trust, or association, although one
or more of the directors
or officers of the Corporation may be an officer, director,
trustee, shareholder, or
member of such other party to the contract, and no such contract
shall be invalidated or
rendered voidable by reason of the existence of any such
relationship, nor shall any
person holding such relationship be liable merely by reason of
such relationship for any
loss or expense to the Corporation under or by reason of said
contract or accountable for
any profit realized directly or indirectly therefrom, provided
that the contract, when
entered into, was reasonable and fair and not inconsistent with
the provisions of this
Section 5.07. The same person (including a firm, corporation,
trust, or association) may
be the other party to contracts entered
into pursuant to the above paragraphs, and any individual may be
financially interested or
otherwise affiliated with persons who are parties to any or all
of the contracts mentioned
in this paragraph.
Any contract entered into pursuant to the first two
paragraphs of this Section
5.07 shall be consistent with and subject to the requirements of
Section 15 of the
Investment Company Act of 1940 (including any amendment thereof
or other applicable Act of
Congress hereafter enacted) with respect to its continuance in
effect, its termination and
the method of authorization and approval of such contract or
renewal thereof.
IN WITNESS WHEREOF, we have signed these Articles of
Incorporation and
acknowledge the same to be our act on this day of
November, 1984.
Henry H. Hopkins
James S. Riepe
STATE OF MARYLAND )
) ss:
CITY OF BALTIMORE )
|
I HEREBY CERTIFY, that on this day of
November, 1984, before me, the
subscriber, a Notary Public of the State of Maryland, in and for
the City of Baltimore,
personally appeared HENRY H. HOPKINS and JAMES S. RIEPE, and they
acknowledged the
foregoing Articles of Incorporation to be their act.
WITNESS my hand and Notarial Seal this day of November, 1984.
Notary Public
My Commission expires:
ARTICLES OF INCORPORATION
OF
T. ROWE PRICE TAX-FREE HIGH-YIELD FUND,
INC.
(A Maryland Corporation)
BY-LAWS
ARTICLE I
NAME OF CORPORATION,
LOCATION OF OFFICES AND SEAL
Section 1.01.Name: The name of the Corporation is
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
Section 1.02.Principal Office: The principal office of
the Corporation in the State of Maryland shall be located in the
City of Baltimore. The Corporation may, in addition, establish
and maintain such other offices and places of business, within or
outside the State of Maryland, as the Board of Directors may from
time to time determine. [ MGCL, Sections 2-103(4), 2-
108(a)(1) ]*
Section 1.03.Seal: The corporate seal of the Corporation shall be circular in form, and shall bear the name of the Corporation, the year of its incorporation, and the words "Corporate Seal, Maryland." The form of the seal shall be subject to alteration by the Board of Directors and the seal may be used by causing it or a facsimile to be impressed or affixed or printed or otherwise reproduced. In lieu of affixing the corporate seal to any document it shall be sufficient to meet the requirements of any law, rule, or regulation relating to a corporate seal to affix the word "(Seal)" adjacent to the signature of the authorized officer of the Corporation. Any officer or Director of the Corporation shall have authority to affix the corporate seal of the Corporation to any document requiring the same. [ MGCL, Sections 1-304(b), 2-103(3) ]
ARTICLE II
STOCKHOLDERS
* Bracketed citations are to the General Corporation Law of the State of Maryland ("MGCL") or to the United States Investment Company Act of 1940, as amended (the "Investment Company Act"), or to Rules of the United States Securities and Exchange Commission thereunder ("SEC Rules"). The citations are inserted for reference only and do not constitute a part of the By-Laws.
purposes constitute the annual meeting of shareholders for the
fiscal year of the Corporation in which the meeting is held. At
any such meeting, the shareholders shall elect directors to hold
the offices of any directors who have held office for more than
one year or who have been elected by the Board of Directors to
fill vacancies which result from any cause. Except as the
Articles of Incorporation or statute provides otherwise,
Directors may transact any business within the powers of the
Corporation as may properly come before the meeting. Any
business of the Corporation may be transacted at the annual
meeting without being specially designated in the notice, except
such business as is specifically required by statute to be stated
in the notice. [MGCL, Section 2-501]
(Section 2.01 Annual Meetings as amended April 20, 1990)
Section 2.02.Special Meetings: Special meetings of the
shareholders may be called at any time by the Chairman of the
Board, the President, any Vice President, or by the Board of
Directors. Special meetings of the shareholders shall be called
by the Secretary on the written request of shareholders entitled
to cast at least ten (10) percent of all the votes entitled to be
cast at such meeting, provided that (a) such request shall state
the purpose or purposes of the meeting and the matters proposed
to be acted on, and (b) the shareholders requesting the meeting
shall have paid to the Corporation the reasonably estimated cost
of preparing and mailing the notice thereof, which the Secretary
shall determine and specify to such shareholders. Unless
requested by stockholders entitled to cast a majority of all the
votes entitled to be cast at the meeting, a special meeting need
not be called to consider any matter which is substantially the
same as a matter voted upon at any special meeting of the
shareholders held during the preceding twelve (12) months.
[ MGCL, Section 2-502 ]
(Section 2.02 Special Meetings as amended July 20, 1993)
Section 2.03.Place of Meetings: All stockholders'
meetings shall be held at such place within the United States as
may be fixed from time to time by the Board of Directors.
[ MGCL, Section 2-503 ]
Section 2.04.Notice of Meetings: Not less than ten
(10) days, nor more than ninety (90) days before each
stockholders' meeting, the Secretary or an Assistant Secretary of
the Corporation shall give to each stockholder entitled to vote
at the meeting, and each other stockholder entitled to notice of
the meeting, written notice stating (1) the time and place of the
meeting, and (2) the purpose or purposes of the meeting if the
meeting is a special meeting or if notice of the purpose is
required by statute to be given. Such notice shall be personally
delivered to the stockholder, or left at his residence or usual
place of business, or mailed to him at his address as it appears
on the records of the Corporation. No notice of a stockholders'
meeting need be given to any stockholder who shall sign a written
waiver of such notice, whether before or after the meeting, which
is filed with the records of stockholders' meetings, or to any
stockholder who is present at the meeting in person or by proxy.
Notice of adjournment of a stockholders' meeting to another time
or place need not be given if such time and place are announced
at the meeting, unless the adjournment is for more than one
hundred twenty (120) days after the original record date. [
MGCL, Sections 2-504, 2-511(d) ]
Section 2.05.Voting - In General: At every stockholders' meeting, each stockholder shall be entitled to one vote for each share of stock of the Corporation validly issued and outstanding and held by such stockholder, except that no shares held by the Corporation shall be entitled to a vote. Fractional shares shall be entitled to fractional votes. Except as otherwise
specifically provided in the Articles of Incorporation, or these
By-Laws, or as required by provisions of the Investment Company
Act, of 1940 ("Investment Company Act"), as amended from time to
time, a majority of all the votes cast at a meeting at which a
quorum is present is sufficient to approve any matter which
properly comes before the meeting. The vote upon any question
shall be by ballot whenever requested by any person entitled to
vote, but, unless such a request is made, voting may be conducted
in any way approved by the meeting. [ MGCL, Sections 2-
214(a)(i), 2-506(a)(2), 2-507(a), 2-509(b) ]
Section 2.06.Stockholders Entitled to Vote: If, pursuant to Section 8.05 hereof, a record date has been fixed for the determination of stockholders entitled to notice of or to vote at any stockholders' meeting, each stockholder of the Corporation shall be entitled to vote in person or by proxy, each share or fraction of a share of stock standing in his name on the books of the Corporation on such record date and outstanding at the time of the meeting. If no record date has been fixed for the determination of stockholders, the record date for the determination of stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day on which notice of the meeting is mailed or the 30th day before the meeting, whichever is the closer date to the meeting, or, if notice is waived by all stockholders, at the close of business on the tenth (10th) day next preceding the date of the meeting. [ MGCL, Sections 2-507, 2-511 ]
Section 2.07.Voting - Proxies: The right to vote by proxy shall exist only if the instrument authorizing such proxy to act shall have been executed in writing by the stockholder himself, or by his attorney thereunto duly authorized in writing.
No proxy shall be valid more than eleven (11) months after its date unless it provides for a longer period. [ MGCL, Section 2- 507(b) ]
Section 2.08.Quorum: The presence at any stockholders' meeting, in person or by proxy, of stockholders entitled to cast a majority of the votes entitled to be cast at the meeting shall constitute a quorum. [ MGCL, Section 2-506(a) ]
Section 2.09.Absence of Quorum: In the absence of a quorum, the holders of a majority of shares entitled to vote at the meeting and present thereat in person or by proxy, or, if no stockholder entitled to vote is present in person or by proxy, any officer present who is entitled to preside at or act as Secretary of such meeting, may adjourn the meeting sine die or from time to time. Any business that might have been transacted at the meeting originally called may be transacted at any such adjourned meeting at which a quorum is present.
Section 2.10.Stock Ledger and List of Stockholders: It shall be the duty of the Secretary or Assistant Secretary of the Corporation to cause an original or duplicate stock ledger to be maintained at the office of the Corporation's transfer agent, containing the names and addresses of all stockholders and the number of shares of each class held by each stockholder. Such stock ledger may be in written form, or any other form capable of being converted into written form within a reasonable time for visual inspection. Any one or more persons, who together are and for at least six (6) months have been stockholders of record of at least five percent (5%) of the outstanding capital stock of the Corporation, may submit (unless the Corporation at the time of the request maintains a duplicate stock ledger at its principal office) a written request to any officer of the Corporation or its resident agent in Maryland for a list of the stockholders of the Corporation. Within twenty (20) days after such a request, there shall be prepared and filed at the Corporation's principal office a list, verified under oath by an officer
of the Corporation or by its stock transfer agent or registrar, which sets forth the name and address of each stockholder and the number of shares of each class which the stockholder holds. [ MGCL, Sections 2-209, 2-513 ]
Section 2.11.Informal Action By Stockholders: Any action required or permitted to be taken at a meeting of stockholders may be taken without a meeting if the following are filed with the records of stockholders' meetings:
(a) A unanimous written consent which sets forth the action and is signed by each stockholder entitled to vote on the matter; and
(b) A written waiver of any right to dissent signed by each stockholder entitled to notice of the meeting, but not entitled to vote at it. [ MGCL, Section 2- 505 ]
ARTICLE III
BOARD OF DIRECTORS
Section 3.01.Number and Term of Office: The Board of Directors shall consist of five (5) Directors, which number may be increased or decreased by a resolution of a majority of the entire Board of Directors, provided that the number of Directors shall not be less than three (3), nor more than fifteen (15). Each Director (whenever elected) shall hold office until the next annual meeting of stockholders and until his successor is elected and qualifies or until his earlier death, resignation, or removal. [ MGCL, Sections 2-402, 2-404, 2-405 ]
Section 3.02.Qualification of Directors: No member of
the Board of Directors need be a stockholder of the Corporation,
but at least one member of the Board of Directors shall be a
person who is not an interested person (as such term is defined
in the Investment Company Act, as amended) of the investment
adviser of the Corporation, nor an officer or employee of the
Corporation. [ MGCL, Section 2-403; Investment Company Act,
Section 10(d) ]
Section 3.03.Election of Directors: Until the first annual meeting of shareholders or until successors are duly elected and qualified, the Board of Directors shall consist of the persons named as such in the Articles of Incorporation. Thereafter, except as otherwise provided in Sections 3.04 and 3.05 hereof, at each annual meeting, the shareholders shall elect Directors to hold office until the next annual meeting and/or until their successors are elected and qualify. In the event that Directors are not elected at an annual shareholders' meeting, then Directors may be elected at a special shareholders' meeting. Directors shall be elected by vote of the holders of a majority of the shares present in person or by proxy and entitled to vote thereon. [ MGCL, Section 2-404 ] (Section 3.03. Election of Directors as amended January 21, 1988)
Section 3.04.Removal of Directors: At any meeting of stockholders, duly called and at which a quorum is present, the stockholders may, by the affirmative vote of the holders of a majority of the votes entitled to be cast thereon, remove any Director or Directors from office, either with or without cause, and may elect a successor or successors to fill any resulting vacancies for the unexpired terms of removed Directors. [ MGCL, Sections 2-406, 2-407 ]
Section 3.05.Vacancies and Newly Created Directorships:
If any vacancies occur in the Board of Directors by reason of resignation, removal or otherwise, or if the authorized number of Directors is increased, the Directors then in office shall continue to act, and such vacancies (if not
previously filled by the stockholders) may be filled by a
majority of the Directors then in office, whether or not
sufficient to constitute a quorum, provided that, immediately
after filling such vacancy, at least two-thirds of the Directors
then holding office shall have been elected to such office by the
stockholders of the Corporation. In the event that at any time,
other than the time preceding the first meeting of stockholders,
less than a majority of the Directors of the Corporation holding
office at that time were so elected by the stockholders, a
meeting of the stockholders shall be held promptly and in any
event within sixty (60) days for the purpose of electing
Directors to fill any existing vacancies in the Board of
Directors unless the Securities and Exchange Commission shall by
order extend such period. Except as provided in Section 3.04
hereof, a Director elected by the Board of Directors to fill a
vacancy shall be elected to hold office until the next annual
meeting of stockholders or until his successor is elected and
qualifies. [ MGCL, Section 2-407; Investment Company Act,
Section 16(a) ]
Section 3.06.General Powers:
(a) The property, business, and affairs of the Corporation shall be managed under the direction of the Board of Directors which may exercise all the powers of the Corporation except such as are by law, by the Articles of Incorporation, or by these By-Laws conferred upon or reserved to the stockholders of the Corporation. [ MGCL, Section 2-401 ]
(b) All acts done by any meeting of the Directors or by any person acting as a Director, so long as his successor shall not have been duly elected or appointed, shall, notwithstanding that it be afterwards discovered that there was some defect in the election of the Directors or such person acting as a Director or that they or any of them were disqualified, be as valid as if the Directors or such person, as the case may be, had been duly elected and were or was qualified to be Directors or a Director of the Corporation.
Section 3.07.Power to Issue and Sell Stock: The Board
of Directors may from time to time authorize by resolution the
issuance and sale of any of the Corporation's authorized shares
to such persons as the Board of Directors shall deem advisable
and such resolution shall set the minimum price or value of
consideration for the stock or a formula for its determination,
and shall include a fair description of any consideration other
than money and a statement of the actual value of such
consideration as determined by the Board of Directors or a
statement that the Board of Directors has determined that the
actual value is or will be not less than a certain sum. [ MGCL,
Section 2-203 ]
Section 3.08.Power to Declare Dividends:
(a) The Board of Directors, from time to time as it may
deem advisable, may declare and the Corporation pay
dividends, in cash, property, or shares of the
Corporation available for dividends out of any source
available for dividends, to the stockholders
according to their respective rights and interests.
[ MGCL, Section 2-309 ]
(b) The Board of Directors shall cause to be accompanied by a written statement any dividend payment wholly or partly from any source other than the Corporation's accumulated undistributed net income (determined in accordance with good accounting practice and the rules and regulations of the Securities and Exchange Commission then in effect) not including profits or losses realized upon the sale of securities or other properties. Such statement shall adequately disclose the source or sources of such payment and the basis of calculation and shall be otherwise in such form as the Securities and Exchange Commission may prescribe.
[ Investment Company Act, Section 19; SEC Rule 19a-1; MGCL, Section 2-309(c) ]
(c) Notwithstanding the above provisions of this Section
3.08, the Board of Directors may at any time declare
and distribute pro rata among the stockholders a
stock dividend out of the Corporation's authorized
but unissued shares of stock, including any shares
previously purchased by the Corporation, provided
that such dividend shall not be distributed in shares
of any class with respect to any shares of a
different class. The shares so distributed shall be
issued at the par value thereof, and there shall be
transferred to stated capital, at the time such
dividend is paid, an amount of surplus equal to the
aggregate par value of the shares issued as a
dividend and there may be transferred from earned
surplus to capital surplus such additional amount as
the Board of Directors may determine. [ MGCL,
Section 2-309 ]
Section 3.09.Annual and Regular Meetings: The annual
meeting of the Board of Directors for choosing officers and
transacting other proper business shall be held immediately after
the annual shareholders' meeting at such place as may be
specified in the notice of such meeting of the Board of
Directors, or, in the absence of such annual shareholders'
meeting, at such time and place as the Board of Directors may
provide. The Board of Directors from time to time may provide by
resolution for the holding of regular meetings and fix their time
and place (within or outside the State of Maryland). [ MGCL,
Section 2-409(a) ]
(Section 3.09. Annual and Regular Meetings
as amended January 21, 1988)
Section 3.l0.Special Meetings: Special meetings of the Board of Directors shall be held whenever called by the Chairman of the Board, the President (or, in the absence or disability of the President, by any Vice President), the Treasurer, or two or more Directors, at the time and place (within or outside the State of Maryland) specified in the respective notices or waivers of notice of such meetings.
Section 3.11.Notice: Notice of annual, regular, and special meetings shall be in writing, stating the time and place, and shall be mailed to each Director at his residence or regular place of business or caused to be delivered to him personally or to be transmitted to him by telegraph, cable, or wireless at least two (2) days before the day on which the meeting is to be held. Except as otherwise required by the By-Laws or the Investment Company Act, such notice need not include a statement of the business to be transacted at, or the purpose of, the meeting. [ MGCL, Section 2-409(b) ]
Section 3.12.Waiver of Notice: No notice of any meeting need be given to any Director who is present at the meeting or to any Director who
signs a waiver of the notice of the meeting (which waiver shall be filed with the records of the meeting), whether before or after the meeting. [ MGCL, Section 2-409(c) ]
Section 3.13.Quorum and Voting: At all meetings of the Board of Directors the presence of one-third of the total number of Directors authorized, but not less than two (2) Directors, shall constitute a quorum. In the absence of a quorum, a majority of the Directors present may adjourn the meeting, from time to time, until a quorum shall be present. The action of a majority of the Directors present at a meeting at which a quorum is present shall be the action of the Board of Directors unless the concurrence of a greater proportion is required for such action by law, by the Articles of Incorporation or by these By-Laws. [ MGCL, Section 2-408 ]
Section 3.14.Conference Telephone: Members of the
Board of Directors or of any committee designated by the Board,
may participate in a meeting of the Board or of such committee by
means of a conference telephone or similar communications
equipment if all persons participating in the meeting can hear
each other at the same time, and participation by such means
shall constitute presence in person at such meeting. [ MGCL,
Section 2-409(d) ]
Section 3.15.Compensation: Each Director may receive such remuneration for his services as shall be fixed from time to time by resolution of the Board of Directors.
Section 3.16.Action Without a Meeting: Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if a unanimous written consent which sets forth the action is signed by all members of the Board or of such committee and such written consent is filed with the minutes of proceedings of the Board or committee. [ MGCL, Section 2-408(c) ]
ARTICLE IV
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 4.01.How Constituted: By resolution adopted by the Board of Directors, the Board may appoint from among its members one or more committees, including an Executive Committee, each consisting of at least two (2) Directors. Each member of a committee shall hold office during the pleasure of the Board. The President shall be a member of the Executive Committee. [ MGCL, Section 2-411 ]
Section 4.02.Powers of the Executive Committee: Unless otherwise provided by resolution of the Board of Directors, the Executive Committee, in the intervals between meetings of the Board of Directors, shall have and may exercise all of the powers of the Board of Directors to manage the business and affairs of the Corporation except the power to:
(a) Declare dividends or distributions on stock;
(b) Issue stock other than as provided in Section 2-411(b) of Article Corporations and Associations of the Annotated Code of Maryland;
(c) Recommend to the stockholders any action which requires stockholder approval;
(d) Amend the By-Laws; or
(e) Approve any merger or share exchange which does not require stockholder approval.
[ MGCL, Section 2-411(a) ]
Section 4.03.Other Committees of the Board of
Directors: To the extent provided by resolution of the Board,
other committees shall have and may exercise any of the powers
that may lawfully be granted to the Executive Committee. [ MGCL,
Section 2-411(a) ]
Section 4.04.Proceedings, Quorum, and Manner of Acting:
In the absence of appropriate resolution of the Board of Directors, each committee may adopt such rules and regulations governing its proceedings, quorum and manner of acting as it shall deem proper and desirable, provided that the quorum shall not be less than two (2) Directors. In the absence of any member of any such committee, the members thereof present at any meeting, whether or not they constitute a quorum, may appoint a member of the Board of Directors to act in the place of such absent member. [ MGCL, Section 2-411(c) ]
Section 4.05.Other Committees: The Board of Directors may appoint other committees, each consisting of one or more persons who need not be Directors. Each such committee shall have such powers and perform such duties as may be assigned to it from time to time by the Board of Directors, but shall not exercise any power which may lawfully be exercised only by the Board of Directors or a committee thereof.
ARTICLE V
OFFICERS
Section 5.01.General: The officers of the Corporation shall be a President, one or more Vice Presidents (one or more of whom may be designated Executive Vice President), a Secretary, and a Treasurer, and may include one or more Assistant Vice Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers as may be appointed in accordance with the provisions of Section 5.11 hereof. The Board of Directors may elect, but shall not be required to elect, a Chairman of the Board. [ MGCL, Section 2-412 ]
Section 5.02.Election, Term of Office and Qualifications: The officers of the Corporation (except those appointed pursuant to Section 5.11 hereof) shall be elected by the Board of Directors at its first meeting and thereafter at each annual meeting of the Board. If any officer or officers are not elected at any such meeting, such officer or officers may be elected at any subsequent regular or special meeting of the Board. Except as provided in Sections 5.03, 5.04, and 5.05 hereof, each officer elected by the Board of Directors shall hold office until the next annual meeting of the Board of Directors and until his successor shall have been chosen and qualified. Any person may hold two or more offices of the Corporation, except that neither the Chairman of the Board nor the President may hold the office of Vice President, but no person shall execute, acknowledge or verify any instrument in more than one capacity if such instrument is required by law, the Articles of Incorporation or these By-Laws to be executed, acknowledged or verified by two or more officers. The Chairman of the Board and the President shall be selected from among the
Directors of the Corporation and may hold such offices only so long as they continue to be Directors. No other officer need be a Director. [ MGCL, Sections 2-413 and 2-415 ] (Section 5.02. Election, Term of Office and Qualifications as amended January 21, 1988)
Section 5.03.Resignation: Any officer may resign his office at any time by delivering a written resignation to the Board of Directors, the President, the Secretary, or any Assistant Secretary. Unless otherwise specified therein, such resignation shall take effect upon delivery.
Section 5.04.Removal: Any officer may be removed from office by the Board of Directors whenever in the judgment of the Board of Directors the best interests of the Corporation will be served thereby. [ MGCL, Section 2-413(c) ]
Section 5.05Vacancies and Newly Created Offices: If any vacancy shall occur in any office by reason of death, resignation, removal, disqualification or other cause, or if any new office shall be created, such vacancies or newly created offices may be filled by the Board of Directors at any meeting or, in the case of any office created pursuant to Section 5.11 hereof, by any officer upon whom such power shall have been conferred by the Board of Directors. [ MGCL, Section 2-413(d) ]
Section 5.06.Chairman of the Board: Unless otherwise provided by resolution of the Board of Directors, the Chairman of the Board, if there be such an officer, shall preside at all stockholders' meetings, and at all meetings of the Board of Directors. He may sign (unless the President or a Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors and shall have such other powers and perform such other duties as may be assigned to him from time to time by the Board of Directors.
Section 5.07.President: Unless otherwise provided by resolution of the Board of Directors, the President shall be the chief executive and operating officer of the Corporation and, at the request of or in the absence or disability of the Chairman of the Board, or if no Chairman of the Board has been chosen, he shall preside at all stockholders' meetings and at all meetings of the Board of Directors and shall in general exercise the powers and perform the duties of the Chairman of the Board. He shall be ex officio a member of all standing committees of the Board of Directors. Subject to the supervision of the Board of Directors, he shall have general charge of the business, affairs, property, and operation of the Corporation and its officers, employees, and agents. He may sign (unless the Chairman or a Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. Except as the Board of Directors may otherwise order, he may sign in the name and on behalf of the Corporation all deeds, bonds, contracts, or agreements. He shall exercise such other powers and perform such other duties as from time to time may be assigned to him by the Board of Directors.
Section 5.08.Vice President: The Board of Directors shall, from time to time, designate and elect one or more Vice Presidents (one or more of whom may be designated Executive Vice President) who shall have such powers and perform such duties as from time to time may be assigned to them by the Board of Directors or the President. At the request or in the absence or
disability of the President, the Vice President (or, if there are two or more Vice Presidents, the Vice President in order of seniority of tenure in such office or in such other order as the Board of Directors may determine) may perform all the duties of the President and, when so acting, shall have all the powers of and be subject to all the restrictions upon the President. Any Vice President may sign (unless the Chairman, the President, or another Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors.
Section 5.09.Treasurer and Assistant Treasurers: The Treasurer shall be the principal financial and accounting officer of the Corporation and shall have general charge of the finances and books of account of the Corporation. Except as otherwise provided by the Board of Directors, he shall have general supervision of the funds and property of the Corporation and of the performance by the custodian of its duties with respect thereto. He may countersign (unless an Assistant Treasurer or Secretary or Assistant Secretary shall have countersigned) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. He shall render to the Board of Directors, whenever directed by the Board, an account of the financial condition of the Corporation and of all his transactions as Treasurer; and as soon as possible after the close of each fiscal year he shall make and submit to the Board of Directors a like report for such fiscal year. He shall cause to be prepared annually a full and correct statement of the affairs of the Corporation, including a balance sheet and a financial statement of operations for the preceding fiscal year, which shall be submitted at the annual meeting of stockholders and filed within twenty (20) days thereafter at the principal office of the Corporation. He shall perform all the acts incidental to the office of Treasurer, subject to the control of the Board of Directors. Any Assistant Treasurer may perform such duties of the Treasurer as the Treasurer or the Board of Directors may assign, and, in the absence of the Treasurer, he may perform all the duties of the Treasurer.
Section 5.10.Secretary and Assistant Secretaries: The Secretary shall attend to the giving and serving of all notices of the Corporation and shall record all proceedings of the meetings of the stockholders and Directors in one or more books to be kept for that purpose. He shall keep in safe custody the seal of the Corporation and shall have charge of the records of the Corporation, including the stock books and such other books and papers as the Board of Directors may direct and such books, reports, certificates and other documents required by law to be kept, all of which shall at all reasonable times be open to inspection by any Director. He shall countersign (unless the Treasurer, an Assistant Treasurer or an Assistant Secretary shall have countersigned) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. He shall perform such other duties as appertain to his office or as may be required by the Board of Directors. Any Assistant Secretary may perform such duties of the Secretary as the Secretary or the Board of Directors may assign, and, in the absence of the Secretary, he may perform all the duties of the Secretary.
Section 5.11.Subordinate Officers: The Board of Directors from time to time may appoint such other officers or agents as it may deem advisable, each of whom shall have such title, hold office for such period, have such authority and perform such duties as the Board of Directors may determine. The Board of Directors from time to time may delegate to one or more officers or agents the power to appoint any such subordinate officers or
agents and to prescribe their respective rights, terms of office, authorities, and duties. [ MGCL, Section 2-412(b) ]
Section 5.12.Remuneration: The salaries or other compensation of the officers of the Corporation shall be fixed from time to time by resolution of the Board of Directors, except that the Board of Directors may by resolution delegate to any person or group of persons the power to fix the salaries or other compensation of any subordinate officers or agents appointed in accordance with the provisions of Section 5.11 hereof.
ARTICLE VI
CUSTODY OF SECURITIES AND CASH
Section 6.01.Employment of a Custodian: The Corporation shall place and at all times maintain in the custody of a Custodian (including any sub-custodian for the Custodian) all funds, securities, and similar investments owned by the Corporation. The Custodian shall be a bank having an aggregate capital, surplus, and undivided profits of not less than $10,000,000. The Custodian shall be appointed and its remuneration fixed by the Board of Directors. [ Investment Company Act, Section 17(f) ]
Section 6.02.Central Certificate Service: Subject to such rules, regulations, and orders as the Securities and Exchange Commission may adopt as necessary or appropriate for the protection of investors, the Corporation's Custodian may deposit all or any part of the securities owned by the Corporation in a system for the central handling of securities established by a national securities exchange or national securities association registered with the Commission under the Securities Exchange Act of 1934, or such other person as may be permitted by the Commission, pursuant to which system all securities of any particular class or series of any issuer deposited within the system are treated as fungible and may be transferred or pledged by bookkeeping entry without physical delivery of such securities. [ Investment Company Act, Section 17(f) ]
Section 6.03.Cash Assets: The cash proceeds from the sale of securities and similar investments and other cash assets of the Corporation shall be kept in the custody of a bank or banks appointed pursuant to Section 6.01 hereof, or in accordance with such rules and regulations or orders as the Securities and Exchange Commission may from time to time prescribe for the protection of investors, except that the Corporation may maintain a checking account or accounts in a bank or banks, each having an aggregate capital, surplus, and undivided profits of not less than $10,000,000, provided that the balance of such account or the aggregate balances of such accounts shall at no time exceed the amount of the fidelity bond, maintained pursuant to the requirements of the Investment Company Act of 1940 and rules and regulations thereunder, covering the officers or employees authorized to draw on such account or accounts. [ Investment Company Act, Section 17(f) ]
Section 6.04.Free Cash Accounts: The Corporation may, upon resolution of its Board of Directors, maintain a petty cash account free of the foregoing requirements of this Article VI in an amount not to exceed $500, provided that such account is operated under the imprest system and is maintained subject to adequate controls approved by the Board of Directors over disbursements and reimbursements including, but not limited to, fidelity
bond coverage for persons having access to such funds. [ Investment Company Act, Rule 17f-3 ]
Section 6.05.Action Upon Termination of Custodian Agreement: Upon resignation of a custodian of the Corporation or inability of a custodian to continue to serve, the Board of Directors shall promptly appoint a successor custodian, but in the event that no successor custodian can be found who has the required qualifications and is willing to serve, the Board of Directors shall call as promptly as possible a special meeting of the stockholders to determine whether the Corporation shall function without a custodian or shall be liquidated. If so directed by vote of the holders of a majority of the outstanding shares of stock of the Corporation, the custodian shall deliver and pay over all property of the Corporation held by it as specified in such vote.
ARTICLE VII
EXECUTION OF INSTRUMENTS, VOTING OF SECURITIES
Section 7.01.Execution of Instruments: All deeds, documents, transfers, contracts, agreements, requisitions or orders, promissory notes, assignments, endorsements, checks and drafts for the payment of money by the Corporation, and other instruments requiring execution by the Corporation shall be signed by the Chairman, the President, a Vice President, or the Treasurer, or as the Board of Directors may otherwise, from time to time, authorize. Any such authorization may be general or confined to specific instances.
Section 7.02.Voting of Securities: Unless otherwise ordered by the Board of Directors, the Chairman, the President, or any Vice President shall have full power and authority on behalf of the Corporation to attend and to act and to vote, or in the name of the Corporation to execute proxies to vote, at any meeting of stockholders of any company in which the Corporation may hold stock. At any such meeting such officer shall possess and may exercise (in person or by proxy) any and all rights, powers, and privileges incident to the ownership of such stock. The Board of Directors may by resolution from time to time confer like powers upon any other person or persons. [ MGCL, Section 2-509 ]
ARTICLE VIII
CAPITAL STOCK
Section 8.01.Ownership of Shares:
(a) Certificates certifying the ownership of shares will not be issued for shares purchased or otherwise acquired after July 1, 1991. The ownership of shares, full or fractional, shall be recorded on the books of the Corporation or its agent. The record books of the Corporation as kept by the Corporation or its agent, as the case may be, shall be conclusive as to the number of shares held from time to time by each such shareholder. The Corporation reserves the right to require the surrender of outstanding certificates if the Board of Directors so determines. [ MGCL, Section 210(c) ]
(b) Every certificate exchanged, surrendered for redemption or otherwise returned to the Corporation shall be marked "Cancelled" with the date of cancellation. (Section 8.01. Ownership of Shares as amended July 1, 1991)
Section 8.02.Transfer of Capital Stock:
(a) Shares of stock of the Corporation shall be transferable only upon the books of the Corporation kept for such purpose and, if one or more certificates representing such shares have been issued, upon surrender to the Corporation or its transfer agent or agents of such certificate or certificates duly endorsed or accompanied by appropriate evidence of assignment, transfer, succession, or authority to transfer.
(b) The Corporation shall be entitled to treat the holder of record of any share of stock as the absolute owner thereof for all purposes, and accordingly shall not be bound to recognize any legal, equitable, or other claim or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by the statutes of the State of Maryland.
Section 8.03.Transfer Agents and Registrars: The Board
of Directors may, from time to time, appoint or remove transfer
agents and registrars of transfers of shares of stock of the
Corporation, and it may appoint the same person as both transfer
agent and registrar.
(Section 8.03. Transfer Agents and Registrars
as amended July 1, 1991)
Section 8.04.Transfer Regulations: The shares of stock of the Corporation may be freely transferred, and the Board of Directors may, from time to time, adopt lawful rules and regulations with reference to the method of transfer of the shares of stock of the Corporation.
Section 8.05.Fixing of Record Date: The Board of Directors may fix in advance a date as a record date for the determination of the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or to receive payment of any dividend or other distribution or allotment of any rights, or to exercise any rights in respect of any change, conversion, or exchange of stock, or for any other proper purpose, provided that such record date shall be a date not more than sixty (60) days nor, in the case of a meeting of stockholders, less than ten (10) days prior to the date on which the particular action, requiring such determination of stockholders, is to be taken. In such case, only such stockholders as shall be stockholders of record on the record date so fixed shall be entitled to such notice of, and to vote at, such meeting or adjournment, or to give such consent, or to receive payment of such dividend or other distribution, or to receive such allotment of rights, or to exercise such rights, or to take other action, as the case may be, notwithstanding any transfer of any shares on the books of the Corporation after any such record date. A meeting of stockholders convened on the date for which it was called may be adjourned from time to time without notice to a date not more than one hundred twenty (120) days after the original record date. [ MGCL, Section 2-511 ]
Section 8.06.Lost, Stolen or Destroyed Certificates:
If a certificate for stock of the Corporation is alleged to have
been lost, stolen or destroyed, no new certificate will be
issued. Instead, ownership of the shares formerly represented by
the lost, stolen or destroyed certificate shall be recorded on
the books of the Corporation or its agent, in accordance with the
provisions of Section 8.01 of these By-Laws. Before recording
ownership of such shares, the Board of Directors, or any officer
authorized by the Board, may, in its discretion, require the
owner of the lost, stolen, or any destroyed certificate (or his
legal representative) to give the Corporation a bond or other
indemnity, in such form and in such amount as the Board or any
such officer may direct and with such surety or sureties as may
be satisfactory to the Board of any such officer, sufficient to
indemnify the Corporation against any claim that may be made
against it on account of the alleged loss, theft, or destruction
of any such certificate. [ MGCL, Section 2-213 ]
(Section 8.06 Lost, Stolen or Destroyed Certificates
as amended July 1, 1991)
ARTICLE IX
FISCAL YEAR, ACCOUNTANT
Section 9.01.Fiscal Year: The fiscal year of the Corporation shall be the twelve (12) calendar months beginning on the 1st day of March in each year and ending on the last day of the following February, or such other period of twelve (12) calendar months as the Board of Directors may by resolution prescribe.
Section 9.02.Accountant:
(a) The Corporation shall employ an independent public accountant or firm of independent public accountants as its accountant to examine the accounts of the Corporation and to sign and certify financial statements filed by the Corporation. The accountant's certificates and reports shall be addressed both to the Board of Directors and to the stockholders.
(b) A majority of the members of the Board of Directors who are not interested persons (as such term is defined in the Investment Company Act, as amended) of the Corporation shall select the accountant, by vote cast in person, at any meeting held before the first annual stockholders' meeting, and thereafter shall select the accountant annually, by vote cast in person, at a meeting held within thirty (30) days before or after the beginning of the fiscal year of the Corporation or within thirty (30) days before the annual stockholders' meeting in that year. Such selection shall be submitted for ratification or rejection at the next succeeding annual stockholders' meeting. If such meeting shall reject such selection, the accountant shall be selected by majority vote of the Corporation's outstanding voting securities, either at the meeting at which the rejection occurred or at a subsequent meeting of stockholders called for the purpose.
(c) Any vacancy occurring between annual meetings, due to the death or resignation of the accountant, may be filled by the vote of a majority of those members of the Board of Directors who are not interested persons (as so defined) of the Corporation, cast in person at a meeting called for the purpose of voting on such action.
(d) The employment of the accountant shall be conditioned upon the right of the Corporation by vote of a majority of the outstanding voting securities at any meeting called for the purpose to terminate such employment forthwith without any penalty. [ Investment Company Act, Section 32(a) ]
ARTICLE X
INDEMNIFICATION AND INSURANCE
Section 10.01. Indemnification and Payment of Expenses in Advance: The Corporation shall indemnify any individual ("Indemnitee") who is a present or former director, officer, employee, or agent of the Corporation, or who is or has been serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, who, by reason of his position was, is, or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (hereinafter collectively referred to as a "Proceeding") against any expenses (including attorneys' fees) judgements, fines and amounts paid in settlement actually and reasonably incurred by such Indemnitee in connection with any Proceeding, to the full extent that such indemnification may be lawful under Maryland General Corporation Law, as from time to time amended. The Corporation shall pay any expenses so incurred by such Indemnitee in defending a Proceeding before the final disposition thereof to the full extent that such advance may be lawful under Maryland General Corporation Law, as from time to time amended. Subject to any applicable limitations and requirements set forth in the Corporation's Articles of Incorporation and in these By-Laws, any payment of indemnification or advance of expenses shall be made in accordance with the procedures set forth in Maryland General Corporation Law, as from time to time amended.
Notwithstanding the foregoing, nothing herein shall protect or purport to protect any Indemnitee of the Corporation against any liability to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of his office ("Disabling Conduct").
Anything in this Article X to the contrary notwithstanding, no indemnification shall be made by the Corporation to any Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act of 1940, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Anything in this Article X to the contrary notwithstanding, any advance of expenses by the Corporation to any Indemnitee shall be made only upon the undertaking by such Indemnitee to repay the advance unless it is ultimately determined that such Indemnitee is entitled to indemnification as above provided, and only if one of the following conditions is met:
(a) the Indemnitee provides a security for his undertaking; or
(b) the Corporation shall be insured against losses arising by reason of any lawful advances; or
(c) there is a determination, based on a review of readily available facts, that there is reason to believe that the Indemnitee will ultimately be found entitled to indemnification, which determination shall be made by:
(i) a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act of 1940, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Section 10.02. Insurance of Officers, Directors, Employees and Agents: To the maximum extent permitted by the Maryland General Corporation Law, as from time to time amended, the Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Corporation, or who is or was serving at the request of the Corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against any liability asserted against him and incurred by him in or arising out of his position, whether or not the Corporation would have the power to indemnify him against such liability. [ MGCL, Section 2-418(h) ]
(ARTICLE X INDEMNIFICATION AND INSURANCE as amended June 29, 1981)
ARTICLE XI
AMENDMENTS
Section 11.01. General: Except as provided in Section 11.02 hereof, all By-Laws of the Corporation, whether adopted by the Board of Directors or the stockholders, shall be subject to amendment, alteration, or repeal, and new By-Laws may be made, by the affirmative vote of a majority of either:
(a) the holders of record of the outstanding shares of stock of the Corporation entitled to vote, at any annual or special meeting the notice or waiver of notice of which shall have specified or summarized the proposed amendment, alteration, repeal, or new By-Law; or
(b) the Directors present at any regular or special meeting at which a quorum is present if the notice or waiver of notice thereof or material sent to the Directors in connection therewith on or prior to the last date for the giving of such notice under these By-Laws shall have specified or summarized the proposed amendment, alteration, repeal, or new By-Law.
Section 11.02. By Stockholders Only:
(a) No amendment of any section of these By-Laws shall be made except by the stockholders of the Corporation if the stockholders shall have provided in the By-Laws that such section may not be amended, altered, or repealed except by the stockholders.
(b) From and after the issue of any shares of the Capital Stock of the Corporation, no amendment of this Article XI shall be made except by the stockholders of the Corporation.
ARTICLE XII
MISCELLANEOUS
Section 12.01. Use of the Term "Annual Meeting": The
use of the term "annual meeting" in these By-Laws shall not be
construed as implying a requirement that a shareholder meeting be
held annually.
(ARTICLE XII MISCELLANEOUS, added on January 21, 1988)
dld/agmts/BYLAWS.TEM
BY-LAWS
OF
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
AS AMENDED:
JUNE 29, 1981
JANUARY 21, 1988
APRIL 20, 1990
JULY 1, 1991
JULY 20, 1993
TABLE OF CONTENTS
Page
ARTICLE I. NAME OF CORPORATION, LOCATION OF OFFICES AND SEAL 1
1.01. Name . . . . . . . . . . . . . . . . . .1
1.02. Principal Office . . . . . . . . . . . .1
1.03. Seal . . . . . . . . . . . . . . . . . .1
ARTICLE II. STOCKHOLDERS . . . . . . . . . . . . . .1
2.01. Annual Meetings. . . . . . . . . . . . .1
2.02. Special Meetings . . . . . . . . . . 2
2.03. Place of Meetings. . . . . . . . . . . .2
2.04. Notice of Meetings . . . . . . . . . . .2
2.05. Voting - in General. . . . . . . . . . .2
2.06. Stockholders Entitled to Vote. . . . . .3
2.07. Voting - Proxies . . . . . . . . . . . .3
2.08. Quorum . . . . . . . . . . . . . . . . .3
2.09. Absence of Quorum. . . . . . . . . . . .3
2.10. Stock Ledger and List of Stockholders. . 3
2.11. Informal Action by Stockholders. . . . .4
ARTICLE III. BOARD OF DIRECTORS . . . . . . . . . . .4
3.01. Number and Term of Office. . . . . . . .4
3.02. Qualification of Directors . . . . . . .4
3.03. Election of Directors. . . . . . . . . .4
3.04. Removal of Directors . . . . . . . . . .4
3.05. Vacancies and Newly Created Directorships. .4
3.06. General Powers . . . . . . . . . . . . .5
3.07. Power to Issue and Sell Stock. . . . . .5
3.08. Power to Declare Dividends . . . . . . .5
3.09. Annual and Regular Meetings. . . . . . .6
3.10. Special Meetings . . . . . . . . . . . .6
3.11. Notice . . . . . . . . . . . . . . . . .6
3.12. Waiver of Notice . . . . . . . . . . . .6
3.13. Quorum and Voting. . . . . . . . . . . .7
3.14. Conference Telephone . . . . . . . . . .7
3.15. Compensation . . . . . . . . . . . . . .7
3.16. Action without a Meeting . . . . . . . .7
|
PAGE 20
ARTICLE IV. EXECUTIVE COMMITTEE AND OTHER COMMITTEES . .7
4.01. How Constituted. . . . . . . . . . . . .7
4.02. Powers of the Executive Committee. . 7
4.03. Other Committees of the Board of Directors .8
4.04. Proceedings, Quorum and Manner of Acting . .8
4.05. Other Committees . . . . . . . . . . . .8
ARTICLE V. OFFICERS. . . . . . . . . . . . . . . . . . 8
5.01. General. . . . . . . . . . . . . . . . .8
5.02. Election, Term of Office and Qualifications8
5.03. Resignation. . . . . . . . . . . . . . .9
5.04. Removal. . . . . . . . . . . . . . . . .9
5.05. Vacancies and Newly Created Offices. . .9
5.06. Chairman of the Board. . . . . . . . 9
5.07. President. . . . . . . . . . . . . . . .9
5.08. Vice President . . . . . . . . . . . 9
5.09. Treasurer and Assistant Treasurers . . .10
5.10. Secretary and Assistant Secretaries. . .10
5.11. Subordinate Officers . . . . . . . . . .10
5.12. Remuneration . . . . . . . . . . . . . .11
ARTICLE VI. CUSTODY OF SECURITIES AND CASH . . . 11
6.01. Employment of a Custodian. . . . . . . .11
6.02. Central Certificate Service. . . . . . .11
6.03. Cash Assets. . . . . . . . . . . . . . .11
6.04. Free Cash Accounts . . . . . . . . . . .11
6.05. Action Upon Termination of Custodian Agreement
12
ARTICLE VII. EXECUTION OF INSTRUMENTS, VOTING OF
SECURITIES12
7.01. Execution of Instruments . . . . . . . .12
7.02. Voting of Securities . . . . . . . . 12
ARTICLE VIII. CAPITAL STOCK. . . . . . . . . . . . . .12
8.01. Ownership of Shares. . . . . . . . . . .12
8.02. Transfer of Capital Stock. . . . . . . .13
8.03. Transfer Agents and Registrars . . . 13
8.04. Transfer Regulations . . . . . . . . . .13
8.05. Fixing of Record Date. . . . . . . . . .13
8.06. Lost, Stolen, or Destroyed Certificates. . .14
|
PAGE 21
ARTICLE IX. FISCAL YEAR, ACCOUNTANT. . . . . . . . .14
9.01. Fiscal Year. . . . . . . . . . . . . . .14
9.02. Accountant . . . . . . . . . . . . . . .14
ARTICLE X. INDEMNIFICATION AND INSURANCE . . . . . . . 15
10.01. Indemnification and Payment of Expenses in
Advance. . 15
10.02. Insurance of Officers, Directors, Employees
and
Agents . . . . . . . . . . . . . . .16
ARTICLE XI. AMENDMENTS . . . . . . . . . . . . . 16
11.01. General. . . . . . . . . . . . . . . . .16
11.02. By Stockholders Only . . . . . . . . . .17
ARTICLE XII. MISCELLANEOUS. . . . . . . . . . . . 17
12.01. Use of the Term "Annual Meeting" . . 17
|
PAGE 22
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.
(A Maryland Corporation)
|
BY-LAWS
ARTICLE I
NAME OF CORPORATION,
LOCATION OF OFFICES AND SEAL
Section 1.01.Name: The name of the Corporation is
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.
Section 1.02.Principal Office: The principal office of
the Corporation in the State of Maryland shall be located in the
City of Baltimore. The Corporation may, in addition, establish
and maintain such other offices and places of business, within or
outside the State of Maryland, as the Board of Directors may from
time to time determine. [ MGCL, Sections 2-103(4), 2-
108(a)(1) ]*
Section 1.03.Seal: The corporate seal of the Corporation shall be circular in form, and shall bear the name of the Corporation, the year of its incorporation, and the words "Corporate Seal, Maryland." The form of the seal shall be subject to alteration by the Board of Directors and the seal may be used by causing it or a facsimile to be impressed or affixed or printed or otherwise reproduced. In lieu of affixing the corporate seal to any document it shall be sufficient to meet the requirements of any law, rule, or regulation relating to a corporate seal to affix the word "(Seal)" adjacent to the signature of the authorized officer of the Corporation. Any officer or Director of the Corporation shall have authority to affix the corporate seal of the Corporation to any document requiring the same. [ MGCL, Sections 1-304(b), 2-103(3) ]
ARTICLE II
SHAREHOLDERS
* Bracketed citations are to the General Corporation Law of the State of Maryland ("MGCL") or to the United States Investment Company Act of 1940, as amended (the "Investment Company Act"), or to Rules of the United States Securities and Exchange Commission thereunder ("SEC Rules"). The citations are inserted for reference only and do not constitute a part of the By-Laws.
purposes constitute the annual meeting of shareholders for the
fiscal year of the Corporation in which the meeting is held. At
any such meeting, the shareholders shall elect directors to hold
the offices of any directors who have held office for more than
one year or who have been elected by the Board of Directors to
fill vacancies which result from any cause. Except as the
Articles of Incorporation or statute provides otherwise,
Directors may transact any business within the powers of the
Corporation as may properly come before the meeting. Any
business of the Corporation may be transacted at the annual
meeting without being specially designated in the notice, except
such business as is specifically required by statute to be stated
in the notice. [MGCL, Section 2-501]
(Section 2.01. Annual Meetings as amended April 20, 1990)
Section 2.02.Special Meetings: Special meetings of the
shareholders may be called at any time by the Chairman of the
Board, the President, any Vice President, or by the Board of
Directors. Special meetings of the shareholders shall be called
by the Secretary on the written request of shareholders entitled
to cast at least ten (10) percent of all the votes entitled to be
cast at such meeting, provided that (a) such request shall state
the purpose or purposes of the meeting and the matters proposed
to be acted on, and (b) the shareholders requesting the meeting
shall have paid to the Corporation the reasonably estimated cost
of preparing and mailing the notice thereof, which the Secretary
shall determine and specify to such shareholders. Unless
requested by shareholders entitled to cast a majority of all the
votes entitled to be cast at the meeting, a special meeting need
not be called to consider any matter which is substantially the
same as a matter voted upon at any special meeting of the
shareholders held during the preceding twelve (12) months.
[ MGCL, Section 2-502 ]
(Section 2.02. Special Meetings as amended July 30, 1993)
Section 2.03.Place of Meetings: All shareholders'
meetings shall be held at such place within the United States as
may be fixed from time to time by the Board of Directors.
[ MGCL, Section 2-503 ]
Section 2.04.Notice of Meetings: Not less than ten
(10) days, nor more than ninety (90) days before each
shareholders' meeting, the Secretary or an Assistant Secretary of
the Corporation shall give to each shareholder entitled to vote
at the meeting, and each other shareholder entitled to notice of
the meeting, written notice stating (1) the time and place of the
meeting, and (2) the purpose or purposes of the meeting if the
meeting is a special meeting or if notice of the purpose is
required by statute to be given. Such notice shall be personally
delivered to the shareholder, or left at his residence or usual
place of business, or mailed to him at his address as it appears
on the records of the Corporation. No notice of a shareholders'
meeting need be given to any shareholder who shall sign a written
waiver of such notice, whether before or after the meeting, which
is filed with the records of shareholders' meetings, or to any
shareholder who is present at the meeting in person or by proxy.
Notice of adjournment of a shareholders' meeting to another time
or place need not be given if such time and place are announced
at the meeting, unless the adjournment is for more than one
hundred twenty (120) days after the original record date. [
MGCL, Sections 2-504, 2-511(d) ]
Section 2.05.Voting - In General: At every shareholders' meeting, each shareholder shall be entitled to one vote for each share of stock of the Corporation validly issued and outstanding and held by such shareholder, except that no shares held by the Corporation shall be entitled to a vote. Fractional shares shall be entitled to fractional votes. Except as otherwise specifically provided in the Articles of Incorporation, or these By-Laws, or
as required by provisions of the Investment Company Act, a
majority of all the votes cast at a meeting at which a quorum is
present is sufficient to approve any matter which properly comes
before the meeting. The vote upon any question shall be by
ballot whenever requested by any person entitled to vote, but,
unless such a request is made, voting may be conducted in any way
approved by the meeting. [ MGCL, Sections 2-214(a)(i), 2-
506(a)(2), 2-507(a), 2-509(b) ]
Section 2.06.Shareholders Entitled to Vote: If, pursuant to Section 8.05 hereof, a record date has been fixed for the determination of shareholders entitled to notice of or to vote at any shareholders' meeting, each shareholder of the Corporation shall be entitled to vote in person or by proxy, each share or fraction of a share of stock outstanding in his name on the books of the Corporation on such record date. If no record date has been fixed for the determination of shareholders, the record date for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the day on which notice of the meeting is mailed or the 30th day before the meeting, whichever is the closer date to the meeting, or, if notice is waived by all shareholders, at the close of business on the tenth (10th) day next preceding the date of the meeting. [ MGCL, Sections 2-507, 2-511 ]
Section 2.07.Voting - Proxies: The right to vote by proxy shall exist only if the instrument authorizing such proxy to act shall have been executed in writing by the shareholder himself, or by his attorney thereunto duly authorized in writing.
No proxy shall be valid more than eleven (11) months after its date unless it provides for a longer period. [ MGCL, Section 2- 507(b) ]
Section 2.08.Quorum: The presence at any shareholders' meeting, in person or by proxy, of shareholders entitled to cast a majority of the votes entitled to be cast at the meeting shall constitute a quorum. [ MGCL, Section 2-506(a) ]
Section 2.09.Absence of Quorum: In the absence of a quorum, the holders of a majority of shares entitled to vote at the meeting and present thereat in person or by proxy, or, if no shareholder entitled to vote is present in person or by proxy, any officer present who is entitled to preside at or act as Secretary of such meeting, may adjourn the meeting sine die or from time to time. Any business that might have been transacted at the meeting originally called may be transacted at any such adjourned meeting at which a quorum is present.
Section 2.10.Stock Ledger and List of Shareholders: It shall be the duty of the Secretary or Assistant Secretary of the Corporation to cause an original or duplicate stock ledger to be maintained at the office of the Corporation's transfer agent, containing the names and addresses of all shareholders and the number of shares of each class held by each shareholder. Such stock ledger may be in written form, or any other form capable of being converted into written form within a reasonable time for visual inspection. Any one or more persons, who together are and for at least six (6) months have been shareholders of record of at least five percent (5%) of the outstanding capital stock of the Corporation, may submit (unless the Corporation at the time of the request maintains a duplicate stock ledger at its principal office) a written request to any officer of the Corporation or its resident agent in Maryland for a list of the shareholders of the Corporation. Within twenty (20) days after such a request, there shall be prepared and filed at the Corporation's principal office a list, verified under oath by an officer of the Corporation or by its stock transfer agent or registrar, which sets
forth the name and address of each shareholder and the number of
shares of each class which the shareholder holds. [ MGCL,
Sections 2-209, 2-513 ]
Section 2.11.Informal Action By Shareholders: Any
action required or permitted to be taken at a meeting of
shareholders may be taken without a meeting if the following are
filed with the records of shareholders' meetings:
(a) A unanimous written consent which sets forth the action and is signed by each shareholder entitled to vote on the matter; and
(b) A written waiver of any right to dissent signed by each shareholder entitled to notice of the meeting, but not entitled to vote at it. [ MGCL, Section 2- 505 ]
ARTICLE III
BOARD OF DIRECTORS
Section 3.01.Number and Term of Office: The Board of Directors shall consist of one (1) Director, which number may be increased by a resolution of a majority of the entire Board of Directors, provided that the number of Directors shall not be more than fifteen (15) nor less than the lesser of (i) three (3) or (ii) the number of shareholders of the Corporation. Each Director (whenever elected) shall hold office until the next annual meeting of shareholders and until his successor is elected and qualifies or until his earlier death, resignation, or removal. [ MGCL, Sections 2-402, 2-404, 2-405 ]
Section 3.02.Qualification of Directors: No member of the Board of Directors need be a shareholder of the Corporation, but at least one member of the Board of Directors shall be a person who is not an interested person (as such term is defined in the Investment Company Act) of the investment adviser of the Corporation, nor an officer or employee of the Corporation. [ MGCL, Section 2-403; Investment Company Act, Section 10(d) ]
Section 3.03.Election of Directors: Until the first annual meeting of shareholders or until successors are duly elected and qualified, the Board of Directors shall consist of the persons named as such in the Articles of Incorporation. Thereafter, except as otherwise provided in Sections 3.04 and 3.05 hereof, at each annual meeting, the shareholders shall elect Directors to hold office until the next annual meeting and/or until their successors are elected and qualify. In the event that Directors are not elected at an annual shareholders' meeting, then Directors may be elected at a special shareholders' meeting. Directors shall be elected by vote of the holders of a majority of the shares present in person or by proxy and entitled to vote thereon. [ MGCL, Section 2-404 ] (Section 3.03. Election of Directors as amended January 21, 1988)
Section 3.04.Removal of Directors: At any meeting of shareholders, duly called and at which a quorum is present, the shareholders may, by the affirmative vote of the holders of a majority of the votes entitled to be cast thereon, remove any Director or Directors from office, either with or without cause, and may elect a successor or successors to fill any resulting vacancies for the unexpired terms of removed Directors. [ MGCL, Sections 2-406, 2-407 ]
Section 3.05.Vacancies and Newly Created Directorships:
If any vacancies occur in the Board of Directors by reason of resignation, removal or
otherwise, or if the authorized number of Directors is increased,
the Directors then in office shall continue to act, and such
vacancies (if not previously filled by the shareholders) may be
filled by a majority of the Directors then in office, whether or
not sufficient to constitute a quorum, provided that, immediately
after filling such vacancy, at least two-thirds of the Directors
then holding office shall have been elected to such office by the
shareholders of the Corporation. In the event that at any time,
other than the time preceding the first meeting of shareholders,
less than a majority of the Directors of the Corporation holding
office at that time were so elected by the shareholders, a
meeting of the shareholders shall be held promptly and in any
event within sixty (60) days for the purpose of electing
Directors to fill any existing vacancies in the Board of
Directors unless the Securities and Exchange Commission shall by
order extend such period. Except as provided in Section 3.04
hereof, a Director elected by the Board of Directors to fill a
vacancy shall be elected to hold office until the next annual
meeting of shareholders or until his successor is elected and
qualifies. [ MGCL, Section 2-407; Investment Company Act,
Section 16(a) ]
Section 3.06.General Powers:
(a) The property, business, and affairs of the Corporation shall be managed under the direction of the Board of Directors which may exercise all the powers of the Corporation except such as are by law, by the Articles of Incorporation, or by these By-Laws conferred upon or reserved to the shareholders of the Corporation. [ MGCL, Section 2-401 ]
(b) All acts done by any meeting of the Directors or by any person acting as a Director, so long as his successor shall not have been duly elected or appointed, shall, notwithstanding that it be afterwards discovered that there was some defect in the election of the Directors or such person acting as a Director or that they or any of them were disqualified, be as valid as if the Directors or such person, as the case may be, had been duly elected and were or was qualified to be Directors or a Director of the Corporation.
Section 3.07.Power to Issue and Sell Stock: The Board
of Directors may from time to time authorize by resolution the
issuance and sale of any of the Corporation's authorized shares
to such persons as the Board of Directors shall deem advisable
and such resolution shall set the minimum price or value of
consideration for the stock or a formula for its determination,
and shall include a fair description of any consideration other
than money and a statement of the actual value of such
consideration as determined by the Board of Directors or a
statement that the Board of Directors has determined that the
actual value is or will be not less than a certain sum. [ MGCL,
Section 2-203 ]
Section 3.08.Power to Declare Dividends:
(a) The Board of Directors, from time to time as it may deem advisable, may declare and the Corporation pay dividends, in cash, property, or shares of the Corporation available for dividends out of any source available for dividends, to the shareholders according to their respective rights and interests. [ MGCL, Section 2-309 ]
(b) The Board of Directors shall cause to be accompanied by a written statement any dividend payment wholly or partly from any source other
than the Corporation's accumulated undistributed net income (determined in accordance with good accounting practice and the rules and regulations of the Securities and Exchange Commission then in effect) not including profits or losses realized upon the sale of securities or other properties. Such statement shall adequately disclose the source or sources of such payment and the basis of calculation and shall be otherwise in such form as the Securities and Exchange Commission may prescribe. [ Investment Company Act, Section 19; SEC Rule 19a-1; MGCL, Section 2-309(c) ]
(c) Notwithstanding the above provisions of this
Section 3.08, the Board of Directors may at any time declare and
distribute pro rata among the shareholders a stock dividend out
of the Corporation's authorized but unissued shares of stock,
including any shares previously purchased by the Corporation,
provided that such dividend shall not be distributed in shares of
any class with respect to any shares of a different class. The
shares so distributed shall be issued at the par value thereof,
and there shall be transferred to stated capital, at the time
such dividend is paid, an amount of surplus equal to the
aggregate par value of the shares issued as a dividend and there
may be transferred from earned surplus to capital surplus such
additional amount as the Board of Directors may determine. [
MGCL, Section 2-309 ]
Section 3.09.Annual and Regular Meetings: The annual
meeting of the Board of Directors for choosing officers and
transacting other proper business shall be held immediately after
the annual shareholders' meeting at such place as may be
specified in the notice of such meeting of the Board of
Directors, or, in the absence of such annual shareholders'
meeting, at such time and place as the Board of Directors may
provide. The Board of Directors from time to time may provide by
resolution for the holding of regular meetings and fix their time
and place (within or outside the State of Maryland). [ MGCL,
Section 2-409(a) ]
(Section 3.09. Annual and Regular Meetings as amended January
21, 1988)
Section 3.10.Special Meetings: Special meetings of the Board of Directors shall be held whenever called by the Chairman of the Board, the President (or, in the absence or disability of the President, by any Vice President), the Treasurer, or two or more Directors, at the time and place (within or outside the State of Maryland) specified in the respective notices or waivers of notice of such meetings.
Section 3.11.Notice: Notice of annual, regular, and special meetings shall be in writing, stating the time and place, and shall be mailed to each Director at his residence or regular place of business or caused to be delivered to him personally or to be transmitted to him by telegraph, cable, or wireless at least two (2) days before the day on which the meeting is to be held. Except as otherwise required by the By-Laws or the Investment Company Act, such notice need not include a statement of the business to be transacted at, or the purpose of, the meeting. [ MGCL, Section 2-409(b) ]
Section 3.12.Waiver of Notice: No notice of any meeting need be given to any Director who is present at the meeting or to any Director who signs a waiver of the notice of the meeting (which waiver shall be filed with the records of the meeting), whether before or after the meeting. [ MGCL, Section 2-409(c) ]
Section 3.13.Quorum and Voting: At all meetings of the Board of Directors the presence of one-third of the total number of Directors authorized, but not less than two (2) Directors if there are at least two directors, shall constitute a quorum. In the absence of a quorum, a majority of the Directors present may adjourn the meeting, from time to time, until a
quorum shall be present. The action of a majority of the Directors present at a meeting at which a quorum is present shall be the action of the Board of Directors unless the concurrence of a greater proportion is required for such action by law, by the Articles of Incorporation or by these By-Laws. [ MGCL, Section 2-408 ]
Section 3.14.Conference Telephone: Members of the
Board of Directors or of any committee designated by the Board,
may participate in a meeting of the Board or of such committee by
means of a conference telephone or similar communications
equipment if all persons participating in the meeting can hear
each other at the same time, and participation by such means
shall constitute presence in person at such meeting. [ MGCL,
Section 2-409(d) ]
Section 3.15.Compensation: Each Director may receive such remuneration for his services as shall be fixed from time to time by resolution of the Board of Directors.
Section 3.16.Action Without a Meeting: Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if a unanimous written consent which sets forth the action is signed by all members of the Board or of such committee and such written consent is filed with the minutes of proceedings of the Board or committee. [ MGCL, Section 2-408(c) ]
Section 3.17.Director Emeritus: Upon the retirement of a Director of the Corporation, the Board of Directors may designate such retired Director as a Director Emeritus. The position of Director Emeritus shall be honorary only and shall not confer upon such Director Emeritus any responsibility, or voting authority, whatsoever with respect to the Corporation. A Director Emeritus may, but shall not be required to attend the meetings of the Board of Directors and receive materials normally provided Directors relating to the Corporation. The Board of Directors may establish such compensation as it may deem appropriate under the circumstances to be paid by the Corporation to a Director Emeritus.
ARTICLE IV
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 4.01.How Constituted: By resolution adopted by the Board of Directors, the Board may appoint from among its members one or more committees, including an Executive Committee, each consisting of at least two (2) Directors. Each member of a committee shall hold office during the pleasure of the Board. The President shall be a member of the Executive Committee. [ MGCL, Section 2-411 ]
Section 4.02.Powers of the Executive Committee: Unless otherwise provided by resolution of the Board of Directors, the Executive Committee, in the intervals between meetings of the Board of Directors, shall have and may exercise all of the powers of the Board of Directors to manage the business and affairs of the Corporation except the power to:
(a) Declare dividends or distributions on stock;
(b) Issue stock other than as provided in Section 2-411(b) of Corporations and Associations Article of the Annotated Code of Maryland;
(c) Recommend to the shareholders any action which requires shareholder approval;
(d) Amend the By-Laws; or
(e) Approve any merger or share exchange which does not
require shareholder approval.
[ MGCL, Section 2-411(a) ]
Section 4.03.Other Committees of the Board of
Directors: To the extent provided by resolution of the Board,
other committees shall have and may exercise any of the powers
that may lawfully be granted to the Executive Committee. [ MGCL,
Section 2-411(a) ]
Section 4.04.Proceedings, Quorum, and Manner of Acting:
In the absence of appropriate resolution of the Board of Directors, each committee may adopt such rules and regulations governing its proceedings, quorum and manner of acting as it shall deem proper and desirable, provided that the quorum shall not be less than two (2) Directors. In the absence of any member of any such committee, the members thereof present at any meeting, whether or not they constitute a quorum, may appoint a member of the Board of Directors to act in the place of such absent member. [ MGCL, Section 2-411(c) ]
Section 4.05.Other Committees: The Board of Directors may appoint other committees, each consisting of one or more persons who need not be Directors. Each such committee shall have such powers and perform such duties as may be assigned to it from time to time by the Board of Directors, but shall not exercise any power which may lawfully be exercised only by the Board of Directors or a committee thereof.
ARTICLE V
OFFICERS
Section 5.01.General: The officers of the Corporation shall be a President, one or more Vice Presidents (one or more of whom may be designated Executive Vice President), a Secretary, and a Treasurer, and may include one or more Assistant Vice Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers as may be appointed in accordance with the provisions of Section 5.11 hereof. The Board of Directors may elect, but shall not be required to elect, a Chairman of the Board. [ MGCL, Section 2-412 ]
Section 5.02.Election, Term of Office and Qualifications: The officers of the Corporation (except those appointed pursuant to Section 5.11 hereof) shall be elected by the Board of Directors at its first meeting and thereafter at each annual meeting of the Board. If any officer or officers are not elected at any such meeting, such officer or officers may be elected at any subsequent regular or special meeting of the Board. Except as provided in Sections 5.03, 5.04, and 5.05 hereof, each officer elected by the Board of Directors shall hold office until the next annual meeting of the Board of Directors and until his successor shall have been chosen and qualified. Any
person may hold two or more offices of the Corporation, except
that neither the Chairman of the Board nor the President may hold
the office of Vice President, but no person shall execute,
acknowledge, or verify any instrument in more than one capacity
if such instrument is required by law, the Articles of
Incorporation or these By-Laws to be executed, acknowledged, or
verified by two or more officers. The Chairman of the Board and
the President shall be selected from among the Directors of the
Corporation and may hold such offices only so long as they
continue to be Directors. No other officer need be a Director.
[ MGCL, Sections 2-413, 2-415 ]
(Section 5.02. Election, Term of Office and Qualifications as
amended January 21, 1988)
Section 5.03.Resignation: Any officer may resign his office at any time by delivering a written resignation to the Board of Directors, the President, the Secretary, or any Assistant Secretary. Unless otherwise specified therein, such resignation shall take effect upon delivery.
