Form 40-17G STATE FARM MUTUAL FUND
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State Farm Mutual Fund Trust
I, David Grizzle, Assistant Secretary-Treasurer of the State Farm Mutual
Fund Trust, a Delaware trust, hereby certify that the following is a true and
correct copy of a resolution duly adopted at a meeting of the Board of Trustees
of the Trust held in Bloomington, Illinois on the 17th day of March, 2017 and
that said resolution is in full force and effect and has not been revoked.
WHEREAS, In compliance with the requirements of Rule 17g-1 of
the Investment Company Act of 1940 (the Act) each Trust is insured and has
coverage against larceny and embezzlement under a joint insured registered
management investment company bond in the amount of $6,500,000 per loss
issued by ICI Mutual Insurance Company, naming as the assureds thereon,
State Farm Investment Management Corp., State Farm Mutual Automobile
Insurance Company, State Farm Associates' Funds Trust, State Farm Variable
Product Trust, and State Farm Mutual Fund Trust (each an "Assured" and
together the "Assureds");
RESOLVED, That giving due consideration to all relevant factors
including the total amount of coverage which each joint assured would have
been required to provide and maintain individually pursuant to Rule 17g-1
under the Act had each such joint assured not been named under a joint
insured bond, the amount, type and form of the coverage against larceny and
embezzlement provided under ICI Mutual Insurance Company's joint insured
registered management investment company bond, containing provisions
complying with the notice requirements of paragraph (c) of Rule 17g-1 under
the Act, are deemed by these Boards of Trustees, to be reasonable, and
RESOLVED, That in consideration of the value of the aggregate assets
of each of these Assureds to which any covered person may have access, the
type and terms of arrangements made for the custody and safekeeping of such
assets, the nature of the securities and other investments to be held in each
of these Assureds' portfolio, the accounting procedures and controls, and the
minimum amount of a single insured bond each of the Assureds would have
been required to provide and maintain individually pursuant to Rule 17g-1
under the Act had each of the Assureds obtained a single insured bond, it is
determined by these Boards of Trustees that the following amounts of fidelity
bond coverage shall be maintained and the Assureds shall have a priority
claim in the event of loss under the joint insured bond of the same amounts:
State Farm Associates' Funds Trust 2,500,000
State Farm Variable Product Trust 1,500,000
State Farm Mutual Fund Trust 2,500,000
RESOLVED, That in consideration of all relevant factors including the
number and the nature of the business activities of the other parties named as
Assureds, the amount of the joint insured bond, the amount of the premium for
such bond, the ratable allocation of the premium among all parties named as
Assureds, according to the relevant cost to each Assured of a single insured
bond in the amount of each Assured's priority coverage, and the extent to which
the share of the premium allocated to each Assured is less than the premium
each Assured would have had to pay if they had provided and maintained a
single insured bond in the amount of the priority coverage, the portion of the
premium of the joint insured bond to be paid by each Assured, based
upon the relative cost to each Assured of a single insured bond in the amount
of each Assured's priority coverage, is hereby approved, and
RESOLVED, That the Joint Fidelity Bond Agreement among all Assureds
under the joint insured bond, in the form presented to this meeting is hereby
approved, the officers are directed to execute the Agreement and the Secretary
is directed to file an executed copy of the Agreement in the form presented
to this meeting with the records of this meeting, and
FURTHER RESOLVED, That, in accordance with Rule 17g-1, the officers are
hereby directed to make the filings and give the notices as may be required by
paragraph (g) of the Rule.
IN WITNESS WHEREOF, I have affixed my signature on the 14th day of
April, 2017.
By: /s/David Grizzle
Name: David Grizzle
Title: Assistant Secretary-Treasurer
JOINT FIDELITY BOND AGREEMENT
This agreement, effective the 1st day of April, 2017, by and among State
Farm Associates' Funds Trust, State Farm Variable Product Trust, State Farm
Mutual Fund Trust, State Farm Investment Management Corp. ("SFIMC") and State
Farm Mutual Automobile Insurance Company ("Auto Company") (collectively, the
"Assureds").
The Assureds have agreed to acquire a joint insured Registered Management
Investment Company Bond ("Bond") in an amount of $6,500,000 per loss, issued
by the ICI Mutual Insurance Company, effective April 1, 2017.
The Assureds desire to provide herein for an amount of priority coverage
for each Assured, an allocation of the premium for the Bond, and a manner of
allocating any recovery under the Bond.
The Assureds, therefore, agree that:
1. Priority Coverage. The following amounts of priority coverage have been
approved for each Assured by its Board of Directors or Board of Trustees.