Section 5.04.Removal: Any officer may be removed from office by the Board of Directors whenever in the judgment of the Board of Directors the best interests of the Corporation will be served thereby. [ MGCL, Section 2-413(c) ]
Section 5.05.Vacancies and Newly Created Offices: If any vacancy shall occur in any office by reason of death, resignation, removal, disqualification or other cause, or if any new office shall be created, such vacancies or newly created offices may be filled by the Board of Directors at any meeting or, in the case of any office created pursuant to Section 5.11 hereof, by any officer upon whom such power shall have been conferred by the Board of Directors. [ MGCL, Section 2-413(d) ]
Section 5.06.Chairman of the Board: Unless otherwise provided by resolution of the Board of Directors, the Chairman of the Board, if there be such an officer, shall be the chief executive and operating officer of the Corporation, shall preside at all shareholders' meetings, and at all meetings of the Board of Directors. He shall be ex officio a member of all standing committees of the Board of Directors. Subject to the supervision of the Board of Directors, he shall have general charge of the business, affairs, property, and operation of the Corporation and its officers, employees, and agents. He may sign (unless the President or a Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors and shall have such other powers and perform such other duties as may be assigned to him from time to time by the Board of Directors.
Section 5.07.President: Unless otherwise provided by
resolution of the Board of Directors, the President shall, at the
request of or in the absence or disability of the Chairman of the
Board, or if no Chairman of the Board has been chosen, he shall
preside at all shareholders' meetings and at all meetings of the
Board of Directors and shall in general exercise the powers and
perform the duties of the Chairman of the Board. He may sign
(unless the Chairman or a Vice President shall have signed)
certificates representing stock of the Corporation authorized for
issuance by the Board of Directors. Except as the Board of
Directors may otherwise order, he may sign in the name and on
behalf of the Corporation all deeds, bonds, contracts, or
agreements. He shall exercise such other powers and perform such
other duties as from time to time may be assigned to him by the
Board of Directors.
Section 5.08.Vice President: The Board of Directors shall, from time to time, designate and elect one or more Vice Presidents (one or more of whom may be designated Executive Vice President) who shall have such powers
and perform such duties as from time to time may be assigned to them by the Board of Directors or the President. At the request or in the absence or disability of the President, the Vice President (or, if there are two or more Vice Presidents, the Vice President in order of seniority of tenure in such office or in such other order as the Board of Directors may determine) may perform all the duties of the President and, when so acting, shall have all the powers of and be subject to all the restrictions upon the President. Any Vice President may sign (unless the Chairman, the President, or another Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors.
Section 5.09.Treasurer and Assistant Treasurers: The Treasurer shall be the principal financial and accounting officer of the Corporation and shall have general charge of the finances and books of account of the Corporation. Except as otherwise provided by the Board of Directors, he shall have general supervision of the funds and property of the Corporation and of the performance by the custodian of its duties with respect thereto. He may countersign (unless an Assistant Treasurer or Secretary or Assistant Secretary shall have countersigned) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. He shall render to the Board of Directors, whenever directed by the Board, an account of the financial condition of the Corporation and of all his transactions as Treasurer; and as soon as possible after the close of each fiscal year he shall make and submit to the Board of Directors a like report for such fiscal year. He shall cause to be prepared annually a full and correct statement of the affairs of the Corporation, including a balance sheet and a financial statement of operations for the preceding fiscal year, which shall be submitted at the annual meeting of shareholders and filed within twenty (20) days thereafter at the principal office of the Corporation. He shall perform all the acts incidental to the office of the Treasurer, subject to the control of the Board of Directors. Any Assistant Treasurer may perform such duties of the Treasurer as the Treasurer or the Board of Directors may assign, and, in the absence of the Treasurer, he may perform all the duties of the Treasurer.
Section 5.10.Secretary and Assistant Secretaries: The Secretary shall attend to the giving and serving of all notices of the Corporation and shall record all proceedings of the meetings of the shareholders and Directors in one or more books to be kept for that purpose. He shall keep in safe custody the seal of the Corporation and shall have charge of the records of the Corporation, including the stock books and such other books and papers as the Board of Directors may direct and such books, reports, certificates and other documents required by law to be kept, all of which shall at all reasonable times be open to inspection by any Director. He shall countersign (unless the Treasurer, an Assistant Treasurer or an Assistant Secretary shall have countersigned) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. He shall perform such other duties as appertain to his office or as may be required by the Board of Directors. Any Assistant Secretary may perform such duties of the Secretary as the Secretary or the Board of Directors may assign, and, in the absence of the Secretary, he may perform all the duties of the Secretary.
Section 5.11.Subordinate Officers: The Board of Directors from time to time may appoint such other officers or agents as it may deem advisable, each of whom shall have such title, hold office for such period, have such authority and perform such duties as the Board of Directors may determine. The Board of Directors from time to time may delegate to one or more officers or agents the power to appoint any such subordinate officers or agents and to prescribe their respective rights, terms of office, authorities, and duties. [ MGCL, Section 2-412(b) ]
Section 5.12.Remuneration: The salaries or other
compensation of the officers of the Corporation shall be fixed
from time to time by resolution of the Board of Directors, except
that the Board of Directors may by resolution delegate to any
person or group of persons the power to fix the salaries or other
compensation of any subordinate officers or agents appointed in
accordance with the provisions of Section 5.11 hereof.
ARTICLE VI
CUSTODY OF SECURITIES AND CASH
Section 6.01.Employment of a Custodian: The
Corporation shall place and at all times maintain in the custody
of a Custodian (including any sub-custodian for the Custodian)
all funds, securities, and similar investments owned by the
Corporation. The Custodian shall be a bank having an aggregate
capital, surplus, and undivided profits of not less than
$10,000,000. Subject to such rules, regulations, and orders as
the Securities and Exchange Commission may adopt as necessary or
appropriate for the protection of investors, the Corporation's
Custodian may deposit all or a part of the securities owned by
the Corporation in a sub-custodian or sub-custodians situated
within or without the United States. The Custodian shall be
appointed and its remuneration fixed by the Board of Directors.
[ Investment Company Act, Section 17(f) ]
Section 6.02.Central Certificate Service: Subject to such rules, regulations, and orders as the Securities and Exchange Commission may adopt as necessary or appropriate for the protection of investors, the Corporation's Custodian may deposit all or any part of the securities owned by the Corporation in a system for the central handling of securities established by a national securities exchange or national securities association registered with the Commission under the Securities Exchange Act of 1934, or such other person as may be permitted by the Commission, pursuant to which system all securities of any particular class or series of any issuer deposited within the system are treated as fungible and may be transferred or pledged by bookkeeping entry without physical delivery of such securities. [ Investment Company Act, Section 17(f) ]
Section 6.03.Cash Assets: The cash proceeds from the sale of securities and similar investments and other cash assets of the Corporation shall be kept in the custody of a bank or banks appointed pursuant to Section 6.01 hereof, or in accordance with such rules and regulations or orders as the Securities and Exchange Commission may from time to time prescribe for the protection of investors, except that the Corporation may maintain a checking account or accounts in a bank or banks, each having an aggregate capital, surplus, and undivided profits of not less than $10,000,000, provided that the balance of such account or the aggregate balances of such accounts shall at no time exceed the amount of the fidelity bond, maintained pursuant to the requirements of the Investment Company Act and rules and regulations thereunder, covering the officers or employees authorized to draw on such account or accounts. [ Investment Company Act, Section 17(f) ]
Section 6.04.Free Cash Accounts: The Corporation may, upon resolution of its Board of Directors, maintain a petty cash account free of the foregoing requirements of this Article VI in an amount not to exceed $500, provided that such account is operated under the imprest system and is maintained subject to adequate controls approved by the Board of Directors over disbursements and reimbursements including, but not limited to, fidelity
bond coverage for persons having access to such funds. [ Investment Company Act, Rule 17f-3 ]
Section 6.05.Action Upon Termination of Custodian Agreement: Upon resignation of a custodian of the Corporation or inability of a custodian to continue to serve, the Board of Directors shall promptly appoint a successor custodian, but in the event that no successor custodian can be found who has the required qualifications and is willing to serve, the Board of Directors shall call as promptly as possible a special meeting of the shareholders to determine whether the Corporation shall function without a custodian or shall be liquidated. If so directed by vote of the holders of a majority of the outstanding shares of stock of the Corporation, the custodian shall deliver and pay over all property of the Corporation held by it as specified in such vote.
ARTICLE VII
EXECUTION OF INSTRUMENTS, VOTING OF SECURITIES
Section 7.01.Execution of Instruments: All deeds, documents, transfers, contracts, agreements, requisitions or orders, promissory notes, assignments, endorsements, checks and drafts for the payment of money by the Corporation, and other instruments requiring execution by the Corporation shall be signed by the Chairman, the President, a Vice President, or the Treasurer, or as the Board of Directors may otherwise, from time to time, authorize. Any such authorization may be general or confined to specific instances.
Section 7.02.Voting of Securities: Unless otherwise ordered by the Board of Directors, the Chairman, the President, or any Vice President shall have full power and authority on behalf of the Corporation to attend and to act and to vote, or in the name of the Corporation to execute proxies to vote, at any meeting of shareholders of any company in which the Corporation may hold stock. At any such meeting such officer shall possess and may exercise (in person or by proxy) any and all rights, powers, and privileges incident to the ownership of such stock. The Board of Directors may by resolution from time to time confer like powers upon any other person or persons. [ MGCL, Section 2-509 ]
ARTICLE VIII
CAPITAL STOCK
Section 8.01.Ownership of Shares:
(a) Certificates certifying the ownership of shares will not be issued for shares purchased or otherwise acquired after July 1, 1991. The ownership of shares, full or fractional, shall be recorded on the books of the Corporation or its agent. The record books of the Corporation as kept by the Corporation or its agent, as the case may be, shall be conclusive as to the number of shares held from time to time by each such shareholder. The Corporation reserves the right to require the surrender of outstanding
certificates if the Board of Directors so determines. [ MGCL,
Section 210(c) ]
(b) Every certificate exchanged, surrendered for
redemption or otherwise returned to the Corporation shall be
marked "Cancelled" with the date of cancellation.
(Section 8.01 Ownership of Shares as amended July 1, 1991)
Section 8.02.Transfer of Capital Stock:
(a) Shares of stock of the Corporation shall be transferable only upon the books of the Corporation kept for such purpose and, if one or more certificates representing such shares have been issued, upon surrender to the Corporation or its transfer agent or agents of such certificate or certificates duly endorsed, or accompanied by appropriate evidence of assignment, transfer, succession, or authority to transfer.
(b) The Corporation shall be entitled to treat the holder of record of any share of stock as the absolute owner thereof for all purposes, and accordingly shall not be bound to recognize any legal, equitable, or other claim or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by the statutes of the State of Maryland.
Section 8.03.Transfer Agents and Registrars: The Board
of Directors may, from time to time, appoint or remove transfer
agents and registrars of transfers of shares of stock of the
Corporation, and it may appoint the same person as both transfer
agent and registrar.
(Section 8.03 Transfer Agents and Registrars as amended July 1,
1991)
Section 8.04.Transfer Regulations: The shares of stock of the Corporation may be freely transferred, and the Board of Directors may, from time to time, adopt lawful rules and regulations with reference to the method of transfer of the shares of stock of the Corporation.
Section 8.05.Fixing of Record Date: The Board of Directors may fix in advance a date as a record date for the determination of the shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or to receive payment of any dividend or other distribution or allotment of any rights, or to exercise any rights in respect of any change, conversion, or exchange of stock, or for any other proper purpose, provided that such record date shall be a date not more than sixty (60) days nor, in the case of a meeting of shareholders, less than ten (10) days prior to the date on which the particular action, requiring such determination of shareholders, is to be taken. In such case, only such shareholders as shall be shareholders of record on the record date so fixed shall be entitled to such notice of, and to vote at, such meeting or adjournment, or to give such consent, or to receive payment of such dividend or other distribution, or to receive such allotment of rights, or to exercise such rights, or to take other action, as the case may be, notwithstanding any transfer of any shares on the books of the Corporation after any such record date. A meeting of shareholders convened on the date for which it was called may be adjourned from time to time without notice to a date not more than one hundred twenty (120) days after the original record date. [ MGCL, Section 2-511 ]
Section 8.06.Lost, Stolen or Destroyed Certificates:
If a certificate for stock of the Corporation is alleged to have
been lost, stolen or destroyed, no new certificate will be
issued. Instead, ownership of the shares formerly represented by
the lost, stolen or destroyed certificate shall be recorded on
the books of the Corporation or its agent, in accordance with the
provisions of Section 8.01 of these By-Laws. Before recording
ownership of such shares, the Board of Directors, or any officer
authorized by the
Board, may, in its discretion, require the owner of the lost, stolen, or any destroyed certificate (or his legal representative) to give the Corporation a bond or other indemnity, in such form and in such amount as the Board or any such officer may direct and with such surety or sureties as may be satisfactory to the Board of any such officer, sufficient to indemnify the Corporation against any claim that may be made against it on account of the alleged loss, theft, or destruction of any such certificate. [ MGCL, Section 2-213 ] (Section 8.06 Lost, Stolen or Destroyed Certificates as amended July 1, 1991)
ARTICLE IX
FISCAL YEAR, ACCOUNTANT
Section 9.01.Fiscal Year: The fiscal year of the Corporation shall be the twelve (12) calendar months beginning on the 1st day of March in each year and ending on the last day of the following February, or such other period of twelve (12) calendar months as the Board of Directors may by resolution prescribe.
Section 9.02.Accountant:
(a) The Corporation shall employ an independent public accountant or firm of independent public accountants as its accountant to examine the accounts of the Corporation and to sign and certify financial statements filed by the Corporation. The accountant's certificates and reports shall be addressed both to the Board of Directors and to the shareholders.
(b) A majority of the members of the Board of
Directors who are not interested persons (as such term is defined
in the Investment Company Act) of the Corporation shall select
the accountant, by vote cast in person, at any meeting held
before the first annual shareholders' meeting, and thereafter
shall select the accountant annually, by vote cast in person, at
a meeting held within thirty (30) days before or after the
beginning of the fiscal year of the Corporation or within thirty
(30) days before the annual shareholders' meeting in that year.
Such selection shall be submitted for ratification or rejection
at the next succeeding annual shareholders' meeting. If such
meeting shall reject such selection, the accountant shall be
selected by majority vote of the Corporation's outstanding voting
securities, either at the meeting at which the rejection occurred
or at a subsequent meeting of shareholders called for the
purpose.
(c) Any vacancy occurring between annual meetings, due to the death or resignation of the accountant, may be filled by the vote of a majority of those members of the Board of Directors who are not interested persons (as so defined) of the Corporation, cast in person at a meeting called for the purpose of voting on such action.
(d) The employment of the accountant shall be conditioned upon the right of the Corporation by vote of a majority of the outstanding voting securities at any meeting called for the purpose to terminate such employment forthwith without any penalty. [ Investment Company Act, Section 32(a) ]
INDEMNIFICATION AND INSURANCE
Section 10.01. Indemnification and Payment of Expenses in Advance: The Corporation shall indemnify any individual ("Indemnitee") who is a present or former director, officer, employee, or agent of the Corporation, or who is or has been serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, who, by reason of his position was, is, or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (hereinafter collectively referred to as a "Proceeding") against any judgments, penalties, fines, settlements, and reasonable expenses (including attorneys' fees) incurred by such Indemnitee in connection with any Proceeding, to the fullest extent that such indemnification may be lawful under applicable Maryland law, as from time to time amended. The Corporation shall pay any reasonable expenses so incurred by such Indemnitee in defending a Proceeding in advance of the final disposition thereof to the fullest extent that such advance payment may be lawful under applicable Maryland law, as from time to time amended. Subject to any applicable limitations and requirements set forth in the Corporation's Articles of Incorporation and in these By-Laws, any payment of indemnification or advance of expenses shall be made in accordance with the procedures set forth in applicable Maryland law, as from time to time amended.
Notwithstanding the foregoing, nothing herein shall protect or purport to protect any Indemnitee against any liability to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of his office ("Disabling Conduct").
Anything in this Article X to the contrary notwithstanding, no indemnification shall be made by the Corporation to any Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Anything in this Article X to the contrary notwithstanding, any advance of expenses by the Corporation to any Indemnitee shall be made only upon the undertaking by such Indemnitee to repay the advance unless it is ultimately determined that such Indemnitee is entitled to indemnification as above provided, and only if one of the following conditions is met:
(a) the Indemnitee provides a security for his undertaking; or
(b) the Corporation shall be insured against losses arising by reason of any lawful advances; or
(c) there is a determination, based on a review of readily available facts, that there is reason to believe that the Indemnitee will ultimately be found entitled to indemnification, which determination shall be made by:
(i) a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Section 10.02. Insurance of Officers, Directors,
Employees and Agents: To the fullest extent permitted by
applicable Maryland law and by Section 17(h) of the Investment
Company Act, as from time to time amended, the Corporation may
purchase and maintain insurance on behalf of any person who is or
was a director, officer, employee, or agent of the Corporation,
or who is or was serving at the request of the Corporation as a
director, officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise, against
any liability asserted against him and incurred by him in or
arising out of his position, whether or not the Corporation would
have the power to indemnify him against such liability. [ MGCL,
Section 2-418(k) ]
ARTICLE XI
AMENDMENTS
Section 11.01. General: Except as provided in Section 11.02 hereof, all By-Laws of the Corporation, whether adopted by the Board of Directors or the shareholders, shall be subject to amendment, alteration, or repeal, and new By-Laws may be made, by the affirmative vote of a majority of either:
(a) the holders of record of the outstanding shares of stock of the Corporation entitled to vote, at any annual or special meeting the notice or waiver of notice of which shall have specified or summarized the proposed amendment, alteration, repeal, or new By-Law; or
(b) the Directors present at any regular or special meeting at which a quorum is present if the notice or waiver of notice thereof or material sent to the Directors in connection therewith on or prior to the last date for the giving of such notice under these By-Laws shall have specified or summarized the proposed amendment, alteration, repeal, or new By-Law.
MISCELLANEOUS
Section 12.01. Use of the Term "Annual Meeting": The
use of the term "annual meeting" in these By-Laws shall not be
construed as implying a requirement that a shareholder meeting be
held annually.
(ARTICLE XII - MISCELLANEOUS added January 21, 1988)
dld\agmts\BYLAWS.TFS
BY-LAWS
OF
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.
AS AMENDED:
JANUARY 21, 1988
APRIL 20, 1990
JULY 1, 1991
JULY 20, 1993
TABLE OF CONTENTS
Page
ARTICLE I. NAME OF CORPORATION, LOCATION OF
OFFICES AND SEAL. . . . . . . . . . . . . . . . . . 1
1.01. Name. . . . . . . . . . . . . . . . . . . . . . . . 1
1.02. Principal Office. . . . . . . . . . . . . . . . . . 1
1.03. Seal. . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II.
SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.01. Annual Meetings . . . . . . . . . . . . . . . . . . 1
2.02. Special Meetings. . . . . . . . . . . . . . . . . . 2
2.03. Place of Meetings . . . . . . . . . . . . . . . . . 2
2.04. Notice of Meetings. . . . . . . . . . . . . . . . . 2
2.05. Voting - in General . . . . . . . . . . . . . . . . 2
2.06. Shareholders Entitled to Vote . . . . . . . . . . . 3
2.07. Voting - Proxies. . . . . . . . . . . . . . . . . . 3
2.08. Quorum. . . . . . . . . . . . . . . . . . . . . . . 3
2.09. Absence of Quorum . . . . . . . . . . . . . . . . . 3
2.10. Stock Ledger and List of Shareholders . . . . . . . 3
2.11. Informal Action by Stockholders . . . . . . . . . . 4
ARTICLE III.
BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . 4
3.01. Number and Term of Office . . . . . . . . . . . . . 4
3.02. Qualification of Directors. . . . . . . . . . . . . 4
3.03. Election of Directors . . . . . . . . . . . . . . . 4
3.04. Removal of Directors. . . . . . . . . . . . . . . . 4
3.05. Vacancies and Newly Created Directorships . . . . . 5
3.06. General Powers. . . . . . . . . . . . . . . . . . . 5
3.07. Power to Issue and Sell Stock . . . . . . . . . . . 5
3.08. Power to Declare Dividends. . . . . . . . . . . . . 5
3.09. Annual and Regular Meetings . . . . . . . . . . . . 6
3.10. Special Meetings. . . . . . . . . . . . . . . . . . 6
3.11. Notice. . . . . . . . . . . . . . . . . . . . . . . 6
3.12. Waiver of Notice. . . . . . . . . . . . . . . . . . 6
3.13. Quorum and Voting . . . . . . . . . . . . . . . . . 6
3.14. Conference Telephone. . . . . . . . . . . . . . . . 7
3.15. Compensation. . . . . . . . . . . . . . . . . . . . 7
3.16. Action without a Meeting. . . . . . . . . . . . . . 7
3.17. Director Emeritus . . . . . . . . . . . . . . . . . 7
|
PAGE 41 ARTICLE IV. EXECUTIVE COMMITTEE AND OTHER COMMITTEES . . . . . . . . . . . 7 4.01. How Constituted . . . . . . . . . . . . . . . . . . 7 4.02. Powers of the Executive Committee . . . . . . . . . 7 4.03. Other Committees of the Board of Directors. . . . . 8 4.04. Proceedings, Quorum and Manner of Acting. . . . . . 8 4.05. Other Committees. . . . . . . . . . . . . . . . . . 8 ARTICLE V. OFFICERS. . . . . . . . . . . . . . . . . . . . . . 8 5.01. General . . . . . . . . . . . . . . . . . . . . . . 8 5.02. Election, Term of Office and Qualifications . . . . 8 5.03. Resignation . . . . . . . . . . . . . . . . . . . . 9 5.04. Removal . . . . . . . . . . . . . . . . . . . . . . 9 5.05. Vacancies and Newly Created Offices . . . . . . . . 9 5.06. Chairman of the Board . . . . . . . . . . . . . . . 9 5.07. President . . . . . . . . . . . . . . . . . . . . . 9 5.08. Vice President. . . . . . . . . . . . . . . . . . .10 5.09. Treasurer and Assistant Treasurers. . . . . . . . .10 5.10. Secretary and Assistant Secretaries . . . . . . . .10 5.11. Subordinate Officers. . . . . . . . . . . . . . . .10 5.12. Remuneration. . . . . . . . . . . . . . . . . . . .11 ARTICLE VI. CUSTODY OF SECURITIES AND CASH . . . . . . . . . . . . . . . .11 6.01. Employment of a Custodian . . . . . . . . . . . . .11 6.02. Central Certificate Service . . . . . . . . . . . .11 6.03. Cash Assets . . . . . . . . . . . . . . . . . . . .11 6.04. Free Cash Accounts. . . . . . . . . . . . . . . . .11 6.05. Action Upon Termination of Custodian Agreement. . .12 ARTICLE VII. EXECUTION OF INSTRUMENTS, VOTING OF SECURITIES . . . . . . . .12 7.01. Execution of Instruments. . . . . . . . . . . . . .12 7.02. Voting of Securities. . . . . . . . . . . . . . . .12 ARTICLE VIII. CAPITAL STOCK. . . . . . . . . . . . . . . . . .12 8.01. Ownership of Shares . . . . . . . . . . . . . . . .12 8.02. Transfer of Capital Stock . . . . . . . . . . . . .13 8.03. Transfer Agents and Registrars. . . . . . . . . . .13 8.04. Transfer Regulations. . . . . . . . . . . . . . . .13 8.05. Fixing of Record Date . . . . . . . . . . . . . . .13 8.06. Lost, Stolen, or Destroyed Certificates . . . . . .13 |
PAGE 42 ARTICLE IX. FISCAL YEAR, ACCOUNTANT. . . . . . . . . . . . . . . . . . . .14 9.01. Fiscal Year . . . . . . . . . . . . . . . . . . . .14 9.02. Accountant. . . . . . . . . . . . . . . . . . . . .14 ARTICLE X. INDEMNIFICATION AND INSURANCE . . . . . . . . . . .15 |
10.01. Indemnification and Payment of Expenses in Advance.15
10.02. Insurance of Officers, Directors, Employees and
Agents 16
ARTICLE XI.
AMENDMENTS 16
11.01. General . . . . . . . . . . . . . . . . . . . . . .16
ARTICLE XII. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . .17 12.01. Use of the Term "Annual Meeting". . . . . . . . . .17 |
(A Maryland Corporation)
BY-LAWS
ARTICLE I
NAME OF CORPORATION,
LOCATION OF OFFICES AND SEAL
Section 1.01.Name: The name of the Corporation is
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
(Section 1.01. Name as amended May 1, 1981)
Section 1.02.Principal Office: The principal office of
the Corporation in the State of Maryland shall be located in the
City of Baltimore. The Corporation may, in addition, establish
and maintain such other offices and places of business, within or
outside the State of Maryland, as the Board of Directors may from
time to time determine. [ MGCL, Sections 2-103(4), 2-
108(a)(1) ]*
Section 1.03.Seal: The corporate seal of the
Corporation shall be circular in form, and shall bear the name of
the Corporation, the year of its incorporation, and the words
"Corporate Seal, Maryland." The form of the seal shall be
subject to alteration by the Board of Directors and the seal may
be used by causing it or a facsimile to be impressed or affixed
or printed or otherwise reproduced. Any officer or Director of
the Corporation shall have authority to affix the corporate seal
of the Corporation to any document requiring the same. [ MGCL,
Section 2-103(3) ]
ARTICLE II
STOCKHOLDERS
*Bracketed citations are to the General Corporation Law of the State of Maryland ("MGCL") or to the United States Investment Company Act of 1940, as amended (the "Investment Company Act"), or to Rules of the United States Securities and Exchange Commission thereunder ("SEC Rules"). The citations are inserted for reference only and do not constitute a part of the By-Laws.
which the meeting is held. At any such meeting, the shareholders shall elect directors to hold the offices of any directors who have held office for more than one year or who have been elected by the Board of Directors to fill vacancies which result from any cause. Except as the Articles of Incorporation or statute provides otherwise, Directors may transact any business within the powers of the Corporation as may properly come before the meeting. Any business of the Corporation may be transacted at the annual meeting without being specially designated in the notice, except such business as is specifically required by statute to be stated in the notice. [MGCL, Section 2-501]
(Section 2.01. Annual Meetings as amended April 20, 1990)
Section 2.02.Special Meetings: Special meetings of the
shareholders may be called at any time by the Chairman of the
Board, the President, any Vice President, or by the Board of
Directors. Special meetings of the shareholders shall be called
by the Secretary on the written request of shareholders entitled
to cast at least ten (10) percent of all the votes entitled to be
cast at such meeting, provided that (a) such request shall state
the purpose or purposes of the meeting and the matters proposed
to be acted on, and (b) the shareholders requesting the meeting
shall have paid to the Corporation the reasonably estimated cost
of preparing and mailing the notice thereof, which the Secretary
shall determine and specify to such shareholders. Unless
requested by shareholders entitled to cast a majority of all the
votes entitled to be cast at the meeting, a special meeting need
not be called to consider any matter which is substantially the
same as a matter voted upon at any special meeting of the
shareholders held during the preceding twelve (12) months.
[ MGCL, Section 2-502 ]
(Section 2.02. Special Meetings as amended July 20, 1993)
Section 2.03.Place of Meetings: All stockholders'
meetings shall be held at such place within the United States as
may be fixed from time to time by the Board of Directors.
[ MGCL, Section 2-503 ]
Section 2.04.Notice of Meetings: Not less than ten
(10) days, nor more than ninety (90) days before each
stockholders' meeting, the Secretary or an Assistant Secretary of
the Corporation shall give to each stockholder entitled to vote
at the meeting and each other shareholder entitled to notice of
the meeting written notice stating (1) the time and place of the
meeting and, (2) the purpose or purposes of the meeting if the
meeting is a special meeting or if notice of the purpose is
required by statute to be given. Such notice shall be personally
delivered to the shareholder, or left at his residence or usual
place of business, or mailed to him at his address as it appears
on the records of the Corporation. No notice of a shareholders'
meeting need be given to any shareholder who shall sign a written
waiver of such notice, whether before or after the meeting, which
is filed with the records of stockholders' meetings, or to any
stockholder who is present at the meeting in person or by proxy.
Notice of adjournment of a stockholders' meeting to another time
or place need not be given if such time and place are announced
at the meeting, unless the adjournment is for more than 30 days
or a new record date is fixed. [ MGCL, Section 2-504 ]
Section 2.05.Voting - In General: At every stockholders' meeting each stockholder shall be entitled to one vote for each share of stock of the Corporation validly issued and outstanding and held by such stockholder, except that no shares held by the Corporation shall be entitled to a vote. Fractional shares shall be entitled to fractional votes. Except as otherwise specifically provided in the Articles of Incorporation or these By-Laws or as required by provisions of the United States Investment Company Act as amended from time to time, a majority of all the votes cast at a meeting at which a quorum is present is sufficient to approve any matter which properly comes
before the meeting. The vote upon any questions shall be by ballot whenever requested by any person entitled to vote, but, unless such a request is made voting may be conducted in any way approved by the meeting. [ MGCL, Sections 2-506(a)(2), 2-507(a), 2-509(b) ]
Section 2.06.Stockholders Entitled to Vote: If, pursuant to Section 8.05 hereof, a record date has been fixed for the determination of stockholders entitled to notice of or to vote at any stockholders' meeting, each stockholder of the Corporation shall be entitled to vote in person or by proxy, each share or fraction of a share of stock standing in his name on the books of the Corporation on such record date and outstanding at the time of the meeting. If no record date has been fixed for the determination of stockholders, the record date for the determination of stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day on which notice of the meeting is mailed or the 30th day before the meeting whichever is the closer date to the meeting, or, if notice is waived by all stockholders, at the close of business on the tenth day next preceding the date of the meeting.
[ MGCL, Sections 2-507, 2-511 ]
Section 2.07.Voting - Proxies: The right to vote by proxy shall exist only if the instrument authorizing such proxy to act shall have been executed in writing by the stockholder himself, or by his attorney thereunto duly authorized in writing.
No proxy shall be valid more than eleven months after its date unless it provides for a longer period. [ MGCL, Section 2-507 ]
Section 2.08.Quorum: The presence at any stockholders' meeting, in person or by proxy, of stockholders entitled to cast a majority of the votes entitled to be cast at the meeting shall constitute a quorum. [ MGCL, Section 2-506 ]
Section 2.09.Absence of Quorum: In the absence of a quorum, the holders of a majority of shares entitled to vote at the meeting and present thereat in person or by proxy, or if no stockholder entitled to vote is present in person or by proxy, any officer present who is entitled to preside at or act as Secretary of such meeting, may adjourn the meeting sine die or from time to time. Any business that might have been transacted at the meeting originally called may be transacted at any such adjourned meeting at which a quorum is present.
Section 2.10.Stock Ledger and List of Stockholders: It shall be the duty of the Secretary or Assistant Secretary of the Corporation to cause an original or duplicate stock ledger to be maintained at the office of the Corporation's transfer agent, containing the names and addresses of all stockholders and the number of shares of each class held by each stockholder. Such stock ledger may be in written form or any other form capable of being converted into written form within a reasonable time for visual inspection. Any one or more persons, who together are and for at least six months have been stockholders of record of at least 5% of the outstanding capital stock of the Corporation, may submit (unless the Corporation at the time of the request maintains a duplicate stock ledger at its principal office) a written request to any officer of the Corporation or its resident agent in Maryland for a list of the stockholders of the Corporation. Within 20 days after such a request, there shall be prepared and filed at the Corporation's principal office a list, verified under oath by an officer of the Corporation or by its stock transfer agent or registrar, which sets forth the name and address of each stockholder and the number of shares of each class which the stockholder holds. [ MGCL, Sections 2-209, 2-513 ]
BOARD OF DIRECTORS
Section 3.01.Number and Term of Office: The Board of Directors shall consist of five Directors, which number may be increased or decreased by a resolution of a majority of the entire Board of Directors, provided that the number of Directors shall not be less than three nor more than 15. Each Director (whenever elected) shall hold office until the next annual meeting of stockholders and until his successor is elected and qualifies or until his earlier death, resignation, or removal. [ MGCL, Sections 2-402, 2-404 ]
Section 3.02.Qualification of Directors: No member of the Board of Directors need be a stockholder of the Corporation but at least one member of the Board of Directors shall be a person who is not an interested person (as such term is defined in the Investment Company Act of 1940, as amended) of the investment adviser of the Corporation nor an officer or employee of the Corporation. [ MGCL, Section 2-403; Investment Company Act, Section 10(d) ]
Section 3.03.Election of Directors: Until the first
annual meeting of shareholders or until successors are duly
elected and qualified, the Board of Directors shall consist of
the persons named as such in the Articles of Incorporation.
Thereafter, except as otherwise provided in Sections 3.04 and
3.05 hereof at each annual meeting, the shareholders shall elect
Directors to hold office until the next annual meeting and/or
until their successors are elected and qualify. In the event
that Directors are not elected at an annual stockholders'
meeting, then Directors may be elected at a special shareholders'
meeting. Directors shall be elected by vote of the holders of a
majority of the shares present in person or by proxy and entitled
to vote. [ MGCL, Section 2-404 ]
(Section 3.03. Election of Directors as amended January 21,
1988)
Section 3.04.Removal of Directors: At any meeting of stockholders, duly called and at which a quorum is present, the stockholders may, by the affirmative vote of the holders of a majority of the votes entitled to be cast thereon, remove any Director or Directors from office, either with or without cause, and may elect a successor or successors to fill any resulting vacancies for the unexpired terms of removed Directors. [ MGCL, Sections 2-406, 2-407 ]
Section 3.05.Vacancies and Newly Created Directorships:
If any vacancies occur in the Board of Directors by reason of
resignation, removal or otherwise, or if the authorized number of
Directors is increased, the Directors then in office shall
continue to act, and such vacancies (if not previously filled by
the stockholders) may be filled by a majority of the Directors
then in office, whether or not a quorum, provided that,
immediately after filling such vacancy, at least two-thirds of
the Directors then holding office shall have been elected to such
office by the stockholders of the Corporation. In the event that
at any time, other than the time preceding the first meeting of
stockholders, less than a majority of the Directors of the
Corporation holding office at that time were so elected by the
stockholders, a meeting of the stockholders shall be held
promptly and in any event within 60 days for the purpose of
electing Directors to fill any existing vacancies in the Board of
Directors unless the Securities and Exchange Commission shall by
order extend such period. Except as provided in Section 3.04
hereof, a Director elected by the Board of Directors to fill a
vacancy shall be elected to hold office until the next annual
meeting of stockholders or until his successor is elected and
qualifies. [ MGCL, Section 2-407; Investment Company Act,
Section 16(a) ]
Section 3.06.General Powers:
(a) The property, affairs, and business of the Corporation shall be managed under the direction of the Board of Directors, which may exercise all the powers of the Corporation except such as are by law, by the Articles of Incorporation or by these By-Laws conferred upon or reserved to the stockholders of the Corporation. [ MGCL, Section 2-401 ]
(b) All acts done by any meeting of the Directors or by any person acting as a Director, so long as his successor shall not have been duly elected or appointed, shall, notwithstanding that it be afterwards discovered that there was some defect in the election of the Directors or such person acting as a Director or that they or any of them were disqualified, be as valid as if the Directors or such person, as the case may be, had been duly elected and were or was qualified to be Directors or a Director of the Corporation.
Section 3.07.Power to Issue and Sell Stock: The Board
of Directors may from time to time authorize by resolution the
issuance and sale of any of the Corporation's authorized shares
to such persons as the Board of Directors shall deem advisable
and such resolution shall set the minimum price or value of
consideration for the stock or a formula for its determination,
and shall include a fair description of any consideration other
than money and a statement of the actual value of such
consideration as then determined by the Board of Directors or a
statement that the Board of Directors has determined that the
actual value is or will be not less than a certain sum. [ MGCL,
Section 2-203 ]
Section 3.08.Power to Declare Dividends:
(a) The Board of Directors, from time to time as it may deem advisable, may declare and the Corporation pay dividends, in cash, property or shares of the Corporation available for dividends out of any source available for dividends, to the stockholders according to their respective rights and interests. [ MGCL, Section 2-309 ]
(b) The Board of Directors shall cause to be accompanied by a written statement any dividend payment wholly or partly from any source other than the Corporation's accumulated undistributed net income (determined in accordance with good accounting practice and the rules and regulations of the Securities and Exchange Commission then in effect) not including profits or losses realized upon the sale of securities or other properties. Such statement shall adequately disclose the source or sources of such payment and the basis of calculation and shall be otherwise in such form as the Securities and Exchange Commission may prescribe. [ Investment Company Act, Section 19; SEC Rule 19a-1; MGCL, Section 2-309(c) ]
(c) Notwithstanding the above provisions of this
Section 3.08, the Board of Directors may at any time declare and
distribute pro rata among the stockholders a stock dividend out
of the Corporation's authorized but unissued shares of stock,
including any shares previously purchased by the Corporation,
provided that such dividend shall not be distributed in shares of
any class with respect to any shares of a different class. The
shares so distributed shall be issued at the par value thereof,
and there shall be transferred to stated capital, at the time
such dividend is paid, an amount of surplus equal to the
aggregate par value of the shares issued as a dividend and there
may be transferred from earned surplus to capital surplus such
additional amount as the Board of Directors may determine. [
MGCL, Section 2-309 ]
Section 3.09.Annual and Regular Meetings: The annual
meeting of the Board of Directors for choosing officers and
transacting other proper business shall be held immediately after
the annual shareholders' meeting at such place as may be
specified in the notice of such meeting of the Board of
Directors, or, in the absence of such annual shareholders'
meeting, at such time and place as the Board of Directors may
provide. The Board of Directors from time to time may provide by
resolution for the holding of regular meetings and fix their time
and place (within or outside the State of Maryland). [ MGCL,
Section 2-409 ]
(Section 3.09. Annual and Regular Meetings as amended January
21, 1988)
Section 3.l0.Special Meetings: Special meetings of the Board of Directors shall be held whenever called by the Chairman of the Board, the President (or, in the absence or disability of the President, by any Vice President), the Treasurer, or two or more Directors, at the time and place (within or outside the State of Maryland) specified in the respective notices or waivers of notice of such meetings.
Section 3.11.Notice: Notice of annual, regular, and special meetings, stating the time and place, shall be mailed to each Director at his residence or regular place of business or caused to be delivered to him personally or to be transmitted to him by telegraph, cable or wireless at least two days before the day on which the meeting is to be held. Such notice need not include a statement of the business to be transacted at, or the purpose of, the meeting. [ MGCL, Section 2-409(b) ]
Section 3.12.Waiver of Notice: No notice of any meeting need be given to any Director who is present at the meeting or to any Director who signs a waiver of the notice of the meeting (which waiver shall be filed with the records of such meeting), whether before or after the meeting. [ MGCL, Section 2-409(c) ]
Section 3.13.Quorum and Voting: At all meetings of the Board of Directors the presence of one-third of the total number of Directors authorized, but not less than two Directors, shall constitute a quorum. In the absence of a quorum, a majority of the Directors present may adjourn the meeting, from time to time, until a quorum shall be present. The action of a majority of the Directors present at a meeting at which a quorum is present shall be the action of the Board of Directors unless the concurrence of a greater proportion is required for such action by law, by the Articles of Incorporation or by these By-Laws. [ MGCL, Section 2-408 ]
Section 3.14.Conference Telephone: Members of the
Board of Directors or of any committee designated by the Board,
may participate in a meeting of the Board or of such committee by
means of a conference telephone or similar communications
equipment if all persons participating in the meeting can hear
each other at the same time, and participation by such means
shall constitute presence in person at such meeting. [ MGCL,
Section 2-409(d) ]
Section 3.15.Compensation: Each Director may receive remuneration for his services as shall be fixed from time to time by resolution of the Board of Directors.
Section 3.16.Action Without a Meeting: Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if a unanimous written consent which sets forth the action is signed by all members of the Board or
of such committee and such written consent is filed with the
minutes of proceedings of the Board or committee. [ MGCL,
Section 2-408(c) ]
Section 3.17.Director Emeritus: Upon the retirement of
a Director of the Corporation, the Board of Directors may
designate such retired Director as a Director Emeritus. The
position of Director Emeritus shall be honorary only and shall
not confer upon such Director Emeritus any responsibility, or
voting authority, whatsoever with respect to the Corporation. A
Director Emeritus may, but shall not be required to attend the
meetings of the Board of Directors and receive materials normally
provided Directors relating to the Corporation. The Board of
Directors may establish such compensation as it may deem
appropriate under the circumstances to be paid by the Fund to a
Director Emeritus.
(Section 3.17. Director Emeritus added February 23, 1983)
ARTICLE IV
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 4.01.How Constituted: By resolution adopted by
the Board of Directors, the Board may appoint from among its
members one or more committees, including an Executive Committee,
each consisting of at least two Directors. Each member of a
committee shall hold office during the pleasure of the Board. [
MGCL, Section 2-411 ]
(Section 4.01. How Constituted as amended October 27, 1982)
Section 4.02.Powers of the Executive Committee: Unless otherwise provided by resolution of the Board of Directors, the Executive Committee, in the intervals between meetings of the Board of Directors, shall have and may exercise all of the powers of the Board of Directors to manage the business and affairs of the Corporation except the power to declare dividends, to issue stock, or to recommend to stockholders any action which requires stockholder approval. [ MGCL, Section 2-411(a) ]
Section 4.03.Other Committees of the Board of
Directors: To the extent provided by resolution of the Board,
other committees shall have and may exercise any of the powers
that may lawfully be granted to the Executive Committee. [ MGCL,
Section 2-411(a) ]
Section 4.04.Proceedings, Quorum, and Manner of Acting:
In the absence of appropriate resolution of the Board of Directors, each committee may adopt such rules and regulations governing its proceedings, quorum and manner of acting as it shall deem proper and desirable, provided that the quorum shall not be less than two Directors. In the absence of any member of any such committee, the members thereof present at any meeting, whether or not they constitute a quorum, may appoint a member of the Board of Directors to act in the place of such absent member.
[ MGCL, Section 2-411(b) ]
Section 4.05.Other Committees: The Board of Directors may appoint other committees, each consisting of one or more persons who need not be Directors. Each such committee shall have such powers and perform such duties as may be assigned to it from time to time by the Board of Directors, but shall not exercise any power which may lawfully be exercised only by the Board of Directors or a committee thereof.
ARTICLE V
Section 5.01.General: The officers of the Corporation shall be a President, one or more Vice Presidents (one or more of whom may be designated Executive Vice President), a Secretary, and a Treasurer, and may include one or more Assistant Vice Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers as may be appointed in accordance with the provisions of Section 5.11 hereof. The Board of Directors may elect, but shall not be required to elect, a Chairman of the Board. [ MGCL, Section 2-412 ]
Section 5.02.Election, Term of Office and
Qualifications: The officers of the Corporation (except those
appointed pursuant to Section 5.11 hereof) shall be elected by
the Board of Directors at its first meeting and thereafter at
each annual meeting of the Board. If any officer or officers are
not elected at any such meeting, such officer or officers may be
elected at any subsequent regular or special meeting of the
Board. Except as provided in Sections 5.03, 5.04 and 5.05
hereof, each officer elected by the Board of Directors shall hold
office until the next annual meeting of the Board of Directors
and until his successor shall have been chosen and qualified.
Any person may hold two or more offices of the Corporation,
except that neither the Chairman of the Board nor the President
may hold the office of Vice President, but no person shall
execute, acknowledge, or verify any instrument in more than one
capacity if such instrument is required by law, the Articles of
Incorporation or these By-Laws to be executed, acknowledged, or
verified by two or more officers. The Chairman of the Board and
the President shall be selected from among the Directors of the
Corporation and may hold such offices only so long as they
continue to be Directors. No other officer need be a Director.
[ MGCL, Sections 2-413, 2-415 ]
(Section 5.02. Election, Term of Office and Qualifications as
amended January 21, 1988)
Section 5.03.Resignation: Any officer may resign his office at any time by delivering a written resignation to the Board of Directors, the President, the Secretary, or any Assistant Secretary. Unless otherwise specified therein, such resignation shall take effect upon delivery.
Section 5.04.Removal: Any officer may be removed from office by the Board of Directors whenever in the judgment of the Board of Directors the best interests of the Corporation will be served thereby. [ MGCL, Section 2-413(c) ]
Section 5.05Vacancies and Newly Created Offices: If any vacancy shall occur in any office by reason of death, resignation, removal, disqualification or other cause, or if any new office shall be created, such vacancies or newly created offices may be filled by the Board of Directors at any meeting or, in the case of any office created pursuant to Section 5.11 hereof, by any officer upon whom such power shall have been conferred by the Board of Directors. [ MGCL, Section 2-413(d) ]
Section 5.06.Chairman of the Board: Unless otherwise provided by resolution of the Board of Directors, the Chairman of the Board, if there be such an officer, shall be the chief executive and operating officer of the Corporation, shall preside at all shareholders' meetings and at all meetings of the Board of Directors. He shall be ex officio a member of all standing committees of the Board of Directors. Subject to the supervision of the Board of Directors, he shall have general charge of the business, affairs, property and operation of the Corporation and its officers, employees and agents. He may sign (unless the President or a Vice President shall have signed)
certificates representing stock of the Corporation authorized for
issuance by the Board of Directors and shall have such other
powers and perform such other duties as may be assigned to him
from time to time by the Board of Directors.
(Section 5.06. Chairman of the Board as amended October 27,
1982)
Section 5.07.President: Unless otherwise provided by resolution of the Board of Directors, the President shall, at the request of or in the absence or disability of the Chairman of the Board or if no Chairman of the Board has been chosen, preside at all shareholders' meetings and at all meetings of the Board of Directors and shall in general exercise the powers and perform the duties of the Chairman of the Board. He may sign (unless the Chairman or a Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. Except as the Board of Directors may otherwise order, he may sign in the name and on behalf of the Corporation all deeds, bonds, contracts or agreements. He shall exercise such other powers and perform such other duties as from time to time may be assigned to him by the Board of Directors.
(Section 5.07. President as amended October 27, 1982)
Section 5.08.Vice President: The Board of Directors shall, from time to time, designate and elect one or more Vice Presidents (one or more of whom may be designated Executive Vice President) who shall have such powers and perform such duties as from time to time may be assigned to them by the Board of Directors or the President. At the request or in the absence or disability of the President, the Vice President (or, if there are two or more Vice Presidents, the Vice President in order of seniority of tenure in such office or in such other order as the Board of Directors may determine) may perform all the duties of the President and, when so acting, shall have all the powers of and be subject to all the restrictions upon the President. Any Vice President may sign (unless the Chairman, the President or another Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors.
Section 5.09.Treasurer and Assistant Treasurers: The Treasurer shall be the principal financial and accounting officer of the Corporation and shall have general charge of the finances and books of account of the Corporation. Except as otherwise provided by the Board of Directors, he shall have general supervision of the funds and property of the Corporation and of the performance by the custodian of its duties with respect thereto. He may countersign (unless an Assistant Treasurer or Secretary or Assistant Secretary shall have countersigned) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. He shall render to the Board of Directors, whenever directed by the Board, an account of the financial condition of the Corporation and of all his transactions as Treasurer; and as soon as possible after the close of each fiscal year he shall make and submit to the Board of Directors a like report for such fiscal year. He shall cause to be prepared annually a full and correct statement of the affairs of the Corporation, including a balance sheet and a financial statement of operations for the preceding fiscal year, which shall be submitted at the annual meeting of stockholders and filed within 20 days thereafter at the principal office of the Corporation. He shall perform all the acts incidental to the office of the Treasurer, subject to the control of the Board of Directors. Any Assistant Treasurer may perform such duties of the Treasurer as the Treasurer or the Board of Directors may assign, and, in the absence of the Treasurer, he may perform all the duties of the Treasurer.
Section 5.10.Secretary and Assistant Secretaries: The Secretary shall attend to the giving and serving of all notices of the Corporation and shall record all proceedings of the meetings of the stockholders and Directors
in one or more books to be kept for that purpose. He shall keep in safe custody the seal of the Corporation and shall have charge of the records of the Corporation, including the stock books and such other books and papers as the Board of Directors may direct and such books, reports, certificates and other documents required by law to be kept, all of which shall at all reasonable times be open to inspection by any Director. He shall countersign (unless the Treasurer, an Assistant Treasurer or an Assistant Secretary shall have countersigned) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. He shall perform such other duties as appertain to his office or as may be required by the Board of Directors. Any Assistant Secretary may perform such duties of the Secretary as the Secretary or the Board of Directors may assign, and, in the absence of the Secretary, he may perform all the duties of the Secretary.
Section 5.11.Subordinate Officers: The Board of Directors from time to time may appoint such other officers or agents as it may deem advisable, each of whom shall have such title, hold office for such period, have such authority and perform such duties as the Board of Directors may determine. The Board of Directors from time to time may delegate to one or more officers or agents the power to appoint any such subordinate officers or agents and to prescribe their respective rights, terms of office, authorities and duties. [ MGCL, Section 2-412(b) ]
Section 5.12.Remuneration: The salaries or other compensation of the officers of the Corporation shall be fixed from time to time by resolution of the Board of Directors, except that the Board of Directors may by resolution delegate to any person or group of persons the power to fix the salaries or other compensation of any subordinate officers or agents appointed in accordance with the provisions of Section 5.11 hereof.
ARTICLE VI
CUSTODY OF SECURITIES AND CASH
Section 6.01.Employment of a Custodian: The Corporation shall place and at all times maintain in the custody of a Custodian (including any sub-custodian for the Custodian) all funds, securities and similar investments owned by the Corporation. The Custodian (and any sub-custodian) shall be a bank having an aggregate capital, surplus and undivided profits of not less than $10,000,000. The Custodian shall be appointed and its remuneration fixed by the Board of Directors. [ Investment Company Act, Section 17(f) ]
Section 6.02.Central Certificate Service: Subject to such rules, regulations, and orders as the Securities and Exchange Commission may adopt as necessary or appropriate for the protection of investors, the Corporation's Custodian may deposit all or any part of the securities owned by the Corporation in a system for the central handling of securities established by a national securities exchange or national securities association registered with the Commission under the Securities Exchange Act of 1934, or such other person as may be permitted by the Commission, pursuant to which system all securities of any particular class or series of any issuer deposited within the system are treated as fungible and may be transferred or pledged by bookkeeping entry without physical delivery of such securities. [ Investment Company Act, Section 17(f) ]
Section 6.03.Cash Assets: The cash proceeds from the sale of securities and similar investments and other cash assets of the Corporation shall be kept in the custody of a bank or banks appointed pursuant to Section 6.01 hereof, or in accordance with such rules and regulations or orders as the Securities and Exchange Commission may from time to time prescribe for the protection of investors, except that the Corporation may maintain a checking account in a bank or banks, each having an aggregate capital, surplus and undivided profits of not less than $10,000,000, provided that the balance of such account or the aggregate balances of such accounts shall at no time exceed the amount of the fidelity bond, maintained pursuant to the requirements of the Investment Company Act of 1940 and rules and regulations thereunder, covering the officers or employees authorized to draw on such account or accounts. [ Investment Company Act, Section 17(f) ]
Section 6.04.Free Cash Accounts: The Corporation may,
upon resolution of its Board of Directors, maintain a petty cash
account free of the foregoing requirements of this Article VI in
an amount not to exceed $500, provided that such account is
operated under the imprest system and is maintained subject to
adequate controls approved by the Board of Directors over
disbursements and reimbursements including, but not limited to,
fidelity bond coverage for persons having access to such funds.
[ Investment Company Act, Rule 17f-3 ]
Section 6.05.Action Upon Termination of Custodian Agreement: Upon resignation of a custodian of the Corporation or inability of a custodian to continue to serve, the Board of Directors shall promptly appoint a successor custodian, but in the event that no successor custodian can be found who has the required qualifications and is willing to serve, the Board of Directors shall call as promptly as possible a special meeting of the stockholders to determine whether the Corporation shall function without a custodian or shall be liquidated. If so directed by vote of the holders of a majority of the outstanding shares of stock of the Corporation, the custodian shall deliver and pay over all property of the Corporation held by it as specified in such vote.
ARTICLE VII
EXECUTION OF INSTRUMENTS, VOTING OF SECURITIES
Section 7.01.Execution of Instruments: All deeds, documents, transfers, contracts, agreements, requisitions or orders, promissory notes, assignments, endorsements, checks and drafts for the payment of money by the Corporation, and other instruments requiring execution by the Corporation shall be signed by the Chairman, the President, a Vice President, or the Treasurer, or as the Board of Directors may otherwise, from time to time, authorize. Any such authorization may be general or confined to specific instances.
Section 7.02.Voting of Securities: Unless otherwise ordered by the Board of Directors, the Chairman, the President, or any Vice President shall have full power and authority on behalf of the Corporation to attend and to act and to vote, or in the name of the Corporation to execute proxies to vote, at any meeting of stockholders of any company in which the Corporation may hold stock. At any such meeting such officer shall possess and may exercise
(in person or by proxy) any and all rights, powers and privileges incident to the ownership of such stock. The Board of Directors may by resolution from time to time confer like powers upon any other person or persons. [ MGCL, Section 2-509 ]
ARTICLE VIII
CAPITAL STOCK
Section 8.01.Ownership of Shares:
(a) Certificates certifying the ownership of shares will not be issued for shares purchased or otherwise acquired after July 1, 1991. The ownership of shares, full or fractional, shall be recorded on the books of the Corporation or its agent. The record books of the Corporation as kept by the Corporation or its agent, as the case may be, shall be conclusive as to the number of shares held from time to time by each such shareholder. The Corporation reserves the right to require the surrender of outstanding certificates if the Board of Directors so determines. [ MGCL, Section 210(c) ]
(b) Every certificate exchanged, surrendered for
redemption or otherwise returned to the Corporation shall be
marked "Cancelled" with the date of cancellation.
(Section 8.01. Ownership of Shares as amended July 1, 1991)
Section 8.02.Transfer of Capital Stock:
(a) Shares of stock of the Corporation shall be transferable only upon the books of the Corporation kept for such purpose and, if one or more certificates representing such shares have been issued, upon surrender to the Corporation or its transfer agent or agents of such certificate or certificates duly endorsed or accompanied by appropriate evidence of assignment, transfer, succession or authority to transfer.
(b) The Corporation shall be entitled to treat the holder of record of any share of stock as the absolute owner thereof for all purposes, and accordingly shall not be bound to recognize any legal, equitable or other claim or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by the statutes of the State of Maryland.
Section 8.03.Transfer Agents and Registrars: The Board
of Directors may, from time to time, appoint or remove transfer
agents and registrars of transfers of shares of stock of the
Corporation, and it may appoint the same person as both transfer
agent and registrar.
(Section 8.03. Transfer Agents and Registrars as amended July 1,
1991)
Section 8.04.Transfer Regulations: The shares of stock
of the Corporation may be freely transferred, and the Board of
Directors may, from time to time, adopt lawful rules and
regulations with reference to the method of transfer of the
shares of stock of the Corporation.
Section 8.05.Fixing of Record Date: The Board of Directors may fix in advance a date as a record date for the determination of the stockholders entitled to notice of or to vote at any meeting of shareholders or any
adjournment thereof, or to express consent to corporate action in writing without a meeting, or to receive payment of any dividend or other distribution or allotment of any rights, or to exercise any rights in respect of any change, conversion or exchange of stock, or for any other proper purpose, provided that such record date shall be a date not more than 60 days nor, in the case of a meeting of stockholders, less than 10 days prior to the date on which the particular action, requiring such determination of stockholders, is to be taken. In such case only such stockholders as shall be stockholders of record on the record date so fixed shall be entitled to such notice of, and to vote at, such meeting or adjournment, or to give such consent, or to receive payment of such dividend or other distribution, or to receive such allotment of rights, or to exercise such rights, or to take other action, as the case may be, notwithstanding any transfer of any shares on the books of the Corporation after any such record date. [ MGCL, Section 2-511 ]
Section 8.06.Lost, Stolen or Destroyed Certificates:
If a certificate for stock of the Corporation is alleged to have
been lost, stolen or destroyed, no new certificate will be
issued. Instead, ownership of the shares formerly represented by
the lost, stolen or destroyed certificate shall be recorded on
the books of the Corporation or its agent, in accordance with the
provisions of Section 8.01 of these By-Laws. Before recording
ownership of such shares, the Board of Directors, or any officer
authorized by the Board, may, in its discretion, require the
owner of the lost, stolen, or any destroyed certificate (or his
legal representative) to give the Corporation a bond or other
indemnity, in such form and in such amount as the Board or any
such officer may direct and with such surety or sureties as may
be satisfactory to the Board of any such officer, sufficient to
indemnify the Corporation against any claim that may be made
against it on account of the alleged loss, theft, or destruction
of any such certificate. [ MGCL, Section 2-213 ]
(Section 8.06. Lost, Stolen or Destroyed Certificates as amended
July 1, 1991)
ARTICLE IX
FISCAL YEAR, ACCOUNTANT
Section 9.01.Fiscal Year: The fiscal year of the
Corporation shall be the twelve (12) calendar months beginning on
the 1st day of March in each year and ending on the last day of
the following February, or such other period of twelve (12)
calendar months as the Board of Directors may by resolution
prescribe.
(Section 9.01 Fiscal Year as amended January 1, 1983)
Section 9.02.Accountant:
(a) The Corporation shall employ an independent public accountant or firm of independent public accountants as its accountant to examine the accounts of the Corporation and to sign and certify financial statements filed by the Corporation. The accountant's certificates and reports shall be addressed both to the Board of Directors and to the stockholders.
(b) A majority of the members of the Board of Directors who are not interested persons (as such term is defined in the Investment Company Act of 1940 as amended) of the Corporation shall select the accountant, by vote cast
in person, at any meeting held before the first annual stockholders' meeting, and thereafter shall select the accountant annually, by vote cast in person, at a meeting held within 30 days before or after the beginning of the fiscal year of the Corporation or 30 days before the annual stockholders' meeting in that year. Such selection shall be submitted for ratification or rejection at the next succeeding annual stockholders' meeting. If such meeting shall reject such selection, the accountant shall be selected by majority vote of the Corporation's outstanding voting securities, either at the meeting at which the rejection occurred or at a subsequent meeting of stockholders called for the purpose.
(c) Any vacancy occurring between annual meetings, due to the death or resignation of the accountant, may be filled by the vote of a majority of those members of the Board of Directors who are not interested persons (as so defined) of the Corporation, cast in person at a meeting called for the purpose of voting on such action.
(d) The employment of the accountant shall be conditioned upon the right of the Corporation by vote of a majority of the outstanding voting securities at any meeting called for the purpose to terminate such employment forthwith without any penalty. [ Investment Company Act, 32(a) ]
ARTICLE X
INDEMNIFICATION AND INSURANCE
Section 10.01. Indemnification and Payment of Expenses in Advance: The Corporation shall indemnify any individual ("Indemnitee") who is a present or former director, officer, employee, or agent of the Corporation, or who is or has been serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, who, by reason of his position was, is, or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (hereinafter collectively referred to as a "Proceeding") against any judgments, penalties, fines, settlements, and reasonable expenses (including attorneys' fees) incurred by such Indemnitee in connection with any Proceeding, to the fullest extent that such indemnification may be lawful under applicable Maryland law, as from time to time amended. The Corporation shall pay any reasonable expenses so incurred by such Indemnitee in defending a Proceeding in advance of the final disposition thereof to the fullest extent that such advance payment may be lawful under applicable Maryland law, as from time to time amended. Subject to any applicable limitations and requirements set forth in the Corporation's Articles of Incorporation and in these By-Laws, any payment of indemnification or advance of expenses shall be made in accordance with the procedures set forth in applicable Maryland law, as from time to time amended.
Notwithstanding the foregoing, nothing herein shall protect or purport to protect any Indemnitee against any liability to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of his office ("Disabling Conduct").
Anything in this Article X to the contrary notwithstanding, no indemnification shall be made by the Corporation to any Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors who are neither "interested persons" of the Corporation, as defined in Section 2(a)(19) of the Investment Company Act, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Anything in this Article X to the contrary notwithstanding, any advance of expenses by the Corporation to any Indemnitee shall be made only upon the undertaking by such Indemnitee to repay the advance unless it is ultimately determined that such Indemnitee is entitled to indemnification as above provided, and only if one of the following conditions is met:
(a) the Indemnitee provides a security for his undertaking; or
(b) the Corporation shall be insured against losses arising by reason of any lawful advances; or
(c) there is a determination, based on a review of readily available facts, that there is reason to believe that the Indemnitee will ultimately be found entitled to indemnification, which determination shall be made by:
(i) a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Section 10.02. Insurance of Officers, Directors, Employees and Agents: To the fullest extent permitted by applicable Maryland law and by Section 17(h) of the Investment Company Act of 1940, as from time to time amended, the Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Corporation, or who is or was serving at the request of the Corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against any liability asserted against him and incurred by him in or arising out of his position, whether or not the Corporation would have the power to indemnify him against such liability. [ MGCL, Section 2-418(k) ]
(ARTICLE X - INDEMNIFICATION AND INSURANCE - as amended January 21, 1982)
AMENDMENTS
Section 11.01. General: Except as provided in Section 11.02 hereof, all By-Laws of the Corporation, whether adopted by the Board of Directors or the stockholders, shall be subject to amendment, alteration, or repeal, and new By-Laws may be made by the affirmative vote of a majority of either:
(a) the holders of record of the outstanding shares of stock of the Corporation entitled to vote, at any annual or special meeting the notice or waiver of notice of which shall have specified or summarized the proposed amendment, alteration, repeal, or new By-Law; or
(b) the Directors present at any regular or special meeting at which a quorum is present if the notice or waiver of notice thereof or material sent to the Directors in connection therewith on or prior to the last date for the giving of such notice under these By-Laws shall have specified or summarized the proposed amendment, alteration, repeal, or new By-Law.
Section 11.02. By Stockholders Only:
(a) No amendment of any section of these By-Laws shall be made except by the stockholders of the Corporation if the stockholders shall have provided in the By-Laws that such section may not be amended, altered, or repealed except by the stockholders.
(b) From and after the issue of any shares of the Capital Stock of the Corporation, no amendment of this Article XI shall be made except by the stockholders of the Corporation.
MISCELLANEOUS
Section 12.01. Use of the Term "Annual Meeting": The
use of the term "annual meeting" in these By-Laws shall not be
construed as implying a requirement that a shareholder meeting be
held annually.
(ARTICLE XII - MISCELLANEOUS - added January 21, 1988)
dld/agmts/BYLAWS.TIF
BY-LAWS
OF
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
AS AMENDED:
MAY 1, 1981
JANUARY 21, 1982
OCTOBER 27, 1982
JANUARY 1, 1983
FEBRUARY 23, 1983
JANUARY 21, 1988
APRIL 20, 1990
JULY 1, 1991
JULY 20, 1993
TABLE OF CONTENTS
Page
ARTICLE I. NAME OF CORPORATION, LOCATION OF
OFFICES AND SEAL. . . . . . . . . . .1
1.01. Name. . . . . . . . . . . . . . . . .1
1.02. Principal Office. . . . . . . . . . .1
1.03. Seal. . . . . . . . . . . . . . . . .1
ARTICLE II.. . . . . . . . . . . . . STOCKHOLDERS1
2.01 Annual Meetings . . . . . . . . . . .1
2.02. Special Meetings. . . . . . . . . . .2
2.03. Place of Meetings . . . . . . . . . 2
2.04. Notice of Meetings. . . . . . . . . .2
2.05. Voting - in General . . . . . . . . .2
2.06. Stockholders Entitled to Vote . . . .3
2.07. Voting - Proxies. . . . . . . . . . .3
2.08. Quorum. . . . . . . . . . . . . . . .3
2.09. Absence of Quorum . . . . . . . . . .3
2.10. Stock Ledger and List of Stockholders3
ARTICLE III. BOARD OF
DIRECTORS 4
3.01. Number and Term of Office . . . . . .4
3.02. Qualification of Directors. . . . . .4
3.03. Election of Directors . . . . . . . .4
3.04. Removal of Directors. . . . . . . . .4
3.05. Vacancies and Newly Created Directorships4
3.06. General Powers. . . . . . . . . . . .5
3.07. Power to Issue and Sell Stock . . . .5
3.08. Power to Declare Dividends. . . . . .5
3.09. Annual and Regular Meetings . . . . .6
3.10. Special Meetings. . . . . . . . . . .6
3.11. Notice. . . . . . . . . . . . . . . .6
3.12. Waiver of Notice. . . . . . . . . . .6
3.13. Quorum and Voting . . . . . . . . . .6
3.14. Conference Telephone. . . . . . . . .6
3.15. Compensation. . . . . . . . . . . . .6
3.16. Action without a Meeting. . . . . . .6
3.17. Director Emeritus . . . . . . . . . .7
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PAGE 62
ARTICLE IV. EXECUTIVE
COMMITTEE AND OTHER
COMMITTEES. . . . . . . . . . . . . .7
4.01. How Constituted . . . . . . . . . . .7
4.02. Powers of the Executive Committee . .7
4.03. Other Committees of the Board of Directors7
4.04. Proceedings, Quorum and Manner of Acting7
4.05. Other Committees. . . . . . . . . . .7
ARTICLE V. OFFICERS. . . . . . . . . . . . . . .8
5.01. General . . . . . . . . . . . . . . .8
5.02. Election, Terms of Office and Qualifications8
5.03. Resignation . . . . . . . . . . . . .8
5.04. Removal . . . . . . . . . . . . . . .8
5.05. Vacancies and Newly Created Offices .8
5.06. Chairman of the Board . . . . . . . .9
5.07. President . . . . . . . . . . . . . .9
5.08. Vice President. . . . . . . . . . . .9
5.09. Treasurer and Assistant Treasurers. .9
5.10. Secretary and Assistant Secretaries 10
5.11. Subordinate Officers. . . . . . . . 10
5.12. Remuneration. . . . . . . . . . . . 10
ARTICLE VI. CUSTODY OF
SECURITIES AND CASH. . . . . . . . . . . . . . 10
6.01. Employment of Custodian . . . . . . 10
6.02. Central Certificate Service . . . . 10
6.03. Cash Assets . . . . . . . . . . . . 11
6.04. Free Cash Accounts. . . . . . . . . 11
6.05. Action Upon Termination of
Custodian Agreement . . . . . . . . 11
ARTICLE VII. EXECUTION OF
INSTRUMENTS,
VOTING OF SECURITIES. . . . . . . . 11
7.01. Execution of Instruments. . . . . . 11
7.02. Voting of Securities. . . . . . . . 12
ARTICLE VIII. CAPITAL STOCK. . . . . . . . . . 12
8.01. Ownership of Shares . . . . . . . . 12
8.02. Transfer of Capital Stock . . . . . 12
8.03. Transfer Agents and Registrars. . . 12
8.04. Transfer Regulations. . . . . . . . 13
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PAGE 63
8.05. Fixing of Record Date . . . . . . . 13
8.06. Lost, Stolen or Destroyed Certificates13
ARTICLE IX. FISCAL YEAR,
ACCOUNTANT 13
9.01. Fiscal Year . . . . . . . . . . . . 13
9.02. Accountant. . . . . . . . . . . . . 13
ARTICLE X. INDEMNIFICATION AND INSURANCE . . . 14
10.01. Indemnification and Payment of Expenses
in Advance. . . . . . . . . . . . . 14
10.02. Insurance of Officers, Directors,
Employees and Agents. . . . . . . . 15
ARTICLE XI. AMENDMENTS16
11.01. General . . . . . . . . . . . . . . 16
11.02. By Stockholders Only. . . . . . . . 16
ARTICLE XII. MISCELLANEOUS17
12.01 Use of the Term "Annual Meeting". . 17
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T. ROWE PRICE TAX-FREE HIGH-YIELD FUND, INC.
(A Maryland Corporation)
|
BY-LAWS
ARTICLE I
NAME OF CORPORATION,
LOCATION OF OFFICES AND SEAL
Section 1.01.Name: The name of the Corporation is
T. ROWE PRICE TAX-FREE HIGH-YIELD FUND, INC.
Section 1.02.Principal Office: The principal office of
the Corporation in the State of Maryland shall be located in the
City of Baltimore. The Corporation may, in addition, establish
and maintain such other offices and places of business, within or
outside the State of Maryland, as the Board of Directors may from
time to time determine. [ MGCL, Sections 2-103(4), 2-
108(a)(1) ]*
Section 1.03.Seal: The corporate seal of the Corporation shall be circular in form, and shall bear the name of the Corporation, the year of its incorporation, and the words "Corporate Seal, Maryland." The form of the seal shall be subject to alteration by the Board of Directors and the seal may be used by causing it or a facsimile to be impressed or affixed or printed or otherwise reproduced. In lieu of affixing the corporate seal to any document it shall be sufficient to meet the requirements of any law, rule, or regulation relating to a corporate seal to affix the word "(Seal)" adjacent to the signature of the authorized officer of the Corporation. Any officer or Director of the Corporation shall have authority to affix the corporate seal of the Corporation to any document requiring the same. [ MGCL, Sections 1-304(b), 2-103(3) ]
ARTICLE II
SHAREHOLDERS
Section 2.01.Annual Meetings: The Corporation shall not be required to hold an annual meeting of its shareholders in any year unless the Investment Company Act of 1940 requires an election of directors by shareholders. In the event that the Corporation shall be so required to hold an annual meeting, such meeting shall be held at a date and time set by the Board of Directors, which date shall be no later than 120 days after the occurrence of the event requiring the _________________________
* Bracketed citations are to the General Corporation Law of the State of Maryland ("MGCL") or to the United States Investment Company Act of 1940, as amended (the "Investment Company Act"), or to Rules of the United States Securities and Exchange Commission thereunder ("SEC Rules"). The citations are inserted for reference only and do not constitute a part of the By-Laws. purposes meeting. Any shareholders' meeting held in accordance with the preceding sentence shall for all constitute the annual meeting of shareholders for the fiscal year of the Corporation in which the meeting is held. At any
such meeting, the shareholders shall elect directors to hold the
offices of any directors who have held office for more than one
year or who have been elected by the Board of Directors to fill
vacancies which result from any cause. Except as the Articles of
Incorporation or statute provides otherwise, Directors may
transact any business within the powers of the Corporation as may
properly come before the meeting. Any business of the
Corporation may be transacted at the annual meeting without being
specially designated in the notice, except such business as is
specifically required by statute to be stated in the notice.
[MGCL, Section 2-501]
(Section 2.01. Annual Meetings as amended April 20,
1990)
Section 2.02.Special Meetings: Special meetings of the
shareholders may be called at any time by the Chairman of the
Board, the President, any Vice President, or by the Board of
Directors. Special meetings of the shareholders shall be called
by the Secretary on the written request of shareholders entitled
to cast at least ten (10) percent of all the votes entitled to be
cast at such meeting, provided that (a) such request shall state
the purpose or purposes of the meeting and the matters proposed
to be acted on, and (b) the shareholders requesting the meeting
shall have paid to the Corporation the reasonably estimated cost
of preparing and mailing the notice thereof, which the Secretary
shall determine and specify to such shareholders. Unless
requested by shareholders entitled to cast a majority of all the
votes entitled to be cast at the meeting, a special meeting need
not be called to consider any matter which is substantially the
same as a matter voted upon at any special meeting of the
shareholders held during the preceding twelve (12) months.
[ MGCL, Section 2-502 ]
(Section 2.02. Special Meetings as amended July 20,
1993)
Section 2.03.Place of Meetings: All shareholders'
meetings shall be held at such place within the United States as
may be fixed from time to time by the Board of Directors.
[ MGCL, Section 2-503 ]
Section 2.04.Notice of Meetings: Not less than ten
(10) days, nor more than ninety (90) days before each
shareholders' meeting, the Secretary or an Assistant Secretary of
the Corporation shall give to each shareholder entitled to vote
at the meeting, and each other shareholder entitled to notice of
the meeting, written notice stating (1) the time and place of the
meeting, and (2) the purpose or purposes of the meeting if the
meeting is a special meeting or if notice of the purpose is
required by statute to be given. Such notice shall be personally
delivered to the shareholder, or left at his residence or usual
place of business, or mailed to him at his address as it appears
on the records of the Corporation. No notice of a shareholders'
meeting need be given to any shareholder who shall sign a written
waiver of such notice, whether before or after the meeting, which
is filed with the records of shareholders' meetings, or to any
shareholder who is present at the meeting in person or by proxy.
Notice of adjournment of a shareholders' meeting to another time
or place need not be given if such time and place are announced
at the meeting, unless the adjournment is for more than one
hundred twenty (120) days after the original record date. [
MGCL, Sections 2-504, 2-511(d) ]
Section 2.05.Voting - In General: At every shareholders' meeting, each shareholder shall be entitled to one vote for each share of stock of the Corporation validly issued and outstanding and held by such shareholder, except that no shares held by the Corporation shall be entitled to a vote. Fractional shares shall be entitled to fractional votes. Except as otherwise specifically provided in the Articles of Incorporation, or these By-Laws, or as required by provisions of the Investment Company Act, a majority of all the votes cast at a meeting at which a quorum is present is sufficient to approve any matter which properly comes before the meeting. The vote upon any
question shall be by ballot whenever requested by any person entitled to vote, but, unless such a request is made, voting may be conducted in any way approved by the meeting. [ MGCL, Sections 2-214(a)(i), 2-506(a)(2), 2-507(a), 2-509(b) ]
Section 2.06.Shareholders Entitled to Vote: If, pursuant to Section 8.05 hereof, a record date has been fixed for the determination of shareholders entitled to notice of or to vote at any shareholders' meeting, each shareholder of the Corporation shall be entitled to vote in person or by proxy, each share or fraction of a share of stock outstanding in his name on the books of the Corporation on such record date. If no record date has been fixed for the determination of shareholders, the record date for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the day on which notice of the meeting is mailed or the 30th day before the meeting, whichever is the closer date to the meeting, or, if notice is waived by all shareholders, at the close of business on the tenth (10th) day next preceding the date of the meeting. [ MGCL, Sections 2-507, 2-511 ]
Section 2.07.Voting - Proxies: The right to vote by proxy shall exist only if the instrument authorizing such proxy to act shall have been executed in writing by the shareholder himself, or by his attorney thereunto duly authorized in writing.
No proxy shall be valid more than eleven (11) months after its date unless it provides for a longer period. [ MGCL, Section 2- 507(b) ]
Section 2.08.Quorum: The presence at any shareholders' meeting, in person or by proxy, of shareholders entitled to cast a majority of the votes entitled to be cast at the meeting shall constitute a quorum. [ MGCL, Section 2-506(a) ]
Section 2.09.Absence of Quorum: In the absence of a quorum, the holders of a majority of shares entitled to vote at the meeting and present thereat in person or by proxy, or, if no shareholder entitled to vote is present in person or by proxy, any officer present who is entitled to preside at or act as Secretary of such meeting, may adjourn the meeting sine die or from time to time. Any business that might have been transacted at the meeting originally called may be transacted at any such adjourned meeting at which a quorum is present.
Section 2.10.Stock Ledger and List of Shareholders: It shall be the duty of the Secretary or Assistant Secretary of the Corporation to cause an original or duplicate stock ledger to be maintained at the office of the Corporation's transfer agent, containing the names and addresses of all shareholders and the number of shares of each class held by each shareholder. Such stock ledger may be in written form, or any other form capable of being converted into written form within a reasonable time for visual inspection. Any one or more persons, who together are and for at least six (6) months have been shareholders of record of at least five percent (5%) of the outstanding capital stock of the Corporation, may submit (unless the Corporation at the time of the request maintains a duplicate stock ledger at its principal office) a written request to any officer of the Corporation or its resident agent in Maryland for a list of the shareholders of the Corporation. Within twenty (20) days after such a request, there shall be prepared and filed at the Corporation's principal office a list, verified under oath by an officer of the Corporation or by its stock transfer agent or registrar, which sets forth the name and address of each shareholder and the number of shares of each class which the shareholder holds. [ MGCL, Sections 2-209, 2-513 ]
Section 2.11.Informal Action By Shareholders: Any action required or permitted to be taken at a meeting of shareholders may be taken without a meeting if the following are filed with the records of shareholders' meetings:
(a) A unanimous written consent which sets forth the action and is signed by each shareholder entitled to vote on the matter; and
(b) A written waiver of any right to dissent signed by each shareholder entitled to notice of the meeting, but not entitled to vote at it. [ MGCL, Section 2- 505 ]
ARTICLE III
BOARD OF DIRECTORS
Section 3.01.Number and Term of Office: The Board of Directors shall consist of one (1) Director, which number may be increased by a resolution of a majority of the entire Board of Directors, provided that the number of Directors shall not be more than fifteen (15) nor less than the lesser of (i) three (3) or (ii) the number of shareholders of the Corporation. Each Director (whenever elected) shall hold office until the next annual meeting of shareholders and until his successor is elected and qualifies or until his earlier death, resignation, or removal. [ MGCL, Sections 2-402, 2-404, 2-405 ]
Section 3.02.Qualification of Directors: No member of the Board of Directors need be a shareholder of the Corporation, but at least one member of the Board of Directors shall be a person who is not an interested person (as such term is defined in the Investment Company Act) of the investment adviser of the Corporation, nor an officer or employee of the Corporation. [ MGCL, Section 2-403; Investment Company Act, Section 10(d) ]
Section 3.03.Election of Directors: Until the first annual meeting of shareholders or until successors are duly elected and qualified, the Board of Directors shall consist of the persons named as such in the Articles of Incorporation. Thereafter, except as otherwise provided in Sections 3.04 and 3.05 hereof, at each annual meeting, the shareholders shall elect Directors to hold office until the next annual meeting and/or until their successors are elected and qualify. In the event that Directors are not elected at an annual shareholders' meeting, then Directors may be elected at a special shareholders' meeting. Directors shall be elected by vote of the holders of a majority of the shares present in person or by proxy and entitled to vote thereon. [ MGCL, Section 2-404 ] (Section 3.03. Election of Directors as amended January 21, 1988)
Section 3.04.Removal of Directors: At any meeting of shareholders, duly called and at which a quorum is present, the shareholders may, by the affirmative vote of the holders of a majority of the votes entitled to be cast thereon, remove any Director or Directors from office, either with or without cause, and may elect a successor or successors to fill any resulting vacancies for the unexpired terms of removed Directors. [ MGCL, Sections 2-406, 2-407 ]
Section 3.05.Vacancies and Newly Created Directorships:
If any vacancies occur in the Board of Directors by reason of resignation, removal or otherwise, or if the authorized number of Directors is increased, the Directors then in office shall continue to act, and such vacancies (if not
previously filled by the shareholders) may be filled by a
majority of the Directors then in office, whether or not
sufficient to constitute a quorum, provided that, immediately
after filling such vacancy, at least two-thirds of the Directors
then holding office shall have been elected to such office by the
shareholders of the Corporation. In the event that at any time,
other than the time preceding the first meeting of shareholders,
less than a majority of the Directors of the Corporation holding
office at that time were so elected by the shareholders, a
meeting of the shareholders shall be held promptly and in any
event within sixty (60) days for the purpose of electing
Directors to fill any existing vacancies in the Board of
Directors unless the Securities and Exchange Commission shall by
order extend such period. Except as provided in Section 3.04
hereof, a Director elected by the Board of Directors to fill a
vacancy shall be elected to hold office until the next annual
meeting of shareholders or until his successor is elected and
qualifies. [ MGCL, Section 2-407; Investment Company Act,
Section 16(a) ]
Section 3.06.General Powers:
(a) The property, business, and affairs of the Corporation shall be managed under the direction of the Board of Directors which may exercise all the powers of the Corporation except such as are by law, by the Articles of Incorporation, or by these By-Laws conferred upon or reserved to the shareholders of the Corporation. [ MGCL, Section 2-401 ]
(b) All acts done by any meeting of the Directors or by any person acting as a Director, so long as his successor shall not have been duly elected or appointed, shall, notwithstanding that it be afterwards discovered that there was some defect in the election of the Directors or such person acting as a Director or that they or any of them were disqualified, be as valid as if the Directors or such person, as the case may be, had been duly elected and were or was qualified to be Directors or a Director of the Corporation.
Section 3.07.Power to Issue and Sell Stock: The Board
of Directors may from time to time authorize by resolution the
issuance and sale of any of the Corporation's authorized shares
to such persons as the Board of Directors shall deem advisable
and such resolution shall set the minimum price or value of
consideration for the stock or a formula for its determination,
and shall include a fair description of any consideration other
than money and a statement of the actual value of such
consideration as determined by the Board of Directors or a
statement that the Board of Directors has determined that the
actual value is or will be not less than a certain sum. [ MGCL,
Section 2-203 ]
Section 3.08.Power to Declare Dividends:
(a) The Board of Directors, from time to time as it may deem advisable, may declare and the Corporation pay dividends, in cash, property, or shares of the Corporation available for dividends out of any source available for dividends, to the shareholders according to their respective rights and interests. [ MGCL, Section 2-309 ]
(b) The Board of Directors shall cause to be accompanied by a written statement any dividend payment wholly or partly from any source other than the Corporation's accumulated undistributed net income (determined in accordance with good accounting practice and the rules and regulations of the Securities and Exchange Commission then in effect) not including profits or losses realized upon the sale of securities or other properties. Such statement shall adequately disclose the source or sources of such payment and the basis of calculation and shall be otherwise in such form as the Securities
and Exchange Commission may prescribe. [ Investment Company Act,
Section 19; SEC Rule 19a-1; MGCL, Section 2-309(c) ]
(c) Notwithstanding the above provisions of this
Section 3.08, the Board of Directors may at any time declare and
distribute pro rata among the shareholders a stock dividend out
of the Corporation's authorized but unissued shares of stock,
including any shares previously purchased by the Corporation,
provided that such dividend shall not be distributed in shares of
any class with respect to any shares of a different class. The
shares so distributed shall be issued at the par value thereof,
and there shall be transferred to stated capital, at the time
such dividend is paid, an amount of surplus equal to the
aggregate par value of the shares issued as a dividend and there
may be transferred from earned surplus to capital surplus such
additional amount as the Board of Directors may determine. [
MGCL, Section 2-309 ]
Section 3.09.Annual and Regular Meetings: The annual
meeting of the Board of Directors for choosing officers and
transacting other proper business shall be held immediately after
the annual shareholders' meeting at such place as may be
specified in the notice of such meeting of the Board of
Directors, or, in the absence of such annual shareholders'
meeting, at such time and place as the Board of Directors may
provide. The Board of Directors from time to time may provide by
resolution for the holding of regular meetings and fix their time
and place (within or outside the State of Maryland). [ MGCL,
Section 2-409(a) ]
(Section 3.09. Annual and Regular Meetings as amended January
21, 1988)
Section 3.10.Special Meetings: Special meetings of the Board of Directors shall be held whenever called by the Chairman of the Board, the President (or, in the absence or disability of the President, by any Vice President), the Treasurer, or two or more Directors, at the time and place (within or outside the State of Maryland) specified in the respective notices or waivers of notice of such meetings.
Section 3.11.Notice: Notice of annual, regular, and special meetings shall be in writing, stating the time and place, and shall be mailed to each Director at his residence or regular place of business or caused to be delivered to him personally or to be transmitted to him by telegraph, cable, or wireless at least two (2) days before the day on which the meeting is to be held. Except as otherwise required by the By-Laws or the Investment Company Act, such notice need not include a statement of the business to be transacted at, or the purpose of, the meeting. [ MGCL, Section 2-409(b) ]
Section 3.12.Waiver of Notice: No notice of any meeting need be given to any Director who is present at the meeting or to any Director who signs a waiver of the notice of the meeting (which waiver shall be filed with the records of the meeting), whether before or after the meeting. [ MGCL, Section 2-409(c) ]
Section 3.13.Quorum and Voting: At all meetings of the Board of Directors the presence of one-third of the total number of Directors authorized, but not less than two (2) Directors if there are at least two directors, shall constitute a quorum. In the absence of a quorum, a majority of the Directors present may adjourn the meeting, from time to time, until a quorum shall be present. The action of a majority of the Directors present at a meeting at which a quorum is present shall be the action of the Board of Directors unless the concurrence of a greater proportion is required for such action by law, by the Articles of Incorporation or by these By-Laws. [ MGCL, Section 2-408 ]
Section 3.14.Conference Telephone: Members of the
Board of Directors or of any committee designated by the Board,
may participate in a meeting of the Board or of such committee by
means of a conference telephone or similar communications
equipment if all persons participating in the meeting can hear
each other at the same time, and participation by such means
shall constitute presence in person at such meeting. [ MGCL,
Section 2-409(d) ]
Section 3.15.Compensation: Each Director may receive such remuneration for his services as shall be fixed from time to time by resolution of the Board of Directors.
Section 3.16.Action Without a Meeting: Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if a unanimous written consent which sets forth the action is signed by all members of the Board or of such committee and such written consent is filed with the minutes of proceedings of the Board or committee. [ MGCL, Section 2-408(c) ]
Section 3.17.Director Emeritus: Upon the retirement of a Director of the Corporation, the Board of Directors may designate such retired Director as a Director Emeritus. The position of Director Emeritus shall be honorary only and shall not confer upon such Director Emeritus any responsibility, or voting authority, whatsoever with respect to the Corporation. A Director Emeritus may, but shall not be required to attend the meetings of the Board of Directors and receive materials normally provided Directors relating to the Corporation. The Board of Directors may establish such compensation as it may deem appropriate under the circumstances to be paid by the Corporation to a Director Emeritus.
ARTICLE IV
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 4.01.How Constituted: By resolution adopted by the Board of Directors, the Board may appoint from among its members one or more committees, including an Executive Committee, each consisting of at least two (2) Directors. Each member of a committee shall hold office during the pleasure of the Board. The President shall be a member of the Executive Committee. [ MGCL, Section 2-411 ]
Section 4.02.Powers of the Executive Committee: Unless otherwise provided by resolution of the Board of Directors, the Executive Committee, in the intervals between meetings of the Board of Directors, shall have and may exercise all of the powers of the Board of Directors to manage the business and affairs of the Corporation except the power to:
(a) Declare dividends or distributions on stock;
(b) Issue stock other than as provided in Section 2-411(b) of Corporations and Associations Article of the Annotated Code of Maryland;
(c) Recommend to the shareholders any action which requires shareholder approval;
(d) Amend the By-Laws; or
(e) Approve any merger or share exchange which does not require shareholder approval.
[ MGCL, Section 2-411(a) ]
Section 4.03.Other Committees of the Board of
Directors: To the extent provided by resolution of the Board,
other committees shall have and may exercise any of the powers
that may lawfully be granted to the Executive Committee. [ MGCL,
Section 2-411(a) ]
Section 4.04.Proceedings, Quorum, and Manner of Acting:
In the absence of appropriate resolution of the Board of Directors, each committee may adopt such rules and regulations governing its proceedings, quorum and manner of acting as it shall deem proper and desirable, provided that the quorum shall not be less than two (2) Directors. In the absence of any member of any such committee, the members thereof present at any meeting, whether or not they constitute a quorum, may appoint a member of the Board of Directors to act in the place of such absent member. [ MGCL, Section 2-411(c) ]
Section 4.05.Other Committees: The Board of Directors may appoint other committees, each consisting of one or more persons who need not be Directors. Each such committee shall have such powers and perform such duties as may be assigned to it from time to time by the Board of Directors, but shall not exercise any power which may lawfully be exercised only by the Board of Directors or a committee thereof.
ARTICLE V
OFFICERS
Section 5.01.General: The officers of the Corporation shall be a President, one or more Vice Presidents (one or more of whom may be designated Executive Vice President), a Secretary, and a Treasurer, and may include one or more Assistant Vice Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers as may be appointed in accordance with the provisions of Section 5.11 hereof. The Board of Directors may elect, but shall not be required to elect, a Chairman of the Board. [ MGCL, Section 2-412 ]
Section 5.02.Election, Term of Office and
Qualifications: The officers of the Corporation (except those
appointed pursuant to Section 5.11 hereof) shall be elected by
the Board of Directors at its first meeting and thereafter at
each annual meeting of the Board. If any officer or officers are
not elected at any such meeting, such officer or officers may be
elected at any subsequent regular or special meeting of the
Board. Except as provided in Sections 5.03, 5.04 and 5.05
hereof, each officer elected by the Board of Directors shall hold
office until the next annual meeting of the Board of Directors
and until his successor shall have been chosen and qualified.
Any person may hold two or more offices of the Corporation,
except that neither the Chairman of the Board nor the President
may hold the office of Vice President, but no person shall
execute, acknowledge or verify any instrument in more than one
capacity if such instrument is required by law, the Articles of
Incorporation or these By-Laws to be executed, acknowledged, or
verified by two or more officers. The Chairman of the Board and
the President shall be selected from among the Directors of the
Corporation and may hold such offices only so long as they
continue to be Directors. No other officer need be a Director.
[ MGCL, Sections 2-413 and 2-415 ]
(Section 5.02. Election, Term of Office and Qualifications: as amended January 21, 1988)
Section 5.03.Resignation: Any officer may resign his office at any time by delivering a written resignation to the Board of Directors, the President, the Secretary, or any Assistant Secretary. Unless otherwise specified therein, such resignation shall take effect upon delivery.
Section 5.04.Removal: Any officer may be removed from office by the Board of Directors whenever in the judgment of the Board of Directors the best interests of the Corporation will be served thereby. [ MGCL, Section 2-413(c) ]
Section 5.05Vacancies and Newly Created Offices: If any vacancy shall occur in any office by reason of death, resignation, removal, disqualification or other cause, or if any new office shall be created, such vacancies or newly created offices may be filled by the Board of Directors at any meeting or, in the case of any office created pursuant to Section 5.11 hereof, by any officer upon whom such power shall have been conferred by the Board of Directors. [ MGCL, Section 2-413(d) ]
Section 5.06.Chairman of the Board: Unless otherwise provided by resolution of the Board of Directors, the Chairman of the Board, if there be such an officer, shall be the chief executive and operating officer of the Corporation, shall preside at all shareholders' meetings, and at all meetings of the Board of Directors. He shall be ex officio a member of all standing committees of the Board of Directors. Subject to the supervision of the Board of Directors, he shall have general charge of the business, affairs, property, and operation of the Corporation and its officers, employees, and agents. He may sign (unless the President or a Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors and shall have such other powers and perform such other duties as may be assigned to him from time to time by the Board of Directors.
Section 5.07.President: Unless otherwise provided by
resolution of the Board of Directors, the President shall, at the
request of or in the absence or disability of the Chairman of the
Board, or if no Chairman of the Board has been chosen, he shall
preside at all shareholders' meetings and at all meetings of the
Board of Directors and shall in general exercise the powers and
perform the duties of the Chairman of the Board. He may sign
(unless the Chairman or a Vice President shall have signed)
certificates representing stock of the Corporation authorized for
issuance by the Board of Directors. Except as the Board of
Directors may otherwise order, he may sign in the name and on
behalf of the Corporation all deeds, bonds, contracts, or
agreements. He shall exercise such other powers and perform such
other duties as from time to time may be assigned to him by the
Board of Directors.
Section 5.08.Vice President: The Board of Directors shall, from time to time, designate and elect one or more Vice Presidents (one or more of whom may be designated Executive Vice President) who shall have such powers and perform such duties as from time to time may be assigned to them by the Board of Directors or the President. At the request or in the absence or disability of the President, the Vice President (or, if there are two or more Vice Presidents, the Vice President in order of seniority of tenure in such office or in such other order as the Board of Directors may determine) may perform all the duties of the President and, when so acting, shall have all the powers of and be subject to all the restrictions upon the President. Any Vice President may sign (unless the Chairman, the President, or another Vice President shall have signed) certificates representing stock of the Corporation authorized for issuance by the Board of Directors.
Section 5.09.Treasurer and Assistant Treasurers: The Treasurer shall be the principal financial and accounting officer of the Corporation and shall have general charge of the finances and books of account of the Corporation. Except as otherwise provided by the Board of Directors, he shall have general supervision of the funds and property of the Corporation and of the performance by the custodian of its duties with respect thereto. He may countersign (unless an Assistant Treasurer or Secretary or Assistant Secretary shall have countersigned) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. He shall render to the Board of Directors, whenever directed by the Board, an account of the financial condition of the Corporation and of all his transactions as Treasurer; and as soon as possible after the close of each fiscal year he shall make and submit to the Board of Directors a like report for such fiscal year. He shall cause to be prepared annually a full and correct statement of the affairs of the Corporation, including a balance sheet and a financial statement of operations for the preceding fiscal year, which shall be submitted at the annual meeting of shareholders and filed within twenty (20) days thereafter at the principal office of the Corporation. He shall perform all the acts incidental to the office of the Treasurer, subject to the control of the Board of Directors. Any Assistant Treasurer may perform such duties of the Treasurer as the Treasurer or the Board of Directors may assign, and, in the absence of the Treasurer, he may perform all the duties of the Treasurer.
Section 5.10.Secretary and Assistant Secretaries: The Secretary shall attend to the giving and serving of all notices of the Corporation and shall record all proceedings of the meetings of the shareholders and Directors in one or more books to be kept for that purpose. He shall keep in safe custody the seal of the Corporation and shall have charge of the records of the Corporation, including the stock books and such other books and papers as the Board of Directors may direct and such books, reports, certificates and other documents required by law to be kept, all of which shall at all reasonable times be open to inspection by any Director. He shall countersign (unless the Treasurer, an Assistant Treasurer or an Assistant Secretary shall have countersigned) certificates representing stock of the Corporation authorized for issuance by the Board of Directors. He shall perform such other duties as appertain to his office or as may be required by the Board of Directors. Any Assistant Secretary may perform such duties of the Secretary as the Secretary or the Board of Directors may assign, and, in the absence of the Secretary, he may perform all the duties of the Secretary.
Section 5.11.Subordinate Officers: The Board of Directors from time to time may appoint such other officers or agents as it may deem advisable, each of whom shall have such title, hold office for such period, have such authority and perform such duties as the Board of Directors may determine. The Board of Directors from time to time may delegate to one or more officers or agents the power to appoint any such subordinate officers or agents and to prescribe their respective rights, terms of office, authorities, and duties. [ MGCL, Section 2-412(b) ]
Section 5.12.Remuneration: The salaries or other compensation of the officers of the Corporation shall be fixed from time to time by resolution of the Board of Directors, except that the Board of Directors may by resolution delegate to any person or group of persons the power to fix the salaries or other compensation of any subordinate officers or agents appointed in accordance with the provisions of Section 5.11 hereof.
ARTICLE VI
CUSTODY OF SECURITIES AND CASH
Section 6.01.Employment of a Custodian: The
Corporation shall place and at all times maintain in the custody
of a Custodian (including any sub-custodian for the Custodian)
all funds, securities, and similar investments owned by the
Corporation. The Custodian shall be a bank having an aggregate
capital, surplus, and undivided profits of not less than
$10,000,000. Subject to such rules, regulations, and orders as
the Securities and Exchange Commission may adopt as necessary or
appropriate for the protection of investors, the Corporation's
Custodian may deposit all or a part of the securities owned by
the Corporation in a sub-custodian or sub-custodians situated
within or without the United States. The Custodian shall be
appointed and its remuneration fixed by the Board of Directors.
[ Investment Company Act, Section 17(f) ]
Section 6.02.Central Certificate Service: Subject to such rules, regulations, and orders as the Securities and Exchange Commission may adopt as necessary or appropriate for the protection of investors, the Corporation's Custodian may deposit all or any part of the securities owned by the Corporation in a system for the central handling of securities established by a national securities exchange or national securities association registered with the Commission under the Securities Exchange Act of 1934, or such other person as may be permitted by the Commission, pursuant to which system all securities of any particular class or series of any issuer deposited within the system are treated as fungible and may be transferred or pledged by bookkeeping entry without physical delivery of such securities. [ Investment Company Act, Section 17(f) ]
Section 6.03.Cash Assets: The cash proceeds from the sale of securities and similar investments and other cash assets of the Corporation shall be kept in the custody of a bank or banks appointed pursuant to Section 6.01 hereof, or in accordance with such rules and regulations or orders as the Securities and Exchange Commission may from time to time prescribe for the protection of investors, except that the Corporation may maintain a checking account or accounts in a bank or banks, each having an aggregate capital, surplus, and undivided profits of not less than $10,000,000, provided that the balance of such account or the aggregate balances of such accounts shall at no time exceed the amount of the fidelity bond, maintained pursuant to the requirements of the Investment Company Act and rules and regulations thereunder, covering the officers or employees authorized to draw on such account or accounts. [ Investment Company Act, Section 17(f) ]
Section 6.04.Free Cash Accounts: The Corporation may,
upon resolution of its Board of Directors, maintain a petty cash
account free of the foregoing requirements of this Article VI in
an amount not to exceed $500, provided that such account is
operated under the imprest system and is maintained subject to
adequate controls approved by the Board of Directors over
disbursements and reimbursements including, but not limited to,
fidelity bond coverage for persons having access to such funds.
[ Investment Company Act, Rule 17f-3 ]
Section 6.05.Action Upon Termination of Custodian Agreement: Upon resignation of a custodian of the Corporation or inability of a custodian to continue to serve, the Board of Directors shall promptly appoint a successor custodian, but in the event that no successor custodian can be found who has the required qualifications and is willing to serve, the Board of Directors shall call as promptly as possible a special meeting of the shareholders to determine whether the Corporation shall function without a custodian or shall
be liquidated. If so directed by vote of the holders of a majority of the outstanding shares of stock of the Corporation, the custodian shall deliver and pay over all property of the Corporation held by it as specified in such vote.
ARTICLE VII
EXECUTION OF INSTRUMENTS, VOTING OF SECURITIES
Section 7.01.Execution of Instruments: All deeds, documents, transfers, contracts, agreements, requisitions or orders, promissory notes, assignments, endorsements, checks and drafts for the payment of money by the Corporation, and other instruments requiring execution by the Corporation shall be signed by the Chairman, the President, a Vice President, or the Treasurer, or as the Board of Directors may otherwise, from time to time, authorize. Any such authorization may be general or confined to specific instances.
Section 7.02.Voting of Securities: Unless otherwise ordered by the Board of Directors, the Chairman, the President, or any Vice President shall have full power and authority on behalf of the Corporation to attend and to act and to vote, or in the name of the Corporation to execute proxies to vote, at any meeting of shareholders of any company in which the Corporation may hold stock. At any such meeting such officer shall possess and may exercise (in person or by proxy) any and all rights, powers, and privileges incident to the ownership of such stock. The Board of Directors may by resolution from time to time confer like powers upon any other person or persons. [ MGCL, Section 2-509 ]
ARTICLE VIII
CAPITAL STOCK
Section 8.01.Ownership of Shares:
(a) Certificates certifying the ownership of shares will not be issued for shares purchased or otherwise acquired after July 1, 1991. The ownership of shares, full or fractional, shall be recorded on the books of the Corporation or its agent. The record books of the Corporation as kept by the Corporation or its agent, as the case may be, shall be conclusive as to the number of shares held from time to time by each such shareholder. The Corporation reserves the right to require the surrender of outstanding certificates if the Board of Directors so determines. [ MGCL, Section 210(c) ]
(b) Every certificate exchanged, surrendered for
redemption or otherwise returned to the Corporation shall be
marked "Cancelled" with the date of cancellation.
(Section 8.01. Ownership of Shares as amended July 1, 1991)
Section 8.02.Transfer of Capital Stock:
(a) Shares of stock of the Corporation shall be transferable only upon the books of the Corporation kept for such purpose and, if one or more
certificates representing such shares have been issued, upon surrender to the Corporation or its transfer agent or agents of such certificate or certificates duly endorsed, or accompanied by appropriate evidence of assignment, transfer, succession, or authority to transfer.
(b) The Corporation shall be entitled to treat the holder of record of any share of stock as the absolute owner thereof for all purposes, and accordingly shall not be bound to recognize any legal, equitable, or other claim or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by the statutes of the State of Maryland.
Section 8.03.Transfer Agents and Registrars: The Board
of Directors may, from time to time, appoint or remove transfer
agents and registrars of transfers of shares of stock of the
Corporation, and it may appoint the same person as both transfer
agent and registrar.
(Section 8.03 Transfer Agents and Registrars as amended July 1,
1991)
Section 8.04.Transfer Regulations: The shares of stock of the Corporation may be freely transferred, and the Board of Directors may, from time to time, adopt lawful rules and regulations with reference to the method of transfer of the shares of stock of the Corporation.
Section 8.05.Fixing of Record Date: The Board of Directors may fix in advance a date as a record date for the determination of the shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or to receive payment of any dividend or other distribution or allotment of any rights, or to exercise any rights in respect of any change, conversion, or exchange of stock, or for any other proper purpose, provided that such record date shall be a date not more than sixty (60) days nor, in the case of a meeting of shareholders, less than ten (10) days prior to the date on which the particular action, requiring such determination of shareholders, is to be taken. In such case, only such shareholders as shall be shareholders of record on the record date so fixed shall be entitled to such notice of, and to vote at, such meeting or adjournment, or to give such consent, or to receive payment of such dividend or other distribution, or to receive such allotment of rights, or to exercise such rights, or to take other action, as the case may be, notwithstanding any transfer of any shares on the books of the Corporation after any such record date. A meeting of shareholders convened on the date for which it was called may be adjourned from time to time without notice to a date not more than one hundred twenty (120) days after the original record date. [ MGCL, Section 2-511 ]
Section 8.06.Lost, Stolen or Destroyed Certificates:
If a certificate for stock of the Corporation is alleged to have
been lost, stolen or destroyed, no new certificate will be
issued. Instead, ownership of the shares formerly represented by
the lost, stolen or destroyed certificate shall be recorded on
the books of the Corporation or its agent, in accordance with the
provisions of Section 8.01 of these By-Laws. Before recording
ownership of such shares, the Board of Directors, or any officer
authorized by the Board, may, in its discretion, require the
owner of the lost, stolen, or any destroyed certificate (or his
legal representative) to give the Corporation a bond or other
indemnity, in such form and in such amount as the Board or any
such officer may direct and with such surety or sureties as may
be satisfactory to the Board of any such officer, sufficient to
indemnify the Corporation against any claim that may be made
against it on account of the alleged loss, theft, or destruction
of any such certificate. [ MGCL, Section 2-213 ]
(Section 8.06 Lost, Stolen or Destroyed Certificates as amended
July 1, 1991)
FISCAL YEAR, ACCOUNTANT
Section 9.01.Fiscal Year: The fiscal year of the Corporation shall be the twelve (12) calendar months beginning on the 1st day of March in each year and ending on the last day of the following February, or such other period of twelve (12) calendar months as the Board of Directors may by resolution prescribe.
Section 9.02.Accountant:
(a) The Corporation shall employ an independent public accountant or firm of independent public accountants as its accountant to examine the accounts of the Corporation and to sign and certify financial statements filed by the Corporation. The accountant's certificates and reports shall be addressed both to the Board of Directors and to the shareholders.
(b) A majority of the members of the Board of
Directors who are not interested persons (as such term is defined
in the Investment Company Act) of the Corporation shall select
the accountant, by vote cast in person, at any meeting held
before the first annual shareholders' meeting, and thereafter
shall select the accountant annually, by vote cast in person, at
a meeting held within thirty (30) days before or after the
beginning of the fiscal year of the Corporation or within thirty
(30) days before the annual shareholders' meeting in that year.
Such selection shall be submitted for ratification or rejection
at the next succeeding annual shareholders' meeting. If such
meeting shall reject such selection, the accountant shall be
selected by majority vote of the Corporation's outstanding voting
securities, either at the meeting at which the rejection occurred
or at a subsequent meeting of shareholders called for the
purpose.
(c) Any vacancy occurring between annual meetings, due to the death or resignation of the accountant, may be filled by the vote of a majority of those members of the Board of Directors who are not interested persons (as so defined) of the Corporation, cast in person at a meeting called for the purpose of voting on such action.
(d) The employment of the accountant shall be conditioned upon the right of the Corporation by vote of a majority of the outstanding voting securities at any meeting called for the purpose to terminate such employment forthwith without any penalty. [ Investment Company Act, Section 32(a) ]
ARTICLE X
INDEMNIFICATION AND INSURANCE
Section 10.01. Indemnification and Payment of Expenses in Advance: The Corporation shall indemnify any individual ("Indemnitee") who is a present or former director, officer, employee, or agent of the Corporation, or who is or has been serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, who, by reason of his position was, is, or is threatened to be made a party to any threatened, pending, or completed action, suit, or
proceeding, whether civil, criminal, administrative, or investigative (hereinafter collectively referred to as a "Proceeding") against any judgments, penalties, fines, settlements, and reasonable expenses (including attorneys' fees) incurred by such Indemnitee in connection with any Proceeding, to the fullest extent that such indemnification may be lawful under applicable Maryland law, as from time to time amended. The Corporation shall pay any reasonable expenses so incurred by such Indemnitee in defending a Proceeding in advance of the final disposition thereof to the fullest extent that such advance payment may be lawful under applicable Maryland law, as from time to time amended. Subject to any applicable limitations and requirements set forth in the Corporation's Articles of Incorporation and in these By-Laws, any payment of indemnification or advance of expenses shall be made in accordance with the procedures set forth in applicable Maryland law, as from time to time amended.
Notwithstanding the foregoing, nothing herein shall protect or purport to protect any Indemnitee against any liability to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of his office ("Disabling Conduct").
Anything in this Article X to the contrary notwithstanding, no indemnification shall be made by the Corporation to any Indemnitee unless:
(a) there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or
(b) in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:
(i) the vote of a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Anything in this Article X to the contrary notwithstanding, any advance of expenses by the Corporation to any Indemnitee shall be made only upon the undertaking by such Indemnitee to repay the advance unless it is ultimately determined that such Indemnitee is entitled to indemnification as above provided, and only if one of the following conditions is met:
(a) the Indemnitee provides a security for his undertaking; or
(b) the Corporation shall be insured against losses arising by reason of any lawful advances; or
(c) there is a determination, based on a review of readily available facts, that there is reason to believe that the Indemnitee will ultimately be found entitled to indemnification, which determination shall be made by:
(i) a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act, nor parties to the Proceeding; or
(ii) an independent legal counsel in a written opinion.
Section 10.02. Insurance of Officers, Directors,
Employees and Agents: To the fullest extent permitted by
applicable Maryland law and by Section 17(h) of the Investment
Company Act, as from time to time amended, the Corporation may
purchase and maintain insurance on behalf of any person who is or
was a director, officer, employee, or agent of the Corporation,
or who is or was serving at the request of the Corporation as a
director, officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise, against
any liability asserted against him and incurred by him in or
arising out of his position, whether or not the Corporation would
have the power to indemnify him against such liability. [ MGCL,
Section 2-418(k) ]
ARTICLE XI
AMENDMENTS
Section 11.01. General: Except as provided in Section 11.02 hereof, all By-Laws of the Corporation, whether adopted by the Board of Directors or the shareholders, shall be subject to amendment, alteration, or repeal, and new By-Laws may be made, by the affirmative vote of a majority of either:
(a) the holders of record of the outstanding shares of stock of the Corporation entitled to vote, at any annual or special meeting the notice or waiver of notice of which shall have specified or summarized the proposed amendment, alteration, repeal, or new By-Law; or
(b) the Directors present at any regular or special meeting at which a quorum is present if the notice or waiver of notice thereof or material sent to the Directors in connection therewith on or prior to the last date for the giving of such notice under these By-Laws shall have specified or summarized the proposed amendment, alteration, repeal, or new By-Law.
Section 11.02. By Shareholders Only:
(a) No amendment of any section of these By-Laws shall be made except by the shareholders of the Corporation if the shareholders shall have provided in the By-Laws that such section may not be amended, altered, or repealed except by the shareholders.
(b) From and after the issue of any shares of the Capital Stock of the Corporation, no amendment of this Article XI shall be made except by the shareholders of the Corporation.
ARTICLE XII
MISCELLANEOUS
Section 12.01. Use of the Term "Annual Meeting": The
use of the term "annual meeting" in these By-Laws shall not be
construed as implying a requirement that a shareholder meeting be
held annually.
(ARTICLE XII, MISCELLANEOUS, added January 21, 1988)
dld/agmts/BYLAWS.TFH
BY-LAWS
OF
T. ROWE PRICE TAX-FREE HIGH-YIELD FUND, INC.
AS AMENDED:
JANUARY 21, 1988
APRIL 20, 1990
JULY 1, 1991
JULY 20, 1993
TABLE OF CONTENTS
Page
ARTICLE I. NAME OF CORPORATION, LOCATION OF OFFICES AND SEAL 1
1.01. Name. . . . . . . . . . . . . . . . . . . . . . . 1
1.02. Principal Office. . . . . . . . . . . . . . . . . 1
1.03. Seal. . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II. SHAREHOLDERS. . . . . . . . . . . . . . . . . . . 1
2.01. Annual Meetings . . . . . . . . . . . . . . . . . 1
2.02. Special Meetings. . . . . . . . . . . . . . . . . 2
2.03. Place of Meetings . . . . . . . . . . . . . . . . 2
2.04. Notice of Meetings. . . . . . . . . . . . . . . . 2
2.05. Voting - in General . . . . . . . . . . . . . . . 2
2.06. Shareholders Entitled to Vote . . . . . . . . . . 3
2.07. Voting - Proxies. . . . . . . . . . . . . . . . . 3
2.08. Quorum. . . . . . . . . . . . . . . . . . . . . . 3
2.09. Absence of Quorum . . . . . . . . . . . . . . . . 3
2.10. Stock Ledger and List of Shareholders . . . . . . 3
2.11. Informal Action by Shareholders . . . . . . . . . 4
ARTICLE III. BOARD OF DIRECTORS. . . . . . . . . . . . . . . . 4
3.01. Number and Term of Office . . . . . . . . . . . . 4
3.02. Qualification of Directors. . . . . . . . . . . . 4
3.03. Election of Directors . . . . . . . . . . . . . . 4
3.04. Removal of Directors. . . . . . . . . . . . . . . 4
3.05. Vacancies and Newly Created Directorships . . . . 5
3.06. General Powers. . . . . . . . . . . . . . . . . . 5
3.07. Power to Issue and Sell Stock . . . . . . . . . . 5
3.08. Power to Declare Dividends. . . . . . . . . . . . 5
3.09. Annual and Regular Meetings . . . . . . . . . . . 6
3.10. Special Meetings. . . . . . . . . . . . . . . . . 6
3.11. Notice. . . . . . . . . . . . . . . . . . . . . . 6
3.12. Waiver of Notice. . . . . . . . . . . . . . . . . 6
3.13. Quorum and Voting . . . . . . . . . . . . . . . . 6
3.14. Conference Telephone. . . . . . . . . . . . . . . 7
3.15. Compensation. . . . . . . . . . . . . . . . . . . 7
3.16. Action without a Meeting. . . . . . . . . . . . . 7
3.17. Director Emeritus . . . . . . . . . . . . . . . . 7
|
PAGE 83 ARTICLE IV. EXECUTIVE COMMITTEE AND OTHER COMMITTEES. . . . . 7 4.01. How Constituted . . . . . . . . . . . . . . . . . 7 4.02. Powers of the Executive Committee . . . . . . . . 7 4.03. Other Committees of the Board of Directors. . . . 8 4.04. Proceedings, Quorum and Manner of Acting. . . . . 8 4.05. Other Committees. . . . . . . . . . . . . . . . . 8 ARTICLE V. OFFICERS. . . . . . . . . . . . . . . . . . . . . 8 5.01. General . . . . . . . . . . . . . . . . . . . . . 8 5.02. Election, Term of Office and Qualifications . . . 8 5.03. Resignation . . . . . . . . . . . . . . . . . . . 9 5.04. Removal . . . . . . . . . . . . . . . . . . . . . 9 5.05. Vacancies and Newly Created Offices . . . . . . . 9 5.06. Chairman of the Board . . . . . . . . . . . . . . 9 5.07. President . . . . . . . . . . . . . . . . . . . . 9 5.08. Vice President. . . . . . . . . . . . . . . . . . 9 5.09. Treasurer and Assistant Treasurers. . . . . . . .10 5.10. Secretary and Assistant Secretaries . . . . . . .10 5.11. Subordinate Officers. . . . . . . . . . . . . . .10 5.12. Remuneration. . . . . . . . . . . . . . . . . . .10 ARTICLE VI. CUSTODY OF SECURITIES AND CASH. . . . . . . . . .11 6.01. Employment of a Custodian . . . . . . . . . . . .11 6.02. Central Certificate Service . . . . . . . . . . .11 6.03. Cash Assets . . . . . . . . . . . . . . . . . . .11 6.04. Free Cash Accounts. . . . . . . . . . . . . . . .11 6.05. Action Upon Termination of Custodian Agreement. .12 ARTICLE VII. EXECUTION OF INSTRUMENTS, VOTING OF SECURITIES. .12 7.01. Execution of Instruments. . . . . . . . . . . . .12 7.02. Voting of Securities. . . . . . . . . . . . . . .12 ARTICLE VIII. CAPITAL STOCK. . . . . . . . . . . . . . . . . . . . . . . . .12 8.01. Ownership of Shares . . . . . . . . . . . . . . .12 8.02. Transfer of Capital Stock . . . . . . . . . . . .13 8.03. Transfer Agents and Registrars. . . . . . . . . .13 8.04. Transfer Regulations. . . . . . . . . . . . . . .13 8.05. Fixing of Record Date . . . . . . . . . . . . . .13 8.06. Lost, Stolen, or Destroyed Certificates . . . . .13 ARTICLE IX. FISCAL YEAR, ACCOUNTANT . . . . . . . . . . . . .14 9.01. Fiscal Year . . . . . . . . . . . . . . . . . . .14 9.02. Accountant. . . . . . . . . . . . . . . . . . . .14 ARTICLE X. INDEMNIFICATION AND INSURANCE . . . . . . . . . .15 10.01. Indemnification and Payment of Expenses in Advance15 10.02. Insurance of Officers, Directors, Employees and Agents 16 PAGE 84 ARTICLE XI. AMENDMENTS. . . . . . . . . . . . . . . . . . . .16 11.01. General . . . . . . . . . . . . . . . . . . . . .16 11.02. By Shareholders Only. . . . . . . . . . . . . . .17 ARTICLE XII. MISCELLANEOUS . . . . . . . . . . . . . . . . . .17 12.01. Use of the Term "Annual Meeting". . . . . . . . .17 |
Between
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
and
T. ROWE PRICE ASSOCIATES, INC.
INVESTMENT MANAGEMENT AGREEMENT, made as of the 1st day of July, 1987, by and between T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Fund"), and T. ROWE PRICE ASSOCIATES, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Manager").
W I T N E S S E T H:
WHEREAS, the Fund is engaged in business as an open-end management investment company and is registered as such under the federal Investment Company Act of l940, as amended (the "Act"); and
WHEREAS, the Manager is engaged principally in the business of rendering investment supervisory services and is registered as an investment adviser under the federal Investment Advisers Act of l940, as amended; and
WHEREAS, the Fund desires the Manager to render investment supervisory services to the Fund in the manner and on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties hereto agree as follows:
1. Duties and Responsibilities of Manager.
A. Investment Advisory Services. The Manager shall act as investment manager and shall supervise and direct the investments of the Fund in accordance with the Fund's investment objectives, program and restrictions as provided in its prospectus, as amended from time to time, and such other limitations as the Fund may impose by notice in writing to the Manager. The Manager shall obtain and evaluate such information relating to the economy, industries, businesses, securities markets and securities as it may deem necessary or useful in the discharge of its obligations hereunder and shall formulate and implement a continuing program for the management of the assets and resources of the Fund in a manner consistent with its investment objectives. In furtherance of this duty, the Manager, as agent and attorney-in-fact with respect to the Fund, is authorized, in its discretion and without prior consultation with the Fund, to:
(i) buy, sell, exchange, convert, lend, and otherwise trade in any stocks, bonds, and other securities or assets; and
(ii) place orders and negotiate the commissions (if any) for the execution of transactions in securities with or through such brokers, dealers, underwriters or issuers as the Manager may select.
B. Financial, Accounting, and Administrative Services. The Manager shall maintain the corporate existence and corporate records of the Fund; maintain the registrations and qualifications of Fund shares under federal and state law; monitor the financial, accounting, and administrative functions of the Fund; maintain liaison with the various agents employed by the Fund (including the Fund's transfer agent, custodian, independent accountants and legal counsel) and assist in the coordination of their activities on behalf of the Fund.
C. Reports to Fund. The Manager shall furnish to or place at the disposal of the Fund such information, reports, evaluations, analyses and opinions as the Fund may, at any time or from time to time, reasonably request or as the Manager may deem helpful to the Fund.
D. Reports and Other Communications to Fund Shareholders. The Manager shall assist the Fund in developing all general shareholder communications, including regular shareholder reports.
E. Fund Personnel. The Manager agrees to permit individuals who are officers or employees of the Manager to serve (if duly elected or appointed) as officers, directors, members of any committee of directors, members of any advisory board, or members of any other committee of the Fund, without remuneration from or other cost to the Fund.
F. Personnel, Office Space, and Facilities of Manager. The Manager at its own expense shall furnish or provide and pay the cost of such office space, office equipment, office personnel, and office services as the Manager requires in the performance of its investment advisory and other obligations under this Agreement.
2. Allocation of Expenses.
A. Expenses Paid by Manager.
(1) Salaries and Fees of Officers. The Manager shall pay all salaries, expenses, and fees of the officers and directors of the Fund who are affiliated with the Manager.
(2) Assumption of Fund Expenses by Manager. The payment or assumption by the Manager of any expense of the Fund that the Manager is not required by this Agreement to pay or assume shall not obligate the Manager to pay or assume the same or any similar expense of the Fund on any subsequent occasion.
B. Expenses Paid by Fund. The Fund shall bear all expenses of its organization, operations, and business not specifically assumed or agreed to be paid by the Manager as provided in this Agreement. In particular, but without limiting the generality of the foregoing, the Fund shall pay:
(1) Custody and Accounting Services. All expenses of the transfer, receipt, safekeeping, servicing and accounting for the Fund's cash, securities, and other property, including all charges of depositories, custodians, and other agents, if any;
(2) Shareholder Servicing. All expenses of maintaining and servicing shareholder accounts, including all charges of the Fund's transfer, shareholder recordkeeping, dividend disbursing, redemption, and other agents, if any;
(3) Shareholder Communications. All expenses of preparing, setting in type, printing, and distributing reports and other communications to shareholders;
(4) Shareholder Meetings. All expenses incidental to holding meetings of Fund shareholders, including the printing of notices and proxy material, and proxy solicitation therefor;
(5) Prospectuses. All expenses of preparing, setting in type, and printing of annual or more frequent revisions of the Fund's prospectus and of mailing them to shareholders;
(6) Pricing. All expenses of computing the Fund's net asset value per share, including the cost of any equipment or services used for obtaining price quotations;
(7) Communication Equipment. All charges for equipment or services used for communication between the Manager or the Fund and the custodian, transfer agent or any other agent selected by the Fund;
(8) Legal and Accounting Fees and Expenses. All charges for services and expenses of the Fund's legal counsel and independent auditors;
(9) Directors' Fees and Expenses. All compensation of directors, other than those affiliated with the Manager, and all expenses incurred in connection with their service;
(10) Federal Registration Fees. All fees and expenses of registering and maintaining the registration of the Fund under the Act and the registration of the Fund's shares under the Securities Act of 1933, as amended (the "'33 Act"), including all fees and expenses incurred in connection with the preparation, setting in type, printing, and filing of any registration statement and prospectus under the '33 Act or the Act, and any amendments or supplements that may be made from time to time;
(11) State Registration Fees. All fees and expenses of qualifying and maintaining qualification of the Fund and of the Fund's shares for sale under securities laws of various states or jurisdictions, and of registration and qualification of the Fund under all other laws applicable to the Fund or its business activities (including registering the Fund as a broker-dealer, or any officer of the Fund or any person as agent or salesman of the Fund in any state);
(12) Issue and Redemption of Fund Shares. All expenses incurred in connection with the issue, redemption, and transfer of Fund shares, including the expense of confirming all share transactions, and of preparing and transmitting the Fund's stock certificates;
(13) Bonding and Insurance. All expenses of bond, liability, and other insurance coverage required by law or deemed advisable by the Fund's board of directors;
(14) Brokerage Commissions. All brokers' commissions and other charges incident to the purchase, sale, or lending of the Fund's portfolio securities;
(15) Taxes. All taxes or governmental fees payable by or with respect of the Fund to federal, state, or other governmental agencies, domestic or foreign, including stamp or other transfer taxes;
(16) Trade Association Fees. All fees, dues, and other expenses incurred in connection with the Fund's membership in any trade association or other investment organization; and
(17) Nonrecurring and Extraordinary Expenses. Such nonrecurring expenses as may arise, including the costs of actions, suits, or proceedings to which the Fund is a party and the expenses the Fund may incur as a result of its legal obligation to provide indemnification to its officers, directors, and agents.
3. Management Fee. The Fund shall pay the Manager a fee ("Fee") which will consist of two components: a Group Management Fee ("Group Fee"), and an Individual Fund Fee ("Fund Fee"). The Fee shall be paid monthly to the Manager on the first business day of the next succeeding calendar month and shall be calculated as follows:
A. Group Fee. The monthly Group Fee ("Monthly Group Fee") shall be the sum of the daily Group Fee accruals ("Daily Group Fee Accruals") for each month. The Daily Group Fee Accrual for any particular day will be computed by multiplying the Price Funds' group fee accrual as determined below ("Daily Price Funds' Group Fee Accrual") by the ratio of the Fund's net assets for that day to the sum of the aggregate net assets of the Price Funds for that day. The Daily Price Funds' Group Fee Accrual for any particular day shall be calculated by multiplying the fraction of one (1) over the number of calendar days in the year by the annualized Daily Price Funds' Group Fee Accrual for that day as determined in accordance with the following schedule:
0.480% First $1 billion 0.450% Next $1 billion 0.420% Next $1 billion 0.390% Next $1 billion 0.370% Next $1 billion 0.360% Next $2 billion 0.350% Next $2 billion 0.340% Next $5 billion 0.330% Next $10 billion 0.320% Thereafter |
The Price Funds shall include all the mutual funds distributed by T. Rowe Price Investment Services, Inc. (except for the T. Rowe Price Institutional Trust and any private label mutual funds). For the purpose of calculating the Daily Price Funds' Group Fee Accrual for any particular day, the net assets of each Price Fund shall be determined in accordance with the Fund's prospectus as of the close of business on the previous business day on which the Fund was open for business.
B. Fund Fee. The monthly Fund Fee ("Monthly Fund Fee") shall be the sum of the daily Fund Fee accruals ("Daily Fund Fee Accruals") for each month. The Daily Fund Fee Accrual for any particular day will be computed by multiplying the fraction of one (1) over the number of calendar days in the year by the Fund Fee Rate of 0.10% and multiplying this product by the net assets of the Fund for that day, as determined in accordance with the Fund's prospectus as of the close of business on the previous business day on which the Fund was open for business.
C. Expense Limitation. To the extent that the aggregate expenses of every character incurred by the Fund in any fiscal year, including but not limited to Fees of the Manager computed as hereinabove set forth, but excluding interest, taxes, brokerage, and other expenditures which are capitalized in accordance with generally accepted accounting principles and extraordinary expenses, shall exceed the limit ("State Expense Limit") prescribed by any state in which the Fund's shares are qualified for sale, such excess amount shall be the liability of the Manager to pay in the manner specified below. To determine the Manager's liability for the Fund's expenses, the expenses of the Fund shall be annualized monthly as of the last day of the month. If the annualized expenses for any month exceed the State Expense Limit, the payment of the Fee for such month (if there be any) shall be reduced by such excess ("Excess Amount") and in the event the Excess Amount exceeds the amount due as the Fee, the Manager shall remit to the Fund the difference between the Excess Amount and the amount due as the Fee; provided, however, that an adjustment shall be made on or before the last day of the first month of the next succeeding fiscal year if the aggregate expenses for the fiscal year do not exceed the State Expense Limit.
D. Proration of Fee. If this Agreement becomes effective or terminates before the end of any month, the Fee for the period from the effective date to the end of such month or from the beginning of such month to the date of termination, as the case may be, shall be prorated according to the proportion which such period bears to the full month in which such effectiveness or termination occurs.
4. Brokerage. Subject to the approval of the board of directors of the Fund, the Manager, in carrying out its duties under Paragraph 1.A., may cause the Fund to pay a broker-dealer which furnishes brokerage or research services [as such services are defined under Section 28(e) of the Securities Exchange Act of l934, as amended (the "'34 Act")], a higher commission than that which might be charged by another broker-dealer which does not furnish brokerage or research services or which furnishes brokerage or research services deemed to be of lesser value, if such commission is deemed reasonable in relation to the brokerage and research services provided by the broker-dealer, viewed in terms of either that particular transaction or the overall responsibilities of the Manager with respect to the accounts as to which it exercises investment discretion (as such term is defined under Section 3(a)(35) of the '34 Act).
5. Manager's Use of the Services of Others. The Manager may (at its cost except as contemplated by Paragraph 4 of this Agreement) employ, retain or otherwise avail itself of the services or facilities of other persons or organizations for the purpose of providing the Manager or the Fund with such statistical and other factual information, such advice regarding economic factors and trends, such advice as to occasional transactions in specific securities or such other information, advice or assistance as the Manager may deem necessary, appropriate or convenient for the discharge of its obligations hereunder or otherwise helpful to the Fund, or in the discharge of Manager's overall responsibilities with respect to the other accounts which it serves as investment manager.
6. Ownership of Records. All records required to be maintained and preserved by the Fund pursuant to the provisions of rules or regulations of the Securities and Exchange Commission under Section 31(a) of the Act and maintained and preserved by the Manager on behalf of the Fund are the property of the Fund and will be surrendered by the Manager promptly on request by the Fund.
7. Reports to Manager. The Fund shall furnish or otherwise make available to the Manager such prospectuses, financial statements, proxy statements, reports, and other information relating to the business and affairs of the Fund as the Manager may, at any time or from time to time, reasonably require in order to discharge its obligations under this Agreement.
8. Services to Other Clients. Nothing herein contained shall limit the freedom of the Manager or any affiliated person of the Manager to render investment supervisory and corporate administrative services to other investment companies, to act as investment manager or investment counselor to other persons, firms or corporations, or to engage in other business activities; but so long as this Agreement or any extension, renewal or amendment hereof shall remain in effect or until the Manager shall otherwise consent, the Manager shall be the only investment manager to the Fund.
9. Limitation of Liability of Manager. Neither the
Manager nor any of its officers, directors, or employees, nor any
person performing executive, administrative, trading, or other
functions for the Fund (at the direction or request of the
Manager) or the Manager in connection with the Manager's
discharge of its obligations undertaken or reasonably assumed
with respect to this Agreement, shall be liable for any error of
judgment or mistake of law or for any loss suffered by the Fund
in connection with the matters to which this Agreement relates,
except for loss resulting from willful misfeasance, bad faith, or
gross negligence in the performance of its or his duties on
behalf of the Fund or from reckless disregard by the Manager or
any such person of the duties of the Manager under this
Agreement.
10. Use of Manager's Name The Fund may use the name
"T. Rowe Price Tax-Exempt Money Fund, Inc." or any other name
derived from the name "T. Rowe Price" only for so long as this
Agreement or any extension, renewal or amendment hereof remains
in effect, including any similar agreement with any organization
which shall have succeeded to the business of the Manager as
investment manager. At such time as this Agreement or any
extension, renewal or amendment hereof, or such other similar
agreement shall no longer be in effect, the Fund will (by
corporate action, if necessary) cease to use any name derived
from the name "T. Rowe Price," any name similar thereto or any
other name indicating that it is advised by or otherwise
connected with the Manager, or with any organization which shall
have succeeded to the Manager's business as investment manager.
11. Term of Agreement. The term of this Agreement shall begin on the date first above written, and unless sooner terminated as hereinafter provided, this Agreement shall remain in effect through April 30, 1988. Thereafter, this Agreement shall continue in effect from year to year, subject to the termination provisions and all other terms and conditions hereof, so long as: (a) such continuation shall be specifically approved at least annually by the board of directors of the Fund or by vote of a majority of the outstanding voting securities of the Fund and, concurrently with such approval by the board of directors or prior to such approval by the holders of the outstanding voting securities of the Fund, as the case may be, by the vote, cast in person at a meeting called for the purpose of voting on such approval, of a majority of the directors of the Fund who are not parties to this Agreement or interested persons of any such party; and (b) the Manager shall not have notified the Fund, in writing, at least 60 days prior to April 30, 1988 or prior to April 30th of any year thereafter, that it does not desire such continuation. The Manager shall furnish to the Fund, promptly upon its request, such information as may reasonably be necessary to evaluate the terms of this Agreement or any extension, renewal or amendment hereof.
12. Amendment and Assignment of Agreement. This Agreement may not be amended or assigned without the affirmative vote of a majority of the outstanding voting securities of the Fund, and this Agreement shall automatically and immediately terminate in the event of its assignment.
13. Termination of Agreement. This Agreement may be terminated by either party hereto, without the payment of any penalty, upon 60 days' prior notice in writing to the other party; provided, that in the case of termination by the Fund such action shall have been authorized by resolution of a majority of the directors of the Fund who are not parties to this Agreement or interested persons of any such party, or by vote of a majority of the outstanding voting securities of the Fund.
14. Miscellaneous.
A. Captions. The captions in this Agreement are included for convenience of reference only and in no way define or delineate any of the provisions hereof or otherwise affect their construction or effect.
B. Interpretation. Nothing herein contained shall be deemed to require the Fund to take any action contrary to its Articles of Incorporation or By-Laws, or any applicable statutory or regulatory requirement to which it is subject or by which it is bound, or to relieve or deprive the board of directors of the Fund of its responsibility for and control of the conduct of the affairs of the Fund.
C. Definitions. Any question of interpretation of any term or provision of this Agreement having a counterpart in or otherwise derived from a term or provision of the Act shall be resolved by reference to such term or provision of the Act and to interpretations thereof, if any, by the United States courts or, in the absence of any controlling decision of any such court, by rules, regulations or orders of the Securities and Exchange Commission validly issued pursuant to the Act. Specifically, the terms "vote of a majority of the outstanding voting securities," "interested person," "assignment," and "affiliated person," as used in Paragraphs 2, 8, 11, 12, and 13 hereof, shall have the meanings assigned to them by Section 2(a) of the Act. In addition, where the effect of a requirement of the Act reflected in any provision of this Agreement is relaxed by a rule, regulation or order of the Securities and Exchange Commission, whether of special or of general application, such provision shall be deemed to incorporate the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by their respective officers thereunto duly authorized and their respective corporate seals to be hereunto affixed, as of the day and year first above written.
Attest: T. ROWE PRICE TAX-EXEMPT MONEY FUND,
INC.
By:
Secretary
Attest: T. ROWE PRICE ASSOCIATES, INC.
By:
Secretary
|
pat/TEMFAdvAgt
Between
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
and
T. ROWE PRICE ASSOCIATES, INC.
INVESTMENT MANAGEMENT AGREEMENT, made as of the 1st day of July, 1987, by and between T. ROWE PRICE TAX-FREE INCOME FUND, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Fund"), and T. ROWE PRICE ASSOCIATES, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Manager").
W I T N E S S E T H:
WHEREAS, the Fund is engaged in business as an open-end management investment company and is registered as such under the federal Investment Company Act of 1940, as amended (the "Act"); and
WHEREAS, the Manager is engaged principally in the business of rendering investment supervisory services and is registered as an investment adviser under the federal Investment Advisers Act of l940, as amended; and
WHEREAS, the Fund desires the Manager to render investment supervisory services to the Fund in the manner and on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties hereto agree as follows:
1. Duties and Responsibilities of Manager.
A. Investment Advisory Services. The Manager shall act as investment manager and shall supervise and direct the investments of the Fund in accordance with the Fund's investment objective, program and restrictions as provided in its prospectus, as amended from time to time, and such other limitations as the Fund may impose by notice in writing to the Manager. The Manager shall obtain and evaluate such information relating to the economy, industries, businesses, securities markets and securities as it may deem necessary or useful in the discharge of its obligations hereunder and shall formulate and implement a continuing program for the management of the assets and resources of the Fund in a manner consistent with its investment objective. In furtherance of this duty, the Manager, as agent and attorney-in-fact with respect to the Fund, is authorized, in its discretion and without prior consultation with the Fund, to:
(i) buy, sell, exchange, convert, lend, and otherwise trade in any stocks, bonds, and other securities or assets; and
(ii) place orders and negotiate the commissions (if any) for the execution of transactions in securities with or through such brokers, dealers, underwriters or issuers as the Manager may select.
B. Financial, Accounting, and Administrative Services. The Manager shall maintain the corporate existence and corporate records of the Fund; maintain the registrations and qualifications of Fund shares under federal and state law; monitor the financial, accounting, and administrative functions of the Fund; maintain liaison with the various agents employed by the Fund (including the Fund's transfer agent, custodian, independent accountants and legal counsel) and assist in the coordination of their activities on behalf of the Fund.
C. Reports to Fund. The Manager shall furnish to or place at the disposal of the Fund such information, reports, evaluations, analyses and opinions as the Fund may, at any time or from time to time, reasonably request or as the Manager may deem helpful to the Fund.