Assured Priority Coverage
State Farm Associates' Funds Trust 2,500,000
State Farm Variable Product Trust 1,500,000
State Farm Mutual Fund Trust 2,500,000
SFIMC 0
Auto Company 0
------------
$6,500,000
2. Allocation of Premium. Each Assured shall pay a portion of the total Bond
premium based upon the relative cost to each Assured of a single insured bond
in the amount of each assured's priority coverage.
3. Allocation of Recovery.
A. Loss to One Assured. In the event of an insured loss to only one Assured,
the entire recovery under the Bond for that loss shall be allocated to the
Assured incurring such loss.
B. Loss to More Than One Assured.
1. Loss Percentages. For purposes of allocating the coverage of the
Bond, each Assured shall have a loss percentage as follows:
Assured Loss Percentage
State Farm Associates' Funds Trust 38.46%
State Farm Variable Product Trust 23.08%
State Farm Mutual Fund Trust 38.46%
SFIMC 0%
Auto Company 0%
----------
100%
These percentages reflect the percentages of the total Bond coverage
represented by the amount of each Assured's priority coverage.
2. Initial Allocation. Each Assured involved in an insured loss which
involves more than one Assured shall receive a portion of the recovery
under the Bond equal to the lesser of (i) the amount of that Assured's
loss, or (ii) the total amount of the Bond multiplied by a fraction, the
numerator of which is that Assured's loss percentage and the denominator
of which is the sum of the loss percentages of all of the Assureds
involved in such insured loss, which initial allocation assures that each
Assured shall receive the full amount of its loss up to the amount of its
priority coverage.
3. Subsequent Allocations. Any recovery under the Bond unallocated after
the initial allocation shall be allocated by repeating the following
procedure until all amounts recovered under the Bond are allocated: To
each Assured involved in the insured loss for which the loss was not
covered by the prior allocation, there shall be allocated a portion of the
unallocated recovery equal to the lesser of (i) the amount of that
Assured's loss not covered by the prior allocation, or (ii) an amount equal
to the unallocated recovery under the Bond multiplied by a fraction, the
numerator of which is that Assured's loss percentage and the denominator
of which is the sum of the loss percentages of all of the Assureds
involved in the insured loss, and for which the loss was not covered by
the prior allocation.
4. Agent. SFIMC is hereby appointed the agent for all of the Assureds for
the purpose of making, adjusting, receiving and enforcing payment of all claims
under the Bond and otherwise dealing with ICI Mutual Insurance Company with
respect to the Bond. Any expenses incurred by SFIMC in its capacity as agent
in connection with a claim as to which there is a recovery shall be shared by
the Assureds in proportion to the Bond recovery received by the Assureds for
the loss. All other expenses incurred by SFIMC in its capacity as agent may be
charged by SFIMC to all of the Assureds in the same proportion as their loss
percentages.
5. Modification and Termination. This Agreement may be modified or amended
from time to time by mutual written agreement among all of the Assureds. It
may be terminated with respect to any one Assured by not less than 75 days'
written notice to the other Assureds which are still parties to the Agreement.
It shall terminate with respect to any Assured as of the date that Assured
ceases to be an assured under the Bond; provided that such termination shall
not affect that Assured's rights and obligations hereunder with respect to any
claims on behalf of that Assured which are paid under the Bond by
ICI Mutual Insurance Company after the date the Assured ceases to be an assured
under the Bond.
6. Further Assurances. Each Assured agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
IN WITNESS WHEREOF, The Assureds have caused this Agreement to be
executed as of the day and year first above written.
STATE FARM ASSOCIATES' FUNDS TRUST
STATE FARM VARIABLE PRODUCT TRUST
STATE FARM MUTUAL FUND TRUST
STATE FARM INVESTMENT MANAGEMENT CORP.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
By: /s/David Grizzle
Name: David Grizzle
Date: April 14, 2017
Title: Assistant Secretary-Treasurer
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
1401 H St. NW
Washington, DC 20005
INVESTMENT COMPANY BLANKET BOND
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
1401 H St. NW
Washington, DC 20005
DECLARATIONS NOTICE
This policy is issued by your risk retention group. Your risk
retention group may not be subject to all of the insurance laws and
regulations of your state. State insurance insol vency guaranty funds are
not available for your risk retention group.
Item 1. Name of Insured (the "Insured") Bond Number:
State Farm Investment Management Corporation 870361178
Principal Office: Mailing Address:
Three State Farm Plaza South, N-2 Three State Farm Plaza South, N-2
Bloomington, IL, 61791-0001 Bloomington, IL 61791-0001
Item 2. Bond Period: from 12:01 a.m. on April 1, 2017, to 12:01 a.m. on
April 1, 2018, or the earlier effective date of the termination of this Bond,
standard time at the Principal Address as to each of said dates.