D. Reports and Other Communications to Fund Shareholders. The Manager shall assist the Fund in developing all general shareholder communications, including regular shareholder reports.
E. Fund Personnel. The Manager agrees to permit individuals who are officers or employees of the Manager to serve (if duly elected or appointed) as officers, directors, members of any committee of directors, members of any advisory board, or members of any other committee of the Fund, without remuneration from or other cost to the Fund.
F. Personnel, Office Space, and Facilities of Manager. The Manager at its own expense shall furnish or provide and pay the cost of such office space, office equipment, office personnel, and office services as the Manager requires in the performance of its investment advisory and other obligations under this Agreement.
2. Allocation of Expenses.
A. Expenses Paid by Manager.
(1) Salaries and Fees of Officers. The Manager shall pay all salaries, expenses, and fees of the officers and directors of the Fund who are affiliated with the Manager.
(2) Assumption of Fund Expenses by Manager. The payment or assumption by the Manager of any expense of the Fund that the Manager is not required by this Agreement to pay or assume shall not obligate the Manager to pay or assume the same or any similar expense of the Fund on any subsequent occasion.
B. Expenses Paid by Fund. The Fund shall bear all expenses of its organization, operations, and business not specifically assumed or agreed to be paid by the Manager as provided in this Agreement. In particular, but without limiting the generality of the foregoing, the Fund shall pay:
(1) Custody and Accounting Services. All expenses of the transfer, receipt, safekeeping, servicing and accounting for the Fund's cash, securities, and other property, including all charges of depositories, custodians, and other agents, if
any;
(2) Shareholder Servicing. All expenses of maintaining and servicing shareholder accounts, including all charges of the Fund's transfer, shareholder recordkeeping, dividend disbursing, redemption, and other agents, if any;
(3) Shareholder Communications. All expenses of preparing, setting in type, printing, and distributing reports and other communications to shareholders;
(4) Shareholder Meetings. All expenses incidental to holding meetings of Fund shareholders, including the printing of notices and proxy material, and proxy solicitation therefor;
(5) Prospectuses. All expenses of preparing, setting in type, and printing of annual or more frequent revisions of the Fund's prospectus and of mailing them to shareholders;
(6) Pricing. All expenses of computing the Fund's net asset value per share, including the cost of any equipment or services used for obtaining price quotations;
(7) Communication Equipment. All charges for equipment or services used for communication between the Manager or the Fund and the custodian, transfer agent or any other agent selected by the Fund;
(8) Legal and Accounting Fees and Expenses. All charges for services and expenses of the Fund's legal counsel and independent auditors;
(9) Directors' Fees and Expenses. All compensation of directors, other than those affiliated with the Manager, and all expenses incurred in connection with their service;
(10) Federal Registration Fees. All fees and expenses of registering and maintaining the registration of the Fund under the Act and the registration of the Fund's shares under the Securities Act of 1933, as amended (the "'33 Act"), including all fees and expenses incurred in connection with the preparation, setting in type, printing, and filing of any registration statement and prospectus under the '33 Act or the Act, and any amendments or supplements that may be made from time to time;
(11) State Registration Fees. All fees and expenses of qualifying and maintaining qualification of the Fund and of the Fund's shares for sale under securities laws of various states or jurisdictions, and of registration and qualification of the Fund under all other laws applicable to the Fund or its business activities (including registering the Fund as a broker-dealer, or any officer of the Fund or any person as agent or salesman of the Fund in any state);
(12) Issue and Redemption of Fund Shares. All expenses incurred in connection with the issue, redemption, and transfer of Fund shares, including the expense of confirming all share transactions, and of preparing and transmitting the Fund's stock certificates;
(13) Bonding and Insurance. All expenses of bond, liability, and other insurance coverage required by law or deemed advisable by the Fund's board of directors;
(14) Brokerage Commissions. All brokers' commissions and other charges incident to the purchase, sale, or lending of the Fund's portfolio securities;
(15) Taxes. All taxes or governmental fees payable by or with respect of the Fund to federal, state, or other governmental agencies, domestic or foreign, including stamp or other transfer taxes;
(16) Trade Association Fees. All fees, dues, and other expenses incurred in connection with the Fund's membership in any trade association or other investment organization; and
(17) Nonrecurring and Extraordinary Expenses. Such nonrecurring expenses as may arise, including the costs of actions, suits, or proceedings to which the Fund is a party and the expenses the Fund may incur as a result of its legal obligation to provide indemnification to its officers, directors, and agents.
3. Management Fee. The Fund shall pay the Manager a fee ("Fee") which will consist of two components: a Group Management Fee ("Group Fee"), and an Individual Fund Fee ("Fund Fee"). The Fee shall be paid monthly to the Manager on the first business day of the next succeeding calendar month and shall be calculated as follows:
A. Group Fee. The monthly Group Fee ("Monthly Group Fee") shall be the sum of the daily Group Fee accruals ("Daily Group Fee Accruals") for each month. The Daily Group Fee Accrual for any particular day will be computed by multiplying the Price Funds' group fee accrual as determined below ("Daily Price Funds' Group Fee Accrual") by the ratio of the Fund's net assets for that day to the sum of the aggregate net assets of the Price Funds for that day. The Daily Price Funds' Group Fee Accrual for any particular day shall be calculated by multiplying the fraction of one (1) over the number of calendar days in the year by the annualized Daily Price Funds' Group Fee Accrual for that day as determined in accordance with the following schedule:
0.480% First $1 billion 0.450% Next $1 billion 0.420% Next $1 billion 0.390% Next $1 billion 0.370% Next $1 billion 0.360% Next $2 billion 0.350% Next $2 billion 0.340% Next $5 billion 0.330% Next $10 billion 0.320% Thereafter |
The Price Funds shall include all the mutual funds distributed by T. Rowe Price Investment Services, Inc. (except for the T. Rowe Price Institutional Trust and any private label mutual funds). For the purpose of calculating the Daily Price Funds' Group Fee Accrual for any particular day, the net assets of each Price Fund shall be determined in accordance with the Fund's prospectus as of the close of business on the previous business day on which the Fund was open for business.
B. Fund Fee. The monthly Fund Fee ("Monthly Fund Fee") shall be the sum of the daily Fund Fee accruals ("Daily Fund Fee Accruals") for each month. The Daily Fund Fee Accrual for any particular day will be computed by multiplying the fraction of one (1) over the number of calendar days in the year by the Fund Fee Rate of 0.15% and multiplying this product by the net assets of the Fund for that day, as determined in accordance with the Fund's prospectus as of the close of business on the previous business day on which the Fund was open for business.
C. Expense Limitation. To the extent that the aggregate expenses of every character incurred by the Fund in any fiscal year, including but not limited to Fees of the Manager computed as hereinabove set forth, but excluding interest, taxes, brokerage, and other expenditures which are capitalized in accordance with generally accepted accounting principles and extraordinary expenses, shall exceed the limit ("State Expense Limit") prescribed by any state in which the Fund's shares are qualified for sale, such excess amount shall be the liability of the Manager to pay in the manner specified below. To determine the Manager's liability for the Fund's expenses, the expenses of the Fund shall be annualized monthly as of the last day of the month. If the annualized expenses for any month exceed the State Expense Limit, the payment of the Fee for such month (if there be any) shall be reduced by such excess ("Excess Amount") and in the event the Excess Amount exceeds the amount due as the Fee, the Manager shall remit to the Fund the difference between the Excess Amount and the amount due as the Fee; provided, however, that an adjustment shall be made on or before the last day of the first month of the next succeeding fiscal year if the aggregate expenses for the fiscal year do not exceed the State Expense Limit.
D. Proration of Fee. If this Agreement becomes effective or terminates before the end of any month, the Fee for the period from the effective date to the end of such month or from the beginning of such month to the date of termination, as the case may be, shall be prorated according to the proportion which such period bears to the full month in which such effectiveness or termination occurs.
4. Brokerage. Subject to the approval of the board of directors of the Fund, the Manager, in carrying out its duties under Paragraph 1.A., may cause the Fund to pay a broker-dealer which furnishes brokerage or research services [as such services are defined under Section 28(e) of the Securities Exchange Act of 1934, as amended (the "'34 Act")], a higher commission than that which might be charged by another broker-dealer which does not furnish brokerage or research services or which furnishes brokerage or research services deemed to be of lesser value, if such commission is deemed reasonable in relation to the brokerage and research services provided by the broker-dealer, viewed in terms of either that particular transaction or the overall responsibilities of the Manager with respect to the accounts as to which it exercises investment discretion (as such term is defined under Section 3(a)(35) of the '34 Act).
5. Manager's Use of the Services of Others. The Manager may (at its cost except as contemplated by Paragraph 4 of this Agreement) employ, retain or otherwise avail itself of the services or facilities of other persons or organizations for the purpose of providing the Manager or the Fund with such statistical and other factual information, such advice regarding economic factors and trends, such advice as to occasional transactions in specific securities or such other information, advice or assistance as the Manager may deem necessary, appropriate or convenient for the discharge of its obligations hereunder or otherwise helpful to the Fund, or in the discharge of Manager's overall responsibilities with respect to the other accounts which it serves as investment manager.
6. Ownership of Records. All records required to be maintained and preserved by the Fund pursuant to the provisions of rules or regulations of the Securities and Exchange Commission under Section 31(a) of the Act and maintained and preserved by the Manager on behalf of the Fund are the property of the Fund and will be surrendered by the Manager promptly on request by the Fund.
7. Reports to Manager. The Fund shall furnish or otherwise make available to the Manager such prospectuses, financial statements, proxy statements, reports, and other information relating to the business and affairs of the Fund as the Manager may, at any time or from time to time, reasonably require in order to discharge its obligations under this Agreement.
8. Services to Other Clients. Nothing herein contained shall limit the freedom of the Manager or any affiliated person of the Manager to render investment supervisory and corporate administrative services to other investment companies, to act as investment manager or investment counselor to other persons, firms or corporations, or to engage in other business activities; but so long as this Agreement or any extension, renewal or amendment hereof shall remain in effect or until the Manager shall otherwise consent, the Manager shall be the only investment manager to the Fund.
9. Limitation of Liability of Manager. Neither the Manager nor any of its officers, directors, or employees, nor any person performing executive, administrative, trading, or other functions for the Fund (at the direction or request of the Manager) or the Manager in connection with the Manager's discharge of its obligations undertaken or reasonably assumed with respect to this Agreement, shall be liable for any error of judgment or mistake of law or for any loss suffered by the Fund in connection with the matters to which this Agreement relates, except for loss resulting from willful misfeasance, bad faith, or gross negligence in the performance of its or his duties on behalf of the Fund or from reckless disregard by the Manager or any such person of the duties of the Manager under this Agreement.
10. Use of Manager's Name. The Fund may use the name "T. Rowe Price Tax-Free Income Fund, Inc." or any other name derived from the name "T. Rowe Price" only for so long as this Agreement or any extension, renewal or amendment hereof remains in effect, including any similar agreement with any organization which shall have succeeded to the business of the Manager as investment manager. At such time as this Agreement or any extension, renewal or amendment hereof, or such other similar agreement shall no longer be in effect, the Fund will (by corporate action, if necessary) cease to use any name derived from the name "T. Rowe Price," any name similar thereto or any other name indicating that it is advised by or otherwise connected with the Manager, or with any organization which shall have succeeded to the Manager's business as investment manager.
11. Term of Agreement. The term of this Agreement shall begin on the date first above written, and unless sooner terminated as hereinafter provided, this Agreement shall remain in effect through April 30, l988. Thereafter, this Agreement shall continue in effect from year to year, subject to the termination provisions and all other terms and conditions hereof, so long as: (a) such continuation shall be specifically approved at least annually by the board of directors of the Fund or by vote of a majority of the outstanding voting securities of the Fund and, concurrently with such approval by the board of directors or prior to such approval by the holders of the outstanding voting securities of the Fund, as the case may be, by the vote, cast in person at a meeting called for the purpose of voting on such approval, of a majority of the directors of the Fund who are not parties to this Agreement or interested persons of any such party; and (b) the Manager shall not have notified the Fund, in writing, at least 60 days prior to April 30, l988 or prior to April 30th of any year thereafter, that it does not desire such continuation. The Manager shall furnish to the Fund, promptly upon its request, such information as may reasonably be necessary to evaluate the terms of this Agreement or any extension, renewal or amendment hereof.
12. Amendment and Assignment of Agreement. This Agreement may not be amended or assigned without the affirmative vote of a majority of the outstanding voting securities of the Fund, and this Agreement shall automatically and immediately terminate in the event of its assignment.
13. Termination of Agreement. This Agreement may be terminated by either party hereto, without the payment of any penalty, upon 60 days' prior notice in writing to the other party; provided, that in the case of termination by the Fund such action shall have been authorized by resolution of a majority of the directors of the Fund who are not parties to this Agreement or interested persons of any such party, or by vote of a majority of the outstanding voting securities of the Fund.
14. Miscellaneous.
A. Captions. The captions in this Agreement are included for convenience of reference only and in no way define or delineate any of the provisions hereof or otherwise affect their construction or effect.
B. Interpretation. Nothing herein contained shall be deemed to require the Fund to take any action contrary to its Articles of Incorporation or By-Laws, or any applicable statutory or regulatory requirement to which it is subject or by which it is bound, or to relieve or deprive the board of directors of the Fund of its responsibility for and control of the conduct of the affairs of the Fund.
C. Definitions. Any question of interpretation of any term or provision of this Agreement having a counterpart in or otherwise derived from a term or provision of the Act shall be resolved by reference to such term or provision of the Act and to interpretations thereof, if any, by the United States courts or, in the absence of any controlling decision of any such court, by rules, regulations or orders of the Securities and Exchange Commission validly issued pursuant to the Act. Specifically, the terms "vote of a majority of the outstanding voting securities," "interested person," "assignment," and "affiliated person," as used in Paragraphs 2, 8, 11, 12, and 13 hereof, shall have the meanings assigned to them by Section 2(a) of the Act. In addition, where the effect of a requirement of the Act reflected in any provision of this Agreement is relaxed by a rule, regulation or order of the Securities and Exchange Commission, whether of special or of general application, such provision shall be deemed to incorporate the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by their respective officers thereunto duly authorized and their respective corporate seals to be hereunto affixed, as of the day and year first above written.
Attest: T. ROWE PRICE TAX-FREE INCOME FUND,
INC.
Secretary
Attest: T. ROWE PRICE ASSOCIATES, INC.
Secretary
pat/TFIAdvAgt
Between
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
and
T. ROWE PRICE ASSOCIATES, INC.
INVESTMENT MANAGEMENT AGREEMENT, made as of the 1st day of July, 1987, by and between T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Fund"), and T. ROWE PRICE ASSOCIATES, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Manager").
W I T N E S S E T H:
WHEREAS, the Fund is engaged in business as an open-end management investment company and is registered as such under the federal Investment Company Act of l940, as amended (the "Act"); and
WHEREAS, the Manager is engaged principally in the business of rendering investment supervisory services and is registered as an investment adviser under the federal Investment Advisers Act of l940, as amended; and
WHEREAS, the Fund desires the Manager to render investment supervisory services to the Fund in the manner and on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties hereto agree as follows:
1. Duties and Responsibilities of Manager.
A. Investment Advisory Services. The Manager shall act as investment manager and shall supervise and direct the investments of the Fund in accordance with the Fund's investment objective, program and restrictions as provided in its prospectus, as amended from time to time, and such other limitations as the Fund may impose by notice in writing to the Manager. The Manager shall obtain and evaluate such information relating to the economy, industries, businesses, securities markets and securities as it may deem necessary or useful in the discharge of its obligations hereunder and shall formulate and implement a continuing program for the management of the assets and resources of the Fund in a manner consistent with its investment objective. In furtherance of this duty, the Manager, as agent and attorney-in-fact with respect to the Fund, is authorized, in its discretion and without prior consultation with the Fund, to:
(i) buy, sell, exchange, convert, lend, and otherwise trade in any stocks, bonds, and other securities or assets; and
(ii) place orders and negotiate the commissions (if any) for the execution of transactions in securities with or through such brokers, dealers, underwriters or issuers as the Manager may select.
B. Financial, Accounting, and Administrative Services. The Manager shall maintain the corporate existence and corporate records of the Fund; maintain the registrations and qualifications of Fund shares under federal and state law; monitor the financial, accounting, and administrative functions of the Fund; maintain liaison with the various agents employed by the Fund (including the Fund's transfer agent, custodian, independent accountants and legal counsel) and assist in the coordination of their activities on behalf of the Fund.
C. Reports to Fund. The Manager shall furnish to or place at the disposal of the Fund such information, reports, evaluations, analyses and opinions as the Fund may, at any time or from time to time, reasonably request or as the Manager may deem helpful to the Fund.
D. Reports and Other Communications to Fund Shareholders. The Manager shall assist the Fund in developing all general shareholder communications, including regular shareholder reports.
E. Fund Personnel. The Manager agrees to permit individuals who are officers or employees of the Manager to serve (if duly elected or appointed) as officers, directors, members of any committee of directors, members of any advisory board, or members of any other committee of the Fund, without remuneration from or other cost to the Fund.
F. Personnel, Office Space, and Facilities of Manager. The Manager at its own expense shall furnish or provide and pay the cost of such office space, office equipment, office personnel, and office services as the Manager requires in the performance of its investment advisory and other obligations under this Agreement.
2. Allocation of Expenses.
A. Expenses Paid by Manager.
(1) Salaries and Fees of Officers. The Manager shall pay all salaries, expenses, and fees of the officers and directors of the Fund who are affiliated with the Manager.
(2) Assumption of Fund Expenses by Manager. The payment or assumption by the Manager of any expense of the Fund that the Manager is not required by this Agreement to pay or assume shall not obligate the Manager to pay or assume the same or any similar expense of the Fund on any subsequent occasion.
B. Expenses Paid by Fund. The Fund shall bear all expenses of its organization, operations, and business not specifically assumed or agreed to be paid by the Manager as provided in this Agreement. In particular, but without limiting the generality of the foregoing, the Fund shall pay:
(1) Custody and Accounting Services. All expenses of the transfer, receipt, safekeeping, servicing and accounting for the Fund's cash, securities, and other property, including all charges of depositories, custodians, and other agents, if any;
(2) Shareholder Servicing. All expenses of maintaining and servicing shareholder accounts, including all charges of the Fund's transfer, shareholder recordkeeping, dividend disbursing, redemption, and other agents, if any;
(3) Shareholder Communications. All expenses of preparing, setting in type, printing, and distributing reports and other communications to shareholders;
(4) Shareholder Meetings. All expenses incidental to holding meetings of Fund shareholders, including the printing of notices and proxy material, and proxy solicitation therefor;
(5) Prospectuses. All expenses of preparing, setting in type, and printing of annual or more frequent revisions of the Fund's prospectus and of mailing them to shareholders;
(6) Pricing. All expenses of computing the Fund's net asset value per share, including the cost of any equipment or services used for obtaining price quotations;
(7) Communication Equipment. All charges for equipment or services used for communication between the Manager or the Fund and the custodian, transfer agent or any other agent selected by the Fund;
(8) Legal and Accounting Fees and Expenses. All charges for services and expenses of the Fund's legal counsel and independent auditors;
(9) Directors' Fees and Expenses. All compensation of directors, other than those affiliated with the Manager, and all expenses incurred in connection with their service;
(10) Federal Registration Fees. All fees and expenses of registering and maintaining the registration of the Fund under the Act and the registration of the Fund's shares under the Securities Act of 1933, as amended (the "'33 Act"), including all fees and expenses incurred in connection with the preparation, setting in type, printing, and filing of any registration statement and prospectus under the '33 Act or the Act, and any amendments or supplements that may be made from time to time;
(11) State Registration Fees. All fees and expenses of qualifying and maintaining qualification of the Fund and of the Fund's shares for sale under securities laws of various states or jurisdictions, and of registration and qualification of the Fund under all other laws applicable to the Fund or its business activities (including registering the Fund as a broker-dealer, or any officer of the Fund or any person as agent or salesman of the Fund in any state);
(12) Issue and Redemption of Fund Shares. All expenses incurred in connection with the issue, redemption, and transfer of Fund shares, including the expense of confirming all share transactions, and of preparing and transmitting the Fund's stock certificates;
(13) Bonding and Insurance. All expenses of bond, liability, and other insurance coverage required by law or deemed advisable by the Fund's board of directors;
(14) Brokerage Commissions. All brokers' commissions and other charges incident to the purchase, sale, or lending of the Fund's portfolio securities;
(15) Taxes. All taxes or governmental fees payable by or with respect of the Fund to federal, state, or other governmental agencies, domestic or foreign, including stamp or other transfer taxes;
(16) Trade Association Fees. All fees, dues, and other expenses incurred in connection with the Fund's membership in any trade association or other investment organization; and
(17) Nonrecurring and Extraordinary Expenses. Such nonrecurring expenses as may arise, including the costs of actions, suits, or proceedings to which the Fund is a party and the expenses the Fund may incur as a result of its legal obligation to provide indemnification to its officers, directors, and agents.
3. Management Fee. The Fund shall pay the Manager a fee ("Fee") which will consist of two components: a Group Management Fee ("Group Fee"), and an Individual Fund Fee ("Fund Fee"). The Fee shall be paid monthly to the Manager on the first business day of the next succeeding calendar month and shall be calculated as follows:
A. Group Fee. The monthly Group Fee ("Monthly Group Fee") shall be the sum of the daily Group Fee accruals ("Daily Group Fee Accruals") for each month. The Daily Group Fee Accrual for any particular day will be computed by multiplying the Price Funds' group fee accrual as determined below ("Daily Price Funds' Group Fee Accrual") by the ratio of the Fund's net assets for that day to the sum of the aggregate net assets of the Price Funds for that day. The Daily Price Funds' Group Fee Accrual for any particular day shall be calculated by multiplying the fraction of one (1) over the number of calendar days in the year by the annualized Daily Price Funds' Group Fee Accrual for that day as determined in accordance with the following schedule:
0.480% First $1 billion 0.450% Next $1 billion 0.420% Next $1 billion 0.390% Next $1 billion 0.370% Next $1 billion 0.360% Next $2 billion 0.350% Next $2 billion 0.340% Next $5 billion 0.330% Next $10 billion 0.320% Thereafter |
The Price Funds shall include all the mutual funds distributed by T. Rowe Price Investment Services, Inc. (except for the T. Rowe Price Institutional Trust and any private label mutual funds). For the purpose of calculating the Daily Price Funds' Group Fee Accrual for any particular day, the net assets of each Price Fund shall be determined in accordance with the Fund's prospectus as of the close of business on the previous business day on which the Fund was open for business.
B. Fund Fee. The monthly Fund Fee ("Monthly Fund Fee") shall be the sum of the daily Fund Fee accruals ("Daily Fund Fee Accruals") for each month. The Daily Fund Fee Accrual for any particular day will be computed by multiplying the fraction of one (1) over the number of calendar days in the year by the Fund Fee Rate of 0.30% and multiplying this product by the net assets of the Fund for that day, as determined in accordance with the Fund's prospectus as of the close of business on the previous business day on which the Fund was open for business.
C. Expense Limitation. To the extent that the aggregate expenses of every character incurred by the Fund in any fiscal year, including but not limited to Fees of the Manager computed as hereinabove set forth, but excluding interest, taxes, brokerage, and other expenditures which are capitalized in accordance with generally accepted accounting principles and extraordinary expenses, shall exceed the limit ("State Expense Limit") prescribed by any state in which the Fund's shares are qualified for sale, such excess amount shall be the liability of the Manager to pay in the manner specified below. To determine the Manager's liability for the Fund's expenses, the expenses of the Fund shall be annualized monthly as of the last day of the month. If the annualized expenses for any month exceed the State Expense Limit, the payment of the Fee for such month (if there be any) shall be reduced by such excess ("Excess Amount") and in the event the Excess Amount exceeds the amount due as the Fee, the Manager shall remit to the Fund the difference between the Excess Amount and the amount due as the Fee; provided, however, that an adjustment shall be made on or before the last day of the first month of the next succeeding fiscal year if the aggregate expenses for the fiscal year do not exceed the State Expense Limit.
However, as part of the consideration for the Fund's entering into this Agreement, the Manager hereby agrees that through February 28, 1986, the expense limit will be 1.0% of the average daily net assets of the Fund ("1.0% Expense Limitation"); provided, however, that any amount paid or assumed by the Manager pursuant to the 1.0% Expense Limitation (but not over any State Expense Limit) shall be reimbursed by the Fund to the Manager after February 28, 1986; provided, that no such reimbursement shall be made to the Manager after February 28, 1988; provided further, however, that such reimbursement shall only be made to the extent that it does not result in the Fund's aggregate expenses exceeding an expense limit of 1.0%.
D. Proration of Fee. If this Agreement becomes effective or terminates before the end of any month, the Fee for the period from the effective date to the end of such month or from the beginning of such month to the date of termination, as the case may be, shall be prorated according to the proportion which such period bears to the full month in which such effectiveness or termination occurs.
4. Brokerage. Subject to the approval of the board of directors of the Fund, the Manager, in carrying out its duties under Paragraph 1.A., may cause the Fund to pay a broker-dealer which furnishes brokerage or research services [as such services are defined under Section 28(e) of the Securities Exchange Act of l934, as amended (the "'34 Act")], a higher commission than that which might be charged by another broker-dealer which does not furnish brokerage or research services or which furnishes brokerage or research services deemed to be of lesser value, if such commission is deemed reasonable in relation to the brokerage and research services provided by the broker-dealer, viewed in terms of either that particular transaction or the overall responsibilities of the Manager with respect to the accounts as to which it exercises investment discretion (as such term is defined under Section 3(a)(35) of the '34 Act).
5. Manager's Use of the Services of Others. The Manager may (at its cost except as contemplated by Paragraph 4 of this Agreement) employ, retain or otherwise avail itself of the services or facilities of other persons or organizations for the purpose of providing the Manager or the Fund with such statistical and other factual information, such advice regarding economic factors and trends, such advice as to occasional transactions in specific securities or such other information, advice or assistance as the Manager may deem necessary, appropriate or convenient for the discharge of its obligations hereunder or otherwise helpful to the Fund, or in the discharge of Manager's overall responsibilities with respect to the other accounts which it serves as investment manager.
6. Ownership of Records. All records required to be maintained and preserved by the Fund pursuant to the provisions of rules or regulations of the Securities and Exchange Commission under Section 31(a) of the Act and maintained and preserved by the Manager on behalf of the Fund are the property of the Fund and will be surrendered by the Manager promptly on request by the Fund.
7. Reports to Manager. The Fund shall furnish or otherwise make available to the Manager such prospectuses, financial statements, proxy statements, reports, and other information relating to the business and affairs of the Fund as the Manager may, at any time or from time to time, reasonably require in order to discharge its obligations under this Agreement.
8. Services to Other Clients. Nothing herein contained shall limit the freedom of the Manager or any affiliated person of the Manager to render investment supervisory and corporate administrative services to other investment companies, to act as investment manager or investment counselor to other persons, firms or corporations, or to engage in other business activities; but so long as this Agreement or any extension, renewal or amendment hereof shall remain in effect or until the Manager shall otherwise consent, the Manager shall be the only investment manager to the Fund.
9. Limitation of Liability of Manager. Neither the Manager nor any of its officers, directors, or employees, nor any person performing executive, administrative, trading, or other functions for the Fund (at the direction or request of the Manager) or the Manager in connection with the Manager's discharge of its obligations undertaken or reasonably assumed with respect to this Agreement, shall be liable for any error of judgment or mistake of law or for any loss suffered by the Fund in connection with the matters to which this Agreement relates, except for loss resulting from willful misfeasance, bad faith, or gross negligence in the performance of its or his duties on behalf of the Fund or from reckless disregard by the Manager or any such person of the duties of the Manager under this Agreement.
10. Use of Manager's Name The Fund may use the name "T. Rowe Price Tax-Free High Yield Fund, Inc." or any other name derived from the name "T. Rowe Price" only for so long as this Agreement or any extension, renewal or amendment hereof remains in effect, including any similar agreement with any organization which shall have succeeded to the business of the Manager as investment manager. At such time as this Agreement or any extension, renewal or amendment hereof, or such other similar agreement shall no longer be in effect, the Fund will (by corporate action, if necessary) cease to use any name derived from the name "T. Rowe Price," any name similar thereto or any other name indicating that it is advised by or otherwise connected with the Manager, or with any organization which shall have succeeded to the Manager's business as investment manager.
11. Term of Agreement. The term of this Agreement shall begin on the date first above written, and unless sooner terminated as hereinafter provided, this Agreement shall remain in effect through April 30, 1988. Thereafter, this Agreement shall continue in effect from year to year, subject to the termination provisions and all other terms and conditions hereof, so long as: (a) such continuation shall be specifically approved at least annually by the board of directors of the Fund or by vote of a majority of the outstanding voting securities of the Fund and, concurrently with such approval by the board of directors or prior to such approval by the holders of the outstanding voting securities of the Fund, as the case may be, by the vote, cast in person at a meeting called for the purpose of voting on such approval, of a majority of the directors of the Fund who are not parties to this Agreement or interested persons of any such party; and (b) the Manager shall not have notified the Fund, in writing, at least 60 days prior to April 30, 1988 or prior to April 30th of any year thereafter, that it does not desire such continuation. The Manager shall furnish to the Fund, promptly upon its request, such information as may reasonably be necessary to evaluate the terms of this Agreement or any extension, renewal or amendment hereof.
12. Amendment and Assignment of Agreement. This Agreement may not be amended or assigned without the affirmative vote of a majority of the outstanding voting securities of the Fund, and this Agreement shall automatically and immediately terminate in the event of its assignment.
13. Termination of Agreement. This Agreement may be terminated by either party hereto, without the payment of any penalty, upon 60 days' prior notice in writing to the other party; provided, that in the case of termination by the Fund such action shall have been authorized by resolution of a majority of the directors of the Fund who are not parties to this Agreement or interested persons of any such party, or by vote of a majority of the outstanding voting securities of the Fund.
14. Miscellaneous.
A. Captions. The captions in this Agreement are included for convenience of reference only and in no way define or delineate any of the provisions hereof or otherwise affect their construction or effect.
B. Interpretation. Nothing herein contained shall be deemed to require the Fund to take any action contrary to its Articles of Incorporation or By-Laws, or any applicable statutory or regulatory requirement to which it is subject or by which it is bound, or to relieve or deprive the board of directors of the Fund of its responsibility for and control of the conduct of the affairs of the Fund.
C. Definitions. Any question of interpretation of any term or provision of this Agreement having a counterpart in or otherwise derived from a term or provision of the Act shall be resolved by reference to such term or provision of the Act and to interpretations thereof, if any, by the United States courts or, in the absence of any controlling decision of any such court, by rules, regulations or orders of the Securities and Exchange Commission validly issued pursuant to the Act. Specifically, the terms "vote of a majority of the outstanding voting securities," "interested person," "assignment," and "affiliated person," as used in Paragraphs 2, 8, 11, 12, and 13 hereof, shall have the meanings assigned to them by Section 2(a) of the Act. In addition, where the effect of a requirement of the Act reflected in any provision of this Agreement is relaxed by a rule, regulation or order of the Securities and Exchange Commission, whether of special or of general application, such provision shall be deemed to incorporate the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by their respective officers thereunto duly authorized and their respective corporate seals to be hereunto affixed, as of the day and year first above written.
Attest: T. ROWE PRICE TAX-FREE HIGH YIELD FUND,
INC.
By:
Secretary
Attest: T. ROWE PRICE ASSOCIATES, INC.
By:
Secretary
|
pat/TFHYMgAgt
UNDERWRITING AGREEMENT
BETWEEN
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
AND
ROWE PRICE MARKETING, INC.
THIS UNDERWRITING AGREEMENT, made as of this 8th day of January, 1981, by and between T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Fund"), and ROWE PRICE MARKETING, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Distributor").
WITNESSETH:
WHEREAS, the Fund intends to engage in business as an open-end management investment company and is registered as such under the Federal Investment Company Act of 1940, as amended ("ICA-40"); and
WHEREAS, the Distributor proposes to engage principally in the business of distributing shares of the investment companies sponsored and managed by either T. Rowe Price Associates, Inc. ("Price Associates") or Rowe Price-Fleming International, Inc. ("Price-Fleming") and is registered as a broker-dealer under the Securities and Exchange Act of 1934, as amended, ("SEA-34") and is a member of the National Association of Securities Dealers, Inc. ("NASD"); and
WHEREAS, the Fund desires the Distributor to act as the distributor in the public offering of its shares;
NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties hereto agree as follows:
1.Delivery of Fund Documents. The Fund has furnished Distributor with copies, properly certified or authenticated, of each of the following:
(a) Articles of Incorporation, dated June 9,
1980, as amended to date.
(b) By-Laws of the Fund as in effect on the
date hereof.
(c) Resolutions of the Board of Directors of
the Fund selecting Distributor as
principal underwriter and approving this
form of agreement.
The Fund shall furnish the Distributor
|
from time to time with copies, properly certified or authenticated, of all the amendments of, or supplements to, the foregoing, if any.
The Fund shall furnish Distributor promptly with properly certified or authenticated copies of any registration statements filed by it with the Securities and Exchange Commission under the Securities Act of 1933, as amended, ("SA-33") or ICA-40, together with any financial statements and exhibits included therein, and all amendments or supplements thereto hereafter filed.
2.Sale of Shares. Subject to the provisions of Paragraphs 3, 4 and 6 hereof, and to such minimum purchase requirements as may from time to time be currently indicated in the Fund's Prospectus, the Distributor is authorized to sell, as agent on behalf of the Fund, shares of the Fund's capital stock ("Shares") authorized for issuance and registered under SA-33. Distributor may also sell Shares under offers of exchange between and among the investment companies for which Price Associates and/or Price-Fleming act as investment advisers ("Price Funds"). Distributor may also purchase as principal such Shares for resale to the public. Such sale will be made by Distributor on behalf of the Fund by accepting unconditional orders to purchase the Shares placed with Distributor by investors and such purchases will be made by Distributor only after acceptance by Distributor of such orders. The sales price to the public of such Shares shall be the public offering price as defined in Paragraph 5 hereof.
3.Sale of Shares by Fund. The rights granted to the Distributor shall be non-exclusive in that the Fund reserves the right to sell its Shares to investors pursuant to applications received and accepted by the Fund or its transfer agent. Further, the Fund reserves the right to issue Shares in connection with the merger or consolidation of any other investment company, trust or personal holding company with the Fund or the Fund's acquisition by the purchase or otherwise, of all or substantially all of the assets of an investment company, trust or personal holding company. Any right granted to Distributor to accept orders for Shares, or to make sales on behalf of the Fund or to purchase Shares for resale, will not apply to Shares issued in connection with the merger or consolidation of any other investment company with the Fund or its acquisition by purchase or otherwise, of all or substantially all of the assets of any investment company, trust or personal holding company, or substantially all of the outstanding shares or interests of any such entity, and such right shall not apply to Shares that may be offered by the Fund to shareholders by virtue of their being shareholders of the Fund.
4.Shares Covered by this Agreement. This Agreement relates to the issuance and sale of Shares that are duly authorized and registered and available for sale by the Fund, including redeemed or repurchased Shares if and to the extent that they may be legally sold and if, but only if, the Fund authorizes the Distributor to sell them.
5 Public Offering Price. All Shares sold by the Distributor pursuant to this Agreement shall be sold at the public offering price. The public offering price for all accepted subscriptions will be the net asset value per share, as determined in the manner provided in the Fund's, Articles of Incorporation, as now in effect, or as they may be amended (and as reflected in the Fund's then current Prospectus), next after the order is accepted by the Distributor. The Distributor will process orders submitted by brokers for the sale of Shares at the public offering price exclusive of any commission charged by such broker to his customer.
6.Suspension of Sales. If and whenever the determination of net asset value is suspended and until such suspension is terminated, no further orders for Shares shall be accepted by the Distributor except such unconditional orders placed with Distributor before it had knowledge of the suspension. In addition, the Fund reserves the right to suspend sales and Distributor's authority to accept orders for Shares on behalf of the Fund if, in the judgment of the Board of Directors of the Fund, it is in the best interests of the Fund to do so, such suspension to continue for such period as may be determined by the Board of Directors of the Fund; and in that event, no orders to purchase Shares shall be processed or accepted by the Distributor on behalf of the Fund while such suspension remains in effect except for Shares necessary to cover unconditional orders accepted by Distributor before it had knowledge of the suspension, unless otherwise directed by the Board of Directors of the Fund.
7.Solicitation of Orders. In consideration of the rights granted to the Distributor under this Agreement, Distributor will use its best efforts (but only in states in which Distributor may lawfully do so) to obtain from investors unconditional orders for Shares authorized for issuance by the Fund and registered under SA-33, provided that Distributor may in its discretion reject any
order to purchase shares. This does not obligate the Distributor to register or maintain its registration as a broker or dealer under the state securities laws of any jurisdiction if, in the discretion of the Distributor, such registration is not practical or feasible. The Fund shall make available to the Distributor at the expense of the Distributor such number of copies of the Fund's currently effective Prospectus as the Distributor may reasonably request. The Fund shale furnish to the Distributor copies of all information, financial statements and other papers which the Distributor may reasonably request for use in connection with the distribution of Shares.
8.Authorized Representations. The Fund is not authorized by the Distributor to give on behalf of the Distributor any information or to make any representations other than the information and representations contained in a registration statement or prospectus filed with the SEC under SA- 33 and/or ICA-40, covering Shares, as such registration statement and prospectus may be amended or supplemented from time to time.
Distributor is not authorized by the Fund to give on behalf of the Fund any information or to make any representations in connection with the sale of Shares other than the information and representations contained in a registration statement or prospectus filed with the Securities and Exchange Commission ("SEC") under SA-33 and/or ICA-40, covering Shares, as such registration statement and prospectus may be amended or supplemented from time to time, or contained in shareholder reports or other material that may be prepared by or on behalf of the Fund for the Distributor's use. This shall not be construed to prevent the Distributor from preparing and distributing tombstone ads and sales literature or other material as it may deem appropriate. No person other than Distributor is authorized to act as principal underwriter (as such term is defined in ICA- 40, as amended) for the Fund.
9.Registration and Sale of Additional Shares. The Fund will, from time to time, use its best efforts to register under SA-33, such Shares of the Fund as Distributor may reasonably be expected to sell on behalf of the Fund. In connection therewith, the Fund hereby agrees to register an indefinite number of Shares pursuant to Rule 24f-2 under ICA-40, and to register such Shares as shall be deemed advisable pursuant to Rule 24e-2 under ICA-40, as amended. The Fund will, in cooperation with the Distributor, take such action as may be necessary from time to time to qualify such Shares (so registered or otherwise qualified for sale under SA-33), in any state mutually agreeable to the Distributor and the Fund, and to maintain such qualification.
10.Expenses. The Fund shall pay all fees and expenses:
a.in connection with the preparation, setting in type and filing of any registration statement and prospectus under SA-33 and/or ICA-40, and any amendments or supplements that may be made from time to time;
b. in connection with the registration and qualification of Shares for sale in the various states in which the Fund shall determine it advisable to qualify such Shares for sale. (Including registering the Fund as a broker or dealer or any officer of the Fund or other person as agent or salesman of the Fund in any state);
c.of preparing, setting in type, printing and mailing any report or other communication to shareholders of the Fund in their capacity as such;
d. of preparing, setting in type, printing and mailing Prospectuses annually to existing shareholders;
e. in connection with the issue and transfer of Shared resulting from the acceptance by Distributor of orders to purchase Shares placed with the Distributor by investors, including the expenses of confirming such purchase orders; and
f. of any issue taxes or (in the case of Shares redeemed) any initial transfer taxes.
The Distributor shall pay (or will enter into arrangements providing that persons other than Distributor shall pay) all fees and expenses:
a. of printing and distributing any Prospectuses or reports prepared for its use in connection with the distribution of Shares to the public;
b. of preparing, setting in type, printing and mailing any other literature used by the Distributor in connection with the distribution of the Shares to the public;
c. of advertising in connection with the distribution of such Shares to the public;
d. incurred in connection with its registration as a broker or dealer or the registration or qualification of its officers, directors or representatives under Federal and state laws; and
e. incurred in connection with the sale and offering for sale of Shares which have not been herein specifically allocated to the Fund.
11.Conformity With Law. Distributor agrees that in selling Shares it shall duly conform in all respects with the laws of the United States and any state in which such Shares may be offered for sale by Distributor pursuant to this Agreement and to the rules and regulations of the NASD.
12.Independent Contractor. Distributor shall be an independent contractor and neither Distributor, nor any of its officers, directors, employees, or representatives is or shall be an employee of the Fund in the performance of Distributor's duties hereunder. Distributor shall be responsible for its own conduct and the employment, control, and conduct of its agents and employees and for injury to such agents or employees or to others through its agents or employees. Distributor assumes full responsibility for its agents and employees under applicable statutes and agrees to pay all employee taxes thereunder.
13.Indemnification. Distributor agrees to indemnify and hold harmless the Fund and each of its directors, officers, employees, representatives and each person, if any, who controls the Fund within the meaning of Section 15 of SA-33 against any and all losses, liabilities, damages, claims or expenses (including the reasonable costs of investigating or defending any alleged loss, liability, damage, claim or expense and reasonable legal counsel fees incurred in connection therewith) to which the Fund or such of its directors, officers, employees, representatives or controlling person may become subject under SA-33, under any other statute, at common law, or otherwise, arising out of the acquisition of any Shares by any person which (i) may be based upon any wrongful act by Distributor or any of Distributor's directors, officers, employees or representatives, or (ii) may be based upon any untrue statement or alleged
untrue statement of a material fact contained in a registration statement, prospectus, shareholder report or other information covering Shares filed or made public by the Fund or any amendment thereof or supplement thereto, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading if such statement or omission was made in reliance upon information furnished to the Fund by Distributor. In no case (i) is Distributor's indemnity in favor of the Fund, or any person indemnified to be deemed to protect the Fund or such indemnified person against any liability to which the Fund or such person would otherwise be subject by reason of willful misfeasance, bad faith, or gross negligence in the performance of his duties or by reason of his reckless disregard of his obligations and duties under' this Agreement or (ii) is Distributor to be liable under its indemnity agreement contained in this Paragraph with respect to any claim made against the Fund or any person indemnified unless the Fund or such person, as the case may be, shall have notified Distributor in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon the Fund or upon such person (or after the Fund or such person shall have received notice of such service on any designated agent). However, failure to notify Distributor of any such claim shall not relieve Distributor from any liability which Distributor may have to the Fund or any person against whom such action is brought otherwise than on account of Distributor's indemnity agreement contained in this Paragraph.
Distributor shall be entitled to participate, at its own expense, in the defense, or if Distributor so elects, to assume the defense of any suit brought to enforce any such claim, but, if Distributor elects to assume the defense, such defense shall be conducted by legal counsel chosen by Distributor and satisfactory to the Fund, to its directors, officers, employees or representatives, or to any controlling person or persons, defendant or defendants, in the suit. In the event that Distributor elects to assume the defense of any such suit and retain such legal counsel, the Fund, its directors, officers, employees, representatives or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional legal counsel retained by them. If Distributor does not elect to assume the defense of any such suit, Distributor will reimburse the Fund, such directors, officers, employees, representatives or controlling person or persons, defendant or defendants in such suit for the reasonable fees and expenses of any legal counsel retained by them. Distributor agrees to promptly notify the Fund of the commencement of any litigation or proceedings against it or any of its directors, officers, employees or representatives in connection with the issue or sale of any Shares.
The Fund agrees to indemnify and hold
harmless Distributor and each of its directors, officers,
employees, representatives and each person, if any, who controls
Distributor within the meaning of Section 15 of SA-33 against any
and all losses, liabilities, damages, claims or expenses
(including the reasonable costs of investigating or defending any
alleged loss, liability, damage, claim or expense and reasonable
legal counsel fees incurred in connection therewith) to which
Distributor or such of its directors, officers, employees,
representatives or controlling person may become subject under
SA-33, under any other statute, at common law, or otherwise,
arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by the Fund or any of
Fund's directors, officers, employees or representatives, or (ii)
may be based upon any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, shareholder report or other information
covering Shares filed or made public by the Fund or any amendment
thereof or supplement thereto, or the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading if such statement or omission was made in reliance
upon information furnished to Distributor by the Fund. In no
case (i) is the Fund's indemnity in favor of the Distributor, or
any person indemnified to be deemed to protect the Distributor or
such indemnified person against any liability to which the
Distributor or such person would otherwise be subject by reason
of willful misfeasance, bad faith, or gross negligence in the
performance of his duties or by reason of his reckless disregard
of his obligations and duties under this Agreement, or (ii) is
the Fund to be liable under its indemnity agreement contained in
this Paragraph with respect to any claim made against
Distributor, or person indemnified unless Distributor, or such
person, as the case may be, shall have notified the Fund in
writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon Distributor or upon such person (or after Distributor or such person shall have received notice of such service on any designated agent). However, failure to notify the Fund of any such claim shall not relieve the Fund from any liability which the Fund may have to Distributor or any person against whom such action is brought otherwise than on account of the Fund's indemnity agreement contained in this Paragraph.
The Fund shall be entitled to participate, at its own expense, in the defense, or, if the Fund so elects, to assume the defense of any suit brought to enforce any such claim, but, if the Fund elects to assume the defense, such defense shall be conducted by legal counsel chosen by the Fund and satisfactory to Distributor, to its directors, officers, employees or representatives, or to any controlling person or persons, defendant or defendants, in the suit. In the event that the Fund elects to assume the defense of any such suit and retain such legal counsel, Distributor, its directors, officers, employees, representatives or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional legal counsel retained by them. If the Fund does not elect to assume the defense of any such suit, the Fund will reimburse Distributor, such directors, officers, employees, representatives or controlling person or persons, defendant or defendants in such suit for the reasonable fees and expenses of any legal counsel retained by them. The Fund agrees to promptly notify Distributor of the commencement of any litigation or proceedings against it or any of its directors, officers, employees or representatives in connection with the issue or sale of any Shares.
14.Duration and Termination of This
Agreement. This Agreement shall become effective upon its
execution ("effective date") and, unless terminated as provided,
shall remain in effect through June 30, 1982, and from year to
year thereafter, but only so long as such continuance is
specifically approved at least annually by the vote of a majority
of the directors of the Fund who are not interested persons of
Distributor or of the Fund, cast in person at a meeting called
for the purpose of voting on such approval, and by vote of the
directors of the Fund or of a majority of the outstanding voting
securities of the Fund. This Agreement may, on 60 days' written
notice, be terminated at any time, without the payment of any
penalty, by the vote of a majority of the directors of the Fund
who are not interested persons of Distributor or the Fund, by a
vote of a majority of the outstanding voting securities of the
Fund, or by Distributor. This Agreement will automatically
terminate in the event of its assignment. In interpreting the
provisions of this Paragraph 3, the definitions contained in
Section 2(a) of ICA-40 (particularly the definitions of
"interested person", "assignment", and "majority of the
outstanding voting securities") shall be applied.
15.Amendment of this Agreement. No provisions of this Agreement may be changed, waived, discharged, or terminated orally, but only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge, or termination is sought. If the Fund should at any time deem it necessary or advisable in the best interests of the Fund that any amendment of this Agreement be made in order to comply with the recommendations or requirements of the SEC or other governmental authority or to obtain any advantage under state or Federal tax laws and notifies Distributor of the form of such amendment, and the reasons therefor, and if Distributor should decline to assent to such amendment, the Fund may terminate this Agreement forthwith. If Distributor should at any time request that a change be made in the Fund's Articles of Incorporation or By-Laws or in its methods of doing business, in order to comply with any requirements of Federal law or regulations of the SEC, or of a national securities association of which Distributor is or may be a member relating to the sale of Shares, and the Fund should not make such necessary change within a reasonable time, Distributor may terminate this Agreement forthwith.
16.Miscellaneous. It is understood and expressly stipulated that neither the shareholders of the Fund, nor the directors of the Fund shall be personally liable hereunder. The captions in this Agreement are included for convenience of reference only, and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. This Agreement may be
executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
17.Notice. Any notice required or permitted to be given by either party to the other shall be deemed sufficient if sent by registered or certified mail, postage prepaid, addressed by the party giving notice to the other party at the last address furnished by the other party to the party giving notice: if to the Fund, at 100 East Pratt Street, Baltimore, Maryland 21202, and if to the Distributor, at 100 East Pratt Street, Baltimore, Maryland 21202.
ATTEST:T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
/s/Lenora V. Hornung /s/Henry H. Hopkins Lenora V. Hornung Henry H. Hopkins Secretary Vice President ATTEST: ROWE PRICE MARKETING, INC. /s/Lenora V. Hornung /s/H. P. Colhoun Lenora V. Hornung H. P. Colhoun Secretary Vice President |
BETWEEN
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.
AND
T. ROWE PRICE MARKETING, INC.
THIS UNDERWRITING AGREEMENT, made as of the 26th day of October, 1983, by and between T. ROWE PRICE TAX-FREE SHORT- INTERMEDIATE FUND, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Fund"), and T. ROWE PRICE MARKETING, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Distributor").
WITNESSETH:
WHEREAS, the Fund proposes to engage in business as an open-end management investment company and to register as such under the federal Investment Company Act of 1940, as amended ("ICA-40"); and
WHEREAS, the Distributor is engaged principally in the business of distributing shares of the investment companies sponsored and managed by either T. Rowe Price Associates, Inc. ("Price Associates") or Rowe Price-Fleming International, Inc. ("Price-Fleming") and is registered as a broker-dealer under the Securities Exchange Act of 1934, as amended, ("SEA-34") and is a member of the National Association of Securities Dealers, Inc. ("NASD"); and
WHEREAS, the Fund desires the Distributor to act as the distributor in the public offering of its shares;
NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties hereto agree as follows:
1. Delivery of Fund Documents. The Fund has furnished Distributor with copies, properly certified or authenticated, of each of the following:
(a) Articles of Incorporation, dated October 7, 1983.
(b) By-Laws of the Fund as in effect on the date hereof.
(c) Resolutions of the Board of Directors of the Fund selecting Distributor as principal underwriter and approving this form of agreement.
The Fund shall furnish the Distributor from time to
time with copies, properly certified or authenticated, of all the
amendments of, or supplements to, the foregoing, if any.
The Fund shall furnish Distributor promptly with
properly certified or authenticated copies of any registration
statements filed by it with the Securities and Exchange
Commission under the Securities Act of
1933, as amended ("SA-33") or ICA-40, together with any financial statements and exhibits included therein, and all amendments or supplements thereto hereafter filed.
2. Sale of Shares. Subject to the provisions of Paragraphs 3, 4, and 6 hereof, and to such minimum purchase requirements as may from time to time be currently indicated in the Fund's prospectus, the Distributor is authorized to sell, as agent on behalf of the Fund, shares of the Fund's capital stock ("Shares") authorized for issuance and registered under SA-33. Distributor may also sell Shares under offers of exchange between and among the investment companies for which Price Associates and/or Price-Fleming act as investment advisers ("Price Funds"). Distributor may also purchase as principal such Shares for resale to the public. Such sale will be made by Distributor on behalf of the Fund by accepting unconditional orders to purchase the Shares placed with Distributor by investors and such purchases will be made by Distributor only after acceptance by Distributor of such orders. The sales price to the public of such Shares shall be the public offering price as defined in Paragraph 5 hereof.
3. Sale of Shares by Fund. The rights granted to the Distributor shall be nonexclusive in that the Fund reserves the right to sell its Shares to investors pursuant to applications received and accepted by the Fund or its transfer agent. Further, the Fund reserves the right to issue Shares in connection with the merger or consolidation of any other investment company, trust or personal holding company with the Fund or the Fund's acquisition by the purchase or otherwise, of all or substantially all of the assets of an investment company, trust or personal holding company. Any right granted to Distributor to accept orders for Shares, or to make sales on behalf of the Fund or to purchase Shares for resale, will not apply to Shares issued in connection with the merger or consolidation of any other investment company with the Fund or its acquisition by purchase or otherwise, of all or substantially all of the assets of any investment company, trust or personal holding company, or substantially all of the outstanding shares or interests of any such entity, and such right shall not apply to Shares that may be offered by the Fund to shareholders by virtue of their being shareholders of the Fund.
4. Shares Covered by this Agreement. This Agreement relates to the issuance and sale of Shares that are duly authorized, registered, and available for sale by the Fund, including redeemed or repurchased Shares if and to the extent that they may be legally sold and if, but only if, the Fund authorizes the Distributor to sell them.
5. Public Offering Price. All Shares sold by the Distributor pursuant to this Agreement shall be sold at the public offering price. The public offering price for all accepted subscriptions will be the net asset value per share, as determined in the manner provided in the Fund's Articles of Incorporation, as now in effect, or as they may be amended (and as reflected in the Fund's then current prospectus), next after the order is accepted by the Distributor. The Distributor will process orders submitted by brokers for the sale of Shares at the public offering price exclusive of any commission charged by such broker to his customer.
6. Suspension of Sales. If and whenever the determination of net asset value is suspended and until such suspension is terminated, no further orders for Shares shall be accepted by the Distributor except such unconditional orders placed with the Distributor before it had knowledge of the suspension. In addition, the Fund reserves the right to suspend sales and Distributor's authority to accept orders for Shares on behalf of the Fund if, in the judgment of the Board of Directors of the Fund, it is in the best interests of the Fund to do so, such suspension to continue for such period as may be determined by the Board of Directors of the Fund; and in that event, no orders to purchase Shares shall be processed or accepted by the Distributor on behalf of the Fund while such suspension remains in effect except for Shares necessary to cover unconditional orders accepted by Distributor before it had knowledge of the suspension, unless otherwise directed by the Board of Directors of the Fund.
7. Solicitation of Orders. In consideration of the rights granted to the Distributor under this Agreement, Distributor will use its best efforts (but only in states in which Distributor may lawfully do
so) to obtain from investors unconditional orders for Shares authorized for issuance by the Fund and registered under SA-33, provided that Distributor may in its discretion reject any order to purchase Shares. This does not obligate the Distributor to register or maintain its registration as a broker or dealer under the state securities laws of any jurisdiction if, in the discretion of the Distributor, such registration is not practical or feasible. The Fund shall make available to the Distributor at the expense of the Distributor such number of copies of the Fund's currently effective prospectus as the Distributor may reasonably request. The Fund shall furnish to the Distributor copies of all information, financial statements and other papers which the Distributor may reasonably request for use in connection with the distribution of Shares.
8. Authorized Representations. The Fund is not authorized by the Distributor to give on behalf of the Distributor any information or to make any representations other than the information and representations contained in a registration statement or prospectus filed with the SEC under SA-33 and/or ICA-40, covering Shares, as such registration statement and prospectus may be amended or supplemented from time to time.
Distributor is not authorized by the Fund to give on behalf of the Fund any information or to make any representations in connection with the sale of Shares other than the information and representations contained in a registration statement or prospectus filed with the Securities and Exchange Commission ("SEC") under SA-33 and/or ICA-40, covering Shares, as such registration statement and prospectus may be amended or supplemented from time to time, or contained in shareholder reports or other material that may be prepared by or on behalf of the Fund for the Distributor's use. This shall not be construed to prevent the Distributor from preparing and distributing tombstone ads and sales literature or other material as it may deem appropriate. No person other than Distributor is authorized to act as principal underwriter (as such term is defined in ICA-40, as amended) for the Fund.
9. Registration and Sale of Additional Shares. The Fund will, from time to time, use its best efforts to register under SA-33, such Shares of the Fund as Distributor may reasonably be expected to sell on behalf of the Fund. In connection therewith, the Fund hereby agrees to register an indefinite number of Shares pursuant to Rule 24f-2 under ICA-40, and to register such Shares as shall be deemed advisable pursuant to Rule 24e-2 under ICA-40, as amended. The Fund will, in cooperation with the Distributor, take such action as may be necessary from time to time to qualify such Shares (so registered or otherwise qualified for sale under SA-33), in any state mutually agreeable to the Distributor and the Fund, and to maintain such qualification.
10. Expenses. The Fund shall pay all fees and expenses:
a. in connection with the preparation, setting in type and filing of any registration statement and prospectus under SA-33 and/or ICA-40, and any amendments or supplements that may be made from time to time;
b. in connection with the registration and qualification of Shares for sale in the various states in which the Fund shall determine it advisable to qualify such Shares for sale. (Including registering the Fund as a broker or dealer or any officer of the Fund or other person as agent or salesman of the Fund in any state.);
c. of preparing, setting in type, printing and mailing any report or other communication to shareholders of the Fund in their capacity as such;
d. of preparing, setting in type, printing and mailing prospectuses annually to existing shareholders;
e. in connection with the issue and transfer of Shares resulting from the acceptance by Distributor of orders to purchase Shares placed with the Distributor by investors, including the expenses of confirming such purchase orders; and
f. of any issue taxes or (in the case of Shares redeemed) any initial transfer taxes.
The Distributor shall pay (or will enter into arrangements providing that persons other than Distributor shall pay) all fees and expenses:
a. of printing and distributing any prospectuses or reports prepared for its use in connection with the distribution of Shares to the public;
b. of preparing, setting in type, printing and mailing any other literature used by the Distributor in connection with the distribution of the Shares to the public;
c. of advertising in connection with the distribution of such Shares to the public;
d. incurred in connection with its registration as a broker or dealer or the registration or qualification of its officers, directors or representatives under Federal and state laws; and
e. incurred in connection with the sale and offering for sale of Shares which have not been herein specifically allocated to the Fund.
11. Conformity With Law. Distributor agrees that in selling Shares it shall duly conform in all respects with the laws of the United States and any state in which such Shares may be offered for sale by Distributor pursuant to this Agreement and to the rules and regulations of the NASD.
12. Independent Contractor. Distributor shall be an independent contractor and neither Distributor, nor any of its officers, directors, employees, or representatives is or shall be an employee of the Fund in the performance of Distributor's duties hereunder. Distributor shall be responsible for its own conduct and the employment, control, and conduct of its agents and employees and for injury to such agents or employees or to others through its agents or employees. Distributor assumes full responsibility for its agents and employees under applicable statutes and agrees to pay all employee taxes thereunder.
13. Indemnification. Distributor agrees to indemnify
and hold harmless the Fund and each of its directors, officers,
employees, representatives and each person, if any, who controls
the Fund within the meaning of Section 15 of SA-33 against any
and all losses, liabilities, damages, claims or expenses
(including the reasonable costs of investigating or defending any
alleged loss, liability, damage, claim or expense and reasonable
legal counsel fees incurred in connection therewith) to which the
Fund or such of its directors, officers, employees,
representatives or controlling person may become subject under
SA-33, under any other statute, at common law, or otherwise,
arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by Distributor or any of
Distributor's directors, officers, employees or representatives,
or (ii) may be based upon any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, shareholder report or other information
covering Shares filed or made public by the Fund or any amendment
thereof or supplement thereto, or the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading if such statement or omission was made in reliance
upon information furnished to the Fund by Distributor. In no
case (i) is Distributor's indemnity in favor of the Fund, or any
person indemnified to be deemed to protect the Fund or such
indemnified person against any liability to which the Fund or
such person would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of
his duties or by reason of his reckless disregard of his
obligations and duties under this Agreement or (ii) is
Distributor to be liable under its indemnity agreement contained
in this Paragraph with respect to any claim made against the Fund
or any person indemnified unless the Fund or such person, as the
case may be, shall have notified Distributor in writing of the
claim within a reasonable time after the summons or other first
written notification giving information of the nature of the
claim shall have been served upon the Fund or upon such person
(or after the Fund or such person shall have received notice of
such service on any designated agent). However, failure to
notify Distributor of any such claim shall not relieve
Distributor from any liability which Distributor may have to the
Fund or any person against whom such action is brought otherwise
than on account of Distributor's indemnity agreement contained in
this Paragraph.
Distributor shall be entitled to participate, at its own expense, in the defense, or, if Distributor so elects, to assume the defense of any suit brought to enforce any such claim, but, if Distributor elects to assume the defense, such defense shall be conducted by legal counsel chosen by Distributor and satisfactory to the Fund, to its directors, officers, employees or representatives, or to any controlling person or persons, defendant or defendants, in the suit. In the event that Distributor elects to assume the defense of any such suit and retain such legal counsel, the Fund, its directors, officers, employees, representatives or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional legal counsel retained by them. If Distributor does not elect to assume the defense of any such suit, Distributor will reimburse the Fund, such directors, officers, employees, representatives or controlling person or persons, defendant or defendants in such suit for the reasonable fees and expenses of any legal counsel retained by them. Distributor agrees to promptly notify the Fund of the commencement of any litigation or proceedings against it or any of its directors, officers, employees or representatives in connection with the issue or sale of any Shares.
The Fund agrees to indemnify and hold harmless Distributor and each of its directors, officers, employees, representatives and each person, if any, who controls Distributor within the meaning of Section 15 of SA-33 against any and all losses, liabilities, damages, claims or expenses (including the reasonable costs of investigating or defending any alleged loss, liability, damage, claim or expense and reasonable legal counsel fees incurred in connection therewith) to which Distributor or such of its directors, officers, employees, representatives or controlling person may become subject under SA-33, under any other statute, at common law, or otherwise, arising out of the acquisition of any Shares by any person which (i) may be based upon any wrongful act by the Fund or any of Fund's directors, officers, employees or representatives, or (ii) may be based upon any untrue statement or alleged untrue statement of a material fact contained in a registration statement, prospectus, shareholder report or other information covering Shares filed or made public by the Fund or any amendment thereof or supplement thereto, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading if such statement or omission was made in reliance upon information furnished to Distributor by the Fund. In no case (i) is the Fund's indemnity in favor of the Distributor, or any person indemnified to be deemed to protect the Distributor or such indemnified person against any liability to which the Distributor or such person would otherwise be subject by reason of willful misfeasance, bad faith, or gross negligence in the performance of his duties or by reason of his reckless disregard of his obligations and duties under this Agreement, or (ii) is the Fund to be liable under its indemnity agreement contained in this Paragraph with respect to any claim made against Distributor, or person indemnified unless Distributor, or such person, as the case may be, shall have notified the Fund in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon Distributor or upon such person (or after Distributor or such person shall have received notice of such service on any designated agent). However, failure to notify the Fund of any such claim shall not relieve the Fund from any liability which the Fund may have to Distributor or any person against whom such action is brought otherwise than on account of the Fund's indemnity agreement contained in this Paragraph.
The Fund shall be entitled to participate, at its own expense, in the defense, or, if the Fund so elects, to assume the defense of any suit brought to enforce any such claim, but, if the Fund elects to assume the defense, such defense shall be conducted by legal counsel chosen by the Fund and satisfactory to Distributor, to its directors, officers, employees or representatives, or to any controlling person or persons, defendant or defendants, in the suit. In the event that the Fund elects to assume the defense of any such suit and retain such legal counsel, Distributor, its directors, officers, employees, representatives or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional legal counsel retained by them. If the Fund does not elect to assume the defense of any such suit, the Fund will reimburse Distributor, such directors, officers, employees, representatives or controlling person or persons, defendant or defendants in such suit for the reasonable fees and expenses of any legal counsel retained by them. The Fund agrees to promptly notify Distributor of the commencement of any litigation or proceedings against it or any of its directors, officers, employees, or representatives in connection with the issue or sale of any Shares.
14. Duration and Termination of This Agreement. This Agreement shall become effective upon its execution ("effective date") and, unless terminated as provided, shall remain in effect through April 30, 1984, and from year to year thereafter, but only so long as such continuance is specifically approved at least annually by the vote of a majority of the directors of the Fund who are not interested persons of Distributor or of the Fund, cast in person at a meeting called for the purpose of voting on such approval, and by vote of the directors of the Fund or of a majority of the outstanding voting securities of the Fund. This Agreement may, on 60 days' written notice, be terminated at any time, without the payment of any penalty, by the vote of a majority of the directors of the Fund who are not interested persons of Distributor or the Fund, by a vote of a majority of the outstanding voting securities of the Fund, or by Distributor. This Agreement will automatically terminate in the event of its assignment. In interpreting the provisions of this Paragraph 14, the definitions contained in Section 2(a) of ICA-40 (particularly the definitions of "interested person," "assignment," and "majority of the outstanding securities") shall be applied.
15. Amendment of this Agreement. No provisions of this Agreement may be changed, waived, discharged, or terminated orally, but only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge, or termination is sought. If the Fund should at any time deem it necessary or advisable in the best interests of the Fund that any amendment of this Agreement be made in order to comply with the recommendations or requirements of the SEC or other governmental authority or to obtain any advantage under state or Federal tax laws and notifies Distributor of the form of such amendment, and the reasons therefor, and if Distributor should decline to assent to such amendment, the Fund may terminate this Agreement forthwith. If Distributor should at any time request that a change be made in the Fund's Articles of Incorporation or By-Laws or in its methods of doing business, in order to comply with any requirements of Federal law or regulations of the SEC, or of a national securities association of which Distributor is or may be a member relating to the sale of Shares, and the Fund should not make such necessary change within a reasonable time, Distributor may terminate this Agreement forthwith.
16. Miscellaneous. It is understood and expressly stipulated that neither the shareholders of the Fund, nor the directors of the Fund shall be personally liable hereunder. The captions in this Agreement are included for convenience of reference only, and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
17. Notice. Any notice required or permitted to be given by either party to the other shall be deemed sufficient if sent by registered or certified mail, postage prepaid, addressed by the party giving notice to the other party at the last address
furnished by the other party to the party giving notice: if to the Fund, 100 East Pratt Street, Baltimore, Maryland 21202, and if to the Distributor, at 100 East Pratt Street, Baltimore, Maryland 21202.
ATTEST: T. ROWE PRICE TAX-FREE SHORT-
INTERMEDIATE
FUND, INC.
|
ATTEST: T. ROWE PRICE MARKETING, INC.
THIS UNDERWRITING AGREEMENT, made as of 1st day of May, 1981, by and between T. ROWE PRICE TAX-FREE INCOME FUND, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Fund"), and T. ROWE PRICE MARKETING, INC., a corporation organized and existing under the law of the State of Maryland (hereinafter called the "Distributor").
WITNESSETH:
WHEREAS, the Fund is engaged in business as an open-end management investment company and is registered as such under the federal Investment Company Act of 1940, as amended ("ICA-40"); and
WHEREAS, the Distributor proposes to engage principally in the business of distributing shares of the investment companies sponsored and managed by either T. Rowe Price Associates, Inc. ("Price Associates") or Rowe Price-Fleming International, Inc. ("Price-Fleming") and is registered as a broker-dealer under the Securities and Exchange Act of 1934, as amended, ("SEA-34") and is a member of the National Association of Securities Dealers, Inc. ("NASD"); and
WHEREAS, the Fund desires the Distributor to act as the distributor in the public offering of its shares;
NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties hereto agree as follows:
1. Delivery of Fund Documents. The Fund has furnished Distributor with copies, properly certified or authenticated, of each of the following:
(a) Articles of Incorporation, dated September 24, 1976, as amended to date.
(b) By-Laws of the Fund as in effect on the date hereof.
(c) Resolutions of the Board of Directors of the Fund selecting Distributor as principal underwriter and approving this form of agreement. The. Fund shall furnish the Distributor from time to time with copies, properly certified or authenticated, of all the amendments of, or supplements to, the foregoing, if any.
The Fund shall furnish Distributor promptly with properly certified or authenticated copies of any registration statements filed by it with the Securities and Exchange Commission under the Securities Act of 1933, as amended, ("SA-33") or ICA-40, together with any financial statements and exhibits included therein, and all amendments or supplements thereto hereafter filed.
2. Sale of Shares. Subject to the provisions of Paragraphs 3, 4 and 6 hereof, and to such minimum purchase requirements as may from time to time be currently indicated in the Fund's Prospectus, the Distributor is authorized to sell, as agent on behalf of the Fund, shares of the Fund's capital stock ("Shares") authorized for issuance and registered under SA-33. Distributor may also sell Shares under offers of exchange between and among the investment companies for which Price Associates and/or Price-Fleming act as investment advisers ("Price Funds"). Distributor may also purchase as principal such Shares for resale
to the public. Such sale will be made by Distributor on behalf of the Fund by accepting unconditional orders to purchase the Shares placed with Distributor by investors and such purchases will be made by Distributor only after acceptance by Distributor of such orders. The sales price to the public of such Shares shall be the public offering price as defined in Paragraph 5 hereof.
3. Sale of Shares by Fund. The rights granted to the Distributor shall be non-exclusive in that the Fund reserves the right to sell its Shares to investors pursuant to applications received and accepted by the Fund or its transfer agent. Further, the Fund reserves the right to issue Shares in connection with the merger or consolidation of any other investment company, trust or personal holding company with the Fund or the Fund's acquisition by the purchase or otherwise, of all or substantially all of the assets of an investment company, trust or personal holding company. Any right granted to Distributor to accept orders for Shares, or to make sales on behalf of the Fund or to purchase Shares four resale, will not apply to Shares issued in connection with the merger or consolidation of any other investment company with the Fund or its acquisition by purchase or otherwise, of all or substantially all of the assets of any investment company, trust or personal holding company, or substantially all of the outstanding shares or interests of any such entity, and such right shall not apply to Shares that may be offered by the Fund to shareholders by virtue of their being shareholders of the Fund.
4. Shares Covered by this Agreement. This Agreement relates to the issuance and sale of Shares that are duly authorized and registered and available for sale by the Fund, including redeemed or repurchased Shares if and to the extent that they may be legally sold and if, but only if, the Fund authorizes the Distributor to sell them.
5. Public Offering Price. All Shares sold by the Distributor pursuant to this Agreement shall be sold at the public offering price. The public offering price for all accepted subscriptions will be the net asset value per share, as determined in the manner provided in the Fund's Articles of Incorporation, as now in effect, or as they may be amended (and as reflected in the Fund's then current Prospectus), next after the order is accepted by the Distributor. The Distributor will process orders submitted by brokers for the sale of Shares at the public offering price exclusive of any commission charged by such broker to his customer.
6. Suspension of Sales. If and whenever the determination of net asset value is suspended and until such suspension is terminated, no further orders for Shares shall be accepted by the Distributor except such unconditional orders placed with Distributor before it had knowledge of the suspension. In addition, the Fund reserves the right to suspend sales and Distributor's authority to accept orders for Shares on behalf of the Fund if, in the judgment of the Board of Directors of the Fund, it is in the best interests of the Fund to do so, such suspension to continue for such period as may be determined by the Board of Directors of the Fund; and in that event, no orders to purchase Shares shall be processed or accepted by the Distributor on behalf of the Fund while such suspension remains in effect except for Shares necessary to cover unconditional orders accepted by Distributor before it had knowledge of the suspension, unless otherwise directed by the Board of Directors of the Fund.
7. Solicitation of Orders. In consideration of the rights granted to the Distributor under this Agreement, Distributor will use its best efforts (but only in states in which Distributor may lawfully do so) to obtain from investors unconditional orders for Shares authorized for issuance by the Fund and registered under SA-33, provided that Distributor may in its discretion reject any order to purchase shares. This does not obligate the Distributor to register or maintain its registration as a broker or dealer under the state securities laws of any jurisdiction if, in the discretion of the Distributor, such registration is not practical or feasible. The Fund shall make available to the Distributor at the expense of the Distributor such number of copies of the Fund's currently effective Prospectus as the Distributor may reasonably request. The Fund shall furnish to the Distributor copies of all information, financial statements and other papers which the Distributor may reasonably request for use in connection with the distribution of Shares.
8. Authorized Representations. The Fund is not authorized by the Distributor to give on behalf of the Distributor any information or to make any representations ether than the information and representations contained in a registration statement or prospectus filed with the SEC under SA-33 and/or ICA-40, covering Shares, as such registration statement and prospectus may be amended or supplemented from time to time.
Distributor is not authorized by the Fund to give on behalf of the Fund any information or to make any representations in connection with the sale of Shares other than the information and representations contained in a registration statement or prospectus filed with the Securities and Exchange Commission ("SEC") under SA-33 and/or ICA-40, covering Shares, as such registration statement and prospectus may be amended or supplemented from time to time, or contained in shareholder reports or other material that may be prepared by or on behalf of the Fund for the Distributor's use. This shall not be construed to prevent the Distributor from preparing and distributing tombstone ads and sales literature or other material as it may deem appropriate. No person other than Distributor is authorized to act as principal underwriter (as such term is defined in ICA- 40, as amended) for the Fund.
9. Registration and Sale of Additional Shares. The Fund will, from time to time, use its best efforts to register under SA-33, such Shares of the Fund as Distributor may reasonably be expected to sell on behalf of the Fund. In connection therewith, the Fund hereby agrees to register an indefinite number of Shares pursuant to Rule 24f-2 under ICA-40, and to register such Shares as shall be deemed advisable pursuant to Rule 24e-2 under ICA-40, as amended. The Fund will, in cooperation with the Distributor, take such action as may be necessary from time to time to qualify such Shares (so registered or otherwise qualified for sale under SA-33), in any state mutually agreeable to the Distributor and the Fund, and to maintain such qualification.
10. Expenses. The Fund shall pay all fees and expenses:
a. in connection with the preparation, setting in type and filing of any registration statement and prospectus under SA-33 and/or ICA-40, and any amendments or supplements that may be made from time to time;
b. in connection with the registration and qualification of Shares for sale in the various states in which the Fund shall determine it advisable to qualify such Shares for sale. (Including registering the Fund as a broker or dealer or any officer of the Fund or other person as agent or salesman of the Fund in any state.);
c. of preparing, setting in type, printing and mailing any report or other communication to shareholders of the Fund in their capacity as such;
d. of preparing, setting in type, printing and mailing Prospectuses annually to existing shareholders;
e. in connection with the issue and transfer of Shares resulting from the acceptance by Distributor of orders to purchase Shares placed with the Distributor by investors, including the expenses of confirming such purchase orders; and
f. of any issue taxes or (in the case of Shares redeemed) any initial transfer taxes.
The Distributor shall pay (or will enter into arrangements providing that persons other than Distributor shall pay) all fees and expenses:
a. of printing and distributing any Prospectuses or reports prepared for its use in connection with the distribution of Shares to the public;
b. of preparing, setting in type, printing and mailing any other literature used by the Distributor in connection with the distribution of the Shares to the public;
c. of advertising in connection with the distribution of such Shares to the public;
d. incurred in connection with its registration as a broker or dealer or the registration or qualification of its officers, directors or representatives under Federal and state laws; and
e. incurred in connection with the bale and offering for sale of Shares which have not been herein specifically allocated to the Fund.
11. Conformity With Law. Distributor agrees that in selling Shares it shall duly conform in all respects with the laws of the United States and any state in which such Shares may be offered for sale by Distributor pursuant to this Agreement and to the rules and regulations of the NASD.
12. Independent Contractor. Distributor shall be an independent contractor and neither Distributor, nor any of its officers, directors, employees, or representatives is or shall be an employee of the Fund in the performance of Distributor's duties hereunder. Distributor shall be responsible for its own conduct and the employment, control, and conduct of its agents and employees and for injury to such agents or employees or to others through its agents or employees. Distributor assumes full responsibility for its agents and employees under applicable statutes and agrees to pay all employee taxes thereunder.
13. Indemnification. Distributor agrees to indemnify and
held harmless the Fund and each of its directors, officers,
employees, representatives and each person, if any, who controls
the Fund within the meaning of Section 15 of SA-33 against any
and all losses, liabilities, damages, claims or expenses
(including the reasonable costs of investigating or defending any
alleged loss, liability, damage, claim or expense and reasonable
legal counsel fees incurred in connection therewith) to which the
Fund or such of its directors, officers, employees,
representatives or controlling person may become subject under
SA-33, under any other statute, at common law, or otherwise,
arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by Distributor or any of
Distributor's directors, officers, employees or representatives,
or (ii) may be based upon any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, shareholder report or other information
covering Shares filed or made public by the Fund or any.
amendment thereof or supplement there to, or the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading if such statement or omission was made in reliance
upon information furnished to the Fund by Distributor. In no
case (i) is Distributor's indemnity in favor of the Fund, or any
person indemnified to be deemed to protect the Fund or such
indemnified person against any liability to which the Fund or
such person would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of
his duties or by reason of his reckless disregard of his
obligations and duties under this Agreement or (ii) is
Distributor to be liable under its indemnity agreement contained
in this Paragraph with respect to any claim made against the Fund
or any person indemnified unless the Fund or such person, as the
case may be, shall have notified Distributor in writing of the
claim within a reasonable time after the summons or other first
written notification giving information of the nature of the
claim shall have been served upon the Fund or upon such person
(or after the Fund or such person shall have received notice of
such service on any designated agent). However, failure to
notify Distributor of any such claim shall not relieve
Distributor from any liability which Distributor may have to the
Fund or any person against whom such action is brought otherwise
than on account of Distributor's indemnity agreement contained in
this Paragraph.
Distributor shall be entitled to participate, at its own expense, in the defense, or, if Distributor so elects, to assume the defense of any suit brought to enforce any such claim, but, if Distributor elects to assume the defense, such defense shall be conducted by legal counsel chosen by Distributor and satisfactory to the Fund, to its directors, officers, employees or representatives, or to any controlling person
or persons, defendant or defendants, in the suit. In the event that Distributor elects to assume the defense of any such suit and retain such legal counsel, the Fund, its directors, officers, employees, representatives or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional legal counsel retained by them. If Distributor does not elect to assume the defense of any such suit, Distributor will reimburse the Fund, such directors, officers, employees, representatives or controlling person or persons, defendant or defendants in such suit for the reasonable fees and expenses of any legal counsel retained by them. Distributor agrees to promptly notify the Fund of the commencement of any litigation or proceedings against it or any of its directors, officers, employees or representatives in connection with the issue or sale of any Shares.
The Fund agrees to indemnify and hold harmless Distributor and each of its directors, officers, employees, representatives and each person, if any, who controls Distributor within the meaning of Section 15 of SA-33 against any and all losses, liabilities, damages, claims or expenses (including the reasonable costs of investigating or defending any alleged loss, liability, damage, claim or expense and reasonable legal counsel fees incurred in connection therewith) to which Distributor or such of its directors, officers, employees, representatives or controlling person may become subject under SA-33, under any other statute, at common law, or otherwise, arising out of the acquisition of any Shares by any person which (i) may be based upon any wrongful act by the Fund or any of Fund's directors, officers, employees or representatives, or (ii) may be based upon any untrue statement or alleged untrue statement of a material fact contained in a registration statement, prospects, shareholder report or other information covering Shares filed or made public by the Fund or any amendment thereof or supplement thereto, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading if such statement or omission was made in reliance upon information furnished to Distributor by the Fund. In no case (i) is the Fund's indemnity in favor of the Distributor, or any person indemnified to be deemed to protect the Distributor or such indemnified person against any liability to which the Distributor or such person would otherwise be subject by reason of willful misfeasance, bad faith, or gross negligence in the performance of his duties or by reason of his reckless disregard of his obligations and duties under this Agreement, or (ii) is the Fund to be liable under its indemnity agreement contained in this Paragraph with respect to any claim made against Distributor, or person indemnified unless Distributor, or such person, as the case may be, shall have notified the Fund in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon Distributor or upon such person (or after Distributor or such person shall have received notice of such service on any designated agent). However, failure to notify the Fund of any such claim shall not relieve the Fund from any liability which thee Fund may have to Distributor or any person against whom such action is brought otherwise than on account of the Fund's indemnity agreement contained in this Paragraph.
The Fund shall be entitled to participate, at its own expense, in the defense, or, if the Fund so elects, to assume the defense of any suit brought to enforce any such claim, but, if the Fund elects to assume the defense, such defense shall be conducted by legal counsel chosen by the Fund and satisfactory to Distributor, to its directors, officers, employees or representatives, or to any controlling person or persons, defendant or defendants, in the suit. In the event that the Fund elects to assume the defense of any such suit and retain such legal counsel, Distributor, its directors, officers, employees, representatives or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional legal counsel retained by them. If the Fund does not elect to assume the defense of any such suit, the Fund will reimburse Distributor, such directors, officers, employees, representatives or controlling person or persons, defendant or defendants in such suit for the reasonable fees and expenses of any legal counsel retained by them. The Fund agrees to promptly notify Distributor of the commencement of any litigation or proceedings against it or any of its directors, officers, employees or representatives in connection with the issue or sale of any Shares.
14. Duration and Termination of This Agreement. This Agreement shall become effective upon its execution ("effective date") and, unless terminated as provided, shall remain in effect through April 30,
1982, and from year to year thereafter, but only so long as such continuance is specifically approved at least annually by the vote of a majority of the directors of the Fund who are not interested persons of Distributor or of the Fund, cast in person at a meeting called for the purpose of voting on such approval, and by vote of the directors of the Fund or of a majority of the outstanding voting securities of the Fund. This Agreement may, on 60 days' written notice, be terminated at any time, without the payment of any penalty, by the vote of a majority of the directors of the Fund who are not interested persons of Distributor or the Fund, by a vote of a majority of the outstanding voting securities of the Fund, or by Distributor. This Agreement will automatically terminate in the event of its assignment. In interpreting the provisions of this Paragraph 3, the definitions contained in Section 2(a) of ICA-40 (particularly the definitions of "interested person", "assignment", and "majority of the outstanding voting securities") shall be applied.
15. Amendment of this Agreement. No provisions of this Agreement may be changed, waived, discharged, or terminated orally, but only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge, or termination is sought. If the Fund should at any time deem it necessary or advisable in the best interests of the Fund that any amendment of this Agreement be made in order to comply with the recommendations or requirements of the SEC or other governmental authority or to obtain any advantage under state or Federal tax laws and notifies Distributor of the form of such amendment, and the reasons therefor, and if Distributor should decline to assent to such amendment, the Fund may terminate this Agreement forthwith. If Distributor should at any time request that a change be made in the Fund's Articles of Incorporation or By-Laws or in its methods of doing business, in order to comply with any requirements of Federal law or regulations of the SEC, or of a national securities association of which Distributor is or may be a member relating to the sale of Shares, and the Fund should not make such necessary change within a reasonable time, Distributor may terminate this Agreement forthwith.
16. Miscellaneous. It is understood and expressly stipulated that neither the shareholders of the Fund, nor the directors of the Fund shall be personally liable hereunder. The captions in this Agreement are included for convenience of reference only, and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
17. Notice. Any notice required or permitted to be given by either party to the other shall be deemed sufficient if sent by registered or certified mail, postage prepaid, addressed by the party giving notice to the other party at the last address furnished by the other party to the party giving notice: if to the Fund, at 100 East Pratt Street, Baltimore, Maryland 21202, and if to the Distributor, at 100 East Pratt Street, Baltimore, Maryland 21202.
ATTEST: T. ROWE PRICE TAX-FREE INCOME FUND, INC.
/s/Lenora V. Hornung By: /s/ Lenora V. Hornung _________________________ Secretary President ATTEST: T ROWE PRICE MARKETING, INC. /s/Mary Louise Williams By: /s/Thomas C. Barry Mary Louise Williams Thomas C. Barry Secretary President |
BETWEEN
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
AND
T. ROWE PRICE INVESTMENT SERVICES, INC.
THIS UNDERWRITING AGREEMENT, made as of the 21st day of December, 1984, by and between T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Fund"), and T. ROWE PRICE INVESTMENT SERVICES, INC., a corporation organized and existing under the laws of the State of Maryland (hereinafter called the "Distributor").
WITNESSETH:
WHEREAS, the Fund proposes to engage in business as an open-end management investment company and to register as such under the federal Investment Company Act of 1940, as amended ("ICA-40"); and
WHEREAS, the Distributor is engaged principally in the business of distributing shares of the investment companies sponsored and managed by either T. Rowe Price Associates, Inc. ("Price Associates") or Rowe Price-Fleming International, Inc. ("Price-Fleming") and is registered as a broker-dealer under the Securities Exchange Act of 1934, as amended, ("SEA-34") and is a member of the National Association of Securities Dealers, Inc. ("NASD"); and
WHEREAS, the Fund desires the Distributor to act as the distributor in the public offering of its shares;
NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties hereto agree as follows:
1. Delivery of Fund Documents. The Fund has furnished Distributor with copies, properly certified or authenticated, of each of the following:
(a) Articles of Incorporation, dated November 29, 1984.
(b) By-Laws of the Fund as in effect on the date hereof.
(c) Resolutions of the Board of Directors of the Fund selecting Distributor as principal underwriter and approving this form of agreement.
The Fund shall furnish the Distributor from time to
time with copies, properly certified or authenticated, of all the
amendments of, or supplements to, the foregoing, if any.
The Fund shall furnish Distributor promptly with
properly certified or authenticated copies of any registration
statements filed by it with the Securities and Exchange
Commission under the Securities Act of 1933, as amended ("SA-33")
or ICA-40, together with any financial statements and exhibits
included therein, and all amendments or supplements thereto
hereafter filed.
2. Sale of Shares. Subject to the provisions of Paragraphs 3, 4, and 6 hereof, and to such minimum purchase requirements as may from time to time be currently indicated in the Fund's prospectus, the Distributor is authorized to sell, as agent on behalf of the Fund, shares of the Fund's capital stock ("Shares") authorized for issuance and registered under SA-33. Distributor may also sell Shares under offers of exchange between and among the investment companies for which Price Associates and/or Price-Fleming act as investment advisers ("Price Funds"). Distributor may also purchase as principal such Shares for resale to the public. Such sale will be made by Distributor on behalf of the Fund by accepting unconditional orders to purchase the Shares placed with Distributor by investors and such purchases will be made by Distributor only after acceptance by Distributor of such orders. The sales price to the public of such Shares shall be the public offering price as defined in Paragraph 5 hereof.
3. Sale of Shares by Fund. The rights granted to the Distributor shall be nonexclusive in that the Fund reserves the right to sell its Shares to investors pursuant to applications received and accepted by the Fund or its transfer agent. Further, the Fund reserves the right to issue Shares in connection with the merger or consolidation of any other investment company, trust or personal holding company with the Fund or the Fund's acquisition by the purchase or otherwise, of all or substantially all of the assets of an investment company, trust or personal holding company. Any right granted to Distributor to accept orders for Shares, or to make sales on behalf of the Fund or to purchase Shares for resale, will not apply to Shares issued in connection with the merger or consolidation of any other investment company with the Fund or its acquisition by purchase or otherwise, of all or substantially all of the assets of any investment company, trust or personal holding company, or substantially all of the outstanding shares or interests of any such entity, and such right shall not apply to Shares that may be offered by the Fund to shareholders by virtue of their being shareholders of the Fund.
4. Shares Covered by this Agreement. This Agreement relates to the issuance and sale of Shares that are duly authorized, registered, and available for sale by the Fund, including redeemed or repurchased Shares if and to the extent that they may be legally sold and if, but only if, the Fund authorizes the Distributor to sell them.
5. Public Offering Price. All Shares sold by the Distributor pursuant to this Agreement shall be sold at the public offering price. The public offering price for all accepted subscriptions will be the net asset value per share, as determined in the manner provided in the Fund's Articles of Incorporation, as now in effect, or as they may be amended (and as reflected in the Fund's then current prospectus), next after the order is accepted by the Distributor. The Distributor will process orders submitted by brokers for the sale of Shares at the public offering price exclusive of any commission charged by such broker to his customer.
6. Suspension of Sales. If and whenever the determination of net asset value is suspended and until such suspension is terminated, no further orders for Shares shall be accepted by the Distributor except such unconditional orders placed with the Distributor before it had knowledge of the suspension. In addition, the Fund reserves the right to suspend sales and Distributor's authority to accept orders for Shares on behalf of the Fund if, in the judgment of the Board of Directors of the Fund, it is in the best interests of the Fund to do so, such suspension to continue for such period as may be determined by the Board of Directors of the Fund; and in that event, no orders to purchase Shares shall be processed or accepted by the Distributor on behalf of the Fund while such suspension remains in effect except for Shares necessary to cover unconditional orders accepted by Distributor before it had knowledge of the suspension, unless otherwise directed by the Board of Directors of the Fund.
7. Solicitation of Orders. In consideration of the rights granted to the Distributor under this Agreement, Distributor will use its best efforts (but only in states in which Distributor may lawfully do so) to obtain from investors unconditional orders for Shares authorized for issuance by the Fund and registered under SA-33, provided that Distributor may in its discretion reject any order to purchase Shares.
This does not obligate the Distributor to register or maintain its registration as a broker or dealer under the state securities laws of any jurisdiction if, in the discretion of the Distributor, such registration is not practical or feasible. The Fund shall make available to the Distributor at the expense of the Distributor such number of copies of the Fund's currently effective prospectus as the Distributor may reasonably request. The Fund shall furnish to the Distributor copies of all information, financial statements and other papers which the Distributor may reasonably request for use in connection with the distribution of Shares.
8. Authorized Representations. The Fund is not authorized by the Distributor to give on behalf of the Distributor any information or to make any representations other than the information and representations contained in a registration statement or prospectus filed with the SEC under SA-33 and/or ICA-40, covering Shares, as such registration statement and prospectus may be amended or supplemented from time to time.
Distributor is not authorized by the Fund to give on behalf of the Fund any information or to make any representations in connection with the sale of Shares other than the information and representations contained in a registration statement or prospectus filed with the Securities and Exchange Commission ("SEC") under SA-33 and/or ICA-40, covering Shares, as such registration statement and prospectus may be amended or supplemented from time to time, or contained in shareholder reports or other material that may be prepared by or on behalf of the Fund for the Distributor's use. This shall not be construed to prevent the Distributor from preparing and distributing tombstone ads and sales literature or other material as it may deem appropriate. No person other than Distributor is authorized to act as principal underwriter (as such term is defined in ICA-40, as amended) for the Fund.
9. Registration and Sale of Additional Shares. The Fund will, from time to time, use its best efforts to register under SA-33, such Shares of the Fund as Distributor may reasonably be expected to sell on behalf of the Fund. In connection therewith, the Fund hereby agrees to register an indefinite number of Shares pursuant to Rule 24f-2 under ICA-40, and to register such Shares as shall be deemed advisable pursuant to Rule 24e-2 under ICA-40, as amended. The Fund will, in cooperation with the Distributor, take such action as may be necessary from time to time to qualify such Shares (so registered or otherwise qualified for sale under SA-33), in any state mutually agreeable to the Distributor and the Fund, and to maintain such qualification.
10. Expenses. The Fund shall pay all fees and expenses:
a. in connection with the preparation, setting in type and filing of any registration statement and prospectus under SA-33 and/or ICA-40, and any amendments or supplements that may be made from time to time;
b. in connection with the registration and qualification of Shares for sale in the various states in which the Fund shall determine it advisable to qualify such Shares for sale. (Including registering the Fund as a broker or dealer or any officer of the Fund or other person as agent or salesman of the Fund in any state.);
c. of preparing, setting in type, printing and mailing any report or other communication to shareholders of the Fund in their capacity as such;
d. of preparing, setting in type, printing and mailing prospectuses annually to existing shareholders;
e. in connection with the issue and transfer of Shares resulting from the acceptance by Distributor of orders to purchase Shares placed with the Distributor by investors, including the expenses of confirming such purchase orders; and
f. of any issue taxes or (in the case of Shares redeemed) any initial transfer taxes.
The Distributor shall pay (or will enter into arrangements providing that persons other than Distributor shall pay) all fees and expenses:
a. of printing and distributing any prospectuses or reports prepared for its use in connection with the distribution of Shares to the public;
b. of preparing, setting in type, printing and mailing any other literature used by the Distributor in connection with the distribution of the Shares to the public;
c. of advertising in connection with the distribution of such Shares to the public;
d. incurred in connection with its registration as a broker or dealer or the registration or qualification of its officers, directors or representatives under Federal and state laws; and
e. incurred in connection with the sale and offering for sale of Shares which have not been herein specifically allocated to the Fund.
11. Conformity With Law. Distributor agrees that in selling Shares it shall duly conform in all respects with the laws of the United States and any state in which such Shares may be offered for sale by Distributor pursuant to this Agreement and to the rules and regulations of the NASD.
12. Independent Contractor. Distributor shall be an independent contractor and neither Distributor, nor any of its officers, directors, employees, or representatives is or shall be an employee of the Fund in the performance of Distributor's duties hereunder. Distributor shall be responsible for its own conduct and the employment, control, and conduct of its agents and employees and for injury to such agents or employees or to others through its agents or employees. Distributor assumes full responsibility for its agents and employees under applicable statutes and agrees to pay all employee taxes thereunder.
13. Indemnification. Distributor agrees to indemnify
and hold harmless the Fund and each of its directors, officers,
employees, representatives and each person, if any, who controls
the Fund within the meaning of Section 15 of SA-33 against any
and all losses, liabilities, damages, claims or expenses
(including the reasonable costs of investigating or defending any
alleged loss, liability, damage, claim or expense and reasonable
legal counsel fees incurred in connection therewith) to which the
Fund or such of its directors, officers, employees,
representatives or controlling person may become subject under
SA-33, under any other statute, at common law, or otherwise,
arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by Distributor or any of
Distributor's directors, officers, employees or representatives,
or (ii) may be based upon any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, shareholder report or other information
covering Shares filed or made public by the Fund or any amendment
thereof or supplement thereto, or the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading if such statement or omission was made in reliance
upon information furnished to the Fund by Distributor. In no
case (i) is Distributor's indemnity in favor of the Fund, or any
person indemnified to be deemed to protect the Fund or such
indemnified person against any liability to which the Fund or
such person would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of
his duties or by reason of his reckless disregard of his
obligations and duties under this Agreement or (ii) is
Distributor to be liable under its indemnity agreement contained
in this Paragraph with respect to any claim made against the Fund
or any person indemnified unless the Fund or such person, as the
case may be, shall have notified Distributor in writing of the
claim within a reasonable time after the summons or other first
written notification giving information of the nature of the
claim shall have been served upon the Fund or upon such person
(or after the Fund or such person shall have received notice of
such service on any designated agent). However, failure to
notify Distributor of any such claim shall not relieve
Distributor from any liability which Distributor may have to the
Fund or any person against whom such action is brought otherwise
than on account of Distributor's indemnity agreement contained in
this Paragraph.
Distributor shall be entitled to participate, at its own expense, in the defense, or, if Distributor so elects, to assume the defense of any suit brought to enforce any such claim, but, if Distributor elects to assume the defense, such defense shall be conducted by legal counsel chosen by Distributor and satisfactory to the Fund, to its directors, officers, employees or representatives, or to any controlling person or persons, defendant or defendants, in the suit. In the event that Distributor elects to assume the defense of any such suit and retain such legal counsel, the Fund, its directors, officers, employees, representatives or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional legal counsel retained by them. If Distributor does not elect to assume the defense of any such suit, Distributor will reimburse the Fund, such directors, officers, employees, representatives or controlling person or persons, defendant or defendants in such suit for the reasonable fees and expenses of any legal counsel retained by them. Distributor agrees to promptly notify the Fund of the commencement of any litigation or proceedings against it or any of its directors, officers, employees or representatives in connection with the issue or sale of any Shares.
The Fund agrees to indemnify and hold harmless Distributor and each of its directors, officers, employees, representatives and each person, if any, who controls Distributor within the meaning of Section 15 of SA-33 against any and all losses, liabilities, damages, claims or expenses (including the reasonable costs of investigating or defending any alleged loss, liability, damage, claim or expense and reasonable legal counsel fees incurred in connection therewith) to which Distributor or such of its directors, officers, employees, representatives or controlling person may become subject under SA-33, under any other
statute, at common law, or otherwise, arising out of the acquisition of any Shares by any person which (i) may be based upon any wrongful act by the Fund or any of Fund's directors, officers, employees or representatives, or (ii) may be based upon any untrue statement or alleged untrue statement of a material fact contained in a registration statement, prospectus, shareholder report or other information covering Shares filed or made public by the Fund or any amendment thereof or supplement thereto, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading if such statement or omission was made in reliance upon information furnished to Distributor by the Fund. In no case (i) is the Fund's indemnity in favor of the Distributor, or any person indemnified to be deemed to protect the Distributor or such indemnified person against any liability to which the Distributor or such person would otherwise be subject by reason of willful misfeasance, bad faith, or gross negligence in the performance of his duties or by reason of his reckless disregard of his obligations and duties under this Agreement, or (ii) is the Fund to be liable under its indemnity agreement contained in this Paragraph with respect to any claim made against Distributor, or person indemnified unless Distributor, or such person, as the case may be, shall have notified the Fund in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon Distributor or upon such person (or after Distributor or such person shall have received notice of such service on any designated agent). However, failure to notify the Fund of any such claim shall not relieve the Fund from any liability which the Fund may have to Distributor or any person against whom such action is brought otherwise than on account of the Fund's indemnity agreement contained in this Paragraph.
The Fund shall be entitled to participate, at its own
expense, in the defense, or, if the Fund so elects, to assume the
defense of any suit brought to enforce any such claim, but, if
the Fund elects to assume the defense, such defense shall be
conducted by legal counsel chosen by the Fund and satisfactory to
Distributor, to its directors, officers, employees or
representatives, or to any controlling person or persons,
defendant or defendants, in the suit. In the event that the Fund
elects to assume the defense of any such suit and retain such
legal counsel, Distributor, its directors, officers, employees,
representatives or controlling person or persons, defendant or
defendants in the suit, shall bear the fees and expenses of any
additional legal counsel retained by them. If the Fund does not
elect to assume the defense of any such suit, the Fund will
reimburse Distributor, such directors, officers, employees,
representatives or controlling person or persons, defendant or
defendants in such suit for the reasonable fees and expenses of
any legal counsel retained by them. The Fund agrees to promptly
notify Distributor of the commencement of any litigation or
proceedings against it or any of its directors, officers,
employees, or representatives in connection with the issue or
sale of any Shares.
14. Duration and Termination of This Agreement. This
Agreement shall become effective upon its execution ("effective
date") and, unless terminated as provided, shall remain in effect
through April 30, 1986 and from year to year thereafter, but only
so long as such continuance is specifically approved at least
annually by the vote of a majority of the directors of the Fund
who are not interested persons of Distributor or of the Fund,
cast in person at a meeting called for the purpose of voting on
such approval, and by vote of the directors of the Fund or of a
majority of the outstanding voting securities of the Fund. This
Agreement may, on 60 days' written notice, be terminated at any
time, without the payment of any penalty, by the vote of a
majority of the directors of the Fund who are not interested
persons of Distributor or the Fund, by a vote of a majority of
the outstanding voting securities of the Fund, or by Distributor.
This Agreement will automatically terminate in the event of its assignment. In interpreting the provisions of this Paragraph 14, the definitions contained in Section 2(a) of ICA-40 (particularly the definitions of "interested person," "assignment," and "majority of the outstanding securities") shall be applied.
15. Amendment of this Agreement. No provisions of this Agreement may be changed, waived, discharged, or terminated orally, but only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge, or termination is sought. If the Fund should at any time deem it necessary or advisable in the best interests of the Fund that any amendment of this Agreement be made in order to comply with the recommendations or requirements of the SEC or other governmental authority or to obtain any advantage under state or Federal tax laws and notifies Distributor of the form of
such amendment, and the reasons therefor, and if Distributor should decline to assent to such amendment, the Fund may terminate this Agreement forthwith. If Distributor should at any time request that a change be made in the Fund's Articles of Incorporation or By-Laws or in its methods of doing business, in order to comply with any requirements of Federal law or regulations of the SEC, or of a national securities association of which Distributor is or may be a member relating to the sale of Shares, and the Fund should not make such necessary change within a reasonable time, Distributor may terminate this Agreement forthwith.
16. Miscellaneous. It is understood and expressly stipulated that neither the shareholders of the Fund, nor the directors of the Fund shall be personally liable hereunder. The captions in this Agreement are included for convenience of reference only, and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
17. Notice. Any notice required or permitted to be given by either party to the other shall be deemed sufficient if sent by registered or certified mail, postage prepaid, addressed by the party giving notice to the other party at the last address
furnished by the other party to the party giving notice: if to the Fund, 100 East Pratt Street, Baltimore, Maryland 21202, and if to the Distributor, at 100 East Pratt Street, Baltimore, Maryland 21202.
ATTEST: T. ROWE PRICE TAX-FREE HIGH YIELD
FUND, INC.
Secretary President
ATTEST: T. ROWE PRICE INVESTMENT SERVICES,
INC.
|
The Custodian Agreement dated September 28, 1987, as amended, between State Street Bank and Trust Company and T. Rowe Price Funds should be inserted here.
FRF 07/87
1. Employment of Custodian and Property to be Held By It1
2. Duties of the Custodian with Respect to Property of the Fund
Held by the Custodian in the United States.. . . . 2
2.1 Holding Securities. . . . . . . . . . . . . . . 2
2.2 Delivery of Securities. . . . . . . . . . . . . 2
1) Sale . . . . . . . . . . . . . . . . . . . 2
2) Repurchase Agreement . . . . . . . . . . . 2
3) Securities System. . . . . . . . . . . . . 3
4) Tender Offer . . . . . . . . . . . . . . . 3
5) Redemption by Issuer . . . . . . . . . . . 3
6) Transfer to Issuer, Nominee, Exchange. . . 3
7) Sale to Broker . . . . . . . . . . . . . . 3
8) Exchange or Conversion . . . . . . . . . . 4
9) Warrants, Rights . . . . . . . . . . . . . 4
10) Loans of Securities. . . . . . . . . . . . 4
11) Borrowings . . . . . . . . . . . . . . . . 4
12) Options. . . . . . . . . . . . . . . . . . 5
13) Futures. . . . . . . . . . . . . . . . . . 5
14) In-Kind Distributions. . . . . . . . . . . 5
15) Miscellaneous. . . . . . . . . . . . . . . 5
16) Type of Payment. . . . . . . . . . . . . . 6
2.3 Registration of Securities. . . . . . . . . . . 6
2.4 Bank Accounts . . . . . . . . . . . . . . . . . 7
|
2.5 Sale of Shares and Availability of Federal Funds7
2.6 Collection of Income, Dividends . . . . . . . . 7
2.7 Payment of Fund Monies. . . . . . . . . . . . . 8
1) Purchases. . . . . . . . . . . . . . . . . 8
2) Exchanges. . . . . . . . . . . . . . . . . 9
3) Redemptions. . . . . . . . . . . . . . . . 9
4) Expense and Liability. . . . . . . . . . . 9
5) Dividends. . . . . . . . . . . . . . . . . 9
6) Short Sale Dividend. . . . . . . . . . . .10
7) Loan . . . . . . . . . . . . . . . . . . .10
8) Miscellaneous. . . . . . . . . . . . . . .10
2.8 Liability for Payment in Advance of Receipt of
Securities Purchased. . . . . . . . . . . . .10
2.9 Appointment of Agents . . . . . . . . . . . . .10
2.10 Deposit of Securities in Securities System. . .10
1) Account of Custodian . . . . . . . . . . .11
2) Records. . . . . . . . . . . . . . . . . .11
3) Payment of Fund Monies, Delivery of
Securities . . . . . . . . . . . . . . .11
4) Reports. . . . . . . . . . . . . . . . . .12
5) Annual Certificate . . . . . . . . . . . .12
6) Indemnification. . . . . . . . . . . . . .12
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2.11 Fund Assets Held in the Custodian's Direct Paper
System. . . . . . . . . . . . . . . . . . . .13
2.12 Segregated Account. . . . . . . . . . . . . . .14
2.13 Ownership Certificates for Tax Purposes . . . .15
2.14 Proxies . . . . . . . . . . . . . . . . . . . .15
2.15 Communications Relating to Fund Portfolio
Securities. . . . . . . . . . . . . . . . . .15
2.16 Reports to Fund by Independent Public
Accountants . . . . . . . . . . . . . . . . .16
3. Duties of the Custodian with Respect to Property
of the Fund Held Outside of the United States. . .16
3.1 Appointment of Foreign Sub-Custodians . . . . .16
3.2 Assets to be Held . . . . . . . . . . . . . . .17
3.3 Foreign Securities Depositories . . . . . . . .17
3.4 Segregation of Securities . . . . . . . . . . .17
3.5 Access of Independent Accountants of the Fund .17
3.6 Reports by Custodian. . . . . . . . . . . . . .18
3.7 Transactions in Foreign Assets of the Fund. . .18
3.8 Responsibility of Custodian, Sub-Custodian and
Fund. . . . . . . . . . . . . . . . . . . . .18
3.9 Monitoring Responsibilities . . . . . . . . . .19
|
3.10 Branches of U.S. Banks. . . . . . . . . . . . .19
4. Payments for Repurchases or Redemptions and Sales of
Shares of the Fund . . . . . . . . . . . . . . . .19
5. Proper Instructions. . . . . . . . . . . . . . . . .20
6. Actions Permitted Without Express Authority. . . . .21
7. Evidence of Authority, Reliance on Documents . . . .21
8. Duties of Custodian with Respect to the Books of Account
and Calculations of Net Asset Value and Net Income22
9. Records, Inventory . . . . . . . . . . . . . . . . .22 10. Opinion of Fund's Independent Accountant . . . . . .23 11. Compensation of Custodian. . . . . . . . . . . . . .23 12. Responsibility of Custodian. . . . . . . . . . . . .23 13. Effective Period, Termination and Amendment. . . . .25 14. Successor Custodian. . . . . . . . . . . . . . . . .26 15. Interpretive and Additional Provisions . . . . . . .28 16. Notice . . . . . . . . . . . . . . . . . . . . . . .28 17. Bond . . . . . . . . . . . . . . . . . . . . . . . .28 18. Confidentiality. . . . . . . . . . . . . . . . . . .29 19. Exemption from Liens . . . . . . . . . . . . . . . .29 20. Massachusetts Law to Apply . . . . . . . . . . . . .29 21. Prior Contracts. . . . . . . . . . . . . . . . . . .29 22. The Parties. . . . . . . . . . . . . . . . . . . . .30 23. Governing Documents. . . . . . . . . . . . . . . . .30 24. Subcustodian Agreement . . . . . . . . . . . . . . .30 25. Directors and Trustees . . . . . . . . . . . . . . .30 26. Massachusetts Business Trust . . . . . . . . . . . .30 27. Successors of Parties. . . . . . . . . . . . . . . .31 |
This Contract by and between State Street Bank and Trust Company, a Massachusetts trust company, having its principal place of business at 225 Franklin Street, Boston, Massachusetts, 02110 (hereinafter called the "Custodian"), and each fund which is listed on Appendix A (as such Appendix may be amended from time to time) and which evidences its agreement to be bound hereby by executing a copy of this Contract (each such fund individually hereinafter called the "Fund," whose definition may be found in Section 22),
WITNESSETH: That in consideration of the mutual covenants
and agreements hereinafter contained, the parties hereto agree as
follows:
1. Employment of Custodian and Property to be Held by It
The Fund hereby employs the Custodian as the custodian of
its assets, including securities it desires to be held in places
within the United States ("domestic securities") and securities
it desires to be held outside the United States ("foreign
securities") pursuant to the Governing Documents of the Fund.
The Fund agrees to deliver to the Custodian all securities and
cash now or hereafter owned or acquired by it, and all payments
of income, payments of principal or capital distributions
received by it with respect to all securities owned by the Fund
from time to time, and the cash consideration received by it for
such new or treasury shares of capital stock ("Shares") of the
Fund as may be issued or sold from time to time. The Custodian
shall not be responsible for any property of the Fund held or
received by the Fund and not delivered to the Custodian.
With respect to domestic securities, upon receipt of "Proper
Instructions" (within the meaning of Article 5), the Custodian
shall from time to time employ one or more sub-custodians located
in the United States, but only in accordance with an applicable
vote by the Board of Directors/Trustees of the Fund, and provided
that the Custodian shall have no more or less responsibility or
liability to the Fund on account of any actions or omissions of
any sub-custodian so employed than any such sub-custodian has to
the Custodian, and further provided that the Custodian shall not
release the sub-custodian from any responsibility or liability
unless mutually agreed upon by the parties in writing. With
respect to foreign securities and other assets of the Fund held
outside the United States, the Custodian shall employ Chase
Manhattan Bank, N.A., as a sub-custodian for the Fund in
accordance with the provisions of Article 3.
2. Duties of the Custodian with Respect to Property of the Fund
Held By the Custodian in the United States
2.1 Holding Securities. The Custodian shall hold and
physically segregate for the account of the Fund all
non-cash property, to be held by it in the United States,
including all domestic securities owned by the Fund, other
than (a) securities which are maintained pursuant to Section
2.10 in a clearing agency which acts as a securities
depository or in a book-entry system authorized by the U.S.
Department of the Treasury, collectively referred to herein
as "Securities System," and (b) commercial paper of an
issuer for which the Custodian acts as issuing and paying
agent ("Direct Paper") which is deposited and/or maintained
in the Direct Paper System of the Custodian pursuant to
Section 2.11.
2.2 Delivery of Securities. The Custodian shall release
and deliver domestic securities owned by the Fund held by
the Custodian or in a Securities System account of the
Custodian or in the Custodian's Direct Paper book entry
system account ("Direct Paper System Account") only upon
receipt of Proper Instructions, which may be continuing
instructions when deemed appropriate by mutual agreement of
the parties, and only in the following cases:
1) Sale. Upon sale of such securities for the
account of the Fund and receipt of payment
therefor;
2) Repurchase Agreement. Upon the receipt of payment
in connection with any repurchase agreement
related to such securities entered into by the
Fund;
3) Securities System. In the case of a sale effected
through a Securities System, in accordance with
the provisions of Section 2.10 hereof;
4) Tender Offer. To the depository agent or other
receiving agent in connection with tender or other
similar offers for portfolio securities of the
Fund;
5) Redemption by Issuer. To the issuer thereof or
its agent when such securities are called,
redeemed, retired or otherwise become payable;
provided that, in any such case, the cash or other
consideration is to be delivered to the Custodian;
6) Transfer to Issuer, Nominee. Exchange. To the
issuer thereof, or its agent, for transfer into
the name of the Fund or into the name of any
nominee or nominees of the Custodian or into the
name or nominee name of any agent appointed
pursuant to Section 2.9 or into the name or
nominee name of any sub-custodian appointed
pursuant to Article 1; or for exchange for a
different number of bonds, certificates or other
evidence representing the same aggregate face
amount or number of units and bearing the same
interest rate, maturity date and call provisions,
if any; provided that, in any such case, the new
securities are to be delivered to the Custodian;
7) Sale to Broker or Dealer. Upon the sale of such
securities for the account of the Fund, to the
broker or its clearing agent or dealer, against a
receipt, for examination in accordance with
"street delivery" custom; provided that in any
such case, the Custodian shall have no
responsibility or liability for any loss arising
from the delivery of such securities prior to
receiving payment for such securities except as
may arise from the Custodian's failure to act in
accordance with its duties as set forth in
Section 12.
8) Exchange or Conversion. For exchange or
conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization,
split-up of shares, change of par value or
readjustment of the securities of the issuer of
such securities, or pursuant to provisions for
conversion contained in such securities, or
pursuant to any deposit agreement provided that,
in any such case, the new securities and cash, if
any, are to be delivered to the Custodian;
9) Warrants, Rights. In the case of warrants, rights
or similar securities, the surrender thereof in
the exercise of such warrants, rights or similar
securities or the surrender of interim receipts or
temporary securities for definitive securities;
provided that, in any such case, the new
securities and cash, if any, are to be delivered
to the Custodian;
10) Loans of Securities. For delivery in connection
with any loans of securities made by the Fund, but
only against receipt of adequate collateral as
agreed upon from time to time by the Custodian and
the Fund, which may be in the form of cash,
obligations issued by the United States
government, its agencies or instrumentalities, or
such other property as mutually agreed by the
parties, except that in connection with any loans
for which collateral is to be credited to the
Custodian's account in the book-entry system
authorized by the U.S. Department of the Treasury,
the Custodian will not be held liable or
responsible for the delivery of securities owned
by the Fund prior to the receipt of such
collateral, unless the Custodian fails to act in
accordance with its duties set forth in
Article 12;
11) Borrowings. For delivery as security in
connection with any borrowings by the Fund
requiring a pledge of assets by the Fund, but only
against receipt of amounts borrowed, except where
additional collateral is required to secure a
borrowing already made, subject to Proper
Instructions, further securities may be released
for that purpose;
12) Options. For delivery in accordance with the
provisions of any agreement among the Fund, the
Custodian and a broker-dealer registered under the
Securities Exchange Act of 1934 (the "Exchange
Act") and a member of The National Association of
Securities Dealers, Inc. ("NASD"), relating to
compliance with the rules of The Options Clearing
Corporation, any registered national securities
exchange, any similar organization or
organizations, or the Investment Company Act of
1940, regarding escrow or other arrangements in
connection with transactions by the Fund;
13) Futures. For delivery in accordance with the
provisions of any agreement among the Fund, the
Custodian, and a Futures Commission Merchant
registered under the Commodity Exchange Act,
relating to compliance with the rules of the
Commodity Futures Trading Commission and/or any
Contract Market, any similar organization or
organizations, or the Investment Company Act of
1940, regarding account deposits in connection
with transactions by the Fund;
14) In-Kind Distributions. Upon receipt of
instructions from the transfer agent ("Transfer
Agent") for the Fund, for delivery to such
Transfer Agent or to the holders of shares in
connection with distributions in kind, as may be
described from time to time in the Fund's
currently effective prospectus and statement of
additional information ("prospectus"), in
satisfaction of requests by holders of Shares for
repurchase or redemption;
15) Miscellaneous. For any other proper corporate
purpose, but only upon receipt of, in addition to
Proper Instructions, a certified copy of a
resolution of the Board of Directors/Trustees or
of the Executive Committee signed by an officer of
the Fund and certified by the Secretary or an
Assistant Secretary, specifying the securities to
be delivered, setting forth the purpose for which
such delivery is to be made, declaring such
purpose to be a proper corporate purpose, and
naming the person or persons to whom delivery of
such securities shall be made; and
16) Type of Payment. In any or all of the above
cases, payments to the Fund shall be made in cash,
by a certified check upon or a treasurer's or
cashier's check of a bank, by effective bank wire
transfer through the Federal Reserve Wire System
or, if appropriate, outside of the Federal Reserve
Wire System and subsequent credit to the Fund's
Custodian account, or, in case of delivery through
a stock clearing company, by book-entry credit by
the stock clearing company in accordance with the
then current street custom, or such other form of
payment as may be mutually agreed by the parties,
in all such cases collected funds to be promptly
credited to the Fund.
2.3 Registration of Securities. Domestic securities held
by the Custodian (other than bearer securities) shall be
registered in the name of the Fund or in the name of any
nominee of the Fund or of any nominee of the Custodian which
nominee shall be assigned exclusively to the Fund, unless
the Fund has authorized in writing the appointment of a
nominee to be used in common with other registered
investment companies having the same investment adviser as
the Fund, or in the name or nominee name of any agent
appointed pursuant to Section 2.9 or in the name or nominee
name of any sub-custodian appointed pursuant to Article 1.
All securities accepted by the Custodian on behalf of the
Fund under the terms of this Contract shall be in "street
name" or other good delivery form.
2.4 Bank Accounts. The Custodian shall open and maintain a
separate bank account or accounts in the United States in
the name of the Fund, subject only to draft or order by the
Custodian acting pursuant to the terms of this Contract, and
shall hold in such account or accounts, subject to the
provisions hereof all cash received by it from or for the
account of the Fund, other than cash maintained by the Fund
in a bank account established and used in accordance with
Rule 17f-3 under the Investment Company Act of 1940. Funds
held by the Custodian for the Fund may be deposited for the
Fund's credit in the Banking Department of the Custodian or
in such other banks or trust companies as the Custodian may
in its discretion deem necessary or desirable; provided,
however, that every such bank or trust company shall be
qualified to act as a custodian under the Investment Company
Act of 1940 and that each such bank or trust company and the
funds to be deposited with each such bank or trust company
shall be approved by vote of a majority of the Board of
Directors/Trustees of the Fund. Such funds shall be
deposited by the Custodian in its capacity as Custodian and
shall be withdrawable by the Custodian only in that
capacity.
2.5 Sale of Shares and Availability of Federal Funds. Upon
mutual agreement between the Fund and the Custodian, the
Custodian shall, upon the receipt of Proper Instructions,
make federal funds available to the Fund as of specified
times agreed upon from time to time by the Fund and the
Custodian in the amount of checks received in payment for
Shares of the Fund which are deposited into the Fund's
account.
2.6 Collection of Income, Dividends. The Custodian shall
collect on a timely basis all income and other payments with
respect to United States registered securities held
hereunder to which the Fund shall be entitled either by law
or pursuant to custom in the securities business, and shall
collect on a timely basis all income and other payments with
respect to United States bearer securities if, on the date
of payment by the issuer, such securities are held by the
Custodian or its agent thereof and shall credit such income
or other payments, as collected, to the Fund's custodian
account. Without limiting the generality of the foregoing,
the Custodian shall detach and present for payment all
coupons and other income items requiring presentation as and
when they become due and shall collect interest when due on
securities held hereunder. The Custodian will also receive
and collect all stock dividends, rights and other items of
like nature as and when they become due or payable. Income
due the Fund on United States securities loaned pursuant to
the provisions of Section 2.2 (10) shall be the
responsibility of the Fund. The Custodian will have no duty
or responsibility in connection therewith, other than to
provide the Fund with such information or data as may be
necessary to assist the Fund in arranging for the timely
delivery to the Custodian of the income to which the Fund is
properly entitled.
2.7 Payment of Fund Monies. Upon receipt of Proper
Instructions,
which may be continuing instructions when deemed appropriate
by mutual agreement of the parties, the Custodian shall pay
out monies of the Fund in the following cases only:
1) Purchases. Upon the purchase of domestic
securities, options, futures contracts or options
on futures contracts for the account of the Fund
but only (a) against the delivery of such
securities, or evidence of title to such options,
futures contracts or options on futures contracts,
to the Custodian (or any bank, banking firm or
trust company doing business in the United States
or abroad which is qualified under the Investment
Company Act of 1940, as amended, to act as a
custodian and has been designated by the Custodian
as its agent for this purpose in accordance with
Section 2.9 hereof) registered in the name of the
Fund or in the name of a nominee of the Fund or of
the Custodian referred to in Section 2.3 hereof or
in other proper form for transfer; (b) in the case
of a purchase effected through a Securities
System, in accordance with the conditions set
forth in Section 2.10 hereof or (c) in the case of
a purchase involving the Direct Paper System, in
accordance with the conditions set forth in
Section 2.11; or (d) in the case of repurchase
agreements entered into between the Fund and the
Custodian, or another bank, or a broker-dealer
which is a member of NASD, (i) against delivery of
the securities either in certificate form or
through an entry crediting the Custodian's account
at the Federal Reserve Bank with such securities
or (ii) against delivery of the receipt evidencing
purchase by the Fund of securities owned by the
Custodian along with written evidence of the
agreement by the Custodian to repurchase such
securities from the Fund. All coupon bonds
accepted by the Custodian shall have the coupons
attached or shall be accompanied by a check
payable on coupon payable date for the interest
due on such date.
2) Exchanges. In connection with conversion,
exchange or surrender of securities owned by the
Fund as set forth in Section 2.2 hereof;
3) Redemptions. For the redemption or repurchase of
Shares issued by the Fund as set forth in Article
4 hereof;
4) Expense and Liability. For the payment of any
expense or liability incurred by the Fund,
including but not limited to the following
payments for the account of the Fund: interest,
taxes, management, accounting, transfer agent and
legal fees, and operating expenses of the Fund
whether or not such expenses are to be in whole or
part capitalized or treated as deferred expenses;
5) Dividends. For the payment of any dividends or
other distributions to shareholders declared
pursuant to the Governing Documents of the Fund;
6) Short Sale Dividend. For payment of the amount of
dividends received in respect of securities sold
short;
7) Loan. For repayment of a loan upon redelivery of
pledged securities and upon surrender of the
note(s), if any, evidencing the loan;
8) Miscellaneous. For any other proper purpose, but
only upon receipt of, in addition to Proper
Instructions, a certified copy of a resolution of
the Board of Directors/Trustees or of the
Executive Committee of the Fund signed by an
officer of the Fund and certified by its Secretary
or an Assistant Secretary, specifying the amount
of such payment, setting forth the purpose for
which such payment is to be made, declaring such
purpose to be a proper purpose, and naming the
person or persons to whom such payment is to be
made.
2.8 Liability for Payment in Advance of Receipt of
Securities Purchased. In any and every case where payment
for purchase of domestic securities for the account of the
Fund is made by the Custodian in advance of receipt of the
securities purchased in the absence of specific written
instructions from the Fund to so pay in advance, the
Custodian shall be absolutely liable to the Fund for such
securities to the same extent as if the securities had been
received by the Custodian.
2.9 Appointment of Agents. The Custodian may at any time
or times in its discretion appoint (and may at any time
remove) any other bank or trust company, which is itself
qualified under the Investment Company Act of 1940, as
amended, to act as a custodian, as its agent to carry out
such of the provisions of this Article 2 as the Custodian
may from time to time direct; provided, however, that the
appointment of any agent shall not relieve the Custodian of
its responsibilities or liabilities hereunder.
2.10 Deposit of Securities in Securities Systems. The
Custodian may deposit and/or maintain domestic securities
owned by the Fund in a clearing agency registered with the
Securities and Exchange Commission under Section 17A of the
Securities Exchange Act of 1934, which acts as a securities
depository, or in the book-entry system authorized by the
U.S. Department of the Treasury and certain federal
agencies, collectively referred to herein as "Securities
System" in accordance with applicable Federal Reserve Board
and Securities and Exchange Commission rules and
regulations, if any, and subject to the following
provisions:
1) Account of Custodian. The Custodian may keep
domestic securities of the Fund in a Securities
System provided that such securities are
represented in an account ("Account") of the
Custodian in the Securities System which shall not
include any assets of the Custodian other than
assets held as a fiduciary, custodian or otherwise
for customers;
2) Records. The records of the Custodian, with
respect to domestic securities of the Fund which
are maintained in a Securities System, shall
identify by book-entry those securities belonging
to the Fund;
3) Payment of Fund Monies, Delivery of Securities.
Subject to Section 2.7, the Custodian shall pay
for domestic securities purchased for the account
of the Fund upon (i) receipt of advice from the
Securities System that such securities have been
transferred to the Account, and (ii) the making of
an entry on the records of the Custodian to
reflect such payment and transfer for the account
of the Fund. Subject to Section 2.2, the
Custodian shall transfer domestic securities sold
for the account of the Fund upon (i) receipt of
advice from the Securities System that payment for
such securities has been transferred to the
Account, and (ii) the making of an entry on the
records of the Custodian to reflect such transfer
and payment for the account of the Fund. Copies
of all advices from the Securities System of
transfers of domestic securities for the account
of the Fund shall identify the Fund, be maintained
for the Fund by the Custodian and be provided to
the Fund at its request. The Custodian shall
furnish the Fund confirmation of each transfer to
or from the account of the Fund in the form of a
written advice or notice and shall furnish to the
Fund copies of daily transaction sheets reflecting
each day's transactions in the Securities System
for the account of the Fund;
4) Reports. The Custodian shall provide the Fund
with any report obtained by the Custodian on the
Securities System's accounting system, internal
accounting control and procedures for safeguarding
domestic securities deposited in the Securities
System, and further agrees to provide the Fund
with copies of any documentation it has relating
to its arrangements with the Securities Systems as
set forth in this Agreement or as otherwise
required by the Securities and Exchange
Commission;
5) Annual Certificate. The Custodian shall have
received the initial or annual certificate, as the
case may be, required by Article 13 hereof;
6) Indemnification. Anything to the contrary in this
Contract notwithstanding, the Custodian shall be
liable to the Fund for any loss or expense,
including reasonable attorneys fees, or damage to
the Fund resulting from use of the Securities
System by reason of any failure by the Custodian
or any of its agents or of any of its or their
employees or agents or from failure of the
Custodian or any such agent to enforce effectively
such rights as it may have against the Securities
System; at the election of the Fund, it shall be
entitled to be subrogated to the rights of the
Custodian with respect to any claim against the
Securities System or any other person which the
Custodian may have as a consequence of any such
loss, expense or damage if and to the extent that
the Fund has not been made whole for any such
loss, expense or damage.
2.11 Fund Assets Held in the Custodian's Direct Paper
System. The Custodian may deposit and/or maintain
securities owned by the Fund in the Direct Paper System of
the Custodian subject to the following provisions:
1) No transaction relating to securities in the
Direct Paper System will be effected in the
absence of Proper Instructions;
2) The Custodian may keep securities of the Fund in
the Direct Paper System only if such securities
are represented in an account ("Account") of the
Custodian in the Direct Paper System which shall
not include any assets of the Custodian other than
assets held as a fiduciary, custodian or otherwise
for customers;
3) The records of the Custodian with respect to
securities of the Fund which are maintained in the
Direct Paper System shall identify by book-entry
those securities belonging to the Fund;
4) The Custodian shall pay for securities purchased
for the account of the Fund upon the making of an
entry on the records of the Custodian to reflect
such payment and transfer of securities to the
account of the Fund. The Custodian shall transfer
securities sold for the account of the Fund upon
the making of an entry on the records of the
Custodian to reflect such transfer and receipt of
payment for the account of the Fund;
5) The Custodian shall furnish the Fund confirmation
of each transfer to or from the account of the
Fund, in the form of a written advice or notice,
of Direct Paper on the next business day following
such transfer and shall furnish to the Fund copies
of daily transaction sheets reflecting each day's
transaction in the Securities System for the
account of the Fund;
6) The Custodian shall provide the Fund with any
report on its system of internal accounting
control as the Fund may reasonably request from
time to time;
2.12 Segregated Account. The Custodian shall, upon receipt
of Proper Instructions, which may be of a continuing nature
where deemed appropriate by mutual agreement of the parties,
establish and maintain a segregated account or accounts for
and on behalf of the Fund, into which account or accounts
may be transferred cash and/or securities, including
securities maintained in an account by the Custodian
pursuant to Section 2.10 hereof, (i) in accordance with the
provisions of any agreement among the Fund, the Custodian
and a broker-dealer registered under the Exchange Act and a
member of the NASD (or any futures commission merchant
registered under the Commodity Exchange Act), relating to
compliance with the rules of The Options Clearing
Corporation and of any registered national securities
exchange (or the Commodity Futures Trading Commission or any
registered contract market), or of any similar organization
or organizations, regarding escrow or other arrangements in
connection with transactions by the Fund, (ii) for purposes
of segregating cash or government securities in connection
with options purchased, sold or written by the Fund or
commodity futures contracts or options thereon purchased or
sold by the Fund, (iii) for the purposes of compliance by
the Fund with the procedures required by Investment Company
Act Release No. 10666, or any subsequent release, rule or
policy, 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 Directors/Trustees or of the
Executive Committee signed by an officer of the Fund and
certified by the Secretary or an Assistant Secretary,
setting forth the purpose or purposes of such segregated
account and declaring such purposes to be proper corporate
purposes.
2.13 Ownership Certificates for Tax Purposes. The Custodian
shall execute ownership and other certificates and
affidavits for all federal and state tax purposes in
connection with receipt of income or other payments with
respect to domestic securities of the Fund held by it and in
connection with transfers of such securities.
2.14 Proxies. If the securities are registered other than
in the name of the Fund or a nominee of the Fund, the
Custodian shall, with respect to the domestic securities
held hereunder, cause to be promptly executed by the
registered holder of such securities, all proxies, without
indication of the manner in which such proxies are to be
voted, and shall promptly deliver to the Fund such proxies,
all proxy soliciting materials and all notices relating to
such securities.
2.15 Communications Relating to Fund Portfolio Securities.
The Custodian shall transmit promptly to the Fund all
written information (including, without limitation, pendency
of calls and maturities of domestic securities and
expirations of rights in connection therewith and notices of
exercise of call and put options written by the Fund and the
maturity of futures contracts purchased or sold by the Fund)
received by the Custodian from issuers of the domestic
securities being held for the Fund by the Custodian, an
agent appointed under Section 2.9, or sub-custodian
appointed under Section 1. With respect to tender or
exchange offers, the Custodian shall transmit promptly to
the Fund all written information received by the Custodian,
an agent appointed under Section 2.9, or sub-custodian
appointed under Section 1 from issuers of the domestic
securities whose tender or exchange is sought and from the
party (or his agents) making the tender or exchange offer.
If the Fund desires to take action with respect to any
tender offer, exchange offer or any other similar
transaction, the Fund shall notify the Custodian of such
desired action at least 72 hours (excluding holidays and
weekends) prior to the time such action must be taken under
the terms of the tender, exchange offer, or other similar
transaction, and it will be the responsibility of the
Custodian to timely transmit to the appropriate person(s)
the Fund's notice. Where the Fund does not notify the
Custodian of its desired action within the aforesaid 72 hour
period, the Custodian shall use its best efforts to timely
transmit the Fund's notice to the appropriate person.
2.16 Reports to Fund by Independent Public Accountants. The
Custodian shall provide the Fund, at such times as the Fund
may reasonably require, with reports by independent public
accountants on the accounting system, internal accounting
control and procedures for safeguarding securities, futures
contracts and options on futures contracts, including
domestic securities deposited and/or maintained in a
Securities System, relating to the services provided by the
Custodian under this Contract; such reports shall be of
sufficient scope and in sufficient detail, as may reasonably
be required by the Fund to provide reasonable assurance that
any material inadequacies existing or arising since the
prior examination would be disclosed by such examination.
The reports must describe any material inadequacies
disclosed and, if there are no such inadequacies, the
reports shall so state.
3. Duties of the Custodian with Respect to Property of the Fund
Held Outside of the United States
3.1 Appointment of Foreign Sub-Custodians. The Custodian
is authorized and instructed to employ Chase Manhattan Bank,
N.A, ("Chase") as sub-custodian for the Fund's securities,
cash and other assets maintained outside of the United
States ("foreign assets") all as described in the
Subcustodian Agreement between the Custodian and Chase.
Upon receipt of "Proper Instructions", together with a
certified resolution of the Fund's Board of
Directors/Trustees, the Custodian and the Fund may agree to
designate additional proper institutions and foreign
securities depositories to act as sub-custodians of the
Fund's foreign assets. Upon receipt of Proper Instructions
from the Fund, the Custodian shall cease the employment of
any one or more of such sub-custodians for maintaining
custody of the Fund's foreign assets.
3.2 Assets to be Held. The Custodian shall limit the
foreign assets maintained in the custody of foreign sub-
custodians to foreign assets specified under the terms of
the Subcustodian Agreement between the Custodian and Chase.
3.3 Foreign Securities Depositories. Except as may
otherwise be agreed upon in writing by the Custodian and the
Fund, foreign assets of the Fund shall be maintained in
foreign securities depositories only through arrangements
implemented by the banking institutions serving as sub-
custodians pursuant to the terms hereof.
3.4 Segregation of Securities. The Custodian shall
identify on its books as belonging to the Fund, the foreign
assets of the Fund held by Chase and by each foreign sub-
custodian.
3.5 Access of Independent Accountants of the Fund. Upon
request of the Fund, the Custodian will use its best efforts
(subject to applicable law) to arrange for the independent
accountants, officers or other representatives of the Fund
or the Custodian to be afforded access to the books and
records of Chase and any banking or other institution
employed as a sub-custodian for the Fund by Chase or the
Custodian insofar as such books and records relate to the
performance of Chase or such banking or other institution
under any agreement with the Custodian or Chase. Upon
request of the Fund, the Custodian shall furnish to the Fund
such reports (or portions thereof) of Chase's external
auditors as are available to the Custodian and which relate
directly to Chase's system of internal accounting controls
applicable to Chase's duties as a subcustodian or which
relate to the internal accounting controls of any
subcustodian employed by Chase with respect to foreign
assets of the Fund.
3.6 Reports by Custodian. The Custodian will supply to the
Fund from time to time, as mutually agreed upon, statements
in respect of the foreign assets of the Fund held pursuant
to the terms of the Subcustodian Agreement between the
Custodian and Chase, including but not limited, to an
identification of entities having possession of the Fund's
foreign assets and advices or notifications of any transfers
of foreign assets to or from each custodial account
maintained by any sub-custodian on behalf of the Fund
indicating, as to foreign assets acquired for the Fund, the
identity of the entity having physical possession of such
foreign assets.
3.7 Transactions in Foreign Assets of the Fund. All
transactions with respect to the Fund's foreign assets shall
be in accordance with, and subject to, the provisions of the
Subcustodian Agreement between Chase and the Custodian.
3.8 Responsibility of Custodian, Sub-Custodian, and Fund.
Notwithstanding anything to the contrary in this Custodian
Contract, the Custodian shall not be liable to the Fund for
any loss, damage, cost, expense, liability or claim arising
out of or in connection with the maintenance of custody of
the Fund's foreign assets by Chase or by any other banking
institution or securities depository employed pursuant to
the terms of any Subcustodian Agreement between Chase and
the Custodian, except that the Custodian shall be liable for
any such loss, damage, cost, expense, liability or claim to
the extent provided in the Subcustodian Agreement between
Chase and the Custodian or attributable to the failure of
the Custodian to exercise the standard of care set forth in
Article 12 hereof in the performance of its duties under
this Contract or such Subcustodian Agreement. At the
election of the Fund, the Fund shall be entitled to be
subrogated to the rights of the Custodian under the
Subcustodian Agreement with respect to any claims arising
thereunder against Chase or any other banking institution or
securities depository employed by Chase if and to the extent
that the Fund has not been made whole therefor. As between
the Fund and the Custodian, the Fund shall be solely
responsible to assure that the maintenance of foreign
securities and cash pursuant to the terms of the
Subcustodian Agreement complies with all applicable rules,
regulations, interpretations and orders of the Securities
and Exchange Commission, and the Custodian assumes no
responsibility and makes no representations as to such
compliance.
3.9 Monitoring Responsibilities. With respect to the
Fund's foreign assets, the Custodian shall furnish annually
to the Fund, during the month of June, information
concerning the sub-custodians employed by the Custodian.
Such information shall be similar in kind and scope to that
furnished to the Fund in connection with the initial
approval of this Contract. In addition, the Custodian will
promptly inform the Fund in the event that the Custodian
learns of a material adverse change in the financial
condition of a sub-custodian.
3.10 Branches of U.S. Banks. Except as otherwise set forth
in this Contract, the provisions of this Article 3 shall not
apply where the custody of the Fund's assets is maintained
in a foreign branch of a banking institution which is a
"bank" as defined by Section 2(a)(5) of the Investment
Company Act of 1940 which meets the qualification set forth
in Section 26(a) of said Act. The appointment of any such
branch as a sub-custodian shall be governed by Section 1 of
this Contract.
4. Payments for Repurchases or Redemptions and Sales of Shares
of the Fund
From such funds as may be available for the purpose but
subject to the limitations of the Governing Documents of the Fund
and any applicable votes of the Board of Directors/Trustees of
the Fund pursuant thereto, the Custodian shall, upon receipt of
instructions from the Transfer Agent, make funds available for
payment to holders of Shares who have delivered to the Transfer
Agent a request for redemption or repurchase of their Shares. In
connection with the redemption or repurchase of Shares of the
Fund, the Custodian is authorized upon receipt of instructions
from the Transfer Agent to wire funds to or through a commercial
bank designated by the redeeming shareholder. In connection with
the redemption or repurchase of Shares of the Fund, the Custodian
shall honor checks drawn on the Custodian by a holder of Shares,
which checks have been furnished by the Fund to the holder of
Shares, when presented to the Custodian in accordance with such
procedures and controls as are mutually agreed upon from time to
time between the Fund and the Custodian.
The Custodian shall receive from the distributor for the
Fund's Shares or from the Transfer Agent of the Fund and deposit
as received into the Fund's account such payments as are received
for Shares of the Fund issued or sold from time to time by the
Fund. The Custodian will provide timely notification to the Fund
and the Transfer Agent of any receipt by it of payments for
Shares of the Fund.
5. Proper Instructions
Proper Instructions as used herein means a writing signed or
initialled by one or more person or persons as the Board of
Directors/Trustees shall have from time to time authorized. Each
such writing shall set forth the specific transaction or type of
transaction involved, including a specific statement of the
purpose for which such action is requested, or shall be a blanket
instruction authorizing specific transactions of a repeated or
routine nature. Oral instructions will be considered Proper
Instructions if the Custodian reasonably believes them to have
been given by a person authorized to give such instructions with
respect to the transaction involved. The Fund shall cause all
oral instructions to be confirmed in writing. Upon receipt of a
certificate of the Secretary or an Assistant Secretary as to the
authorization by the Board of Directors/Trustees of the Fund
accompanied by a detailed description of procedures approved by
the Board of Directors/Trustees, Proper Instructions may include
communications effected directly between electro-mechanical or
electronic devices provided that the Board of Directors/Trustees
and the Custodian are satisfied that such procedures afford
adequate safeguards for the Fund's assets.
6. Actions Permitted without Express Authority
The Custodian may in its discretion, without express
authority from the Fund:
1) make payments to itself or others for minor
expenses of handling securities or other similar
items relating to its duties under this Contract,
provided that all such payments shall be accounted
for to the Fund;
2) surrender securities in temporary form for
securities in definitive form;
3) endorse for collection, in the name of the Fund,
checks, drafts and other negotiable instruments on
the same day as received; and
4) in general, attend to all non-discretionary
details in connection with the sale, exchange,
substitution, purchase, transfer and other
dealings with the securities and property of the
Fund except as otherwise directed by the Board of
Directors/Trustees of the Fund.
7. Evidence of Authority, Reliance on Documents
The Custodian shall be protected in acting upon any
instructions, notice, request, consent, certificate or other
instrument or paper reasonably and in good faith believed by it
to be genuine and to have been properly executed by or on behalf
of the Fund in accordance with Article 5 hereof. The Custodian
may receive and accept a certified copy of a vote of the Board of
Directors/Trustees of the Fund as conclusive evidence (a) of the
authority of any person to act in accordance with such vote or
(b) of any determination or of any action by the Board of
Directors/Trustees pursuant to the Governing Documents of the
Fund as described in such vote, and such vote may be considered
as in full force and effect until receipt by the Custodian of
written notice to the contrary. So long as and to the extent
that it is in the exercise of the standard of care set forth in
Article 12 hereof, the Custodian shall not be responsible for the
title, validity or genuineness of any property or evidence of
title thereto received by it or delivered by it pursuant to this
Contract and shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably
believed by it to be genuine and to be signed by the proper party
or parties.
8. Duties of Custodian with Respect to the Books of Account and
Calculation of Net Asset Value and Net Income
The Custodian shall cooperate with and supply necessary
information to the person or persons appointed by the Board of
Directors/Trustees of the Fund to keep the books of account of
the Fund and/or compute the net asset value per share of the
outstanding shares of the Fund or, if directed in writing to do
so by the Fund, shall itself keep such books of account and/or
compute such net asset value per share. If so directed, the
Custodian shall also calculate daily the net income of the Fund
as described in the Fund's currently effective prospectus and
shall advise the Fund and the Transfer Agent daily of the total
amounts of such net income and, if instructed in writing by an
officer of the Fund to do so, shall advise the Transfer Agent
periodically of the division of such net income among its various
components. The calculations of the net asset value per share
and the daily income of the Fund shall be made at the time or
times and in the manner described from time to time in the Fund's
currently effective prospectus.
9. Records, Inventory
The Custodian shall create and maintain all records relating
to its activities and obligations under this Contract in such
manner as will meet the obligations of the Fund under the
Investment Company Act of 1940, with particular attention to
Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
applicable federal and state tax laws and any other law or
administrative rules or procedures which may be applicable to the
Fund. All such records shall be the property of the Fund and
shall at all times during the regular business hours of the
Custodian be open for inspection and audit by duly authorized
officers, employees or agents of the Fund and employees and
agents of the Securities and Exchange Commission, and, in the
event of termination of this Agreement, will be delivered in
accordance with Section 14 hereof. The Custodian shall, at the
Fund's request, supply the Fund with a tabulation of securities
owned by the Fund and held by the Custodian and shall, when
requested to do so by the Fund and for such compensation as shall
be agreed upon between the Fund and the Custodian, include
certificate numbers in such tabulations. The Custodian shall
conduct a periodic inventory of all securities and other property
subject to this Agreement and provide to the Fund a periodic
reconciliation of the vaulted position of the Fund to the
appraised position of the Fund. The Custodian will promptly
report to the Fund the results of the reconciliation, indicating
any shortages or discrepancies uncovered thereby, and take
appropriate action to remedy any such shortages or discrepancies.
10. Opinion of Fund's Independent Accountant
The Custodian shall cooperate with the Fund's independent
public accountants in connection with the annual and other audits
of the books and records of the Fund and take all reasonable
action, as the Fund may from time to time request, to provide
from year to year the necessary information to such accountants
for the expression of their opinion without any qualification as
to the scope of their examination, including but not limited to,
any opinion in connection with the preparation of the Fund's Form
N-lA, and Form N-SAR or other annual reports to the Securities
and Exchange Commission and with respect to any other
requirements of such Commission.
11. Compensation of Custodian
The Custodian shall be entitled to reasonable compensation
for its services and expenses as Custodian, as agreed upon from
time to time between the Fund and the Custodian.
12. Responsibility of Custodian
Notwithstanding anything to the contrary in this Agreement,
the Custodian shall be held to the exercise of reasonable care in
carrying out the provisions of this Contract, but shall be kept
indemnified by and shall be without liability to the Fund for any
action taken or omitted by it in good faith without negligence.
In order for the indemnification provision contained in this
Section to apply, it is understood that if in any case the Fund
may be asked to indemnify or save the Custodian harmless, the
Fund shall be fully and promptly advised of all pertinent facts
concerning the situation in question, and it is further
understood that the Custodian will use all reasonable care to
identify and notify the Fund promptly concerning any situation
which presents or appears likely to present the probability of
such a claim for indemnification against the Fund. The Fund,
shall have the option to defend the Custodian against any claim
which may be the subject of this indemnification, and in the
event that the Fund so elects, it will so notify the Custodian,
and thereupon the Fund shall take over complete defense of the
claim and the Custodian shall in such situation initiate no
further legal or other expenses for which it shall seek
indemnification under this Section. The Custodian shall in no
case confess any claim or make any compromise in any case in
which the Fund will be asked to indemnify the Custodian except
with the Fund's prior written consent. Nothing herein shall be
construed to limit any right or cause of action on the part of
the Custodian under this Contract which is independent of any
right or cause of action on the part of the Fund. The Custodian
shall be entitled to rely on and may act upon advice of counsel
(who may be counsel for the Fund or such other counsel as may be
agreed to by the parties) on all matters, and shall be without
liability for any action reasonably taken or omitted pursuant to
such advice. Notwithstanding the foregoing, the responsibility
of the Custodian with respect to redemptions effected by check
shall be in accordance with a separate Agreement entered into
between the Custodian and the Fund.
If the Fund requires the Custodian to take any action with
respect to securities, which action involves the payment of money
or which action may, in the opinion of the Custodian, result in
the Custodian or its nominee assigned to the Fund being liable
for the payment of money or incurring liability of some other
form, the Fund, as a prerequisite to requiring the Custodian to
take such action, shall provide indemnity to the Custodian in an
amount and form satisfactory to it.
If the Fund requires the Custodian to advance cash or
securities for any purpose or in the event that the Custodian or
its nominee shall incur or be assessed any taxes, charges,
expenses, assessments, claims or liabilities in connection with
the performance of this Contract, except such as may arise from
its or its nominee's own negligent action, negligent failure to
act or willful misconduct, any property at any time held for the
account of the Fund shall be security therefor and should the
Fund fail to repay the Custodian promptly, the Custodian shall be
entitled to utilize available cash and to dispose of the Fund's
assets to the extent necessary to obtain reimbursement, provided
that the Custodian gives the Fund reasonable notice to repay such
cash or securities advanced, however, such notice shall not
preclude the Custodian's right to assert any lien under this
provision.
13. Effective Period, Termination and Amendment
This Contract shall become effective as of its execution,
shall continue in full force and effect until terminated as
hereinafter provided, may be amended at any time by mutual
agreement of the parties hereto and may be terminated by either
party by an instrument in writing delivered or mailed, postage
prepaid to the other party, such termination to take effect not
sooner than sixty (60) days after the date of such delivery or
mailing in the case of a termination by the Fund, and not sooner
than 180 days after the date of such delivery or mailing in the
case of a termination by the Custodian; provided, however that
the Custodian shall not act under Section 2.10 hereof in the
absence of receipt of an initial certificate of the Secretary or
an Assistant Secretary that the Board of Directors/Trustees of
the Fund has approved the initial use of a particular Securities
System and the receipt of an annual certificate of the Secretary
or an Assistant Secretary that the Board of Directors/Trustees
has reviewed the use by the Fund of such Securities System, as
required in each case by Rule 17f-4 under the Investment Company
Act of 1940, as amended and that the Custodian shall not act
under Section 2.11 hereof in the absence of receipt of an initial
certificate of the Secretary or an Assistant Secretary that the
Board of Directors/Trustees has approved the initial use of the
Direct Paper System and the receipt of an annual certificate of
the Secretary or an Assistant Secretary that the Board of
Directors/Trustees has reviewed the use by the Fund of the Direct
Paper System; provided further, however, that the Fund shall not
amend or terminate this Contract in contravention of any
applicable federal or state regulations, or any provision of the
Governing Documents of the Fund, and further provided, that the
Fund may at any time by action of its Board of Directors/Trustees
(i) substitute another bank or trust company for the Custodian by
giving notice as described above to the Custodian, or (ii)
immediately terminate this Contract in the event of the
appointment of a conservator or receiver for the Custodian by the
Comptroller of the Currency or upon the happening of a like event
at the direction of an appropriate regulatory agency or court of
competent jurisdiction.
Upon termination of the Contract, the Fund shall pay to the
Custodian such compensation as may be due as of the date of such
termination and shall likewise reimburse the Custodian for its
costs, expenses and disbursements, provided that the Custodian
shall not incur any costs, expenses or disbursements specifically
in connection with such termination unless it has received prior
approval from the Fund, which approval shall not be unreasonably
withheld.
14. Successor Custodian
If a successor custodian shall be appointed by the Board of
Directors/Trustees of the Fund, the Custodian shall, upon
termination, deliver to such successor custodian at the office of
the Custodian, duly endorsed and in the form for transfer, all
securities, funds and other properties then held by it hereunder
and shall transfer to an account of the successor custodian all
of the Fund's securities held in a Securities System. The
Custodian shall also use its best efforts to assure that the
successor custodian will continue any subcustodian agreement
entered into by the Custodian and any subcustodian on behalf of
the Fund.
If no such successor custodian shall be appointed, the Custodian shall, in like manner, upon receipt of a certified copy of a vote of the Board of Directors/Trustees of the Fund, deliver at the office of the Custodian and transfer such securities, funds and other properties in accordance with such vote.
In the event that no written order designating a successor custodian or certified copy of a vote of the Board of Directors/Trustees shall have been delivered to the Custodian on or before the date when such termination shall become effective, then the Custodian shall have the right to deliver to a bank or trust company, which is a "bank" as defined in the Investment Company Act of 1940, doing business in Boston, Massachusetts, of its own selection, having an aggregate capital, surplus, and undivided profits, as shown by its last published report, of not
less than $25,000,000, all securities, funds and other properties held by the Custodian and all instruments held by the Custodian relative thereto and all other property held by it under this Contract and to transfer to an account of such successor custodian all of the Fund's securities held in any Securities System. Thereafter, such bank or trust company shall be the successor of the Custodian under this Contract.
In the event that securities, funds and other properties
remain in the possession of the Custodian after the date of
termination hereof owing to failure of the Fund to procure the
certified copy of the vote referred to or of the Board of
Directors/Trustees to appoint a successor custodian, the
Custodian shall be entitled to fair compensation for its services
during such period as the Custodian retains possession of such
securities, funds and other properties and the provisions of this
Contract relating to the duties and obligations of the Custodian
shall remain in full force and effect. If while this Contract is
in force the Fund shall be liquidated pursuant to law, the
Custodian shall distribute, either in cash or (if the Fund so
orders) in the portfolio securities and other assets of the Fund,
pro rata among the holders of shares of the Fund as certified by
the Transfer Agent, the property of the Fund which remains after
paying or satisfying all expenses and liabilities of the Fund.
Section 12 hereof shall survive any termination of this Contract.
15. Interpretive and Additional Provisions
In connection with the operation of this Contract, the
Custodian and the Fund may from time to time agree on such
provisions interpretive of or in addition to the provisions of
this Contract as may in their joint opinion be consistent with
the general tenor of this Contract. Any such interpretive or
additional provisions shall be in a writing signed by both
parties and shall be annexed hereto, provided that no such
interpretive or additional provisions shall contravene any
applicable federal or state regulations or any provision of the
Governing Documents of the Fund. No interpretive or additional
provisions made as provided in the preceding sentence shall be
deemed to be an amendment of this Contract.
16. Notice
Any notice shall be sufficiently given when sent by
registered or certified mail, or by such other means as the
parties shall agree, to the other party at the address of such
party set forth above or at such other address as such party may
from time to time specify in writing to the other party.
17. Bond
The Custodian shall, at all times, maintain a bond in such
form and amount as is acceptable to the Fund which shall be
issued by a reputable fidelity insurance company authorized to do
business in the place where such bond is issued against larceny
and embezzlement, covering each officer and employee of the
Custodian who may, singly or jointly with others, have access to
securities or funds of the Fund, either directly or through
authority to receive and carry out any certificate instruction,
order request, note or other instrument required or permitted by
this Agreement. The Custodian agrees that it shall not cancel,
terminate or modify such bond insofar as it adversely affects the
Fund except after written notice given to the Fund not less than
10 days prior to the effective date of such cancellation,
termination or modification. The Custodian shall furnish to the
Fund a copy of each such bond and each amendment thereto.
18. Confidentiality
The Custodian agrees to treat all records and other
information relative to the Fund and its prior, present or future
shareholders as confidential, and the Custodian, on behalf of
itself and its employees, agrees to keep confidential all such
information except, after prior notification to and approval in
writing by the Fund, which approval shall not be unreasonably
withheld and may not be withheld where the Custodian may be
exposed to civil or criminal contempt proceedings for failure to
comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Fund.
19. Exemption from Liens
The securities and other assets held by the Custodian for
the Fund shall be subject to no lien or charge of any kind in
favor of the Custodian or any person claiming through the
Custodian, but nothing herein shall be deemed to deprive the
Custodian of its right to invoke any and all remedies available
at law or equity to collect amounts due it under this Agreement.
Neither the Custodian nor any sub-custodian appointed pursuant to
Section 1 hereof shall have any power or authority to assign,
hypothecate, pledge or otherwise dispose of any securities held
by it for the Fund, except upon the direction of the Fund, duly
given as herein provided, and only for the account of the Fund.
20. Massachusetts Law to Apply
This Contract shall be construed and the provisions thereof
interpreted under and in accordance with laws of The Commonwealth
of Massachusetts.
21. Prior Contracts
Without derogating any of the rights established by such
contracts, this Contract supersedes and terminates, as of the
date hereof, all prior contracts between the Fund and the
Custodian relating to the custody of the Fund's assets.
22. The Parties
All references herein to "the Fund" are to each of the funds
listed on Appendix A individually, as if this Contract were
between such individual fund and the Custodian. In the case of a
series fund or trust, all references to "the Fund" are to the
individual series or portfolio of such fund or trust, or to such
fund or trust on behalf of the individual series or portfolio, as
appropriate. Any reference in this Contract to "the parties"
shall mean the Custodian and such other individual Fund as to
which the matter pertains.
23. Governing Documents.
The term "Governing Documents" means the Articles of
Incorporation, Agreement of Trust, By-Laws and Registration
Statement filed under the Securities Act of 1933, as amended from
time to time.
24. Subcustodian Agreement.
Reference to the "Subcustodian Agreement" between the
Custodian and Chase shall mean any such agreement which shall be
in effect from time to time between Chase and the Custodian with
respect to foreign assets of the Fund.
25. Directors and Trustees.
It is understood and is expressly stipulated that neither
the holders of shares in the Fund nor any Directors or Trustees
of the Fund shall be personally liable hereunder.
26. Massachusetts Business Trust
With respect to any Fund which is a party to this Contract
and which is organized as a Massachusetts business trust, the
term Fund means and refers to the trustees from time to time
serving under the applicable trust agreement (Declaration of
Trust) of such Trust as the same may be amended from time to
time. It is expressly agreed that the obligations of any such
Trust hereunder shall not be binding upon any of the trustees,
shareholders, nominees, officers, agents or employees of the
Trust, personally, but bind only the trust property of the Trust,
as provided in the Declaration of Trust of the Trust. The
execution and delivery of this Contract has been authorized by
the trustees and signed by an authorized officer of the Trust,
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 but shall bind only the trust
property of the Trust as provided in its Declaration of Trust.
27. Successors of Parties.
This Contract shall be binding on and shall inure to the
benefit of the Fund and the Custodian and their respective
successors.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be executed in its name and behalf by its duly authorized representative and its seal to be hereunder affixed as of the dates indicated below.
STATE STREET BANK AND TRUST
COMPANY
ATTEST:
/s/Kathleen M. Kubit By/s/Charles Cassidy _____________________ _________________________________ Assistant Secretary Vice President |
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Stock Fund
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
New York Tax-Free Money Fund
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
New York Tax-Free Bond Fund
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
ATTEST:
The following Funds are parties to this Agreement and have so indicated their intention to be bound by such Agreement by executing the Agreement on the dates indicated thereon.
T. Rowe Price California Tax-Free Income Trust on behalf of
the
California Tax-Free Bond Fund and
California Tax-Free Money Fund
T. Rowe Price Capital Appreciation Fund
T. Rowe Price Equity Income Fund
T. Rowe Price GNMA Fund
T. Rowe Price Growth & Income Fund, Inc.
T. Rowe Price Growth Stock Fund, Inc.
T. Rowe Price High Yield Fund, Inc.
T. Rowe Price Institutional Trust on behalf of the
Tax-Exempt Reserve Portfolio
T. Rowe Price International Trust on behalf of the
T. Rowe Price International Bond Fund and
T. Rowe Price International Stock Fund
T. Rowe Price New America Growth Fund
T. Rowe Price New Era Fund, Inc.
T. Rowe Price New Horizons Fund, Inc.
T. Rowe Price New Income Fund, Inc.
T. Rowe Price Prime Reserve Fund, Inc.
T. Rowe Price Science & Technology Fund, Inc.
T. Rowe Price Short-Term Bond Fund, Inc.
T. Rowe Price State Tax-Free Income Trust on behalf of the
Maryland Tax-Free Bond Fund,
New York Tax-Free Bond Fund and
New York Tax-Free Money Fund
T. Rowe Price Tax-Exempt Money Fund, Inc.
T. Rowe Price Tax-Free High Yield Fund, Inc.
T. Rowe Price Tax-Free Income Fund, Inc.
T. Rowe Price Tax-Free Short-Intermediate Fund, Inc.
T. Rowe Price U.S. Treasury Money Fund, Inc.
THIS AGREEMENT, made as of this 24th day of June, 1988, by and between: T. Rowe Price Growth Stock Fund, Inc., T. Rowe Price New Horizons Fund, Inc., T. Rowe Price New Era Fund, Inc., T. Rowe Price New Income Fund, Inc., T. Rowe Price Prime Reserve Fund, Inc., T. Rowe Price International Trust, T. Rowe Price U.S. Treasury Money Fund, Inc., T. Rowe Price Growth & Income Fund, Inc., T. Rowe Price Tax-Exempt Money Fund, Inc., T. Rowe Price Tax-Free Income Fund, Inc., T. Rowe Price Tax-Free Short- Intermediate Fund, Inc., T. Rowe Price Short-Term Bond Fund, Inc., T. Rowe Price High Yield Fund, Inc., T. Rowe Price Tax-Free High Yield Fund, Inc., T. Rowe Price New America Growth Fund, T. Rowe Price Equity Income Fund, T. Rowe Price GNMA Fund, T. Rowe Price Capital Appreciation Fund, T. Rowe Price Institutional Trust, T. Rowe Price State Tax-Free Income Trust, T. Rowe Price California Tax-Free Income Trust, T. Rowe Price Science & Technology Fund, Inc., (hereinafter together called the "Funds" and individually "Fund") and State Street Bank and Trust Company, a Massachusetts trust,
W I T N E S S E T H:
It is mutually agreed that the Custodian Contract made by the parties on the 28th day of September, 1987, is hereby amended by adding thereto the T. Rowe Price Small-Cap Value Fund, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE NEW HORIZONS FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE NEW ERA FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE NEW INCOME FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE PRIME RESERVE FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE INTERNATIONAL TRUST
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
/s/Henry H.Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE GROWTH & INCOME FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE HIGH YIELD FUND, INC.
/s/ Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE NEW AMERICA GROWTH FUND
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE EQUITY INCOME FUND
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE GNMA FUND
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE CAPITAL APPRECIATION FUND
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE INSTITUTIONAL TRUST
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/William Blackwell ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of October 19, 1988, by adding thereto the T. Rowe Price International Discovery Fund, Inc., a separate series of T. Rowe Price International Trust.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/Guy R. Sturgeon ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988 and October 19, 1988, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of February 22, 1989, by adding thereto the T. Rowe Price International Equity Fund, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/K. Donelson ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988 and February 22, 1989, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of July 19, 1989, by adding thereto the Institutional International Funds, Inc., on behalf of the Foreign Equity Fund.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, and July 19, 1989 between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of September 15, 1989, by adding thereto the T. Rowe Price U.S. Treasury Funds, Inc., on behalf of the U.S. Treasury Intermediate Fund and the U.S. Treasury Long-Term Fund.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended
June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989
and September 15, 1989, between State Street Bank and Trust
Company and each of the Parties listed on Appendix A thereto is
hereby further amended, as of December 15, 1989, by restating
Section 2.15 as follows:
2.15 Communications Relating to Fund Portfolio Securities. The Custodian shall transmit promptly to the Fund all written information (including, without limitation, pendency of calls and maturities of domestic securities and expirations of rights in connection therewith and notices of exercise of call and put options written by the Fund and the maturity of futures contracts purchased or sold by the Fund) received by the Custodian from issuers of the domestic securities being held for the Fund by the Custodian, an agent appointed under Section 2.9, or sub-custodian appointed under Section 1. With respect to tender or exchange offers, the Custodian shall transmit promptly to the Fund all written information received by the Custodian, an agent appointed under Section 2.9, or sub-custodian appointed under Section 1 from issuers of the domestic securities whose tender or exchange is sought and from the party (or his agents) making the tender or exchange offer. If the Fund desires to take action with respect to any tender offer, exchange offer or any other similar transaction, the Fund shall notify the Custodian of such desired action at least 48 hours (excluding holidays and weekends) prior to the time such action must be taken under the terms of the tender, exchange offer, or other similar transaction, and it will be the responsibility of the Custodian to timely transmit to the appropriate person(s) the Fund's notice. Where the Fund does not notify the custodian of its desired action within the aforesaid 48 hour period, the Custodian shall use its best efforts to timely transmit the Fund's notice to the appropriate person. It is expressely noted that the parties may negotiate and agree to alternative procedures with respect to such 48 hour notice period on a selective and individual basis.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U. S. TREASURY FUNDS, INC.
U. S. Treasury Intermediate Fund
U. S. Treasury Long-Term Fund
/s/Carmen F. Deyesu
______________________________________________
By: Carmen F. Deyesu,
Treasurer
|
STATE STREET BANK AND TRUST COMPANY
/s/ E. D. Hawkes, Jr.
______________________________________________
By: E. D. Hawkes, Jr.
Vice President
|
Amendment No. 7 filed on Form SE January 25, 1990 with International Trust (CIK 313212) Post Effective Amendment No. 17.
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, and December 20, 1989, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of January 25, 1990, by adding thereto the T. Rowe Price European Stock Fund, a separate series of T. Rowe Price International Trust.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
/s/Henry H. Hopkins ______________________________________________ By: Henry H. Hopkins Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, and January 25, 1990 between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of February 21, 1990, by adding thereto the T. Rowe Price Index Trust, Inc., on behalf of the T. Rowe Price Equity Index Fund.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
/s/Henry H. Hopkins
__________________________________________
By: Henry H. Hopkins
Vice President
|
STATE STREET BANK AND TRUST COMPANY
/s/ ___________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of June 12, 1990, by adding thereto the T. Rowe Price Spectrum Fund, Inc., on behalf of the Spectrum Growth Fund and the Spectrum Income Fund.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL TRUST
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund
T. ROWE PRICE U.S. TREASURY MONEY FUND, INC.
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
/s/Henry H. Hopkins __________________________________________ By: Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ___________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, and June 12, 1990 between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of July 18, 1990, by adding thereto the T. Rowe Price New Asia Fund, a separate series of the T. Rowe Price International Funds, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
/s/Henry H. Hopkins __________________________________________ By: Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ Guy R. Sturgeon ___________________________________________ By: Guy R. Sturgeon |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, and July 18, 1990 between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of October 15, 1990, by adding thereto the T. Rowe Price Global Government Bond Fund, a separate series of the T. Rowe Price International Funds, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE INSTITUTIONAL TRUST
Tax-Exempt Reserve Portfolio
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
/s/Henry H. Hopkins __________________________________________ By: Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ Guy R. Sturgeon ___________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, and October 15, 1990, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of February 13, 1991, by adding thereto the Virginia Tax-Free Bond Fund and New Jersey Tax-Free Bond Fund, two separate series of the T. Rowe Price State Tax- Free Income Trust
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund Virginia Tax-Free Bond Fund New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
/s/Henry H. Hopkins __________________________________________ By: Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ Guy Sturgeon ___________________________________________ By: Vice President |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, and February 13, 1991, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of March 6, 1991, by adding thereto the T. Rowe Price Balanced Fund, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund Virginia Tax-Free Bond Fund New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
/s/Henry H. Hopkins __________________________________________ By: Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ___________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, and March 6, 1991, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of September 12, 1991, by adding thereto the T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund Virginia Tax-Free Bond Fund New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S.
GOVERNMENT FUND, INC.
/s/Henry H. Hopkins __________________________________________ By: Henry H. Hopkins, Vice President |
/s/ ___________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991 and September 12, 1991, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of November 6, 1991, by adding thereto the T. Rowe Price Japan Fund, a separate series of the T. Rowe Price International Funds, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund New York Tax-Free Money Fund Virginia Tax-Free Bond Fund New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY
FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL
EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S.
GOVERNMENT FUND, INC.
/s/Henry H. Hopkins __________________________________________ By: Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ___________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991 and November 6, 1991, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of April 23, 1992, by adding thereto the T. Rowe Price Mid-Cap Growth Fund, Inc. and T. Rowe Price Short-Term Global Income Fund, a separate series of the T. Rowe Price International Funds, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Income Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund
New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
/s/Henry H. Hopkins __________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ _________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, and April 23, 1992, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of September 2, 1992, by adding thereto the T. Rowe Price OTC Fund, a series of the T. Rowe Price OTC Fund, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Income Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund
New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ _____________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, and September 2, 1992, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of November 3, 1992, by adding thereto the T. Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Income Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund
New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE TAX-FREE INSURED INTEREMEDIATE
BOND FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, and November 3, 1992, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of December 16, 1992, by adding thereto the T. Rowe Price Dividend Growth Fund, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Income Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund
New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE TAX-FREE INSURED INTEREMEDIATE
BOND FUND, INC.
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, November 3, 1992, and December 16, 1992, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of December 21, 1992, by adding thereto the Maryland Short-Term Tax-Free Bond Fund, an additional series to the T. Rowe Price State Tax-Free Income Trust.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Income Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund
New Jersey Tax-Free Bond Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, November 3, 1992, December 16, 1992, and December 21, 1992, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of January 28, 1993, by adding thereto the Georgia Tax-Free Bond Fund and the Florida Insured Intermediate Tax-Free Fund, additional series to the T. Rowe Price State Tax-Free Income Trust.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Income Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund
New Jersey Tax-Free Bond Fund
Georgia Tax-Free Bond Fund
Florida Insured Intermediate Tax-Free Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE TAX-FREE INSURED INTEREMEDIATE
BOND FUND, INC.
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ ______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, November 3, 1992, December 16, 1992, December 21, 1992, and January 28, 1993, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of April 22, 1993, by adding thereto the T. Rowe Price Blue Chip Growth Fund, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Income Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund
New Jersey Tax-Free Bond Fund
Georgia Tax-Free Bond Fund
Florida Insured Intermediate Tax-Free Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
/s/Henry H. Hopkins ______________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ _______________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, November 3, 1992, December 16, 1992, December 21, 1992, January 28, 1993, April 22, 1993, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of September 16, 1993, by adding thereto the T. Rowe Price Summit Funds, Inc. and T. Rowe Price Summit Municipal Funds, Inc.
Notwithstanding anything to the contrary herein, it is understood that the T. Rowe Price Summit Funds, Inc. and T. Rowe Price Summit Municipal Funds, Inc. (collectively referred to as the "Funds") shall not be responsible for paying any of the fees or expenses set forth herein but that, in accordance with the Investment Management Agreement, dated September 16, 1993, between the Funds and T. Rowe Price Associates, Inc. ("T. Rowe Price"), the Funds will require T. Rowe Price to pay all such fees and expenses.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund T. Rowe Price Short-Term Global Income Fund
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund New York Tax-Free Bond Fund New York Tax-Free Money Fund Virginia Tax-Free Bond Fund New Jersey Tax-Free Bond Fund Georgia Tax-Free Bond Fund Florida Insured Intermediate Tax-Free Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE TAX-FREE INSURED INTEREMEDIATE
BOND FUND, INC.
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Money Market
Fund
T. Rowe Price Summit Municipal Intermediate
Fund
T. Rowe Price Summit Municipal Income Fund
/s/Henry H. Hopkins _____________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ _____________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, November 3, 1992, December 16, 1992, December 21, 1992, January 28, 1993, April 22, 1993, and September 16, 1993, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of November 3, 1993, by adding thereto the T. Rowe Price Latin America Fund, a separate series of the T. Rowe Price International Funds, Inc.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund T. Rowe Price Short-Term Global Income Fund T. Rowe Price Latin America Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund New York Tax-Free Bond Fund New York Tax-Free Money Fund Virginia Tax-Free Bond Fund New Jersey Tax-Free Bond Fund Georgia Tax-Free Bond Fund Florida Insured Intermediate Tax-Free Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE TAX-FREE INSURED INTEREMEDIATE
BOND FUND, INC.
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Money Market
Fund
T. Rowe Price Summit Municipal Intermediate
Fund
T. Rowe Price Summit Municipal Income Fund
/s/Henry H. Hopkins _____________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ _____________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, November 3, 1992, December 16, 1992, December 21, 1992, January 28, 1993, April 22, 1993, September 16, 1993, and November 3, 1993, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of March 1, 1994, by adding thereto the T. Rowe Price Equity Income Portfolio and T. Rowe Price New America Growth Portfolio, two separate series of the T. Rowe Price Equity Series, Inc. and T. Rowe Price International Stock Portfolio, a separate series of the T. Rowe Price International Series, Inc.
Notwithstanding anything to the contrary herein, it is understood that the T. Rowe Price Equity Series, Inc. and T. Rowe Price International Series, Inc. (collectively referred to as the "Funds") shall not be responsible for paying any of the fees or expenses set forth herein but that, in accordance with the Investment Management Agreements, dated March 1, 1994, between the Funds and T. Rowe Price Associates, Inc. and Rowe Price- Fleming International, Inc. (collectively referred to as "T. Rowe Price"), the Funds will require T. Rowe Price to pay all such fees and expenses.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund T. Rowe Price Short-Term Global Income Fund T. Rowe Price Latin America Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund New York Tax-Free Bond Fund New York Tax-Free Money Fund Virginia Tax-Free Bond Fund New Jersey Tax-Free Bond Fund Georgia Tax-Free Bond Fund Florida Insured Intermediate Tax-Free Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE TAX-FREE INSURED INTEREMEDIATE
BOND FUND, INC.
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Money Market
Fund
T. Rowe Price Summit Municipal Intermediate
Fund
T. Rowe Price Summit Municipal Income Fund
T. ROWE PRICE EQUITY SERIES, INC.
T. Rowe Price Equity Income Portfolio T. Rowe Price New America Growth Portfolio
/s/Henry H. Hopkins _____________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ _____________________________________________ By: |
W I T N E S S E T H:
The Custodian Contract of September 28, 1987, as amended June 24, 1988, October 19, 1988, February 22, 1989, July 19, 1989, September 15, 1989, December 15, 1989, December 20, 1989, January 25, 1990, February 21, 1990, June 12, 1990, July 18, 1990, October 15, 1990, February 13, 1991, March 6, 1991, September 12, 1991, November 6, 1991, April 23, 1992, September 2, 1992, November 3, 1992, December 16, 1992, December 21, 1992, January 28, 1993, April 22, 1993, September 16, 1993, November 3, 1993, and March 1, 1994, between State Street Bank and Trust Company and each of the Parties listed on Appendix A thereto is hereby further amended, as of April 21, 1994, by adding thereto the T. Rowe Price Limited-Term Bond Portfolio, a separate series of the T. Rowe Price Fixed Income Series, Inc.
Notwithstanding anything to the contrary herein, it is understood that the T. Rowe Price Fixed Income Series, Inc. (referred to as the "Fund") shall not be responsible for paying any of the fees or expenses set forth herein but that, in accordance with the Investment Management Agreement, dated April 21, 1994, between the Fund and T. Rowe Price Associates, Inc. (referred to as "T. Rowe Price"), the Fund will require T. Rowe Price to pay all such fees and expenses.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE NEW HORIZONS FUND, INC.
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Stock Fund T. Rowe Price International Discovery Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund T. Rowe Price Short-Term Global Income Fund T. Rowe Price Latin America Fund
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND,
INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund New York Tax-Free Bond Fund New York Tax-Free Money Fund Virginia Tax-Free Bond Fund New Jersey Tax-Free Bond Fund Georgia Tax-Free Bond Fund Florida Insured Intermediate Tax-Free Fund
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. Rowe Price OTC Fund
T. ROWE PRICE TAX-FREE INSURED INTEREMEDIATE
BOND FUND, INC.
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Money Market
Fund
T. Rowe Price Summit Municipal Intermediate
Fund
T. Rowe Price Summit Municipal Income Fund
T. ROWE PRICE EQUITY SERIES, INC.
T. Rowe Price Equity Income Portfolio T. Rowe Price New America Growth Portfolio
T. ROWE PRICE INTERNATIONAL SERIES, INC.
T. Rowe Price International Stock Portfolio
T. ROWE PRICE FIXED INCOME SERIES, INC.
T. Rowe Price Limited-Term Bond Portfolio
/s/Henry H. Hopkins _____________________________________________ By:Henry H. Hopkins, Vice President |
STATE STREET BANK AND TRUST COMPANY
/s/ _____________________________________________ By: |
The Global Custody Agreement dated January 3, 1994, between The Chase Manhattan Bank, N.A. and T. Rowe Price Funds should be inserted here.
This AGREEMENT is effective January 3, 1994, and is between
THE CHASE MANHATTAN BANK, N.A. (the "Bank") and EACH OF THE
ENTITIES LISTED ON SCHEDULE A HERETO, Individually and Separately
(each individually, the "Customer").
1. Customer Accounts.
The Bank agrees to establish and maintain the following accounts ("Accounts"):
(a) A custody account in the name of the Customer ("Custody Account") for any and all stocks, shares, bonds, debentures, notes, mortgages or other obligations for the payment of money, bullion, coin and any certificates, receipts, warrants or other instruments representing rights to receive, purchase or subscribe for the same or evidencing or representing any other rights or interests therein and other similar property whether certificated or uncertificated as may be received by the Bank or its Subcustodian (as defined in Section 3) for the account of the Customer ("Securities"); and
(b) A deposit account in the name of the Customer ("Deposit Account") for any and all cash in any currency received by the Bank or its Subcustodian for the account of the Customer, which cash shall not be subject to withdrawal by draft or check.
The Customer warrants its authority to: 1) deposit the cash and Securities ("Assets") received in the Accounts and 2) give Instructions (as defined in Section 11) concerning the Accounts. The Bank may deliver securities of the same class in place of those deposited in the Custody Account.
Upon written agreement between the Bank and the Customer, additional Accounts may be established and separately accounted for as additional Accounts under the terms of this Agreement.
2. Maintenance of Securities and Cash at Bank and Subcustodian Locations.
Unless Instructions specifically require another location acceptable to the Bank:
(a) Securities will be held in the country or other jurisdiction in which the principal trading market for such Securities is located, where such Securities are to be presented for payment or where such Securities are acquired; and
(b) Cash will be credited to an account in a country or other jurisdiction in which such cash may be legally deposited or is the legal currency for the payment of public or private debts.
Cash may be held pursuant to Instructions in either interest or non-interest bearing accounts as may be available for the particular currency. To the extent Instructions are issued and the Bank can comply with such Instructions, the Bank is authorized to maintain cash balances on deposit for the Customer with itself or one of its affiliates at such reasonable rates of interest as may from time to time be paid on such accounts, or in non-interest bearing accounts as the Customer may direct, if acceptable to the Bank.
If the Customer wishes to have any of its Assets held in the custody of an institution other than the established Subcustodians as defined in Section 3 (or their securities depositories), such arrangement must be authorized by a written agreement, signed by the Bank and the Customer.
3. Subcustodians and Securities Depositories.
The Bank may act under this Agreement through the subcustodians listed in Schedule B of this Agreement with which the Bank has entered into subcustodial agreements ("Subcustodians"). The Customer authorizes the Bank to hold Assets in the Accounts in accounts which the Bank has established with one or more of its branches or Subcustodians. The Bank and Subcustodians are authorized to hold any of the Securities in their account with any securities depository in which they participate.
The Bank reserves the right to add new, replace or remove Subcustodians. The Customer will be given reasonable notice by the Bank of any amendment to Schedule B. Upon request by the Customer, the Bank will identify the name, address and principal place of business of any Subcustodian of the Customer's Assets and the name and address of the governmental agency or other regulatory authority that supervises or regulates such Subcustodian.
4. Use of Subcustodian.
(a) The Bank will identify such Assets on its books as belonging to the Customer.
(b) A Subcustodian will hold such Assets together with assets belonging to other customers of the Bank in accounts identified on such Subcustodian's books as special custody accounts for the exclusive benefit of customers of the Bank.
(c) Any Assets in the Accounts held by a Subcustodian will be subject only to the instructions of the Bank or its agent.
Any Securities held in a securities depository for the account of a Subcustodian will be subject only to the instructions of such Subcustodian.
(d) Any agreement the Bank enters into with a Subcustodian for holding its customer's assets shall provide that such assets will not be subject to any right, charge, security interest, lien or claim of any kind in favor of such Subcustodian or its creditors except for a claim for payment for safe custody or administration, and that the beneficial ownership of such assets will be freely transferable without the payment of money or value other than for safe custody or administration. The foregoing shall not apply to the extent of any special agreement or arrangement made by the Customer with any particular Subcustodian.
5. Deposit Account Transactions.
(a) The Bank or its Subcustodians will make payments from the Deposit Account upon receipt of Instructions which include all information required by the Bank.
(b) In the event that any payment to be made under this
Section 5 exceeds the funds available in the Deposit Account, the
Bank, in its discretion, may advance the Customer such excess
amount which shall be deemed a loan payable on demand, bearing
interest at the rate customarily charged by the Bank on similar
loans.
(c) If the Bank credits the Deposit Account on a payable date, or at any time prior to actual collection and reconciliation to the Deposit Account, with interest, dividends, redemptions or any other amount due, the Customer will promptly return any such amount upon oral or written notification: (i) that such amount has not been received in the ordinary course of business or (ii) that such amount was incorrectly credited. If the Customer does not promptly return any amount upon such notification, the Bank shall be entitled, upon oral or written notification to the Customer, to reverse such credit by debiting the Deposit Account for the amount previously credited. The Bank or its Subcustodian shall have no duty or obligation to institute legal proceedings, file a claim or a proof of claim in any insolvency proceeding or take any other action with respect to the collection of such amount, but may act for the Customer upon Instructions after consultation with the Customer.
6. Custody Account Transactions.
(a) Securities will be transferred, exchanged or delivered by the Bank or its Subcustodian upon receipt by the Bank of Instructions which include all information required by the Bank. Settlement and payment for Securities received for, and delivery of Securities out of, the Custody Account may be made in
accordance with the customary or established securities trading or securities processing practices and procedures in the jurisdiction or market in which the transaction occurs, including, without limitation, delivery of Securities to a purchaser, dealer or their agents against a receipt with the expectation of receiving later payment and free delivery. Delivery of Securities out of the Custody Account may also be made in any manner specifically required by Instructions acceptable to the Bank.
(b) The Bank, in its discretion, may credit or debit the Accounts on a contractual settlement date with cash or Securities with respect to any sale, exchange or purchase of Securities. Otherwise, such transactions will be credited or debited to the Accounts on the date cash or Securities are actually received by the Bank and reconciled to the Account.
(i) The Bank may reverse credits or debits made to the Accounts in its discretion if the related transaction fails to settle within a reasonable period, determined by the Bank in its discretion, after the contractual settlement date for the related transaction.
(ii) If any Securities delivered pursuant to this
Section 6 are returned by the recipient thereof, the
Bank may reverse the credits and debits of the
particular transaction at any time.
7. Actions of the Bank.
The Bank shall follow Instructions received regarding assets held in the Accounts. However, until it receives Instructions to the contrary, the Bank will:
(a) Present for payment any Securities which are called, redeemed or retired or otherwise become payable and all coupons and other income items which call for payment upon presentation, to the extent that the Bank or Subcustodian is actually aware of such opportunities.
(b) Execute in the name of the Customer such ownership and other certificates as may be required to obtain payments in respect of Securities.
(c) Exchange interim receipts or temporary Securities for definitive Securities.
(d) Appoint brokers and agents for any transaction involving the Securities, including, without limitation, affiliates of the Bank or any Subcustodian.
(e) Issue statements to the Customer, at times mutually agreed upon, identifying the Assets in the Accounts.
The Bank will send the Customer an advice or notification of any transfers of Assets to or from the Accounts. Such statements, advices or notifications shall indicate the identity of the entity having custody of the Assets. Unless the Customer sends the Bank a written exception or objection to any Bank statement within ninety (90) days of receipt, the Customer shall be deemed to have approved such statement. The Bank shall, to the extent permitted by law, be released, relieved and discharged with respect to all matters set forth in such statement or reasonably implied therefrom as though it had been settled by the decree of a court of competent jurisdiction in an action where the Customer and all persons having or claiming an interest in the Customer or the Customer's Accounts were parties if: (a) the Customer has failed to provide a written exception or objection to any Bank statement within ninety (90) days of receipt and where the Customer's failure to so provide a written exception or objection within such ninety (90) day period has limited the Bank's (i) access to the records, materials and other information required to investigate the Customer's exception or objection, and (ii) ability to recover from third parties any amounts for which the Bank may become liable in connection with such exception or objection, or (b) where the Customer has otherwise explicitly approved any such statement.
All collections of funds or other property paid or distributed in respect of Securities in the Custody Account shall be made at the risk of the Customer. The Bank shall have no liability for any loss occasioned by delay in the actual receipt of notice by the Bank or by its Subcustodians of any payment, redemption or other transaction regarding Securities in the Custody Account in respect of which the Bank has agreed to take any action under this Agreement.
8. Corporate Actions; Proxies.
Whenever the Bank receives information concerning the Securities which requires discretionary action by the beneficial owner of the Securities (other than a proxy), such as subscription rights, bonus issues, stock repurchase plans and rights offerings, or legal notices or other material intended to be transmitted to securities holders ("Corporate Actions"), the Bank will give the Customer notice of such Corporate Actions to the extent that the Bank's central corporate actions department has actual knowledge of a Corporate Action in time to notify its customers.
When a rights entitlement or a fractional interest resulting from a rights issue, stock dividend, stock split or similar Corporate Action is received which bears an expiration date, the Bank will endeavor to obtain Instructions from the Customer or its Authorized Person, but if Instructions are not received in time for the Bank to take timely action, or actual notice of such Corporate Action was received too late to seek Instructions, the
Bank is authorized to sell such rights entitlement or fractional interest and to credit the Deposit Account with the proceeds or take any other action it deems, in good faith, to be appropriate in which case it shall be held harmless for any such action.
The Bank will deliver proxies to the Customer or its designated agent pursuant to special arrangements which may have been agreed to in writing. Such proxies shall be executed in the appropriate nominee name relating to Securities in the Custody Account registered in the name of such nominee but without indicating the manner in which such proxies are to be voted; and where bearer Securities are involved, proxies will be delivered in accordance with Instructions.
9. Nominees.
Securities which are ordinarily held in registered form may be registered in a nominee name of the Bank, Subcustodian or securities depository, as the case may be. The Bank may without notice to the Customer cause any such Securities to cease to be registered in the name of any such nominee and to be registered in the name of the Customer. In the event that any Securities registered in a nominee name are called for partial redemption by the issuer, the Bank may allot the called portion to the respective beneficial holders of such class of security pro rata or in any other manner that is fair, equitable and practicable. The Customer agrees to hold the Bank, Subcustodians, and their respective nominees harmless from any liability arising directly or indirectly from their status as a mere record holder of Securities in the Custody Account.
10. Authorized Persons.
As used in this Agreement, the term "Authorized Person" means employees or agents including investment managers as have been designated by written notice from the Customer or its designated agent to act on behalf of the Customer under this Agreement. Such persons shall continue to be Authorized Persons until such time as the Bank receives Instructions from the Customer or its designated agent that any such employee or agent is no longer an Authorized Person.
11. Instructions.
The term "Instructions" means instructions of any Authorized Person received by the Bank, via telephone, telex, TWX, facsimile transmission, bank wire or other teleprocess or electronic instruction or trade information system acceptable to the Bank which the Bank believes in good faith to have been given by Authorized Persons or which are transmitted with proper testing or authentication pursuant to terms and conditions which the Bank may specify. Unless otherwise expressly provided, all
Instructions shall continue in full force and effect until canceled or superseded.
Any Instructions delivered to the Bank by telephone shall promptly thereafter be confirmed in writing by an Authorized Person (which confirmation may bear the facsimile signature of such Person), but the Customer will hold the Bank harmless for the failure of an Authorized Person to send such confirmation in writing, the failure of such confirmation to conform to the telephone instructions received or the Bank's failure to produce such confirmation at any subsequent time. The Bank may electronically record any Instructions given by telephone, and any other telephone discussions with respect to the Custody Account. The Customer shall be responsible for safeguarding any testkeys, identification codes or other security devices which the Bank shall make available to the Customer or its Authorized Persons.
12. Standard of Care; Liabilities.
(a) The Bank shall be responsible for the performance of only such duties as are set forth in this Agreement or expressly contained in Instructions which are consistent with the provisions of this Agreement. Notwithstanding anything to the contrary in this Agreement:
(i) The Bank will use reasonable care with respect to its obligations under this Agreement and the safekeeping of Assets. The Bank shall be liable to the Customer for any loss which shall occur as the result of the failure of a Subcustodian to exercise reasonable care with respect to the safekeeping of such Assets to the same extent that the Bank would be liable to the Customer if the Bank were holding such Assets in New York. In the event of any loss to the Customer by reason of the failure of the Bank or its Subcustodian to utilize reasonable care, the Bank shall be liable to the Customer only to the extent of the Customer's direct damages, and shall in no event be liable for any special or consequential damages.
(ii) The Bank will not be responsible for any act, omission, default or for the solvency of any broker or agent which it or a Subcustodian appoints unless such appointment was made negligently or in bad faith or for any loss due to the negligent act of such broker or agent except to the extent that such broker or agent (other than a Subcustodian) performs in a negligent manner which is the cause of the loss to the Customer and the Bank failed to exercise reasonable care in monitoring such broker's or agent's performance where Customer has requested and Bank has agreed to accept such monitoring responsibility.
(iii) The Bank shall be indemnified by, and without liability to the Customer for any action taken or omitted by the Bank whether pursuant to Instructions or otherwise within the scope of this Agreement if such act or omission was in good faith, without negligence. In performing its obligations under this Agreement, the Bank may rely on the genuineness of any document which it believes in good faith to have been validly executed.
(iv) The Customer agrees to pay for and hold the Bank harmless from any liability or loss resulting from the imposition or assessment of any taxes or other governmental charges, and any related expenses with respect to income from or Assets in the Accounts, except to the extent that the Bank has failed to exercise reasonable care in performing any obligations which the Bank may have agreed to assume (in addition to those stated in this Agreement) with respect to taxes and such failure by the Bank is the direct cause of such imposition or assessment of such taxes, charges or expenses.
(v) The Bank shall be entitled to rely, and may act, upon the advice of counsel (who may be counsel for the Customer) on all legal matters and shall be without liability for any action reasonably taken or omitted pursuant to such advice; provided, that the Bank gives (to the extent practicable) prior notice to Customer of Bank's intention to so seek advice of counsel and an opportunity for consultation with Customer on the proposed contact with counsel.
(vi) The Bank represents and warrants that it currently maintain a banker's blanket bond which provides standard fidelity and non-negligent loss coverage with respect to the Securities and Cash which may be held by Subcustodians pursuant to this Agreement. The Bank agrees that if at any time it for any reason discontinues such coverage, it shall immediately give sixty (60) days' prior written notice to the Customer. The Bank need not maintain any insurance for the benefit of the Customer.
(vii) Without limiting the foregoing, the Bank
shall not be liable for any loss which results from:
(1) the general risk of investing, or (2) investing or
holding Assets in a particular country including, but
not limited to, losses resulting from nationalization,
expropriation or other governmental actions; regulation
of the banking or securities industry; currency
restrictions, devaluations or fluctuations; and market
conditions which prevent the orderly execution of securities transactions or affect the value of Assets.
(viii) Neither party shall be liable to the other for any loss due to forces beyond their control including, but not limited to strikes or work stoppages, acts of war or terrorism, insurrection, revolution, nuclear fusion, fission or radiation, or acts of God.
(b) Consistent with and without limiting the first paragraph of this Section 12, it is specifically acknowledged that the Bank shall have no duty or responsibility to:
(i) question Instructions or make any suggestions to the Customer or an Authorized Person regarding such Instructions;
(ii) supervise or make recommendations with respect to investments or the retention of Securities;
(iii) advise the Customer or an Authorized Person
regarding any default in the payment of principal or
income of any security other than as provided in
Section 5(c) of this Agreement;
(iv) evaluate or report to the Customer or an Authorized Person regarding the financial condition of any broker, agent (other than a Subcustodian) or other party to which Securities are delivered or payments are made pursuant to this Agreement;
(v) review or reconcile trade confirmations received from brokers. The Customer or its Authorized Persons (as defined in Section 10) issuing Instructions shall bear any responsibility to review such confirmations against Instructions issued to and statements issued by the Bank.
(c) The Customer authorizes the Bank to act under this Agreement notwithstanding that the Bank or any of its divisions or affiliates may have a material interest in a transaction, or circumstances are such that the Bank may have a potential conflict of duty or interest including the fact that the Bank or any of its affiliates may provide brokerage services to other customers, act as financial advisor to the issuer of Securities, act as a lender to the issuer of Securities, act in the same transaction as agent for more than one customer, have a material interest in the issue of Securities, or earn profits from any of the activities listed herein.
13. Fees and Expenses.
The Customer agrees to pay the Bank for its services under this Agreement such amount as may be agreed upon in writing, together with the Bank's reasonable out-of-pocket or incidental expenses, including, but not limited to, reasonable legal fees. The Bank shall have a lien on and is authorized to charge any Accounts of the Customer for any amount owing to the Bank under any provision of this Agreement upon notice to the Customer.
14. Miscellaneous.
(a) Foreign Exchange Transactions. Pursuant to Instructions, which may be standing Instructions, to facilitate the administration of the Customer's trading and investment activity, the Bank is authorized to enter into spot or forward foreign exchange contracts with the Customer or an Authorized Person for the Customer and may also provide foreign exchange through its subsidiaries or Subcustodians. The Bank may establish rules or limitations concerning any foreign exchange facility made available. In all cases where the Bank, its subsidiaries, affiliates or Subcustodians enter into a foreign exchange contract related to Accounts, the terms and conditions of the then current foreign exchange contract of the Bank, its subsidiary, affiliate or Subcustodian and, to the extent not inconsistent, this Agreement shall apply to such transaction.
(b) Certification of Residency, etc. The Customer certifies that it is a resident of the United States and agrees to notify the Bank of any changes in residency. The Bank may rely upon this certification or the certification of such other facts as may be required to administer the Bank's obligations under this Agreement. The Customer will indemnify the Bank against all losses, liability, claims or demands arising directly or indirectly from any such certifications.
(c) Access to Records. The Bank shall allow the Customer's independent public accountants, officers and advisers reasonable access to the records of the Bank relating to the Assets as is required in connection with their examination of books and records pertaining to the Customer's affairs. Subject to restrictions under applicable law, the Bank shall also obtain an undertaking to permit the Customer's independent public accountants reasonable access to the records of any Subcustodian which has physical possession of any Assets as may be required in connection with the examination of the Customer's books and records.
(d) Governing Law; Successors and Assigns. This Agreement shall be governed by the laws of the State of New York and shall not be assignable by either party, but shall bind the successors in interest of the Customer and the Bank.
(e) Entire Agreement; Applicable Riders. Customer represents that the Assets deposited in the Accounts are (Check one):
X Employee Benefit Plan or other assets subject to the Employee Retirement Income Security Act of 1974, as amended ("ERISA");
X Mutual Fund assets subject to certain Securities and Exchange Commission ("SEC") rules and regulations;
X Neither of the above.
With respect to each Customer, this Agreement consists exclusively of this document together with Schedules A, B, Exhibits I - _______ and the following Rider(s) to the extent indicated on Schedule A hereto opposite the name of the Customer under the column headed "Applicable Riders to Agreement":
X ERISA
X MUTUAL FUND
SPECIAL TERMS AND CONDITIONS
There are no other provisions of this Agreement and this Agreement supersedes any other agreements, whether written or oral, between the parties. Any amendment to this Agreement must be in writing, executed by both parties.
(f) Severability. In the event that one or more provisions of this Agreement are held invalid, illegal or enforceable in any respect on the basis of any particular circumstances or in any jurisdiction, the validity, legality and enforceability of such provision or provisions under other circumstances or in other jurisdictions and of the remaining provisions will not in any way be affected or impaired.
(g) Waiver. Except as otherwise provided in this Agreement, no failure or delay on the part of either party in exercising any power or right under this Agreement operates as a waiver, nor does any single or partial exercise of any power or right preclude any other or further exercise, or the exercise of any other power or right. No waiver by a party of any provision of this Agreement, or waiver of any breach or default, is effective unless in writing and signed by the party against whom the waiver is to be enforced.
(h) Notices. All notices under this Agreement shall be effective when actually received. Any notices or other communications which may be required under this Agreement are to be sent to the parties at the following addresses or such other addresses as may subsequently be given to the other party in writing:
Bank: The Chase Manhattan Bank, N.A.
Chase MetroTech Center
Brooklyn, NY 11245
Attention: Global Investor Services
Telephone: (718) 242-3455
Facsimile: (718) 242-1374
Copy to: The Chase Manhattan Bank, N.A.
Woolgate House
Coleman Street
London EC2P 2HD England
Attention: Global Investor Services
Telephone: 44-71-962-5000
Facsimile: 44-71-962-5377
Telex: 8954681CMBG
Customer: Name of Customer from Schedule A
c/o T. Rowe Price
100 East Pratt Street
Baltimore, MD 21202
Attention: Treasurer
Telephone: (410) 625-6658
Facsimile: (410) 547-0180
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(i) Termination. This Agreement may be terminated by the Customer or the Bank by giving ninety (90) days written notice to the other, provided that such notice to the Bank shall specify the names of the persons to whom the Bank shall deliver the Assets in the Accounts. If notice of termination is given by the Bank, the Customer shall, within ninety (90) days following receipt of the notice, deliver to the Bank Instructions specifying the names of the persons to whom the Bank shall deliver the Assets. In either case the Bank will deliver the Assets to the persons so specified, after deducting any amounts which the Bank determines in good faith to be owed to it under
Section 13. If within ninety (90) days following receipt of a notice of termination by the Bank, the Bank does not receive Instructions from the Customer specifying the names of the persons to whom the Bank shall deliver the Assets, the Bank, at its election, may deliver the Assets to a bank or trust company doing business in the State of New York to be held and disposed of pursuant to the provisions of this Agreement, or to Authorized Persons, or may continue to hold the Assets until Instructions are provided to the Bank.
(j) Entire Agreement. This Agreement, including the Schedules and Riders hereto, embodies the entire agreement and understanding of the parties in respect of the subject matter contained in this Agreement. This Agreement supersedes all other custody or other agreements between the parties with respect to such subject matter, which prior agreements are hereby terminated effective as of the date hereof and shall have no further force or effect.
EACH OF THE CUSTOMERS, INDIVIDUALLY
AND SEPARATELY LISTED ON SECTION I OF
SCHEDULE A HERETO
/s/Carmen F. Deyesu
By:________________________________
Carmen F. Deyesu
Treasurer & Vice President
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EACH OF THE CUSTOMERS, INDIVIDUALLY
AND SEPARATELY LISTED ON SECTION II OF
SCHEDULE A HERETO
/s/Alvin M. Younger
By:____________________________________
Alvin M. Younger
Treasurer
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EACH OF THE CUSTOMERS, INDIVIDUALLY
AND SEPARATELY LISTED ON SECTION III OF
SCHEDULE A HERETO
/s/Alvin M. Younger
By:___________________________________
Alvin M. Younger
Treasurer
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/s/Alan Naughton
By:_________________________________
Alan Naughton
Vice President
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STATE OF )
: ss.
COUNTY OF )
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On this day of , 19 , before me personally came , to me known, who being by me duly sworn, did depose and say that he/she resides in
at ;
that he/she is of
, the entity
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described in and which executed the foregoing instrument; that he/she knows the seal of said entity, that the seal affixed to said instrument is such seal, that it was so affixed by order of said entity, and that he/she signed his/her name thereto by like order.
Sworn to before me this
day of , 19 .
Notary
STATE OF )
: ss.
COUNTY OF )
On this day of
|
,19 , before me personally came , to
me known, who being by me duly sworn, did depose and say that
he/she resides in
at ; that
he/she is a Vice President of THE CHASE MANHATTAN BANK, (National
Association), the corporation described in and which executed the
foregoing instrument; that he/she knows the seal of said
corporation, that the seal affixed to said instrument is such
corporate seal, that it was so affixed by order of the Board of
Directors of said corporation, and that he/she signed his/her
name thereto by like order.
Sworn to before me this
day of , 19 .
Notary
LIST OF CUSTOMERS, EACH INDIVIDUALLY PARTIES TO
GLOBAL CUSTODY AGREEMENT WITH
THE CHASE MANHATTAN BANK, N.A.
DATED JANUARY 3, 1994
APPLICABLE RIDERS TO
CUSTOMER GLOBAL CUSTODY AGREEMENT
I. INVESTMENT COMPANIES/PORTFOLIOS The Mutual Fund Rider is
REGISTERED UNDER THE INVESTMENT applicable to all
COMPANY ACT OF 1940 Customers listed under
Section I of this
Schedule A.
Equity Funds
|
T. Rowe Price Balanced Fund, Inc.
T. Rowe Price Blue Chip Growth Fund, Inc.
T. Rowe Price Capital Appreciation Fund
T. Rowe Price Dividend Growth Fund, Inc.
T. Rowe Price Equity Income Fund
T. Rowe Price Growth & Income Fund, Inc.
T. Rowe Price Growth Stock Fund, Inc.
Institutional International Funds, Inc. on behalf of:
Foreign Equity Fund
T. Rowe Price International Funds, Inc. on behalf of:
T. Rowe Price European Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price International Stock Fund
T. Rowe Price Japan Fund
T. Rowe Price Latin America Fund
T. Rowe Price New Asia Fund
T. Rowe Price Mid-Cap Growth Fund, Inc.
T. Rowe Price New Era Fund, Inc.
T. Rowe Price New Horizons Fund, Inc.
T. Rowe Price OTC Fund, Inc. on behalf of:
T. Rowe Price OTC Fund
T. Rowe Price Science & Technology Fund, Inc.
T. Rowe Price Small Cap Value Fund, Inc.
CUNA Mutual Funds, Inc. on behalf of:
CUNA Mutual Cornerstone Fund
Schedule A
APPLICABLE RIDERS TO
CUSTOMER GLOBAL CUSTODY AGREEMENT
Income Funds
T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.
T. Rowe Price High Yield Fund, Inc.
T. Rowe Price New Income Fund, Inc.
T. Rowe Price Short-Term Bond Fund, Inc.
T. Rowe Price Summit Funds, Inc. on behalf of:
T. Rowe Price Summit Limited-Term Bond Fund
T. Rowe Price International Funds, Inc. on behalf of:
T. Rowe Price Global Government Bond Fund
T. Rowe Price International Bond Fund
T. Rowe Price Short-Term Global Income Fund
II. ACCOUNTS SUBJECT TO ERISA The ERISA Rider is
applicable to all
T. Rowe Price Trust Company, as Customers under Section
Trustee for the Johnson Matthey II of this Schedule A.
Salaried Employee Savings Plan
|
Common Trust Funds
T. Rowe Price Trust Company, as Trustee for the International Common Trust Fund on behalf of the Underlying Trusts:
Foreign Discovery Trust
Foreign Discovery Trust-Augment
Pacific Discovery Trust
European Discovery Trust
Japan Discovery Trust
Latin American Discovery Trust
New York City International Common Trust Fund
III. OTHER No Riders are applicable to the Customer listed RPFI International Partners, L.P. under Section III of this Schedule A.
ERISA Rider to Global Custody Agreement Between The Chase Manhattan Bank, N.A. and Each of the Entities Listed on Schedule A Hereto effective January 3, 1994
Customer represents that the Assets being placed in the Bank's custody are subject to ERISA. It is understood that in connection therewith the Bank is a service provider and not a fiduciary of the plan and trust to which the assets are related. The Bank shall not be considered a party to the underlying plan and trust and the Customer hereby assumes all responsibility to assure that Instructions issued under this Agreement are in compliance with such plan and trust and ERISA.
This Agreement will be interpreted as being in compliance with the Department of Labor Regulations Section 2550.404b-1 concerning the maintenance of indicia of ownership of plan assets outside of the jurisdiction of the district courts of the United States.
The following modifications are made to the Agreement:
Section 3. Subcustodians and Securities Depositories.
Add the following language to the end of Section 3:
As used in this Agreement, the term Subcustodian and the term securities depositories include a branch of the Bank, a branch of a qualified U.S. bank, an eligible foreign custodian, or an eligible foreign securities depository, where such terms shall mean:
(a) "qualified U.S. bank" shall mean a U.S. bank as described in paragraph (a)(2)(ii)(A)(1) of the Department of Labor Regulations Section 2550.404b-1;
(b) "eligible foreign custodian" shall mean a banking institution incorporated or organized under the laws of a country other than the United States which is supervised or regulated by that country's government or an agency thereof or other regulatory authority in the foreign jurisdiction having authority over banks; and
(c) "eligible foreign securities depository" shall mean a securities depository or clearing agency, incorporated or organized under the laws of a country other than the United States, which is supervised or regulated by that country's government or an agency thereof or other regulatory authority in the foreign jurisdiction having authority over such depositories or clearing agencies and which is described in paragraph (c)(2) of the Department of Labor Regulations Section 2550.404b-1.
Section 4. Use of Subcustodian.
Subsection (d) of this section is modified by deleting the last sentence.
Section 5. Deposit Account Payments.
Subsection (b) is amended to read as follows:
(b) In the event that any payment made under this Section 5 exceeds the funds available in the Deposit Account, such discretionary advance shall be deemed a service provided by the Bank under this Agreement for which it is entitled to recover its costs as may be determined by the Bank in good faith.
Section 10. Authorized Persons.
Add the following paragraph at the end of Section 10:
Customer represents that: a) Instructions will only be issued by or for a fiduciary pursuant to Department of Labor Regulation Section 404b-1 (a)(2)(i) and b) if Instructions are to be issued by an investment manager, such entity will meet the requirements of Section 3(38) of ERISA and will have been designated by the Customer to manage assets held in the Customer Accounts ("Investment Manager"). An Investment Manager may designate certain of its employees to act as Authorized Persons under this Agreement.
Section 14(a). Foreign Exchange Transactions.
Add the following paragraph at the end of Subsection 14(a):
Instructions to execute foreign exchange transactions with the Bank, its subsidiaries, affiliates or Subcustodians will include (1) the time period in which the transaction must be completed; (2) the location i.e., Chase New York, Chase London, etc. or the Subcustodian with whom the contract is to be executed and (3) such additional information and guidelines as may be deemed necessary; and, if the Instruction is a standing Instruction, a provision allowing such Instruction to be overridden by specific contrary Instructions.
Mutual Fund Rider to Global Custody Agreement Between The Chase Manhattan Bank, N.A. and Each of the Entities Listed on Schedule A Hereto effective January 3, 1994
Customer represents that the Assets being placed in the Bank's custody are subject to the Investment Company Act of 1940 (the Act), as the same may be amended from time to time.
Except to the extent that the Bank has specifically agreed to comply with a condition of a rule, regulation, interpretation promulgated by or under the authority of the SEC or the Exemptive Order applicable to accounts of this nature issued to the Bank (Investment Company Act of 1940, Release No. 12053, November 20, 1981), as amended, or unless the Bank has otherwise specifically agreed, the Customer shall be solely responsible to assure that the maintenance of Assets under this Agreement complies with such rules, regulations, interpretations or exemptive order promulgated by or under the authority of the Securities Exchange Commission.
The following modifications are made to the Agreement:
Section 3. Subcustodians and Securities Depositories.
Add the following language to the end of Section 3:
The terms Subcustodian and securities depositories as used in this Agreement shall mean a branch of a qualified U.S. bank, an eligible foreign custodian or an eligible foreign securities depository, which are further defined as follows:
(a) "qualified U.S. Bank" shall mean a qualified U.S. bank as defined in Rule 17f-5 under the Investment Company Act of 1940;
(b) "eligible foreign custodian" shall mean (i) a banking institution or trust company incorporated or organized under the laws of a country other than the United States that is regulated as such by that country's government or an agency thereof and that has shareholders' equity in excess of $200 million in U.S. currency (or a foreign currency equivalent thereof), (ii) a majority owned direct or indirect subsidiary of a qualified U.S. bank or bank holding company that is incorporated or organized under the laws of a country other than the United States and that has shareholders' equity in excess of $100 million in U.S. currency (or a foreign currency equivalent thereof)(iii) a banking institution or trust company incorporated or organized under the laws of a country other than the United States or a majority owned direct or indirect subsidiary of a qualified U.S. bank or bank holding company that is incorporated or organized under the laws of a country other than the United States which has such other qualifications as shall be specified in Instructions and approved by the Bank; or (iv) any other
entity that shall have been so qualified by exemptive order, rule or other appropriate action of the SEC; and
(c) "eligible foreign securities depository" shall mean a
securities depository or clearing agency, incorporated or
organized under the laws of a country other than the United
States, which operates (i) the central system for handling
securities or equivalent book-entries in that country, or
(ii) a transnational system for the central handling of
securities or equivalent book-entries.
The Customer represents that its Board of Directors has approved each of the Subcustodians listed in Schedule B to this Agreement and the terms of the subcustody agreements between the Bank and each Subcustodian, which are attached as Exhibits I through of Schedule B, and further represents that its Board has determined that the use of each Subcustodian and the terms of each subcustody agreement are consistent with the best interests of the Fund(s) and its (their) shareholders. The Bank will supply the Customer with any amendment to Schedule B for approval. As requested by the Bank, the Customer will supply the Bank with certified copies of its Board of Directors resolution(s) with respect to the foregoing prior to placing Assets with any Subcustodian so approved.
Section 11. Instructions.
Add the following language to the end of Section 11:
Deposit Account Payments and Custody Account Transactions made pursuant to Section 5 and 6 of this Agreement may be made only for the purposes listed below. Instructions must specify the purpose for which any transaction is to be made and Customer shall be solely responsible to assure that Instructions are in accord with any limitations or restrictions applicable to the Customer by law or as may be set forth in its prospectus.
(a) In connection with the purchase or sale of Securities at prices as confirmed by Instructions;
(b) When Securities are called, redeemed or retired, or otherwise become payable;
(c) In exchange for or upon conversion into other securities alone or other securities and cash pursuant to any plan or merger, consolidation, reorganization, recapitalization or readjustment;
(d) Upon conversion of Securities pursuant to their terms into other securities;
(e) Upon exercise of subscription, purchase or other similar rights represented by Securities;
(f) For the payment of interest, taxes, management or supervisory fees, distributions or operating expenses;
(g) In connection with any borrowings by the Customer requiring a pledge of Securities, but only against receipt of amounts borrowed;
(h) In connection with any loans, but only against receipt of adequate collateral as specified in Instructions which shall reflect any restrictions applicable to the Customer;
(i) For the purpose of redeeming shares of the capital stock of the Customer and the delivery to, or the crediting to the account of, the Bank, its Subcustodian or the Customer's transfer agent, such shares to be purchased or redeemed;
(j) For the purpose of redeeming in kind shares of the Customer against delivery to the Bank, its Subcustodian or the Customer's transfer agent of such shares to be so redeemed;
(k) For delivery in accordance with the provisions of any agreement among the Customer, the Bank and a broker-dealer registered under the Securities Exchange Act of 1934 (the "Exchange Act") and a member of The National Association of Securities Dealers, Inc. ("NASD"), relating to compliance with the rules of The Options Clearing Corporation and of any registered national securities exchange, or of any similar organization or organizations, regarding escrow or other arrangements in connection with transactions by the Customer;
(l) For release of Securities to designated brokers under covered call options, provided, however, that such Securities shall be released only upon payment to the Bank of monies for the premium due and a receipt for the Securities which are to be held in escrow. Upon exercise of the option, or at expiration, the Bank will receive from brokers the Securities previously deposited. The Bank will act strictly in accordance with Instructions in the delivery of Securities to be held in escrow and will have no responsibility or liability for any such Securities which are not returned promptly when due other than to make proper request for such return;
(m) For spot or forward foreign exchange transactions to facilitate security trading, receipt of income from Securities or related transactions;
(n) For other proper purposes as may be specified in Instructions issued by an officer of the Customer which shall include a statement of the purpose for which the delivery or payment is to be made, the amount of the payment or specific Securities to be delivered, the name of the person or persons to whom delivery or payment is to be made, and a certification that the purpose is a proper purpose under the instruments governing the Customer; and
(o) Upon the termination of this Agreement as set forth in
Section 14(i).
Section 12. Standard of Care; Liabilities.
Add the following subsection (c) to Section 12:
(c) The Bank hereby warrants to the Customer that in its opinion, after due inquiry, the established procedures to be followed by each of its branches, each branch of a qualified U.S. bank, each eligible foreign custodian and each eligible foreign securities depository holding the Customer's Securities pursuant to this Agreement afford protection for such Securities at least equal to that afforded by the Bank's established procedures with respect to similar securities held by the Bank and its securities depositories in New York.
Section 14. Access to Records.
Add the following language to the end of Section 14(c):
Upon reasonable request from the Customer, the Bank shall furnish the Customer such reports (or portions thereof) of the Bank's system of internal accounting controls applicable to the Bank's duties under this Agreement. The Bank shall endeavor to obtain and furnish the Customer with such similar reports as it may reasonably request with respect to each Subcustodian and securities depository holding the Customer's assets.
GLOBAL CUSTODY AGREEMENT
WITH
DATE
SPECIAL TERMS AND CONDITIONS RIDER
January, 1994 Schedule B
SUB-CUSTODIANS EMPLOYED BY
THE CHASE MANHATTAN BANK, N.A. LONDON, GLOBAL CUSTODY
COUNTRY
SUB-
CUSTODIAN
CORRESPOND
ENT BANK
ARGENTINA
The Chase
Manhattan
Bank, N.A.
Main
Branch
25 De Mayo
130/140
Buenos
Aires
ARGENTINA
The Chase
Manhattan
Bank, N.A.
Buenos
Aires
AUSTRALIA
The Chase
Manhattan
Bank,
Australia
Limited
36th Floor
World
Trade
Centre
Jamison
Street
Sydney
New South
Wales 2000
AUSTRALIA
The Chase
Manhattan
Bank
Australia
Limited
Sydney
AUSTRIA
Creditanst
alt -
Bankvereln
Schottenga
sse 6
A - 1011,
Vienna
AUSTRIA
Credit
Lyonnais
Vienna
BANGLADESH
Standard
Chartered
Bank
18-20
Motijheel
C.A.
Box 536,
Dhaka-1000
BANGLADESH
Standard
Chartered
Bank Dhaka
BELGIUM
Generale
Bank
3 Montagne
Du Parc
1000
Bruxelles
BELGIUM
Credit
Lyonnais
Bank
Brussels
BOTSWANA
Standard
Chartered
Bank
Botswana
Ltd.
4th Floor
Commerce
House
The Mall
Gaborone
BOTSWANA
Standard
Chartered
Bank
Botswana
Ltd.
Gaborone
BRAZIL
Banco
Chase
Manhattan,
S.A.
Chase
Manhattan
Center
Rua Verbo
Divino,
1400
Sao Paulo,
SP 04719-
002
BRAZIL
Banco
Chase
Manhattan
S.A.
Sao Paulo
CANADA
The Royal
Bank of
Canada
Royal Bank
Plaza
Toronto
Ontario
M5J 2J5
CANADA
Canada
Trust
Canada
Trust
Tower
BCE Place
161 Bay at
Front
Toronto
Ontario
M5J 2T2
CANADA
Toronto
Dominion
Bank
Toronto
Toronto
Dominion
Bank
Toronto
CHILE
The Chase
Manhattan
Bank, N.A.
Agustinas
1235
Casilla
9192
Santiago
CHILE
The Chase
Manhattan
Bank, N.A.
Santiago
COLOMBIA
Cititrust
Colombia
S.A.
Sociedad
Fiduciaria
Av.
Jimenez No
8-89
Santafe de
Bogota, DC
COLOMBIA
Cititrust
Colombia
S.A.
Sociedad
Fiduciaria
Santafe de
Bogota
CZECH
REPUBLC
Ceskoslove
nska
Obchodni
Banka,
A.S.
Na
Prikoope
14
115 20
Praha 1
CZECH
REPUBLIC
Ceskoslove
nska
Obchodni
Banka,
A.S.
Praha
DENMARK
Den Danske
Bank
2 Holmens
Kanala DK
1091
Copenhagen
DENMARK
Den Danske
Bak
Copenhagen
EUROBONDS
Cedel S.A.
67
Boulevard
Grande
Duchesse
Charlotte
LUXEMBOURG
A/c The
Chase
Manhattan
Bank, N.A.
London
A/c No.
17817
ECU:Lloyds
Bank PLC
Internatio
nal
Banking
Dividion
London
For all
other
currencies
: see
relevant
country
EURO CDS
First
Chicago
Clearing
Centre
27
Leadenhall
Street
London
EC3A 1AA
UNITED
KINGDOM
ECU:Lloyds
Bank PLC
Banking
Division
London
For all
other
currencies
: see
relevant
country
FINLAND
Kansallis-
Osake-
Pankki
Aleksanter
inkatu 42
00100
Helsinki
10
FINLAND
Kanasallis
- -Osake-
Pankki
FRANCE
Banque
Paribas
Ref 256
BP 141
3, Rue
D'Antin
75078
Paris
Cedex 02
FRANCE
Societe
Generale
Paris
GERMANY
Chase Bank
A.G.
Alexanders
trasse 59
Postfach
90 01 09
60441
Frankfurt/
Main
GERMANY
Chase Bank
A.G.
Frankfurt
GREECE
National
Bank of
Greece
S.A.
38 Stadiou
Street
Athens
GREECE
National
Bank of
Greece
S.A.
Athens
A/c Chase
Manhattan
Bank,
N.A.,
London
A/c No.
040/7/9215
78-68
HONG KONG
The Chase
Manhattan
Bank, N.A.
40/F One
Exchange
Square
8,
Connaught
Place
Central,
Hong Kong
HONG KONG
The Chase
Manhattan
Bank, N.A.
Hong Kong
HUNGARY
Citibank
Budapest
Rt.
Vaci Utca
19-21
1052
Budapest V
HUNGARY
Citibank
Budapest
Rt.
Budapest
INDIA
The
Hongkong
and
Shanghai
Banking
Corporatio
n Limited
52/60
Mahatma
Gandhi
Road
Bombay 400
001
INDIA
The
Hongkong
and
Shanghai
Banking
Corporatio
n Limited
Bombay
INDONESIA
The
Hongkong
and
Shanghai
Banking
Corporatio
n Limited
World
Trade
Center
J1. Jend
Sudirman
Kav. 29-31
Jakarta
10023
INDONESIA
The Chase
Manhattan
Bank, N.A.
Jakarta
IRELAND
Bank of
Ireland
Internatio
nal
Financial
Services
Centre
1
Hargourmas
ter Place
Dublin 1
IRELAND
Allied
Irish Bank
Dublin
ISRAEL
Bank Leumi
Le-Israel
B.M.
19 Herzi
Street
65136 Tel
Aviv
ISRAEL
Bank Leumi
Le-Israel
B.M.
Tel Aviv
ITALY
The Chase
Manhattan
Bank, N.A.
Piazza
Meda 1
20121
Milan
ITALY
The Chase
Manhattan
Bank, N.A.
Milan
JAPAN
The Chase
Manhattan
Bank, N.A.
1-3
Marunouchi
1-Chome
Chiyoda-Ku
Tokyo 100
JAPAN
The Chase
Manhattan
Bank, N.A.
Tokyo
JORDAN
Arab Bank
Limited
P.O. Box
950544-5
Amman
Shmeisani
JORDAN
Arab Bank
Limited
Amman
LUXEMBOURG
Banque
Generale
du
Luxembourg
S.A.
27 Avenue
Monterey
LUXEMBOURG
Banque
Generale
du
Luxembourg
S.A.
Luxembourg
MALAYSIA
The Chase
Manhattan
Bank, N.A.
Pernas
Internatio
nal
Jalan
Sultan
Ismail
50250,
Kuala
Lumpur
MALAYSIA
The Chase
Manhattan
Bank, N.A.
Kuala
Lumpur
MEXICO
(Equities)
The Chase
Manhattan
Bank, N.A.
Hamburgo
213, Piso 7
06660
Mexico D.F.
MEXICO
No
corresponde
nt Bank
(Government
Bonds)
Banco
Nacional de
Mexico,
Avenida
Juarez No.
104 - 11
Piso
06040
Mexico D.F.
MEXICO
Banque
Commerciale
du Maroc
Casablanca
NETHERLANDS
ABN AMRO
N.V.
Securities
Centre
P.O. Box
3200
4800 De
Breda
NETHERLANDS
Credit
Lyonnais
Bank
Nederland
N.V.
Rotterdam
NEW ZEALAND
National
Nominees
Limited
Level 2 BNZ
Tower
125 Queen
Street
Auckland
NEW ZEALAND
National
Bank of New
Zealand
Wellington
NORWAY
Den Norske
Bank
Kirkegaten
21
Oslo 1
NORWAY
Den Norske
Bank
Oslo
PAKISTAN
Citibank
N.A.
State Life
Building
No.1
I.I.
Chundrigar
Road
Karachi
PAKISTAN
Citibank
N.A.
Karachi
PERU
Citibank,
N.A.
Camino Real
457
CC Torre
Real - 5th
Floor
San Isidro,
Lima 27
PERU
Citibank
N.A.
Lima
PHILIPPINES
The
Hongkong
and
Shanghai
Banking
Corporation
Limited
Hong Kong
Bank Centre
3/F
San Miguel
Avenue
Ortigas
Commercial
Centre
Pasig Metro
Manila
PHILIPPINES
The
Hongkong
and Shaghai
Banking
Corporation
Limited
Manila
POLAND
Bank Polska
Kasa Opieki
S.A.
6/12 Nowy
Swiat Str
00-920
Warsaw
POLAND
Bank Potska
Kasa Opieki
S.A.
Warsaw
PORTUGAL
Banco
Espirito
Santo &
Comercial
de Lisboa
Servico de
Gestaode
Titulos
R. Mouzinho
da
Silvelra,
36 r/c
1200 Lisbon
PORTUGAL
Banco Pinto
& Sotto
Mayor
Avenida
Fontes
Pereira de
Melo
1000 Lisbon
SHANGHAI
(CHINA)
The
Hongkong
and
Shanghai
Banking
Corporation
Limited
Shanghai
Branch
Corporate
Banking
Centre
Unit 504,
5/F
Shanghai
Centre
1376
Hanjing Xi
Lu
Shanghai
THE
PEOPLE'S
REPUBLIC OF
CHINA
The Chase
Manhattan
Bank, N.A.
Hong Kong
SCHENZHEN
(CHINA)
The
Hongkong
and
Shanghai
Banking
Corporation
Limited
1st Floor
Central
Plaza Hotel
No. 1 Chun
Feng Lu
Shenzhen
THE
PEOPLE'S
REPUBLIC OF
CHINA
The Chase
Manhattan
Bank, N.A.
Hong Kong
SINGAPORE
The Chase
Manhattan
Bank, N.A.
Shell Tower
50 Raffles
Place
Singapore
0104
SINGAPORE
The Chase
Manhattan
Bank, N.A.
Singapore
SOUTH KOREA
The
Hongkong &
Shanghai
Banking
Corporation
Limited
6/F Kyobo
Building
#1 Chongro,
1-ka
Chongro-Ku,
Seoul
SOUGH KOREA
The
Hongkong &
Shanghai
Banking
Corporation
Limited
Seoul
SPAIN
The Chase
Manhattan
Bank, N.A.
Calle
Peonias 2
7th Floor
La Piovera
28042
Madrid
SPAIN
Banco
Zaragozano,
S.A.
Madrid
URUGUAY
The First
National
Bank of
Boston
Zabala 1463
Montevideo
URUGUAY
The First
National
Bank of
Boston
Montevideo
U.S.A
The Chase
Manhattan
Bank, N.A.
1 Chase
Manhattan
Plaza
New York
NY 10081
U.S.A.
The Chase
Manhattan
Bank, N.A.
New York
VENEZUELA
Citibank
N.A.
Carmelitas
a
Altagracia
Edificio
Citibank
Caracas
1010
VENEZUELA
Citibank
N.A.
Caracas
AMENDMENT AGREEMENT, dated as of April 18, 1994 (the "Amendment Agreement") to the Global Custody Agreement, effective January 3, 1994 (the "Custody Agreement") by and between each of the Entities listed in Attachment A hereto, separately and individually (each such entity referred to hereinafter as the "Customer") and THE CHASE MANHATTAN BANK, N.A. (the "Bank"). Terms defined in the Custody Agreement are used herein as therein defined.
WITNESSETH:
WHEREAS, the Customer wishes to appoint the Bank as its global custodian and the bank wishes to accept such appointment pursuant to the terms of the Custody Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
1. Amendment. Section I of Schedule A of the Custody Agreement ("Schedule A") shall be amended to add each Customer listed in Attachment A hereto. The revised Schedule A incorporating these changes in the form attached hereto as Attachment B shall supersede the existing Schedule A in its entirety.
2. Agreement. The Customer agrees to be bound in all respects by all the terms and conditions of the Custody Agreement and shall be fully liable thereunder as a "Customer" as defined in the Custody Agreement.
3. Confirmation of Agreement. Except as amended hereby, the Custody Agreement is in full force and effect and as so amended is hereby ratified, approved and confirmed by the Customer and the Bank in all respects.
4. Governing Law. This Amendment Agreement shall be construed in accordance with and governed by the law of the State of New York without regard to its conflict of law principles.
IN WITNESS WHEREOF, the parties have executed this Amendment Agreement as of the day and year first above written.
THE CHASE MANHATTAN BANK, N.A.
By:
Alan P. Naughton
Vice President
EACH OF THE CUSTOMERS LISTED IN
ATTACHMENT A HERETO, SEPARATELY AND
INDIVIDUALLY
By:
Carmen F. Deyesu
Treasurer
LIST OF CUSTOMERS
T. Rowe Price International Series, Inc. on behalf of the T. Rowe Price International Stock Portfolio
T. Rowe Price Equity Series, Inc. on behalf of the T. Rowe Price Equity Income Portfolio T. Rowe Price New America Growth Portfolio
T. Rowe Price New America Growth Fund, Inc.
T. Rowe Price Income Series, Inc. on behalf of T. Rowe Price Limited-Term Bond Portfolio
Schedule A
LIST OF CUSTOMERS, EACH INDIVIDUALLY PARTIES TO
GLOBAL CUSTODY AGREEMENT WITH
THE CHASE MANHATTAN BANK, N.A.
DATED JANUARY 3, 1993
APPLICABLE RIDERS TO
CUSTOMER GLOBAL CUSTODY AGREEMENT
I. INVESTMENT The Mutual Fund Rider is
COMPANIES/PORTFOLIOS applicable to all Customers
REGISTERED UNDER THE listed under Section I
INVESTMENT COMPANY ACT OF 1940 of this Schedule A.
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Equity Funds
T. Rowe Price Balanced Fund, Inc.
T. Rowe Price Blue Chip Growth Fund, Inc.
T. Rowe Price Capital Appreciation Fund
T. Rowe Price Dividend Growth Fund, Inc.
T. Rowe Price Equity Income Fund
T. Rowe Price Growth & Income Fund, Inc.
T. Rowe Price Growth Stock Fund, Inc.
Institutional International Funds, Inc. on behalf of:
Foreign Equity Fund
T. Rowe Price International Funds, Inc. on behalf of:
T. Rowe Price European Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price International Stock Fund
T. Rowe Price Japan Fund
T. Rowe Price Latin America Fund
T. Rowe Price New Asia Fund
T. Rowe Price International Series, Inc., on behalf of:
T. Rowe Price International Stock Portfolio
T. Rowe Price Mid-Cap Growth Fund, Inc.
T. Rowe Price New Era Fund, Inc.
T. Rowe Price New Horizons Fund, Inc.
T. Rowe Price OTC Fund, Inc. on behalf of:
T. Rowe Price OTC Fund
T. Rowe Price Science & Technology Fund, Inc.
T. Rowe Price Small-Cap Value Fund, Inc.
CUNA Mutual Funds, Inc. on behalf of:
CUNA Mutual Cornerstone Fund
T. Rowe Price Equity Series, Inc. on behalf of:
T. Rowe Price Equity Income Portfolio
T. Rowe Price New America Growth Portfolio T. Rowe Price New America Growth Fund, Inc.
Income Funds
T. Rowe Price Adjustable Rate U.S. Government Fund, Inc. T. Rowe Price High Yield Fund, Inc. T. Rowe Price New Income Fund, Inc. T. Rowe Price Short-Term Bond Fund, Inc. T. Rowe Price Summit Funds, Inc. on behalf of:
T. Rowe Price Summit Limited-Term Bond Fund
T. Rowe Price International Funds, Inc. on behalf of:
T. Rowe Price Global Government Income Fund
T. Rowe Price International Bond Fund
T. Rowe Price Short-Term Global Income Fund
T. Rowe Price Income Series, Inc. on behalf of:
T. Rowe Price Limited-Term Bond Portfolio
II. ACCOUNTS SUBJECT TO ERISA The ERISA Rider is
applicable to all Customers
T. Rowe Price Trust Company, under Section II of this
as Trustee for the Johnson Schedule A.
Matthey Salaried Employee
Savings Plan
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Common Trust Funds
T. Rowe Price Trust company,
as Trustee for the International
Common Trust Fund on behalf of
the Underlying Trusts:
Foreign Discovery Trust
Foreign Discovery Trust-Augment
Pacific Discovery Trust
European Discovery Trust
Japan Discovery Trust
Latin American Discovery Trust
New York City International Common Trust Fund
III. OTHER No Riders are applicable to
the Customer listed under
RPFI International Section III of this
Partners, L.P. Schedule A.
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The Transfer Agency and Service Agreement between T. Rowe Price Services, Inc. and T. Rowe Price Funds, dated January 1, 1994, as amended, should be inserted here.
TRANSFER AGENCY AND SERVICE AGREEMENT
between
T. ROWE PRICE SERVICES, INC.
and
EACH OF THE PARTIES INDICATED ON APPENDIX A
TABLE OF CONTENTS
Page
Article A Terms of Appointment . . . . . . . . . . . . . .2
Article B Duties of Price Services . . . . . . . . . . . .3
1. Receipt of Orders/Payments. . . . . . . . .3
2. Written Redemptions . . . . . . . . . . . .4
3. Transfers . . . . . . . . . . . . . . . . .6
4. Confirmations . . . . . . . . . . . . . . .6
5. Issuance of Share Certificates. . . . . . .6
6. Returned Checks and ACH Debits. . . . . . 7
7. Redemptions of Shares under Ten Day Hold. 7
8. Dividends, Distributions and Other
Corporate Actions. . . . . . . . . . . . 9
9. Unclaimed Payments and Certificates . . .10
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10. Books and Records . . . . . . . . . . . .10
11. Authorized Issued and Outstanding Shares.12
12. Tax Information . . . . . . . . . . . . .13
13. Information to be Furnished to the Fund .13
14. Correspondence. . . . . . . . . . . . . .13 15. Lost or Stolen Securities . . . . . . . .14 16. Telephone Services . . . . . . . . . . .14 17. Proxies . . . . . . . . . . . . . . . . .14 18. Form N-SAR. . . . . . . . . . . . . . . .15 19. Cooperation With Accountants. . . . . . .15 20. Blue Sky. . . . . . . . . . . . . . . . .15 21. Other Services. . . . . . . . . . . . . .15 22. Fees and Out-of-Pocket Expenses . . . . .15 |
Article C Representations and Warranties of the Price Services. . . . . . . . . . . . . . . . . . .17 Article D Representations and Warranties of the Fund . .18
Article E Standard of Care/Indemnification . . . . . . .18
Article F Dual Interests . . . . . . . . . . . . . . . . 20
Article G Documentation. . . . . . . . . . . . . . . . . 20
Article H References to Price Services . . . . . . . . . 22
Article I Compliance with Governmental Rules and
Regulations . . . . . . . . . . . . . . . . . 22
Article J Ownership of Software and Related Material . . 22
PAGE 3
Article K Quality Service Standards. . . . . . . . . . . 23
Article L As of Transactions . . . . . . . . . . . . . . 23
Article M Term and Termination of Agreement. . . . . . . 26
Article N Notice . . . . . . . . . . . . . . . . . . . . 26
Article O Assignment . . . . . . . . . . . . . . . . . . 26
Article P Amendment/Interpretive Provisions. . . . . . . 26
Article Q Further Assurances . . . . . . . . . . . . . . 27
Article R Maryland Law to Apply. . . . . . . . . . . . . 27
Article S Merger of Agreement. . . . . . . . . . . . . . 27
Article T Counterparts . . . . . . . . . . . . . . . . . 27
Article U The Parties. . . . . . . . . . . . . . . . . . 27
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Article V Directors, Trustees, Shareholders and Massachusetts Business Trust . . . . . . . . . . . . . . . . 28 Article W Captions . . . . . . . . . . . . . . . . . . . 28
AGREEMENT made as of the first day of January, 1994, by and
between T. ROWE PRICE SERVICES, INC., a Maryland corporation
having its principal office and place of business at 100 East
Pratt Street, Baltimore, Maryland 21202 ("Price Services"), and
EACH FUND WHICH IS LISTED ON APPENDIX A (as such Appendix may be
amended from time to time) and which evidences its agreement to
be bound hereby by executing a copy of this Agreement (each such
Fund individually hereinafter referred to as "the Fund", whose
definition may be found in Article U);
WHEREAS, the Fund desires to appoint Price Services as its
transfer agent, dividend disbursing agent and agent in connection
with certain other activities, and Price Services desires to
accept such appointment;
WHEREAS, Price Services represents that it is registered
with the Securities and Exchange Commission as a Transfer Agent
under Section 17A of the Securities Exchange Act of 1934 ("'34
Act") and will notify each Fund promptly if such registration is
revoked or if any proceeding is commenced before the Securities
and Exchange Commission which may lead to such revocation;
WHEREAS, certain of the Funds are named investment options
under various tax-sheltered retirement plans including, but not
limited to, individual retirement accounts, simplified employee
pension plans, deferred compensation plans, 403(b) plans, and
profit sharing, thrift, and money purchase pension plans for
self-employed individuals and professional partnerships and
corporations, (collectively referred to as "Retirement Plans");
WHEREAS, Price Services has the capability of providing
special services, on behalf of the Funds, for the accounts of
shareholders participating in these Retirement Plans ("Retirement
Accounts").
WHEREAS, Price Services may subcontract or jointly contract
with other parties, on behalf of the Funds, including, but not
limited to, DST, SRI, Moore Business Forms, Boston Financial Data
Services, Inc., and the 440 Financial Group, to perform certain
of the functions and services described herein including services
to Retirement Plans and Retirement Accounts. Price Services may
also enter into, on behalf of the Funds, certain banking
relationships to perform various banking services including, but
not limited to, check deposits, check disbursements, automated
clearing house transactions ("ACH") and wire transfers. Subject
to guidelines mutually agreed upon by the Funds and Price
Services, excess balances, if any, resulting from these banking
relationships will be invested and the income therefrom will be
used to offset fees which would otherwise be charged to the Funds
under this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:
A. Terms of Appointment
Subject to the terms and conditions set forth in this
Agreement, the Fund hereby employs and appoints Price Services to
act, and Price Services agrees to act, as the Fund's transfer
agent, dividend disbursing agent and agent in connection with:
(1) the Fund's authorized and issued shares of its common stock
or shares of beneficial interest (all such stock and shares to be
referred to as "Shares"); (2) any accumulation, open-account or
similar plans provided to the shareholders of the Fund
("Shareholders"), including, without limitation, any periodic
investment plan or periodic withdrawal program; and (3) certain
Retirement Plan and Retirement Accounts as agreed upon by the
parties.
The parties to the Agreement hereby acknowledge that from
time to time, Price Services and T. Rowe Price Trust Company may
enter into contracts ("Other Contracts") with employee benefit
plans and/or their sponsors for the provision of certain plan
participant services to Retirement Plans and Retirement Accounts.
Compensation paid to Price Services pursuant to this Agreement
is with respect to the services described herein and not with
respect to services provided under Other Contracts.
B. Duties of Price Services
Price Services agrees that it will perform the following
services:
1. Receipt of Orders/Payments
Receive for acceptance, orders/payments for the
purchase of Shares and promptly deliver payment and
appropriate documentation thereof to the authorized
custodian of the Fund (the "Custodian"). Upon receipt of
any check or other instrument drawn or endorsed to it as
agent for, or identified as being for the account of, the
Fund, Price Services will process the order as follows:
o Examine the check to determine if the check conforms to
the Funds' acceptance procedures (including certain
third-party check procedures). If the check conforms,
Price Services will endorse the check and include the
date of receipt, will process the same for payment, and
deposit the net amount to the parties agreed upon
designated bank account prior to such deposit in the
Custodial account, and will notify the Fund and the
Custodian, respectively, of such deposits (such
notification to be given on a daily basis of the total
amount deposited to said accounts during the prior
business day);
o Open a new account, if necessary, and credit the
account of the investor with the number of Shares to be
purchased according to the price of the Fund's Shares
in effect for purchases made on that date, subject to
any instructions which the Fund may have given to Price
Services with respect to acceptance of orders for
Shares relating to payments so received by it;
o Maintain a record of all unpaid purchases and report
such information to the Fund daily;
o Process periodic payment orders, as authorized by
investors, in accordance with the payment procedures
for pre-authorized checking ("PAC") and ACH purchases
mutually agreed upon by both parties;
o Receive monies from Retirement Plans and determine the
proper allocation of such monies to the Retirement
Accounts based upon instructions received from
Retirement Plan participants or Retirement Plan
administrators ("Administrators"); and
o Process telephone orders for purchases of Fund shares
from the Shareholder's bank account (via wire or ACH)
to the Fund in accordance with procedures mutually
agreed upon by both parties.
Upon receipt of funds through the Federal Reserve Wire
System that are designated for purchases in Funds which
declare dividends at 12:00 p.m. (or such time as set forth
in the Fund's current prospectus), Price Services shall
promptly notify the Fund and the Custodian of such deposit.
2. Redemptions
Receive for acceptance redemption requests, including
telephone redemptions and requests received from
Administrators for distributions to participants or their
designated beneficiaries or for payment of fees due the
Administrator or such other person, including Price
Services, and deliver the appropriate documentation
thereofto the Custodian. Price Services shall receive and
stamp with the date of receipt, all requests for redemptions
of Shares (including all certificates delivered to it for
redemption) and shall process said redemption requests as
follows, subject to the provisions of Section 7 hereof:
o Examine the redemption request and, for written
redemptions, the supporting documentation, to determine
that the request is in good order and all requirements
have been met;
o Notify the Fund on the next business day of the total
number of Shares presented and covered by all such
requests;
o As set forth in the prospectus of the Fund, and in any
event, on or prior to the seventh (7th) calendar day
succeeding any such request for redemption, Price
Services shall, from funds available in the accounts
maintained by Price Services as agent for the Funds,
pay the applicable redemption price in accordance with
the current prospectus of the Fund, to the investor,
participant, beneficiary, Administrator or such other
person, as the case may be;
o If any request for redemption does not comply with the
Fund's requirements, Price Services shall promptly
notify the investor of such fact, together with the
reason therefore, and shall effect such redemption at
the price in effect at the time of receipt of all
appropriate documents;
o Make such withholdings as may be required under
applicable Federal and State tax law;
o In the event redemption proceeds for the payment of
fees are to be wired through the Federal Reserve Wire
System or by bank wire, Price Services shall cause such
proceeds to be wired in Federal funds to the bank
account designated; and
o Process periodic redemption orders as authorized by the
investor in accordance with the periodic withdrawal
procedures for Systematic Withdrawal Plan ("SWP") and
systematic ACH redemptions mutually agreed upon by both
parties.
Procedures and requirements for effecting and accepting
redemption orders from investors by telephone, Tele*Access,
Mailgram, or written instructions shall be established by
mutual agreement between Price Services and the Fund
consistent with the Fund's current prospectus.
3. Transfers
Effect transfers of Shares by the registered owners
thereof upon receipt of appropriate instructions and
documentation and examine such instructions for conformance
with appropriate procedures and requirements. In this
regard, Price Services, upon receipt of a proper request for
transfer, including any transfer involving the surrender of
certificates of Shares, is authorized to transfer, on the
records of the Fund, Shares of the Fund, including
cancellation of surrendered certificates, if any, to credit
a like amount of Shares to the transferee and to
countersign, issue and deliver new certificates, if
requested, for those Funds issuing certificates.
4. Confirmations
Mail all confirmations and other enclosures requested
by the Fund to the shareholder, and in the case of
Retirement Accounts, to the Administrators, as may be
required by the Funds or by applicable Federal or state law.
5. Issuance of Share Certificates
o Those Funds which issue stock certificates shall supply
Price Services with a sufficient supply of blank stock
certificates and shall renew such supply upon request
of Price Services. Such blank stock certificates shall
be properly signed, manually or facsimile, if
authorized by the Fund, and shall bear the seal or
facsimile thereof of the Fund; and notwithstanding the
death, resignation or removal of any officers of the
Fund authorized to sign certificates of stock, on
behalf of the Fund, Price Services may continue to
countersign certificates which bear the manual or
facsimile signature of such officer until otherwise
directed by the Fund.
o If an investor requests a share certificate of a Fund
which issues stock certificates (except shares in
Retirement Plans and Retirement Accounts which will be
non certificated), Price Services will countersign and
mail by first class mail, a share certificate to the
investor at his address as set forth on the transfer
books of the Fund, subject to any other instructions
for delivery of certificates which the Fund may give to
Price Services with respect to certificates
representing newly purchased Shares.
6. Returned Checks and ACH Debits
In order to minimize the risk of loss to the Fund by
reason of any check being returned unpaid, Price Services
will promptly identify and follow-up on any check or ACH
debit returned unpaid. For items returned, Price Services
may telephone the investor and/or redeposit the check or
debit for collection or cancel the purchase, as deemed
appropriate.
7. Redemption of Shares under Ten Day Hold
o Uncollected Funds
Shares purchased by personal, corporate, or
governmental check, or by ACH will be considered
uncollected until the tenth calendar date following the
trade date of the trade ("Uncollected Funds");
o Good Funds
Share purchased by treasurer's, cashier, certified, or
official check, or by wire transfer will be considered
collected immediately ("Good Funds"). Absent
information to the contrary (i.e., notification from
the payee institution), Uncollected Funds will be
considered Good Funds on the tenth calendar day
following trade date.
o Redemption of Uncollected Funds
o Shareholders making telephone requests for
redemption of shares purchased with Uncollected
Funds will be given two options:
1. The Shareholder will be permitted to exchange
to a money market fund to preserve principal until
the funds are deemed Good Funds,
2. The redemption can be processed utilizing the
same procedures for written redemptions described
below.
o If a written redemption request is made for shares
where any portion of the payment for said shares
is in Uncollected Funds, and the request is in
good order, Price Services will promptly obtain
the information relative to the payment necessary
to determine when the payment becomes Good Funds.
The redemption will be processed in accordance
with normal procedures, and the proceeds will be
held until confirmation that the payment is Good
Funds. On the seventh (7th) calendar day after
trade date, and each day thereafter until either
confirmation is received or the tenth (10th)
calendar day, Price Services will call the paying
institution to request confirmation that the check
or ACH in question has been paid. On the tenth
calendar day after trade date, the redemption
proceeds will be released, regardless of whether
confirmation has been received.
o Checkwriting Redemptions.
o Daily, all checkwriting redemptions $10,000 and
over reported as Uncollected Funds or insufficient
funds will be reviewed. An attempt will be made
to contact the shareholder to make good the funds
(through wire, exchange, transfer). Generally by
12:00 p.m. the same day, if the matter has not
been resolved, the redemption request will be
rejected and the check returned to the
Shareholder.
o All checkwriting redemptions under $10,000
reported as Uncollected or insufficient funds will
be rejected and the check returned to the
Shareholder.
o Confirmations of Available Funds
The Fund expects that situations may develop whereby it
would be beneficial to determine if a person who has
placed an order for Shares has sufficient funds in his
or her checking account to cover the payment for the
Shares purchased. When this situation occurs, Price
Services may call the bank in question and request that
it confirm that sufficient funds to cover the purchase
are currently credited to the account in question.
Price Services will maintain written documentation or a
recording of each telephone call which is made under
the procedures outlined above. None of the above
procedures shall preclude Price Services from inquiring
as to the status of any check received by it in payment
for the Fund's Shares as Price Services may deem
appropriate or necessary to protect both the Fund and
Price Services. If a conflict arises between Section 2
and this Section 7, Section 7 will govern.
8. Dividends, Distributions and Other Corporate Actions
o The Fund will promptly inform Price Services of the
declaration of any dividend, distribution, stock split
or any other distributions of a similar kind on account
of its Capital Stock.
o Price Services shall act as Dividend Disbursing Agent
for the Fund, and as such, shall prepare and make
income and capital gain payments to investors. As
Dividend Disbursing Agent, Price Services will on or
before the payment date of any such dividend or
distribution, notify the Custodian of the estimated
amount required to pay any portion of said dividend or
distribution which is payable in cash, and the Fund
agrees that on or before the payment date of such
distribution, it shall instruct the Custodian to make
available to Price Services sufficient funds for the
cash amount to be paid out. If an investor is entitled
to receive additional Shares by virtue of any such
distribution or dividend, appropriate credits will be
made to his or her account.
9. Unclaimed Payments and Certificates
In accordance with procedures agreed upon by both
parties, report abandoned property to appropriate state and
governmental authorities of the Fund. Price Services shall,
90 days prior to the annual reporting of abandoned property
to each of the states, make reasonable attempts to locate
Shareholders for which (a) checks or share certificates have
been returned; (b) for which accounts have aged outstanding
checks; or (c) accounts with unissued shares that have been
coded with stop mail and meet the dormancy period guidelines
specified in the individual states. Price Services shall
make reasonable attempts to contact shareholders for those
accounts which have significant aged outstanding checks.
10. Books and Records
Maintain records showing for each Shareholder's
account, Retirement Plan or Retirement Account, as the case
may be, the following:
o Names, address and tax identification number;
o Number of Shares held;
o Certain historical information regarding the
account of each Shareholder, including dividends
and distributions distributed in cash or invested
in Shares;
o Pertinent information regarding the establishment
and maintenance of Retirement Plans and Retirement
Accounts necessary to properly administer each
account;
o Information with respect to the source of
dividends and distributions allocated among income
(taxable and nontaxable income), realized short-
term gains and realized long-term gains;
o Any stop or restraining order placed against a
Shareholder's account;
o Information with respect to withholdings on
domestic and foreign accounts;
o Any instructions from a Shareholder including, all
forms furnished by the Fund and executed by a
Shareholder with respect to (i) dividend or
distribution elections, and (ii) elections with
respect to payment options in connection with the
redemption of Shares;
o Any correspondence relating to the current
maintenance of a Shareholder's account;
o Certificate numbers and denominations for any
Shareholder holding certificates;
o Any information required in order for Price
Services to perform the calculations contemplated
under this Agreement.
Price Services shall maintain files and furnish
statistical and other information as required under this
Agreement and as may be agreed upon from time to time by
both parties or required by applicable law. However, Price
Services reserves the right to delete, change or add any
information to the files maintained; provided such
deletions, changes or additions do not contravene the terms
of this Agreement or applicable law and do not materially
reduce the level of services described in this Agreement.
Price Services shall also use its best efforts to obtain
additional statistical and other information as each Fund
may reasonably request for additional fees as may be agreed
to by both parties.
Any such records maintained pursuant to Rule 31a-1
under the Investment Company Act of 1940 ("the Act") will be
preserved for the periods and maintained in a manner
prescribed in Rule 31a-2 thereunder. Disposition of such
records after such prescribed periods shall be as mutually
agreed upon by the Fund and Price Services. The retention
of such records, which may be inspected by the Fund at
reasonable times, shall be at the expense of the Fund. All
records maintained by Price Services in connection with the
performance of its duties under this Agreement will remain
the property of the Fund and, in the event of termination of
this Agreement, will be delivered to the Fund as of the date
of termination or at such other time as may be mutually
agreed upon.
All books, records, information and data pertaining to
the business of the other party which are exchanged or
received pursuant to the negotiation or the carrying out of
this Agreement shall remain confidential, and shall not be
voluntarily disclosed to any other person, except after
prior notification to and approval by the other party
hereto, which approval shall not be unreasonably withheld
and may not be withheld where Price Services or the Fund may
be exposed to civil or criminal contempt proceedings for
failure to comply; when requested to divulge such
information by duly constituted governmental authorities; or
after so requested by the other party hereto.
11. Authorized Issued and Outstanding Shares
Record the issuance of Shares of the Fund and maintain,
pursuant to Rule 17Ad-10(e) of the '34 Act, a record of the
total number of Shares of the Fund which are authorized,
issued and outstanding, based upon data provided to it by
the Fund. Price Services shall also provide the Fund on a
regular basis the total number of Shares which are
authorized and issued and outstanding. Price Services shall
have no obligation, when recording the issuance of Shares,
to monitor the issuance of such Shares or to take cognizance
of any laws relating to the issuance or sale of such Shares.
12. Tax Information
Prepare and file with the Internal Revenue Service and
with other appropriate state agencies and, if required, mail
to investors, those returns for reporting dividends and
distributions paid as required to be so filed and mailed,
and shall withhold such sums required to be withheld under
applicable Federal and state income tax laws, rules, and
regulations. Additionally, Price Services will file and, as
applicable, mail to investors, any appropriate information
returns required to be filed in connection with Retirement
Plan processing, such as 1099R, 5498, as well as any other
appropriate forms that the Fund or Price Services may deem
necessary. The Fund and Price Services shall agree to
procedures to be followed with respect to Price Services'
responsibilities in connection with compliance with back-up
withholding and other tax laws.
13. Information to be Furnished to the Fund
Furnish to the Fund such information as may be agreed
upon between the Fund and Price Services including any
information that the Fund and Price Services agree is
necessary to the daily operations of the business.
14. Correspondence
Promptly and fully answer correspondence from
shareholders and Administrators relating to Shareholder
Accounts, Retirement Accounts, transfer agent procedures,
and such other correspondence as may from time to time be
mutually agreed upon with the Funds. Unless otherwise
instructed, copies of all correspondence will be retained by
Price Services in accordance with applicable law and
procedures.
15. Lost or Stolen Securities
Pursuant to Rule 17f-1 of the '34 Act, report to the
Securities Information Center and/or the FBI or other
appropriate person on Form X-17-F-1A all lost, stolen,
missing or counterfeit securities. Provide any other
services relating to lost, stolen or missing securities as
may be mutually agreed upon by both parties.
16. Telephone Services
Maintain a Telephone Servicing Staff of representatives
("Representatives") sufficient to timely respond to all
telephonic inquiries reasonably foreseeable. The
Representatives will also effect telephone purchases,
redemptions, exchanges, and other transactions mutually
agreed upon by both parties, for those Shareholders who have
authorized telephone services. The Reprentatives shall
require each Shareholder effecting a telephone transaction
to properly identify themself before the transaction is
effected, in accordance with procedures agreed upon between
by both parties. Procedures for processing telephone
transactions will be mutually agreed upon by both parties.
Price Services will also be responsible for providing
Tele*Access, PC*Access and such other Services as may be
offered by the Funds from time to time. Price Services will
maintain a special Shareholder Servicing staff to service
certain Shareholders with substantial relationships with the
Funds.
17. Proxies
Monitor the mailing of proxy cards and other material
supplied to it by the Fund in connection with Shareholder
meetings of the Fund and shall coordinate the receipt,
examination and tabulation of returned proxies and the
certification of the vote to the Fund.
18. Form N-SAR
Maintain such records, if any, as shall enable the Fund
to fulfill the requirements of Form N-SAR.
19. Cooperation With Accountants
Cooperate with each Fund's independent public
accountants and take all reasonable action in the
performance of its obligations under the Agreement to assure
that the necessary information is made available to such
accountants for the expression of their opinion without any
qualification as to the scope of their examination,
including, but not limited to, their opinion included in
each such Fund's annual report on Form N-SAR and annual
amendment to Form N-1A.
20. Blue Sky
Provide to the Fund or its agent, on a daily, weekly,
monthly and quarterly basis, and for each state in which the
Fund's Shares are sold, sales reports and other materials
for blue sky compliance purposes as shall be agreed upon by
the parties.
21. Other Services
Provide such other services as may be mutually agreed
upon between Price Services and the Fund.
22. Fees and Out-of-Pocket Expenses
Each Fund shall pay to Price Services and/or its agents
for its Transfer Agent Services hereunder, fees computed as
set forth in Schedule A attached. Except as provided below,
Price Services will be responsible for all expenses relating
to the providing of Services. Each Fund, however, will
reimburse Price Services for the following out-of-pocket
expenses and charges incurred in providing Services:
o Postage. The cost of postage and freight for
mailing materials to Shareholders and Retirement
Plan participants, or their agents, including
overnight delivery, UPS and other express mail
services and special courier services required to
transport mail between Price Services locations
and mail processing vendors.
o Proxies. The cost to mail proxy cards and other
material supplied to it by the Fund and costs
related to the receipt, examination and tabulation
of returned proxies and the certification of the
vote to the Fund.
o Communications
o Print. The printed forms used internally and
externally for documentation and processing
Shareholder and Retirement Plan participant,
or their agent's inquiries and requests;
paper and envelope supplies for letters,
notices, and other written communications
sent to Shareholders and Retirement Plan
participants, or their agents.
o Print & Mail House. The cost of internal
and third party printing and mail house
services, including printing of statements
and reports.
o Voice and Data. The cost of equipment
(including associated maintenance), supplies
and services used for communicating to and
from the Shareholders of the Fund and
Retirement Plan participants, or their
agents, the Fund's transfer agent, other Fund
offices, and other agents of either the Fund
or Price Services. These charges shall
include:
o telephone toll charges (both incoming
and outgoing, local, long distance and
mailgrams); and
o data and telephone lines and associated
equipment such as modems, multiplexers,
and facsimile equipment.
o Record Retention. The cost of maintenance
and supplies used to maintain, microfilm,
copy, record, index, display, retrieve, and
store, in microfiche or microfilm form,
documents and records.
o Disaster Recovery. The cost of services,
equipment, facilities and other charges
necessary to provide disaster recovery for
any and all services listed in this
Agreement.
Out-of-pocket costs will be billed at cost to the
Funds. Allocation of monthly costs among the Funds will
generally be made based upon the number of Shareholder and
Retirement Accounts serviced by Price Services each month. Some
invoices for these costs will contain costs for both the Funds
and other funds serviced by Price Services. These costs will be
allocated based on a reasonable allocation mehodology. Where
possible, such as in the case of inbound and outbound WATS
charges, allocation will be made on the actual distribution or
usage.
C. Representations and Warranties of Price Services
Price Services represents and warrants to the Fund that:
1. It is a corporation duly organized and existing and in
good standing under the laws of Maryland;
2. It is duly qualified to carry on its business in
Maryland and California;
3. It is empowered under applicable laws and by its
charter and by-laws to enter into and perform this
Agreement;
4. All requisite corporate proceedings have been taken to
authorize it to enter into and perform this Agreement;
5. It is registered with the Securities and Exchange
Commission as a Transfer Agent pursuant to Section 17A of
the '34 Act; and
6. It has and will continue to have access to the
necessary facilities, equipment and personnel to perform its
duties and obligations under this Agreement.
D. Representations and Warranties of the Fund
The Fund represents and warrants to Price Services that:
1. It is a corporation or business trust duly organized
and existing and in good standing under the laws of Maryland
or Massachusetts, as the case may be;
2. It is empowered under applicable laws and by its
Articles of Incorporation or Declaration of Trust, as the
case may be, and By-Laws to enter into and perform this
Agreement;
3. All proceedings required by said Articles of
Incorporation or Declaration of Trust, as the case may be,
and By-Laws have been taken to authorize it to enter into
and perform this Agreement;
4. It is an investment company registered under the Act;
and
5. A registration statement under the Securities Act of
1933 ("the '33 Act") is currently effective and will remain
effective, and appropriate state securities law filings have
been made and will continue to be made, with respect to all
Shares of the Fund being offered for sale.
E. Standard of Care/Indemnification
Notwithstanding anything to the contrary in this Agreement:
1. Price Services shall not be liable to any Fund for any
act or failure to act by it or its agents or subcontractors
on behalf of the Fund in carrying or attempting to carry out
the terms and provisions of this Agreement provided Price
Services has acted in good faith and without negligence or
willful misconduct and selected and monitored the
performance of its agents and subcontractors with reasonable
care.
2. The Fund shall indemnify and hold Price Services
harmless from and against all losses, costs, damages,
claims, actions and expenses, including reasonable expenses
for legal counsel, incurred by Price Services resulting
from: (i) any action or omission by Price Services or its
agents or subcontractors in the performance of their duties
hereunder; (ii) Price Services acting upon instructions
believed by it to have been executed by a duly authorized
officer of the Fund; or (iii) Price Services acting upon
information provided by the Fund in form and under policies
agreed to by Price Services and the Fund. Price Services
shall not be entitled to such indemnification in respect of
actions or omissions constituting negligence or willful
misconduct of Price Services or where Price Services has not
exercised reasonable care in selecting or monitoring the
performance of its agents or subcontractors.
3. Except as provided in Article L of this Agreement,
Price Services shall indemnify and hold harmless the Fund
from all losses, costs, damages, claims, actions and
expenses, including reasonable expenses for legal counsel,
incurred by the Fund resulting from the negligence or
willful misconduct of Price Services or which result from
Price Services' failure to exercise reasonable care in
selecting or monitoring the performance of its agents or
subcontractors. The Fund shall not be entitled to such
indemnification in respect of actions or omissions
constituting negligence or willful misconduct of such Fund
or its agents or subcontractors; unless such negligence or
misconduct is attributable to Price Services.
4. In the event either party is unable to perform its
obligations under the terms of this Agreement because of
acts of God, strikes or other causes reasonably beyond its
control, such party shall not be liable to the other party
for any loss, cost, damage, claim, action or expense
resulting from such failure to perform or otherwise from
such causes.
5. In order that the indemnification provisions contained
in this Article E shall apply, upon the assertion of a claim
for which either party may be required to indemnify the
other, the party seeking indemnification shall promptly
notify the other party of such assertion, and shall keep the
other party advised with respect to all developments
concerning such claim. The party who may be required to
indemnify shall have the option to participate with the
party seeking indemnification in the defense of such claim,
or to defend against said claim in its own name or in the
name of the other party. The party seeking indemnification
shall in no case confess any claim or make any compromise in
any case in which the other party may be required to
indemnify it except with the other party's prior written
consent.
6. Neither party to this Agreement shall be liable to the
other party for consequential damages under any provision of
this Agreement.
F. Dual Interests
It is understood that some person or persons may be
directors, officers, or shareholders of both the Funds and Price
Services (including Price Services's affiliates), and that the
existence of any such dual interest shall not affect the validity
of this Agreement or of any transactions hereunder except as
otherwise provided by a specific provision of applicable law.
G. Documentation
o As requested by Price Services, the Fund shall promptly
furnish to Price Services the following:
o A certified copy of the resolution of the
Directors/Trustees of the Fund authorizing the
appointment of Price Services and the execution
and delivery of this Agreement;
o A copy of the Articles of Incorporation or
Declaration of Trust, as the case may be, and By-
Laws of the Fund and all amendments thereto;
o Specimens of all forms of outstanding and new
stock/share certificates in the forms approved by
the Board of Directors/Trustees of the Fund with a
certificate of the Secretary of the Fund as to
such approval;
o All account application forms and other documents
relating to Shareholders' accounts;
o An opinion of counsel for the Fund with respect to
the validity of the stock, the number of Shares
authorized, the status of redeemed Shares, and the
number of Shares with respect to which a
Registration Statement has been filed and is in
effect; and
o A copy of the Fund's current prospectus.
The delivery of any such document for the purpose of any
other agreement to which the Fund and Price Services are or were
parties shall be deemed to be delivery for the purposes of this
Agreement.
o As requested by Price Services, the Fund will also furnish
from time to time the following documents:
o Each resolution of the Board of Directors/Trustees of
the Fund authorizing the original issue of its Shares;
o Each Registration Statement filed with the Securities
and Exchange Commission and amendments and orders
thereto in effect with respect to the sale of Shares
with respect to the Fund;
o A certified copy of each amendment to the Articles of
Incorporation or Declaration of Trust, and the By-Laws
of the Fund;
o Certified copies of each vote of the Board of
Directors/Trustees authorizing officers to give
instructions to the Transfer Agent;
o Specimens of all new certificates accompanied by the
Board of Directors/Trustees' resolutions approving such
forms;
o Such other documents or opinions which Price Services,
in its discretion, may reasonably deem necessary or
appropriate in the proper performance of its duties;
and
o Copies of new prospectuses issued.
Price Services hereby agrees to establish and maintain
facilities and procedures reasonably acceptable to the Fund for
safekeeping of stock certificates, check forms and facsimile
signature imprinting devices, if any; and for the preparation or
use, and for keeping account of, such certificates, forms and
devices.
H. References to Price Services
Each Fund agrees not to circulate any printed matter which
contains any reference to Price Services without the prior
approval of Price Services, excepting solely such printed matter
that merely identifies Price Services as agent of the Fund. The
Fund will submit printed matter requiring approval to Price
Services in draft form, allowing sufficient time for review by
Price Services and its legal counsel prior to any deadline for
printing.
I. Compliance With Governmental Rules and Regulations
Except as otherwise provided in the Agreement and except for
the accuracy of information furnished to the Fund by Price
Services, each Fund assumes full responsibility for the
preparation, contents and distribution of its prospectuses and
compliance with all applicable requirements of the Act, the '34
Act, the '33 Act, and any other laws, rules and regulations of
governmental authorities having jurisdiction over the Fund.
Price Services shall be responsible for complying with all laws,
rules and regulations of governmental authorities having
jurisdiction over transfer agents and their activities.
J. Ownership of Software and Related Material
All computer programs, magnetic tapes, written procedures
and similar items purchased and/or developed and used by Price
Services in performance of the Agreement shall be the property of
Price Services and will not become the property of the Fund.
K. Quality Service Standards
Price Services and the Fund may from time to time agree to
certain quality service standards, as well as incentives and
penalties with respect to Price Services' hereunder.
L. As Of Transactions
For purposes of this Article L, the term "Transaction" shall
mean any single or "related transaction" (as defined below)
involving the purchase or redemption of Shares (including
exchanges) that is processed at a time other than the time of the
computation of the Fund's net asset value per Share next computed
after receipt of any such transaction order by Price Services.
If more than one Transaction ("Related Transaction") in the Fund
is caused by or occurs as a result of the same act or omission,
such transactions shall be aggregated with other transactions in
the Fund and be considered as one Transaction.
o Reporting
Price Services shall:
1. Utilize a system to identify all Transactions, and
shall compute the net effect of such Transactions upon
the Fund on a daily, monthly and rolling 365 day basis.
The monthly and rolling 365 day periods are hereafter
referred to as "Cumulative".
2. Supply to the Fund, from time to time as mutually
agreed upon, a report summarizing the Transactions and
the daily and Cumulative net effects of such
Transactions both in terms of aggregate dilution and
loss ("Dilution") or gain and negative dilution
("Gain") experienced by the Fund, and the impact such
Gain or Dilution has had upon the Fund's net asset
value per Share.
3. With respect to any Transaction which causes
Dilution to the Fund of $25,000 or more, immediately
provide the Fund: (i) a report identifying the
Transaction and the Dilution resulting therefrom, (ii)
the reason such Transaction was processed as described
above, and (iii) the action that Price Services has or
intends to take to prevent the reoccurrence of such as
of processing ("Report").
o Liability
1. It will be the normal practice of the Funds not to
hold Price Services liable with respect to any
Transaction which causes Dilution to any single Fund of
less than $25,000. Price Services will, however,
closely monitor for each Fund the daily and Cumulative
Gain/Dilution which is caused by Transactions of less
than $25,000. When the Cumulative Dilution to any Fund
exceeds 3/10 of 1% per share, Price Services, in
consultation with counsel to the Fund, will make
appropriate inquiry to determine whether it should take
any remedial action. Price Services will report to the
Board of Directors/Trustees of the Fund ("Board") any
action it has taken.
2. Where a Transaction causes Dilution to a Fund of
$25,000 or more ("Significant Transaction"), Price
Services will review with counsel to the Fund the
Report and the circumstances surrounding the underlying
Transaction to determine whether the Transaction was
caused by or occurred as a result of a negligent act or
omission by Price Services. If it is determined that
the Dilution is the result of a negligent action or
omission by Price Services, Price Services and outside
counsel for the Fund will negotiate settlement. All
such Significant Transactions will be reported to the
Board at its next meeting (unless the settlement fully
compensates the Fund for any Dilution). Any
Significant Transaction, however, causing Dilution in
excess of the lesser of $100,000 or a penny per Share
will be promptly reported to the Board. Settlement
will not be entered into with Price Services until
approved by the Board. The factors the Board would be
expected to consider in making any determination
regarding the settlement of a Significant Transaction
would include but not be limited to:
o Procedures and controls adopted by Price Services
to prevent "As Of" processing;
o Whether such procedures and controls were being
followed at the time of the Significant
Transaction;
o The absolute and relative volume of all
transactions processed by Price Services on the
day of the Significant Transaction;
o The number of Transactions processed by Price
Services during prior relevant periods, and the
net Dilution/Gain as a result of all such
transactions to the Fund and to all other Price
Funds;
o The prior response of Price Services to
recommendations made by the Funds regarding
improvement to the Transfer Agent's "As Of"
Processing Procedures.
M. Term and Termination of Agreement
o This Agreement shall run for a period of one (1) year from
the date first written above and will be renewed from year
to year thereafter unless terminated by either party as
provided hereunder.
o This Agreement may be terminated by the Fund upon one
hundred twenty (120) days' written notice to Price Services;
and by Price Services, upon three hundred sixty-five (365)
days' writing notice to the Fund.
o Upon termination hereof, the Fund shall pay to Price
Services such compensation as may be due as of the date of
such termination, and shall likewise reimburse for out-of-
pocket expenses related to its services hereunder.
N. Notice
Any notice as required by this Agreement shall be
sufficiently given (i) when sent to an authorized person of the
other party at the address of such party set forth above or at
such other address as such party may from time to time specify in
writing to the other party; or (ii) as otherwise agreed upon by
appropriate officers of the parties hereto.
O. Assignment
Neither this Agreement nor any rights or obligations
hereunder may be assigned either voluntarily or involuntarily, by
operation of law or otherwise, by either party without the prior
written consent of the other party, provided this shall not
preclude Price Services from employing such agents and
subcontractors as it deems appropriate to carry out its
obligations set forth hereunder.
P. Amendment/Interpretive Provisions
The parties by mutual written agreement may amend this
Agreement at any time. In addition, in connection with the
operation of this Agreement, Price Services and the Fund may
agree from time to time on such provisions interpretive of or in
addition to the provisions of this Agreement as may in their
joint opinion be consistent with the general tenor of this
Agreement. Any such interpretive or additional provisions are to
be signed by all parties and annexed hereto, but no such
provision shall contravene any applicable Federal or state law or
regulation and no such interpretive or additional provision shall
be deemed to be an amendment of this Agreement.
Q. Further Assurances
Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the
purposes hereof.
R. Maryland Law to Apply
This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of Maryland.
S. Merger of Agreement
This Agreement, including the attached Appendices and
Schedules supersedes any prior agreement with respect to the
subject hereof, whether oral or written.
T. Counterparts
This Agreement may be executed by the parties hereto on any
number of counterparts, and all of said counterparts taken
together shall be deemed to constitute one and the same
instruments.
U. The Parties
All references herein to "the Fund" are to each of the Funds
listed on Appendix A individually, as if this Agreement were
between such individual Fund and Price Services. In the case of
a series Fund or trust, all references to "the Fund" are to the
individual series or portfolio of such Fund or trust, or to such
Fund or trust on behalf of the individual series or portfolio, as
appropriate. The "Fund" also includes any T. Rowe Price Funds
which may be established after the execution of this Agreement.
Any reference in this Agreement to "the parties" shall mean Price
Services and such other individual Fund as to which the matter
pertains.
V. Directors, Trustees and Shareholders and Massachusetts
Business Trust
It is understood and is expressly stipulated that neither
the holders of Shares in the Fund nor any Directors or Trustees
of the Fund shall be personally liable hereunder. With respect to
any Fund which is a party to this Agreement and which is
organized as a Massachusetts business trust, the term "Fund"
means and refers to the trustees from time to time serving under
the applicable trust agreement (Declaration of Trust) of such
Trust as the same may be amended from time to time. It is
expressly agreed that the obligations of any such Trust hereunder
shall not be binding upon any of the trustees, shareholders,
nominees, officers, agents or employees of the Trust, personally,
but bind only the trust property of the Trust, as provided in the
Declaration of Trust of the Trust. The execution and delivery of
this Agreement has been authorized by the trustees and signed by
an authorized officer of the Trust, 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, but shall bind only the trust property of the Trust as
provided in its Declaration of Trust.
W. Captions
The captions in the Agreement are included for convenience
of reference only and in no way define or limit any of the
provisions hereof or otherwise affect their construction or
effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their names and on their behalf under their seals by and through their duly authorized officers.
DATED: 2/18/94 T. ROWE PRICE SERVICES, INC. ATTEST: /s/Barbara A. VanHorn /s/Mark E. Rayford ____________________ BY:___________________________ Barbara A. VanHorn Mark E. Rayford |
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT FUND, INC.
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE DIVIDEND GROWTH FUND, INC
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Discovery Fund
T. Rowe Price International Stock Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Fund
T. Rowe Price Latin America Fund
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW HORIZONS FUNDS, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
New Jersey Tax-Free Money Fund
Virginia Tax-Free Money Fund
Florida Insured Intermediate Tax-Free Fund
Georgia Tax-Free Bond Fund
T. ROWE PRICE SUMMIT FUNDS, INC.
Summit Cash Reserves Fund
Summit Limited-Term Bond Fund
Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
Summit Municipal Money Market Fund
Summit Municipal Intermediate Fund
Summit Municipal Income Fund
T. ROWE PRICE TAX-EXEMPT MONEY FUND,INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-FREE INSURED INTERMDIATE BOND FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
DATED: 2/16/94
ATTEST:
/s/Lenora V. Hornung /s/Carmen F. Deyesu _________________________ BY:__________________________ Lenora V. Hornung Carmen F. Deyesu |
The following Funds are parties to this Agreement, and have so indicated their intention to be bound by such Agreement by executing the Agreement on the dates indicated thereon. T. Rowe Price Adjustable Rate U.S. Government Fund, Inc.
T. Rowe Price Blue Chip Growth Fund, Inc.
T. Rowe Price Balanced Fund, Inc.
T. Rowe Price California Tax-Free Income Trust on behalf of the
California Tax-Free Bond Fund and
California Tax-Free Money Fund
T. Rowe Price Capital Appreciation Fund
T. Rowe Price Dividend Growth Fund, Inc.
T. Rowe Price Equity Income Fund
T. Rowe Price GNMA Fund
T. Rowe Price Growth & Income Fund, Inc.
T. Rowe Price Growth Stock Fund, Inc.
T. Rowe Price High Yield Fund, Inc.
T. Rowe Price Index Trust, Inc. on behalf of the T. Rowe Price Equity Index Fund
T. Rowe Price Institutional International Funds, Inc. on behalf
of the
Foreign Equity Fund
T. Rowe Price International Funds, Inc. on behalf of the
T. Rowe Price International Bond Fund and
T. Rowe Price International Stock Fund
T. Rowe Price International Discovery Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Fund
T. Rowe Price Latin America Fund
T. Rowe Price Mid-Cap Growth Fund
T. Rowe Price New America Growth Fund
T. Rowe Price New Era Fund, Inc.
T. Rowe Price New Horizons Fund, Inc.
T. Rowe Price New Income Fund, Inc.
T. Rowe Price Prime Reserve Fund, Inc.
T. Rowe Price OTC Fund, Inc.
T. Rowe Price Science & Technology Fund, Inc.
T. Rowe Price Short-Term Bond Fund, Inc.
T. Rowe Price Small-Cap Value Fund, Inc.
T. Rowe Price Spectrum Fund, Inc. on behalf of the
Spectrum Growth Fund
Spectrum Income Fund
T. Rowe Price State Tax-Free Income Trust on behalf of the
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
New Jersey Tax-Free Bond Fund
Virginia Tax-Free Bond Fund
Georgia Tax-Free Bond Fund
Florida Insured Intermediate Tax-Free Fund
T. Rowe Price Tax-Exempt Money Fund, Inc.
T. Rowe Price Tax-Free High Yield Fund, Inc.
T. Rowe Price Tax-Free Income Fund, Inc.
T. Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc.
T. Rowe Price Tax-Free Short-Intermediate Fund, Inc.
T. Rowe Price U.S. Treasury Funds, Inc. on behalf of the
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. Rowe Price Summit Funds, Inc. on behalf of the
Summit Cash Reserves Fund
Summit Limited-Term Bond Fund
Summit GNMA Fund
T. Rowe Price Summit Municipal Funds, Inc. on behalf of the
Summit Municipal Money Market Fund
Summit Municipal Intermediate Fund
Summit Municipal Income Fund
Effective January 1, 1994 to December 31, 1994, For the account of:
THE T. ROWE PRICE FUNDS
EQUITY FUNDS
T. Rowe Price New American Growth Fund
T. Rowe Price Growth Stock Fund, Inc. T. Rowe Price New Horizons Fund, Inc. T. Rowe Price New Era Fund, Inc. T. Rowe Price International Stock Fund T. Rowe Price Equity Income Fund T. Rowe Price Growth & Income Fund, Inc. T. Rowe Price Capital Appreciation Fund T. Rowe Price Science & Technology Fund, Inc. T. Rowe Price Small Capital Value Fund, Inc. T. Rowe Price International Discovery Fund Foreign Equity Fund T. Rowe Price Equity Index Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Spectrum Growth Fund T.Rowe Price Japan Fund T. Rowe Price Latin America Fund T. Rowe Price Balanced Fund, Inc. T. Rowe Price Dividend Growth Fund, Inc. T. Rowe Price Mid-Cap Growth Fund, Inc. T. Rowe Price Over-the-Counter Fund, Inc. T. Rowe Price Blue Chip Growth Fund, Inc.
BOND FUNDS
T. Rowe Price New Income Fund, Inc.
T. Rowe Price Tax-Free Income Fund, Inc. T. Rowe Price New Jersey Tax-Free Bond Fund T. Rowe Price Virginia Tax-Free Bond Fund T. Rowe Price Short Term Bond Fund, Inc. T. Rowe Price Tax-Free Short Intermediate Fund, Inc. T. Rowe Price High Yield Fund, Inc. T. Rowe Price Tax-Free High Yield Fund, Inc. T. Rowe Price Adjustable Rate U.S. Government Fund, Inc. T. Rowe Price GNMA Fund T. Rowe Price New York Tax-Free Bond Fund T. Rowe Price California Tax-Free Bond Fund T. Rowe Price International Bond Fund T. Rowe Price Maryland Short-Term Tax-Free Bond Fund T. Rowe Price Maryland Tax-Free Bond Fund T. Rowe Price U.S. Treasury Intermediate Fund T. Rowe Price U.S. Treasury Long-Term Fund T. Rowe Price Global Government Bond Fund
T. Rowe Price Spectrum Income Fund T. Rowe Price Short-term Global Bond Fund T. Rowe Price Tax-Free Insured Intermediate Fund, Inc. T. Rowe Price Georgia Tax-Free Bond Fund T. Rowe Price Florida Insured Intermediate Tax-Free Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund T. Rowe Price Summit Municipal Intermediate Fund T. Rowe Price Summit Municipal Income Fund
Money Market Funds
T. Rowe Price Prime Reserve Fund, Inc.
T. Rowe Price Tax-Exempt Money Fund, Inc. T. Rowe Price U.S. Treasury Money Fund T. Rowe Price New York Tax-Free Money Fund T. Rowe Price California Tax-Free Money Fund T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Municipal Money Market Fund
The following fees for services provided by T. Rowe Price Services, Inc. (TRPS) and vendors will be billed by TRPS for 1994:
I. T. Rowe Price Services Maintenance and Transaction Charges - Billable Monthly
A. Base Fee
1. Per Fund - Beginning January 1, 1994, chargeable at the rate of $1,000 per month to each Fund shown on the previous page. The fee is waived for new Funds for the first 6 months after effective date.
2. Monthly - $5,987,000 payable in twelve monthly installments of $498,917.
B. Per Account Annual Fee - $3.63 for each Equity, Bond, and Money Market Account serviced.
The Per Account Annual Fee will be billed monthly at a rate of 1/12 of the annual fee for each Fund account serviced during the month. Accounts serviced is defined as all open accounts at month end plus accounts which closed during the month.
C. Transaction Fees
1. New Account Fees
a. $3.00 for every account opened, including fiduciary accounts, excluding those opened by exchange and those established as described in (b) below.
b. A fee of $1.00 will be assessed for accounts established within the model and list functions programs and under the agreement that the registrant's name will be quality controlled subsequent to its establishment.
2. Non-Automated Transactions
a. $1.05 for each non-automated transaction and maintenance item processed for the Fund Group as a whole during a month. The non-automated transaction count will include all manually processed price dependent and maintenance transactions. Also, the number of new account setups will be excluded from the number of non-automated transactions.
b. Fee to be charged to the Funds based on each Fund's number of total non-automated transactions and maintenance.
c. Fee to be billed monthly for that month.
d. NOTE: The transaction count should not include correction of transactions caused by non-shareholder errors.
D. Telephone Fee
Billed at the rate of $5.20 per call for shareholder servicing calls received in excess of 34,000 calls per month. Calls received in Retail Services are allocated to the Funds based on accounts serviced and calls received in Telephone Services are allocated based on actual calls received.
E. Items Scanned
$.29 will be billed for each document page scanned. It will be allocated based on the number of items indexed to each Fund.
F. Tele*Access
Base fee, per month for all calls is $39,000.
G. Institutional Electronic Interface
Maximum fee calculated is 10 basis points or less per Fund.
10 basis points < $500 million
8 basis points > $500 million < $1 billion
5 basis points > $1 billion < $2 billion
3 basis points > $2 billion
H. Correspondence
$4.20 billed for each shareholder correspondence request completed in writing or by phone. Allocated to the Funds based on accounts serviced.
I. Telephone Transaction Fee
Each price dependent transaction initiated through the Telephone Services Group will be charged $.50.
II. Vendor Fees
A. DST
1. Annual Open Account Fee
a. $1.77 for each Equity Fund account serviced.
b. $4.20 for each Bond Fund account serviced.
c. $4.20 for each Money Market Fund account serviced.
The Open Account Fee will be billed monthly at a rate of 1/12 of the annual fee for each Fund account serviced during the month.
2. Closed Account Fee (Annualized)
Payable at an annual rate of $1.44. The Closed Account Fee will be billed monthly at a rate of 1/12 of the annual rate and will be charged in the month following the month during which such account is closed and shall cease to be charged in the month following the Purge Date.
3. Fiduciary Sub-Accounting
Payable at the rate of $1.00 per month for each fiduciary account. Fiduciary accounts closed during the prior year will not be included as billable items.
4. Annual Base Fee Per Fund
Annual Fee of $7,205.88 will be charged at a monthly rate of $600.49. The fee is waived for the first six (6) months after a new Fund is effective. The definition of new Fund excludes Funds created by mergers, purchases, or reorganizations.
5. Bank Account Reconciliation System (Comp/Recon)
Annual charge of $120,000 payable at a rate of $10,000 per month.
6. TRAC 2000 - $7.00 per participant, per year
7. Voice Response Unit
a. $500 Set-up Fee will be charged for each investment company unit.
b. $2,500 Maintenance Fee will be billed each month.
c. $.50 will be billed per call connected to the VRU.
8. Contingent Deferred Sales Charge.
Billed to each Fund utilizing this service at an annual rate of $1.03 per open account.
B. State Street Bank
1. NSCC Settlements
a. $11.30 for net redemptions
b. $ 5.14 per net purchases
2. Checkwriting Fees
$.565 for each checkwriting item processed (i.e. those resulting in either redemptions or returned as non- processable). This includes signature card maintenance and verification, manual or special processing of checks, stop payment processing, settlement functions, and postage and mailing expenses to return canceled checks to shareholders.
3. Stop Payments - Redemption/Distribution Accounts
$15.00 for each manual stop payment placed on a redemption or distribution check.
4. ACH Transactions
$.06 for each ACH transaction processed by the Bank and submitted to the ACH network.
5. Internal Book Transfers
$1.08 billed for money movement between TRP DDA's at the Bank. Money is transferred by debit and credit memos.
6. Wire Fees
$4.00 for each incoming, manual, and internal bank transfer wire; $3.75 for each outgoing transmission wire.
7. Paid checks
$.18 for each paid check processed.
8. DDA Research
$1.03 per request.
9. Special Handling
$2,917 billed per month for the special handling of checks at Marina Bay.
10. Nightly Audits
$.0285 per page for the audit of the DST nightly update.
11. VAX Computer Usage
Billed at the rate of $8,318 per month which covers both:
a. System Fee - for use of sub-systems such as capital stock interface, PDPS, Direct Deposit, etc.
b. Communication Fee - charge for the line, modems, and statistical multiplexers.
12. Abandoned Property
Services based on the following fee schedule:
a. Administrative charge $125/Fund
b. Processing charges $1.00/account
c. Due Diligence Mailings $1.50/account
d. Labor will be charged based on the number of hours
required.
13. Account maintenance $16.00 per account per month
14. Reporting (SSCAN) for selected accounts - $50.00 per account per month
15. FDIC Passthrough - charged at prevailing FDIC rates
C. J.P. Morgan Bank
1. Wire Transfer Fees
Annual Account Maintenance $250.00
Annual MORCOM/CASH
First Account $5,000.00
Subsequent Accounts $3,000.00
Batch File Transfer (BFT)
Transmission $15.00 each
(capped at 10 per month)
BFT Per Outgoing Wire
Peak (8 a.m. and 8 p.m.) $0.064
Off Peak (8 p.m. and 8 a.m.) $0.032
Outgoing Wires
Straight-through (Repetive or Freetype)
80% of total volume $3.25
Book Transfer (IBT) $1.50
Repair (Freeform) $7.00
Zero Balance Transfer $1.00
|
Incoming Wires Fed or CHIPS $3.25 Book (IBT) $1.50 |
FDIC Passthrough - charged at prevailing FDIC rates
2. Controlled Disbursement Fees
Annual Account Maintenance
(capped at 6 accounts) $760.00 per
account
Annual MORCOM Next Day $1,385.00
per account
Annual MORCOM Check $715.00 per
account
Batch File Transfer (BFT)
Transmission (capped at 10 per month) $15.00 each
Same Day Match Pay (Dividend & Redemption Checks)
DCD Match $2,500.00
per account
TRPS Matches .005 per
item
Checks Paid
Up to 500,000 items $0.051
Up to 750,000 items $0.042
Up to 1,000,000 items $0.035
Stops
On-line $3.00
Returned Checks $3.00 per
item
|
3. The bank may charge interest at a rate in excess of normal borrowing rates if the TRPS balance is overdrawn or is in a negative collected balance status.
D. Fleet Bank of Massachusetts
1. Demand Deposit Services
a. Monthly Account Maintenance $13.00/
14.00 in
May
|
b. Deposit Ticket $.85
c. Deposited Item Fee (all inclusive) $.054
d. Return of a Deposited Item
Redeposit Fee per deposit $1.00
Per redeposited item $.50
Returned item $3.00
2. Treasury Master System
a. Previous Day Balance Reporting
Monthly module charge $60.00
Per Account $10.00
b. Previous Day Detail
Monthly module charge $70.00
Per Transaction $.10
c. Current Day Detail
Monthly module charge $70.00
Per Transaction $.10
d. Depository Transfer
Monthly module charge $75.00
Per Transfer $.25
e. Money Movers per transfer $.50
f. Wire Transfer no addt'l
charge-
normal wire
fees only
3. Wire Transfer
a. Outgoing Repetitive Wire
Placed prior to 1:00 pm $9.00
Placed after 1:00 pm $10.00
b. Outgoing Non-Repetitive Wire
Placed prior to 1:00 pm $12.00
Placed after 1:00 pm $13.00
c. Incoming Wire $6.00
|
4. The bank may charge interest at a rate in excess of normal borrowing rates if the TRPS balance is overdrawn or is in a negative collected balance status.
5. FDIC Passthrough - charged at prevailing FDIC rates.
E. First National Bank of Maryland 1. Internal Fund Transfer $5.40 2. Returned Items $2.70 |
3. Deposit Items Charge
varies
4. Deposit Tickets $.45
5. Return/redeposit items $2.25
6. Deposit Corrections $4.50
7. Check copy $9.00
8. First Facts
CDA Repetitive Wire $4.05
System Reports/Per Module $27.00
Per Report Previous Day $1.80
Per Report Current Day $3.60
9. Account maintenance $11.25
10. Debit item $.54
11. Credit transaction $.54
12. Foreign Deposit $4.50
13. ACH Debit $.117
14. Tax Deposits $.90
15. Film - Monthly $121.50
|
16. TRPS may be charged interest when TRPS's balance at FNB
is in a negative collected balance status. TRPS may
also receive balance credits on a positive investable
balance
17. FDIC Passthrough charged at prevailing FDIC rates
III. New Funds
Funds added during the term of this contract may have their
Maintenance and Transaction charges and other charges (Section
I) waived for a period of time, as agreed to by TRPS and Fund
Directors, following the establishment of the Fund. Out-of-
pocket expenses will be billed to the Fund from the Fund's
inception.
IN WITNESS WHEREOF, T.Rowe Price Funds and T.Rowe Price Services, Inc. have agreed upon this fee schedule to be executed in their names and on their behalf through their duly authorized officers:
T. ROWE PRICE FUNDS T. ROWE PRICE SERVICES, INC. /s/Carmen F. Deyesu /s/Mark E. Rayford NAME ____________________ NAME ________________________ Carmen F. Deyesu Mark E. Rayford TITLE Treasurer TITLE President DATE 2/16/94 DATE 2/18/94 |
The Transfer Agency and Service Agreement of January 1, 1994, between T. Rowe Price Services, Inc. and each of the Parties listed on Appendix A thereto is hereby amended, as of March 1, 1994, by adding thereto the T. Rowe Price Equity Series, Inc. and T. Rowe Price International Series, Inc. Notwithstanding anything to the contrary herein, it is understood that the T. Rowe Price Equity Series, Inc. and T. Rowe Price International Series, Inc. (collectively referred to as the "Funds") shall not be responsible for paying any of the fees or expenses set forth herein but that, in accordance with the Investment Management Agreements, dated March 1, 1994, between the Funds and T. Rowe Price Associates, Inc. and Rowe Price- Fleming International, Inc. (collectively referred to as "T. Rowe Price"), the Funds will require T. Rowe Price to pay all such fees and expenses.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE DIVIDEND GROWTH FUND, INC
T. ROWE PRICE EQUITY SERIES, INC.
T. Rowe Price Equity Income Portfolio T. Rowe Price New America Growth Portfolio
T. ROWE PRICE GNMA FUND
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Discovery Fund T. Rowe Price International Stock Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund T. Rowe Price Short-Term Global Fund
T. ROWE PRICE INTERNATIONAL SERIES, INC.
T. Rowe Price International Stock Portfolio
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW HORIZONS FUNDS, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund New York Tax-Free Bond Fund New York Tax-Free Money Fund New Jersey Tax-Free Money Fund Virginia Tax-Free Money Fund Florida Insured Intermediate Tax-Free Fund Georgia Tax-Free Bond Fund
T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Money Market
Fund
T. Rowe Price Summit Municipal Intermediate
Fund
T. Rowe Price Summit Municipal Income Fund
T. ROWE PRICE TAX-EXEMPT MONEY FUND,INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE
FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
Attest: /s/Lenora V. Hornung /s/Carmen F. Deyesu ______________________ ______________________________ Lenora V. Hornung, By: Carmen F. Deyesu Secretary |
Attest: T. ROWE PRICE SERVICES, INC. /s/Barbara A. VanHorn /s/Henry H. Hopkins ______________________ ______________________________ Barbara A. VanHorn, By: Henry H. Hopkins, Assistant Secretary Vice President |
The Transfer Agency and Service Agreement of January 1, 1994, as amended March 1, 1994, between T. Rowe Price Services, Inc. and each of the Parties listed on Appendix A thereto is hereby further amended, as of April 21, 1994, by adding thereto the T. Rowe Price Fixed Income Series, Inc. Notwithstanding anything to the contrary herein, it is understood that the T. Rowe Price Fixed Income Series, Inc. (referred to as the "Fund") shall not be responsible for paying any of the fees or expenses set forth herein but that, in accordance with the Investment Management Agreement, dated April 21, 1994, between the Fund and T. Rowe Price Associates, Inc. (referred to as "T. Rowe Price"), the Fund will require T. Rowe Price to pay all such fees and expenses.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE DIVIDEND GROWTH FUND, INC
T. ROWE PRICE EQUITY INCOME FUND
T. Rowe Price Equity Income Portfolio T. Rowe Price New America Growth Portfolio
T. ROWE PRICE FIXED INCOME SERIES, INC.
T. Rowe Price Limited-Term Bond Portfolio
T. ROWE PRICE GNMA FUND
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Discovery Fund T. Rowe Price International Stock Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund T. Rowe Price Short-Term Global Fund
T. ROWE PRICE INTERNATIONAL SERIES, INC.
T. Rowe Price International Stock Portfolio
T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW HORIZONS FUNDS, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund New York Tax-Free Bond Fund New York Tax-Free Money Fund New Jersey Tax-Free Money Fund Virginia Tax-Free Money Fund Florida Insured Intermediate Tax-Free Fund Georgia Tax-Free Bond Fund
T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Money Market
Fund
T. Rowe Price Summit Municipal Intermediate
Fund
T. Rowe Price Summit Municipal Income Fund
T. ROWE PRICE TAX-EXEMPT MONEY FUND,INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE
FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
Attest: /s/Lenora V. Hornung /s/Carmen F. Deyesu ______________________ ______________________________ Lenora V. Hornung, By: Carmen F. Deyesu Secretary |
Attest: T. ROWE PRICE SERVICES, INC. /s/Barbara A. VanHorn /s/Henry H. Hopkins ______________________ ______________________________ Barbara A. VanHorn, By: Henry H. Hopkins, Assistant Secretary Vice President |
The Agreement between T. Rowe Price Associates, Inc. and T. Rowe Price Funds for Fund Accounting Services, dated January 1, 1994, as amended, should be inserted here.
AGREEMENT
between
T. ROWE PRICE ASSOCIATES, INC.
and
THE T. ROWE PRICE FUNDS
for
FUND ACCOUNTING SERVICES
TABLE OF CONTENTS
Page
Article A Terms of Appointment/Duties of Price Associates .1
Article B Fees and Out-of-Pocket Expenses . . . . . . . . .2
Article C Representations and Warranties of Price Associates3
Article D Representations and Warranties of the Fund. . . .3
Article E Ownership of Software and Related Material. . . .3
Article F Quality Service Standards . . . . . . . . . . . .4
Article G Standard of Care/Indemnification. . . . . . . . .4
Article H Dual Interests. . . . . . . . . . . . . . . . . .5
Article I Documentation . . . . . . . . . . . . . . . . . .5
Article J Recordkeeping/Confidentiality . . . . . . . . . .5
Article K Compliance with Governmental Rules and Regulations6
Article L Terms and Termination of Agreement. . . . . . . .6
Article M Notice. . . . . . . . . . . . . . . . . . . . . . 6
Article N Assignment. . . . . . . . . . . . . . . . . . . . 7
Article O Amendment/Interpretive Provisions . . . . . . . .7
Article P Further Assurances. . . . . . . . . . . . . . . .7
Article Q Maryland Law to Apply . . . . . . . . . . . . . .7
Article R Merger of Agreement . . . . . . . . . . . . . . .7
Article S Counterparts. . . . . . . . . . . . . . . . . . .8
Article T The Parties . . . . . . . . . . . . . . . . . . . 8
Article U Directors, Trustee and Shareholders and Massachusetts
Business Trust. . . . . . . . . . . . . . . . . .8
PAGE 3
Article V Captions. . . . . . . . . . . . . . . . . . . . . 9
|
AGREEMENT made as of the first day of January, 1994, by and
between T. ROWE PRICE ASSOCIATES, INC., a Maryland corporation
having its principal office and place of business at 100 East
Pratt Street, Baltimore, Maryland 21202 ("Price Associates"), and
each Fund which is listed on Appendix A (as such Appendix may be
amended from time to time) and which evidences its agreement to
be bound hereby by executing a copy of this Agreement (each such
Fund individually hereinafter referred to as "the Fund", whose
definition may be found in Article T);
WHEREAS, Price Associates has the capability of providing the
Funds with certain accounting services ("Accounting Services");
WHEREAS, the Fund desires to appoint Price Associates to
provide these Accounting Services and Price Associates desires to
accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:
A. Terms of Appointment/Duties of Price Associates
Subject to the terms and conditions set forth in this
Agreement, the Fund hereby employs and appoints Price Associates
to provide, and Price Associates agrees to provide, the following
Accounting Services:
a. Maintain for each Fund a daily trial balance, a general
ledger, subsidiary records and capital stock accounts;
b. Maintain for each Fund an investment ledger, including
amortized bond and foreign dollar denominated costs where
applicable;
c. Maintain for each Fund all records relating to the Fund's
income and expenses;
d. Provide for the daily valuation of each Fund's portfolio
securities and the computation of each Fund's daily net
asset value per share. Such daily valuations shall be
made in accordance with the valuation policies established
by each of the Fund's Board of Directors including, but
not limited to, the utilization of such pricing valuation
sources and/or pricing services as determined by the
Boards. Price Associates shall have no liability for any
losses or damages incurred by the Fund as a result of
erroneous portfolio security evaluations provided by such
designated sources and/or pricing services; provided that,
Price Associates reasonably believes the prices are
accurate, has adhered to its normal verification control
procedures, and has otherwise met the standard of care as
set forth in Article G of this Agreement;
e. Provide daily cash flow and transaction status information
to each Fund's adviser;
f. Prepare for each Fund such financial information that is
reasonably necessary for shareholder reports, reports to
the Board of Directors and to the officers of the Fund,
and reports to the Securities and Exchange Commission and
the Internal Revenue Service and other Federal and state
regulatory agencies;
g. Provide each Fund with such advice that may be reasonably
necessary to properly account for all financial
transactions and to maintain the Fund's accounting
procedures and records so as to insure compliance with
generally accepted accounting and tax practices and rules;
h. Maintain for each Fund all records that may be reasonably
required in connection with the audit performed by each
Fund's independent accountant, the Securities and Exchange
Commission, the Internal Revenue Service or such other
Federal or state regulatory agencies; and
i. Cooperate with each Fund's independent public accountants
and take all reasonable action in the performance of its
obligations under the Agreement to assure that the
necessary information is made available to such
accountants for the expression of their opinion without
any qualification as to the scope of their examination
including, but not limited to, their opinion included in
each such Fund's annual report on Form N-SAR and annual
amendment to Form N-1A.
B. Fees and Out-of-Pocket Expenses
Each Fund shall pay to Price Associates for its Accounting
Services hereunder, fees as set forth in the Schedule attached
hereto. In addition, each Fund will reimburse Price Associates
for out-of-pocket expenses such as postage, printed forms, voice
and data transmissions, record retention, disaster recovery,
third party vendors, equipment leases and other similar items as
may be agreed upon between Price Associates and the Fund. Some
invoices will contain costs for both the Funds and other funds
services by Price Associates. In these cases, a reasonable
allocation methodogy will be used to allocate these costs to the
Funds.
C. Representations and Warrantees of Price Associates
Price Associates represents and warrants to the Fund that:
1. It is a corporation duly organized and existing in good
standing under the laws of Maryland.
2. It is duly qualified to carry on its business in Maryland.
3. It is empowered under applicable laws and by its charter
and By-Laws to enter into and perform this Agreement.
4. All requisite corporate proceedings have been taken to
authorize it to enter into and perform this Agreement.
5. It has, and will continue to have, access to the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement.
D. Representations and Warrantees of the Fund
The Fund represents and warrants to Price Associates that:
1. It is a corporation or business trust, as the case may be,
duly organized and existing and in good standing under the laws
of Maryland or Massachusetts, as the case may be.
2. It is empowered under applicable laws and by its Articles
of Incorporation or Declaration of Trust, as the case may be, and
By-Laws have been taken to authorize it to enter into and perform
this Agreement.
3. All proceedings required by said Articles of Incorporation
or Declaration of Trust, as the case may be, and By-Laws have
been taken to authorize it to enter into and perform this
Agreement.
E. Ownership of Software and Related Material
All computer programs, magnetic tapes, written procedures,
and similar items purchased and/or developed and used by Price
Associates in performance of the Agreement shall be the property
of Price Associates and will not become the property of the
Funds.
F. Quality Service Standards
Price Associates and the Fund may, from time to time, agree
to certain quality service standards, with respect to Price
Associates' services hereunder.
G. Standard of Care/Indemnification
Notwithstanding anything to the contrary in this Agreement:
1. Price Associates shall not be liable to any Fund for any
act or failure to act by it or its agents or subcontractors on
behalf of the Fund in carrying or attempting to carry out the
terms and provisions of the Agreement provided Price Associates
has acted in good faith and without negligence or willful
misconduct and selected and monitored the performance of its
agents and subcontractors with reasonable care.
2. The Fund shall indemnify and hold Price Associates
harmless from and against all losses, costs, damages, claims,
actions, and expenses, including reasonable expenses for legal
counsel, incurred by Price Associates resulting from: (i) any
action or omission by Price Associates or its agents or
subcontractors in the performance of their duties hereunder; (ii)
Price Associates acting upon instructions believed by it to have
been executed by a duly authorized officer of the Fund; or (iii)
Price Associates acting upon information provided by the Fund in
form and under policies agreed to by Price Associates and the
Fund. Price Associates shall not be entitled to such
indemnification in respect of actions or omissions constituting
negligence or willful misconduct of Price Associates or where
Price Associates has not exercised reasonable care in selecting
or monitoring the performance of its agents or subcontractors.
3. Price Associates shall indemnify and hold harmless the
Fund from all losses, costs, damages, claims, actions and
expenses, including reasonable expenses for legal counsel,
incurred by the Fund resulting from the negligence or willful
misconduct of Price Associates or which result from Price
Associates' failure to exercise reasonable care in selecting or
monitoring the performance of its agents or subcontractors. The
Fund shall not be entitled to such indemnification with respect
to actions or omissions constituting negligence or willful
misconduct of such Fund or its agents or subcontractors; unless
such negligence or misconduct is attributable to Price
Associates.
4. In the event either party is unable to perform its
obligations under the terms of this Agreement because of acts of
God, strikes or other causes reasonably beyond its control, such
party shall not be liable to the other party for any loss, cost,
damage, claim, action or expense resulting from such failure to
perform or otherwise from such causes.
5. In order that the indemnification provisions contained in
this Article F shall apply, upon the assertion of a claim for
which either party may be required to indemnify the other, the
party seeking indemnification shall promptly notify the other
party of such assertion, and shall keep the other party advised
with respect to all developments concerning such claim. The
party who may be required to indemnify shall have the option to
participate with the party seeking indemnification in the defense
of such claim, or to defend against said claim in its own name or
in the name of the other party. The party seeking
indemnification shall in no case confess any claim or make any
compromise in any case in which the other party may be required
to indemnify it except with the other party's prior written
consent.
6. Neither party to this Agreement shall be liable to the
other party for consequential damages under any provision of this
Agreement.
H. Dual Interests
It is understood that some person or persons may be
directors, officers, or shareholders of both the Fund and Price
Associates (including Price Associates' affiliates), and that the
existence of any such dual interest shall not affect the validity
of this Agreement or of any transactions hereunder except as
otherwise provided by a specific provision of applicable law.
I. Documentation
As requested by Price Associates, the Fund shall promptly
furnish to Price Associates such documents as it may reasonably
request and as are necessary for Price Associates to carry out
its responsibilities hereunder.
J. Recordkeeping/Confidentiality
1. Price Associates shall keep records relating to the
services to be performed hereunder, in the form and manner as it
may deem advisable, provided that Price Associates shall keep all
records in such form and in such manner as required by applicable
law, including the
Investment Company Act of 1940 ("the Act") and the Securities
Exchange Act of 1934 ("the '34 Act").
2. Price Associates and the Fund agree that all books,
records, information and data pertaining to the business of the
other party which are exchanged or received pursuant to the
negotiation or the carrying out of this Agreement shall remain
confidential, and shall not be voluntarily disclosed to any other
person, except: (a) after prior notification to and approval in
writing by the other party hereto, which approval shall not be
unreasonably withheld and may not be withheld where Price
Associates or Fund may be exposed to civil or criminal contempt
proceedings for failure to comply; (b) when requested to divulge
such information by duly constituted governmental authorities; or
(c) after so requested by the other party hereto.
K. Compliance With Governmental Rules and Regulations
Except as otherwise provided in the Agreement and except for
the accuracy of information furnished to the Funds by Price
Associates, each Fund assumes full responsibility for the
preparation, contents and distribution of its prospectuses, and
for complying with all applicable requirements of the Act, the
'34 Act, the Securities Act of 1933 (the "33 Act"), and any laws,
rules and regulations of governmental authorities having
jurisdiction over the Funds.
L. Term and Termination of Agreement
1. This Agreement shall run for a period of one (1) year from
the date first written above and will be renewed from year to
year thereafter unless terminated by either party as provided
hereunder.
2. This Agreement may be terminated by the Fund upon sixty
(60) days' written notice to Price Associates; and by Price
Associates, upon three hundred sixty-five (365) days' writing
notice to the Fund.
3. Upon termination hereof, the Fund shall pay to Price
Associates such compensation as may be due as of the date of such
termination, and shall likewise reimburse for out-of-pocket
expenses related to its services hereunder.
M. Notice
Any notice as required by this Agreement shall be
sufficiently given (i) when sent to an authorized person of the
other party at the address of such party set forth above or at
such other address as such party may from time to time specify in
writing to the other party; or (ii) as otherwise agreed upon by
appropriate officers of the parties hereto.
N. Assignment
Neither this Agreement nor any rights or obligations
hereunder may be assigned either voluntarily or involuntarily, by
operation of law or otherwise, by either party without the prior
written consent of the other party, provided this shall not
preclude Price Associates from employing such agents and
subcontractors as it deems appropriate to carry out its
obligations set forth hereunder.
O. Amendment/Interpretive Provisions
The parties by mutual written agreement may amend this
Agreement at any time. In addition, in connection with the
operation of this Agreement, Price Associates and the Fund may
agree from time to time on such provisions interpretive of or in
addition to the provisions of this Agreement as may in their
joint opinion be consistent with the general tenor of this
Agreement. Any such interpretive or additional provisions are to
be signed by all parties and annexed hereto, but no such
provision shall contravene any applicable Federal or state law or
regulation and no such interpretive or additional provision shall
be deemed to be an amendment of this Agreement.
P. Further Assurances
Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the
purposes hereof.
Q. Maryland Law to Apply
This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of Maryland.
R. Merger of Agreement
This Agreement, including the attached Appendices and
Schedules supersedes any prior agreement with respect to the
subject hereof, whether oral or written.
S. Counterparts
This Agreement may be executed by the parties hereto on any
number of counterparts, and all of said counterparts taken
together shall be deemed to constitute one and the same
instruments.
T. The Parties
All references herein to "the Fund" are to each of the Funds
listed on Appendix A individually, as if this Agreement were
between such individual Fund and Price Associates. In the case
of a series Fund or trust, all references to "the Fund" are to
the individual series or portfolio of such Fund or trust, or to
such Fund or trust on behalf of the individual series or
portfolio, as appropriate. The "Fund" also includes any T. Rowe
Price Funds which may be established after the execution of this
Agreement. Any reference in this Agreement to "the parties"
shall mean Price Associates and such other individual Fund as to
which the matter pertains.
U. Directors, Trustees and Shareholders and Massachusetts
Business Trust
It is understood and is expressly stipulated that neither the
holders of shares in the Fund nor any Directors or Trustees of
the Fund shall be personally liable hereunder.
With respect to any Fund which is a party to this Agreement
and which is organized as a Massachusetts business trust, the
term "Fund" means and refers to the trustees from time to time
serving under the applicable trust agreement (Declaration of
Trust) of such Trust as the same may be amended from time to
time. It is expressly agreed that the obligations of any such
Trust hereunder shall not be binding upon any of the trustees,
shareholders, nominees, officers, agents or employees of the
Trust, personally, but bind only the trust property of the Trust,
as provided in the Declaration of Trust of the Trust. The
execution and delivery of this Agreement has been authorized by
the trustees and signed by an authorized officer of the Trust,
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, but shall bind only the trust
property of the Trust as provided in its Declaration of Trust.
V. Captions
The captions in the Agreement are included for convenience of
reference only and in no way define or limit any of the
provisions hereof or otherwise affect their construction or
effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed in their names and on their behalf under
their seals by and through their duly authorized officers.
DATED: 2/22/94 T. ROWE PRICE ASSOCIATES, INC. ATTEST: /s/Barbara A. VanHorn /s/Alvin M. Younger |
_________________________ BY:___________________________ Barbara A. VanHorn Managing Director
PAGE 17
T. ROWE PRICE ADJUSTABLE RATE U.S.
GOVERNMENT FUND, INC.
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE GNMA FUND
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE INTERNATIONAL EQUITY FUND,
INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund
T. Rowe Price International Discovery Fund
T. Rowe Price International Stock Fund
T. Rowe Price European Stock Fund
T. Rowe Price New Asia Fund
T. Rowe Price Global Government Bond Fund
T. Rowe Price Japan Fund
T. Rowe Price Short-Term Global Fund
T. Rowe Price Latin America Fund
T. ROWE PRICE MID-CAP GROWTH FUND
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE NEW ERA FUND, INC.
PAGE 18
T. ROWE PRICE NEW HORIZONS FUNDS, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND,
INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
New Jersey Tax-Free Bond Fund
Virginia Tax-Free Bond Fund
Florida Insured Intermediate Tax-Free Fund
Georgia Tax-Free Bond Fund
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND,
INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE TAX-FREE INSURED
INTERMEDIATE BOND FUND, INC.
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
|
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
Summit Municipal Money Market Fund
Summit Municipal Intermediate Fund
Summit Municipal Income Fund
DATED: 2/16/94
ATTEST:
/s/Lenora V. Hornung /s/Carmen F. Deyesu _________________________ BY:______________________________ Lenora V. Hornung Carmen F. Deyesu |
The following Funds are parties to this Agreement, and have so
indicated their intention to be bound by such Agreement by
executing the Agreement on the dates indicated thereon.
T. Rowe Price Adjustable Rate U.S.
Government Fund, Inc.
T. Rowe Price Blue Chip Growth Fund, Inc.
T. Rowe Price Balanced Fund, Inc.
T. Rowe Price California Tax-Free Income
Trust on behalf of the
California Tax-Free Bond Fund and
California Tax-Free Money Fund
T. Rowe Price Capital Appreciation Fund
T. Rowe Price Dividend Growth Fund, Inc.
T. Rowe Price Equity Income Fund
T. Rowe Price GNMA Fund
T. Rowe Price Growth & Income Fund, Inc.
T. Rowe Price Growth Stock Fund, Inc.
T. Rowe Price High Yield Fund, Inc.
T. Rowe Price Index Trust, Inc. on behalf
of the T. Rowe Price Equity Index Fund
T. Rowe Price Institutional International
Funds, Inc. on behalf of the
Foreign Equity Fund
T. Rowe Price International Equity Fund,
Inc.
T. Rowe Price Mid-Cap Growth Fund
T. Rowe Price New America Growth Fund
T. Rowe Price New Era Fund, Inc.
T. Rowe Price New Horizons Fund, Inc.
T. Rowe Price New Income Fund, Inc.
T. Rowe Price OTC Fund, Inc.
T. Rowe Price Prime Reserve Fund, Inc.
T. Rowe Price Science & Technology Fund,
Inc.
T. Rowe Price Short-Term Bond Fund, Inc.
T. Rowe Price Small-Cap Value Fund, Inc.
T. Rowe Price Spectrum Fund, Inc. on
behalf of the
Spectrum Growth Fund
Spectrum Income Fund
T. Rowe Price State Tax-Free Income Trust
on behalf of the
Maryland Tax-Free Bond Fund,
Maryland Short-Term Tax-Free Bond Fund
New York Tax-Free Bond Fund and
New York Tax-Free Money Fund
New Jersey Tax-Free Bond Fund
Virginia Tax-Free Bond Fund
Florida Insured Intermediate Tax-Free
Bond Fund
Georgia Tax-Free Bond Fund
T. Rowe Price Tax-Free Insured
Intermediate Bond Fund, Inc.
T. Rowe Price Tax-Free High Yield Fund,
Inc.
T. Rowe Price Tax-Free Income Fund, Inc.
T. Rowe Price Tax-Free Short-Intermediate
Fund, Inc.
T. Rowe Price U.S. Treasury Funds, Inc.
on behalf of the
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund
T. Rowe Price Summit Funds, Inc. on
behalf of the
Summit Cash Reserves Fund
Summit Limited-Term Bond Fund
Summit GNMA Fund
T. Rowe Price Summit Municipal Funds,
Inc. on behalf of
Summit Municipal Money Market Fund
Summit Municipal Intermediate Fund
Summit Municipal Income Fund
FUND ACCOUNTING SERVICES
1994 FEE SCHEDULE
A. Fee Structure
1. Base Fee
Domestic Funds $60,000 each
International Funds $100,000 each
Spectrum Funds $35,000 each
Per Fund fee for basic recordkeeping
and financial reporting
2. Individual Fund Fee
Total fees reflecting special $ 883,000
characteristics of each Fund
3. Stock Lending Fee
Allocated to each Fund based $ 75,000
on ratio of net earnings from
stock loans
4. Additional Funds
Domestic Funds $60,000 each
International Funds $100,000 each
Spectrum Funds $35,000 each
|
B. Total Cost Per Fund
Growth Stock Fund $ 114,000
New Horizons Fund 95,000
Equity Income Fund 85,000
New Era Fund 72,000
International Stock Fund 115,000
Growth & Income Fund 85,000
New America Growth Fund 70,000
Capital Appreciation Fund 85,000
Small-Cap Value Fund 60,000
Foreign Equity Fund 105,000
International Discovery Fund 125,000
Science & Technology Fund 60,000
High Yield Fund 165,000
Tax-Free Income Fund 110,000
New Income Fund 100,000
Tax-Free High Yield Fund 110,000
European Stock Fund 100,000
Equity Index Fund 60,000
PAGE 24
New Asia Fund 110,000
Spectrum Growth Fund 35,000
GNMA Fund 120,000
International Bond Fund 125,000
Balanced Fund 90,000
Maryland Bond Fund 81,000
Tax-Free Short Intermediate Fund 85,000
Short-Term Bond Fund 120,000
California Bond Fund 72,000
New York Bond Fund 72,000
U.S. Treasury Short-Intermediate Fund 60,000
U.S. Treasury Long-Term Bond Fund 60,000
Spectrum Income Fund 35,000
Prime Reserve Fund 85,000
Tax-Exempt Money Fund 93,000
U.S. Treasury Money Fund 60,000
California Money Fund 67,000
New York Money Fund 67,000
Adjustable Rate Government Fund 110,000
Virginia Bond Fund 60,000
New Jersey Bond Fund 60,000
Global Government Bond Fund 100,000
OTC Fund 85,000
Japan Fund 100,000
Mid-Cap Growth Fund 60,000
Short-Term Global Fund 100,000
Maryland Short-Term Tax-Free Bond Fund 60,000
Florida Insured Intermediate Tax-Free Fund 60,000
Georgia Tax-Free Bond Fund 60,000
Tax-Free Insured Intermediate Bond Fund 60,000
Blue Chip Growth Fund 60,000
Dividend Growth Fund 65,000
Latin America Fund 100,000
Summit Cash Reserve Fund 60,000
Summit Limited-Term Bond Fund 60,000
Summit GNMA Fund 60,000
Summit Municipal Money Market Fund 60,000
Summit Municipal Intermediate Fund 60,000
Summit Municipal Income Fund 60,000
|
IN WITNESS WHEREOF, T. Rowe Price Funds and T. Rowe Price Associates, Inc. have agreed upon this fee schedule to be executed in their names and on their behalf through their duly authorized officers:
T. ROWE PRICE FUNDS T. ROWE PRICE ASSOCIATES, INC.
/s/Carmen F. Deyesu /s/Alvin M. Younger Name_________________________ Name__________________________ Carmen F. Deyesu Alvin M. Younger |
Title Treasurer Title Treasurer and Managing
Director
Date 2/16/94 Date 2/16/94
|
The Agreement for Fund Accounting Services of January 1, 1994, between T. Rowe Price Associates, Inc. and each of the Parties listed on Appendix A thereto is hereby amended, as of March 1, 1994, by adding thereto the T. Rowe Price Equity Series, Inc. and T. Rowe Price International Series, Inc. Notwithstanding anything to the contrary herein, it is understood that the T. Rowe Price Equity Series, Inc. and T. Rowe Price International Series, Inc. (collectively referred to as the "Funds") shall not be responsible for paying any of the fees or expenses set forth herein but that, in accordance with the Investment Management AgreementS, dated March 1, 1994, between the Funds and T. Rowe Price Associates, Inc. and Rowe Price- Fleming International, Inc. (collectively referred to as "T. Rowe Price"), the Funds will require T. Rowe Price to pay all such fees and expenses.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. ROWE PRICE EQUITY INCOME FUND
T. ROWE PRICE EQUITY SERIES, INC.
T. Rowe Price Equity Income Portfolio T. Rowe Price New America Growth Portfolio
T. ROWE PRICE GNMA FUND
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Discovery Fund T. Rowe Price International Stock Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund T. Rowe Price Short-Term Global Fund
T. ROWE PRICE INTERNATIONAL SERIES, INC.
T. Rowe Price International Stock Portfolio
T. ROWE PRICE MID-CAP GROWTH FUND
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW HORIZONS FUNDS, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund New York Tax-Free Bond Fund New York Tax-Free Money Fund New Jersey Tax-Free Bond Fund Virginia Tax-Free Bond Fund Florida Insured Intermediate Tax-Free Fund Georgia Tax-Free Bond Fund
T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Money Market
Fund
T. Rowe Price Summit Municipal Intermediate
Fund
T. Rowe Price Summit Municipal Income Fund
T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE
FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
Attest: /s/Lenora V. Hornung /s/Carmen F. Deyesu ________________________ ___________________________________ Lenora V. Hornung, By: Carmen F. Deyesu Secretary Attest: T. ROWE PRICE SERVICES, INC. /s/Barbara A. VanHorn /s/Henry H. Hopkins ________________________ ___________________________________ Barbara A. VanHorn, By: Henry H. Hopkins, Vice President Assistant Secretary |
The Agreement for Fund Accounting Services of January 1, 1994, as amended March 1, 1994, between T. Rowe Price Associates, Inc. and each of the Parties listed on Appendix A thereto is hereby further amended, as of April 21, 1994, by adding thereto the T. Rowe Price Fixed Income Series, Inc. Notwithstanding anything to the contrary herein, it is understood that the T. Rowe Price Fixed Income Series, Inc. (referred to as the "Fund") shall not be responsible for paying any of the fees or expenses set forth herein but that, in accordance with the Investment Management Agreement, dated April 21, 1994, between the Fund and T. Rowe Price Associates, Inc. (referred to as "T. Rowe Price"), the Fund will require T. Rowe Price to pay all such fees and expenses.
T. ROWE PRICE ADJUSTABLE RATE U.S. GOVERNMENT
FUND, INC.
T. ROWE PRICE BALANCED FUND, INC.
T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. ROWE PRICE CALIFORNIA TAX-FREE INCOME
TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund
T. ROWE PRICE CAPITAL APPRECIATION FUND
T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. ROWE PRICE EQUITY INCOME FUND
T. Rowe Price Equity Income Portfolio T. Rowe Price New America Growth Portfolio
T. ROWE PRICE FIXED INCOME SERIES, INC.
T. Rowe Price Limited-Term Bond Portfolio
T. ROWE PRICE GNMA FUND
T. ROWE PRICE GROWTH & INCOME FUND, INC.
T. ROWE PRICE GROWTH STOCK FUND, INC.
T. ROWE PRICE HIGH YIELD FUND, INC.
T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index Fund
INSTITUTIONAL INTERNATIONAL FUNDS, INC.
Foreign Equity Fund
T. ROWE PRICE INTERNATIONAL EQUITY FUND, INC.
T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price International Bond Fund T. Rowe Price International Discovery Fund T. Rowe Price International Stock Fund T. Rowe Price European Stock Fund T. Rowe Price New Asia Fund T. Rowe Price Global Government Bond Fund T. Rowe Price Japan Fund T. Rowe Price Short-Term Global Fund
T. ROWE PRICE INTERNATIONAL SERIES, INC.
T. Rowe Price International Stock Portfolio
T. ROWE PRICE MID-CAP GROWTH FUND
T. ROWE PRICE NEW AMERICA GROWTH FUND
T. ROWE PRICE NEW ERA FUND, INC.
T. ROWE PRICE NEW HORIZONS FUNDS, INC.
T. ROWE PRICE NEW INCOME FUND, INC.
T. ROWE PRICE OTC FUND, INC.
T. ROWE PRICE PRIME RESERVE FUND, INC.
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Maryland Tax-Free Bond Fund
Maryland Short-Term Tax-Free Bond Fund New York Tax-Free Bond Fund New York Tax-Free Money Fund New Jersey Tax-Free Bond Fund Virginia Tax-Free Bond Fund Florida Insured Intermediate Tax-Free Fund Georgia Tax-Free Bond Fund
T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund T. Rowe Price Summit Limited-Term Bond Fund T. Rowe Price Summit GNMA Fund
T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Money Market
Fund
T. Rowe Price Summit Municipal Intermediate
Fund
T. Rowe Price Summit Municipal Income Fund
T. ROWE PRICE TAX-FREE INSURED INTERMEDIATE
FUND, INC.
T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.
T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.
T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE
FUND, INC.
T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund U.S. Treasury Money Fund
Attest: /s/Lenora V. Hornung /s/Carmen F. Deyesu ________________________ ___________________________________ Lenora V. Hornung, By: Carmen F. Deyesu Secretary Attest: T. ROWE PRICE SERVICES, INC. /s/Barbara A. VanHorn /s/Henry H. Hopkins ________________________ ___________________________________ Barbara A. VanHorn, By: Henry H. Hopkins, Vice President Assistant Secretary |
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors of the T. Rowe Price Tax-Exempt Money Fund, Inc.:
We consent to the incorporation by reference in Post- Effective Amendment No. 26 to the Registration Statement of the T. Rowe Price Tax-Exempt Money Fund, Inc. on Form N-1A (File No. 2-67029) of our report dated March 17, 1994, on our audit of the financial statements and financial highlights of the Fund, which report is included in the Annual Report to Shareholders for the year ended February 28, 1994 which is incorporated by reference in the Registration Statement. We also consent to the reference to our Firm under the captions "Financial Highlights" in the Prospectus and "Independent Accountants" in the Statement of Additional Information.
/s/Coopers & Lybrand COOPERS & LYBRAND Baltimore, Maryland April 22, 1994 |
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors of the T. Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc.:
We consent to the incorporation by reference in Post- Effective Amendment No. 3 to the Registration Statement of the T. Rowe Price Tax-Free Insured Intermediate Bond Fund, Inc. on Form N-1A (File No. 33-49117) of our report dated March 17, 1994, on our audit of the financial statements and financial highlights of the Fund, which report is included in the Annual Report to Shareholders for the year ended February 28, 1994 which is incorporated by reference in the Registration Statement. We also consent to the reference to our Firm under the captions "Financial Highlights" in the Prospectus and "Independent Accountants" in the Statement of Additional Information.
/s/Coopers & Lybrand COOPERS & LYBRAND Baltimore, Maryland April 22, 1994 |
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors of the T. Rowe Price Tax-Free High Yield Fund, Inc.:
We consent to the incorporation by reference in Post- Effective Amendment No. 15 to the Registration Statement of the T. Rowe Price Tax-Free High Yield Fund, Inc. on Form N-1A (File No. 2-94641) of our report dated March 17, 1994, on our audit of the financial statements and financial highlights of the Fund, which report is included in the Annual Report to Shareholders for the year ended February 28, 1994 which is incorporated by reference in the Registration Statement. We also consent to the reference to our Firm under the captions "Financial Highlights" in the Prospectus and "Independent Accountants" in the Statement of Additional Information.
/s/Coopers & Lybrand COOPERS & LYBRAND Baltimore, Maryland April 22, 1994 |
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus and Statement of Additional Information constituting parts of this Post-Effective Amendment No. 19 to the Registration Statement on Form N-1A (the "Registration Statement") of our report dated March 17, 1994, relating to the financial statements and selected per share data and ratios appearing in the February 28, 1994 Annual Report to Shareholders of the T. Rowe Price Tax- Free Short-Intermediate Fund, Inc., which is also incorporated by reference into the Registration Statement. We also consent to the reference to us under the heading "Financial Highlights" in the Prospectus and under the heading "Independent Accountants" in the Statement of Additional Information.
/s/Price Waterhouse PRICE WATERHOUSE Baltimore, Maryland April 22, 1994 |
We hereby consent to the incorporation by reference in the Prospectus and Statement of Additional Information constituting parts of this Post-Effective Amendment No. 36 to the Registration Statement on Form N-1A (the "Registration Statement") of our report dated March 17, 1994, relating to the financial statements and selected per share data and ratios appearing in the February 28, 1994 Annual Report to Shareholders of the T. Rowe Price Tax- Free Income Fund, Inc., which is also incorporated by reference into the Registration Statement. We also consent to the reference to us under the heading "Financial Highlights" in the Prospectus and under the heading "Independent Accountants" in the Statement of Additional Information.
/s/Price Waterhouse PRICE WATERHOUSE Baltimore, Maryland April 22, 1994 |
(16) TOTAL RETURN PERFORMANCE
The cumulative total return performance of the Fund is measured by using an index of adjusted net asset values that reflect both the assumed investment of one share on the inception date of the Fund and the inclusion of shares received from the reinvestment of all Fund capital gains and income dividends, during the Fund's history.
As an example, the following index assumes an investment of 1 share of the T. Rowe Price Tax-Free income Fund on October 26, 1976, its inception. Each quarter thereafter, and, beginning with 5/31/83, each month, the dividends and capital gains per share were accumulated on the shares held and were reinvested in additional fund shares reported net asset value of the Fund at the time of the reinvestment. These valuation points comprise the performance index.
Distri- butions Reinvest-Cumulat- Per Share ment tive Reported Index Valu- (Inc. & Share Price Share N.A.V. Total ation |
INCEPTION
l.000000000 X $l0.00 = $ 10.00000
10/26/76
12/31/76 $0.087201 X 1.00000000 / 10.20 = 0.00854909
1.00854909 X 10.20 = 10.28720
12/31/76
03/31/77 $0.141770 X 1.00854909 / 10.17 = 0.01405919
1.02260828 X 10.17 = 10.39992
03/31/77
06/30/77 $0.134200 X 1.02260828 / 10.32 = 0.01329786
1.03590615 X 10.32 = 10.69055
06/30/77
09/30/77 $0.136943 X 1.03590615 / 10.42 = 0.01361418
1.04952034 X 10.42 = 10.93600
09/30/77
12/31/77 $0.129788 X 1.04952034 / 10.28 = 0.01325051
1.06277086 X 10.28 = 10.92528
12/31/77
01/04/78 $0.003900 x 1.062770860) / 10.28 = 0.00040319
(cap. gains)
1.06317045 X 10.28 = 10.92942 01/04/78
02/28/78 $0.090337 X 1.06317405 / 10.31 = 0.00931566
(2 mo.'s accrued
income)
1.072489712 X 10.31 = 11.05736
02/28/78
03/31/78 $0.135801 X 1.06317405 / 10.28 = 0.01404479
1.07721884 X 10.28 = 11.07380
03/31/78
06/30/78 $0.134642 X 1.07721884 / 9.77 = 0.01484537 1.09206422 x 9.77 = 10.66946 06/30/78
09/30/78 $0.128576 X 1.09206422 / 9.83 = 0.01428416 1.10634838 x 9.g3 = 10.87540 09/30/78
12/31/78 $o;126~~7 X 1.10634838 / 9.54 = 0.01465128 1.12099966 x 9.54 = 10.69433 12/31/78
03/31/79 $0.129052 X 1.12099966 / 9.64 = 0.01500694
1.13600661 X 9.64 = 10.95110
03/31/79
06/30/79 $0.127811 X 1.13600661 / 9.71 0.01495307
1.15095968 X 9.71 = 11.17581
06/30/79
09/30/79 $0.127988 X 1.15095968 / 9.56 = 0.01540894
1.16636863 X 9.56 = 11.15048
09/30/79
12/31/79 $0.149078 X 1.16636863 / 9.20 = 0.01889997
1.18526861 X 9.20 = 10.90447
12/31/79
03/31/80 $0.150892 X 1.18526861 / 8.48 = 0.02109046
1.20635908 X 8.48 = 10.22992
03/31/80
Distri- butions Reinvest-Cumulat- Per Share ment tive Reported Index Valu- (Inc. & Share Price Share N.A.V. Total ation |
INCEPTION
06/30/80 $0.166762 X 1.20635908 / 8.98 = 0.022402)5
1.288761646 X 8.98 = 11.03427
06/30/80
|
09/30/80 $0.175028 X 1.22876164 / 8.46 = 0.02542173
1.25418337 X 8.46 = 10.61039
09/30/80
12/31/80 $0.182038 X 1.25418337 / 8.06 = 0.02832623
1.28250961 X 8.06 = 10.33702
12/31/80
03/31/81 $0.180890 X 1.28250961 / 8.02 = 0.02892676
1.31143637 X 8.02 = 10.51771
03/31/81
06/30/81 $0.179880 X 1.31143637 7.80 = 0.03024378
1.34168015 X 7.80 = 10.46510
06/30/81
09/30/81 $0.180186 X 1.34168015 / 7.21 = 0.03353001
1.37521017 X 7.21 =
9.91526509/30/81
12/31/81 $0.188208 X 1.37521017 / 7.26 = 0.03565086
1.41086104 X 7.26 = 10.24285
12/31/81
03/31/82 $0.194864 X 1.41086104 / 7.25 = 0.03792088
1.44878193 X 7.25 = 10.50366
03/31/82
06/30/82 $0.199933 X 1.44878193 / 7.34 = 0.03946314 1.488245085 x 7.34 = 10.92371 06/30/82
09/30/82 $0.203166 X 1.48824508 / 8.13 = 0.03719076
1.56113854 X 8.58 = 13.39456
12/31/82
02/28/83 $0.129282 X 1.56113854 / 8.85 = 0.02280544
(2 mo.'s accrued
income)
03/31/83 $0.199387 X 1.56113854 / 8.96 = 0.03474004
1.59587859 X 8.96 = 14.29907
03/31/83
05131/83 $0.119441 X 1.59587859 1 8.96 = 0.02127374
1.61715233 X 8.96 = 14.48968
05/31/83
06/30/83 $0.057440 X 1.61715233 / 8.80 = 0.01055553
1.62770786 X 8.80 = 14.32382
06/30/83
07/31/83 $0.055509 X 1.62770786 / 8.72 = 0.01036158
1.63806944 X 8.72 = 14.28396
07/31/83
08/31/83 $0.057482 X 1.63806944 / 8.56 = 0.01099999
1.64906944 X 8.56 = 14.11603
08131183
09/30/83 $0.061003 X 1.64906944 / 8.66 = 0.01161645
1.66068589 X 8.66 = 14.38153
09/30/83
10/31/83 $0.056891 X 1.66068589 / 8.45 = 0.01118086
1.67186676 X 8.45 = 14.12727
10/31/83
Distri- butions Reinvest-Cumulat- Per Share ment tive Reported Index Valu- (Inc. & Share Price Share N.A.V. Total ation |
INCEPTION
11/30/83 $0.059514 X 1.67186676 / 8.40 = 0.01184518
1.68371194 X 8.40 = 14.14318
11/30/83
12/31/83 $0.063500 X 1.68371194 / 8.45 = 0.01265284
1.69636478 X 8.45 = 14.33428
12/31/83
01/31/84 $0.056635 X 1.69636478 / 8.58 = 0.01119751
1.70756229 X 8.58 = 14.65088
01/31/84
02/28/84 $0.060692 X 1.70756229 / 8.48 = 0.01222131
1.71978361 X 8.48 = 14.58376
02/28/84
03/31/84 $0.057552 X 1.71978361 / 8.44 = 0.01172731
1.73151092 X 8.44 = 14.61395
03/31/84
04/30/84 0.050956 X 1.73151092 / 8.40 = 0.01050375
1.74201468 X 8.40 = 14.63292
04/30/84
05/31/84 0.052913 X 1.74201468 / 8.17 = 0.01128219
1.75329688 X 8.17 = 14.32443
05/31/84
06/30/84 0.048811 X 1.75329688 / 8.20 = 0.01043675 1.76373363 x 8.20 = 14.46261 06/30/84
07/31/84 0.049290 X 1.76373363 / 8.30 = 0.01047414
1.77420778 X 8.30 = 14.72592
07/31/84
08/31/84 0.058213 X 1.77420778 / 8.32 = 0.01241378
1.78662157 X 8.32 = 14.86469
08/31/84
09/30/84 0.050264 X 1.78662157 / 8.27 = 0.01085900
1.79748057 X 8.27 = 14.86516
09/30184
10/31/84 0.054260 X 1.79748057 / 8.32 = 0.01172267
1.80929325 X 8.32 = 15.05257
10/31/84
11/30/84 0.061414 X 1.80920325 / 8.33 : 0.01333862
1.82254187 X 8.33 = 15.18177
11/30/84
12/31/84 0.057044 X 1.82254187 / 8.37 = 0.01242124
1.83496312 X 8.37 = 15.35864
12/31/84
01/31/85 0.056182 X 1.83496312 / 8.55 = 0.01205753
1.84702065 X 8.55 = 15.79202
01/31/85
02/28/85 0.057403 X 1.84702065 / 8.41 = 0.01260714
1.85962780 X 8.41 = 15.63946
02/28/85
03/31/85 0.057499 X 1.85962780 / 8.40 = 0.01272958
1.87235739 X 8.40 = 15.72780
03/31/85
04/30/85 0.058496 X 1.87235739 / 8.53 = 0.01284009
1.88519748 X 8.53 = 16.08073
04/30/85
Distri- butions Reinvest-Cumulat- Per Share ment tive Reported Index Valu- (Inc. & Share Price Share N.A.V. Total ation |
INCEPTION
05/31/85 0.064514 X 1.88519748 / 8.75 = 0.01389962
1.89909710 X 8.75 = 16.61709
05/31/85
06/30/85 0.056886 X 1.89909710 / 8.75 = 0.1234673
1.91144383 X 8.75 = 16.72513
06/30/85
07/31/85 0.058574 X 1.91144383 / 8.73 = 0.01282506
1.92426890 X 8.73 = 16.79886
07/31/85
08/31/85 0.061813 X 1.92426890 / 8.66 = 0.01373518
1.93800408 X 8.66 = 16.78311
08/31/85
09/30/85 0.051543 X 1.93800408 / 8.55 = 0.01168310
1.94968719 X 8.55 = 16.66982
09/30/85
10/31/85 0.054723 X 1.94968719 / 8.70 = 0.01226356
1.96195075 X 8.70 = 17.06897
10/31/85
11/30/85 0.058875 X 1.96195075 / 8.88 = 0.01300799
1.97495875 X 8.88 = 17.53763
11/30/85
12/31/85 0.061770 X 1.97495875 / 9..03 = 0.01350990
1.98846865 X 9.03 = 17.95587
12/31/85
01/31/86 0.065927 X 1.98846865 / 9.39 = 0.01396112 2.00242977 x 9.39 = 18.80281 01/31/86
02/28/86 0.061561 ~ 2.00242977 / 9.73 = 0.01266940 2.01509918 x 9.73 = 19.60691 02/28/86
03/31/86 0.056208 X 2.01509918 / 9.78 = 0.01158128
2.02668047 X 9.78 = 19.82093
03/31/86
04/30/86 0.060279 X 2.02668047 / 9.67 = 0.01263368
2.03931416 X 9.67 = 19.72016
04/30/86
05/31/86 0.058655 X 2.03931416 / 9.44 = 0.01267128 2.05198544 x 9.44 = 19.37074 05/31/86
06/30/86 0.053730 X 2.05198544 / 9.49 = 0.01161786 2.06360331 x 9.49 = 19.58359 06/30/86
07/31/86 0.057301 X 2.06360331 / 9.44 = 0.01252632
2.07612963 X 9.44 = 19.59866
07/31/86
08/31/86 0.062093 X 2.07612963 / 9.97 = 0.01293013 2.08905976 x 9.97 = 20.82792 08/31/86
09/30/86 0.056955 X 2.08905976 / 9.80 = 0.01214107
2.10120083 X 9.80 = 20.59176
09/30/86
10/31/86 0.059392 X 2.10120083 / 9.95 = 0.01254216 2.11374300 x 9.95 = 21.03174 10/31/86
Distri- butions Reinvest-Cumulat- Per Share ment tive Reported Index Valu- (Inc. & Share Price Share N.A.V. Total ation |
INCEPTION
11/30/86 0.049686 X 2.11374300 / 10.10 = 0.01039844
2.12414145 X 10.10 = 21.45382
11/31/86
12/31/86 0.057489 X 2.12414145 / 10.07 = 0.01212673
2.13626818 X 10.07 = 21.51222
12/31/86
01/31/87 0.054424 X 2.13626818 / 10.28 = 0.01130985
2.14757804 X 10.28 = 22.07710
01/31/87
02/28/87 0.052893 X 2.14757804 / 10.27 = 0.01106058
2.15863863 X 10.27 = 22.16921
02/28/87
03/09/87 0.540000 X 2.15863863 / 9.76 = 0.11943287
(cap. gains)
2.27807151 X 9.76 = 22.23397 03/09/87
03/31/87 0.050592 X 2.27807151 / 9.60 = 0.01200532
2.29007683 X 9.60 = 21.98473
03.31/87
04/30/87 0.052602 X 2.29007683 / 8.82 = 0.01365778
2.30373461 X 8.82 = 20.31893
04/30/87
05/31/87 0.050966 X 2.30373461 / 8.68 = 0.01352683
2.31726145 X 8.68 = 20.11382
05/31/87
06/30/87 0.044632 X 2.31726145 / 8.81 = 0.01173941
2.32900087 X 8.81 = 20.51849
06/30/87
07/31/87 0.048412 X 2.32900087 / 8.88 = 0.01269717
2.34169805 X 8.88 = 20.79427
07/31/87
08/31/87 0.044812 X 2.34169805 / 8.83 = 0.01188416
2.35358221 X 8.83 = 20.78213
08/31/87
09/30/87 0.048825 X 2.35358221 / 8.44 = 0.015~1537 2.367197s8 X 8.44 = 19.97914 09/30/87
10/31/87 0.046309 X 2.36719758 / 8.36 = 0.01311262
2.38031021 X 8.36 = 19.89939
10/31/87
11/30/87 0.046812 X 2.38031021 / 8.50 = 0.01310914
2.39341935 X 8.50 = 20.34406
11/30/87
12/31/87 0.056639 X 2.39341935 / 8.55 = 0.01585511
2.40927446 X 8.55 = 20.59929
12/31/87
01/31/88 0.047573 X 2.40927446 / 8.77 = 0.01306930
2.42234376 X 8.77 = 21.24395
01/31/88
02/29/88 0.052212 X 2.42234376 / 8.81 = 0.01435593
2.43669970 X 8.81 = 21.46732
02/29/88
Cumulative performance for any investment period is calculated as the percentage difference between a beginning index value and an ending index value. The ten year performance from 2/28/78 to 2/29/88 for the New Income Fund would be calculated as:
The five year performance from 2/28/83 to 2/29/88 would be calculated as:
The one year performance from 2/28/87 to 2/29/88 would be calculated as:
The since inception performance from 10/26/76 to 2/29/88 would be calculated as:
Average annual compound rates of return are calculated for specific periods of the Fund's history. Each return is the cumulative total return performance expressed as a constant rate of growth for each year involved. For example: the T. Rowe Price Tax-Free Income Fund averaged a +6.85% compound annual growth rate for ten years to achieve the 94.15% cumulative total return performance for the period ended February 29, 1988.
This can be illustrated with a $1,000 hypothetical
investment made in the Tax-Free Income Fund on February 28, 1978
and completely redeemed ten years later on February 29, 1988. All
fund income and capital gains were reinvested at the reinvestment
price during the period. There are no loads or fees charged to
shareholders. Previously, it was determined (by using the total
return performance index for the Tax-Free Income Fund) that the
fund appreciated 94.15% for this ten year period. This represents
an increase of $941.50 for a $1,000 investment or a total
redemption value of
$1,941.50.
To determine the average annual rate required to achieve these results the following compounding formula is used to solve for T.
P(1 + T)n = ERV
WHERE P = a hypothetical initial payment of $1,000
T = average annual total return
n : number of years
ERV = ending redeemable value of a hypothetical $1,000
payment made at the beginning of the investment period.
The ten year average annual return from 2/28/78 to 2/29/88 would be calculated as:
$1000 (1 + T)10 = $1,941.50
T (1,941.502)l/10 1 ( 1,000) T =1.0685- l T =0.0685 or 6.85% |
Similarly, a $1,000 hypothetical total return investment made in the T. Rowe Price Tax-Free Income Fund on February 28, 1983 would have appreciated 53.14% and have an ending redeemable value of $1,531.40 on February 29, 1988.
The five year average annual return from 2/28/83 to 2/29/88 would be calculated as:
$1000(1 + T)5 = $1,531.40
T =1.0889- 1
T =0.0889 or 8.89%
And finally, a $1,000 hypothetical total return investment made in the T. Rowe Price Tax-Free Inocme Fund at inception of October 26, 1976 would have apprecaited 114.67% and have an ending redeemable value of #$2,146.70 on February 29, 1988.
The 11.4 year average annual return from 10/26/76 to 2/29/88 would be calculated as:
$1000(1 + T)11.4 = $2,146.70
T = 1.0696- 1
T =0.0696 or 6.96%
l:\trpprod\edg\perform.tf