Item 3. Limit of Liability-Subject to Sections 9, 10 and 12 hereof:
LIMIT OF LIABILITY DEDUCTIBLE AMOUNT
Insuring Agreement A-FIDELITY $6,500,000 $50,000
Insuring Agreement B-AUDIT EXPENSE $50,000 $10,000
Insuring Agreement C-ON PREMISES $6,500,000 $50,000
Insuring Agreement D-IN TRANSIT $6,500,000 $50,000
Insuring Agreement E-FORGERY OR ALTERATION $6,500,000 $50,000
Insuring Agreement F-SECURITIES $6,500,000 $50,000
Insuring Agreement G-COUNTERFEIT CURRENCY $6,500,000 $50,000
Insuring Agreement H-UNCOLLECTIBLE ITEMS
OF DEPOSIT $25,000 $5,000
Insuring Agreement I-PHONE/ELECTRONIC
TRANSACTIONS $6,500,000 $50,000
If "Not Covered" is i nserted opposite any Insuri ng Agreement above, such
Insuring Agreement and any reference thereto shall be deemed to be deleted
from this Bond.
OPTIONAL INSURING AGREEMENTS ADDED BY RIDER:
Insuring Agreement J-COMPUTER SECURITY $6,500,000 $50,000
Item 4. Offices or Premises Covered--All the Insured's offices or other
premises in existence at the time this Bond becomes effective are covered
under this Bond, except the offices or other premises excluded by Rider.
Offices or other premises acquired or established after the effective date of
this Bond are covered subject to the terms of General Agreement A.
Item 5. The liability of ICI Mutual Insurance Company, a Risk Retention Group
(the "Underwriter") is subject to the terms of the following Riders attached
hereto:
Riders: 1-2-3-4-5-6-7-8-9
and of all Riders applicable to this Bond issued during the Bond Period.
By: /S/ Swenitha Nalli By: /S/ Catherine Dalton
Authorizd Representative Authorized Representative
Bond ( 10/15)
INVESTMENT COMPANY BLANKET BOND
NOTICE
This policy is issued by your risk retention group. Your risk retention group
may not be subject to all of the insurance laws and regulations of your state.
State insurance insolvency guaranty funds are not available for your risk
retention group.
ICI Mutual Insurance Company, a Risk Retention Group (the "Underwriter"), in
consideration of an agreed premium, and in reliance upon the Application and
all other information furnished to the Underwriter by the Insured, and subject
to and in accordance with the Declarations, General Agreements, Provisions,
Conditions and Limitations and other terms of this bond (including all
riders hereto) ("Bond"), to the extent of the Limit of Liability and subject
to the Deductible Amount, agrees to indemnify the Insured for the loss, as
described in the Insuring Agreements, sustained by the Insured at any time but
discovered during the Bond Period.
INSURING AGREEMENTS
A. FIDELITY
Loss caused by any Dishonest or Fraudulent Act or Theft committed by an
Employee anywhere, alone or in collusion with other persons (whether or not
Employees), during the time such Employee has the status of an Employee as
defined herein, and even if such loss is not discovered until after he or she
ceases to be an Employee, EXCLUDING loss covered under Insuring Agreement B.
B. AUDIT EXPENSE
Expense incurred by the Insured for that part of audits or examinations
required by any governmental regulatory authority or Self Regulatory
Organization to be conducted by such authority or Organization or by an
independent accountant or other person, by reason of the discovery of loss
sustained by the Insured and covered by this Bond.
C. ON PREMISES
Loss resulting from Property that is (1) located or reasonably believed by
the Insured to be located within the Insured's offices or premises, and (2)
the object of Theft, Dishonest or Fraudulent Act, or Mysterious Disappearance,
EXCLUDING loss covered under Insuring Agreement A.
D. IN TRANSIT
Loss resulting from Property that is (1) in transit in the custody of any
person authorized by an Insured to act as a messenger, except while in the
mail or with a carrier for hire (other than a Security Company), and (2) the
object of Theft, Dishonest or Fraudulent Act, or Mysterious Disappearance,
EXCLUDING loss covered under Insuring Agreement A. Property is "in transit"
beginning immediately upon receipt of such Property by the transporting person
and ending immediately upon delivery at the specified destination.
E. FORGERY OR ALTERATION
Loss caused by the Forgery or Alteration of or on (1) any bills of exchange,
checks, drafts, or other written orders or directions to pay certain sums in
money, acceptances, certificates of deposit, due bills, money orders, or
letters of credit; or (2) other written instructions, requests or applications
to the Insured, authorizing or acknowledging the transfer, payment,
redemption, delivery or receipt of Property, or giving notice of any bank
account, which instructions or requests or applications purport
to have been signed or endorsed by (a) any customer of the Insured, or (b) any
shareholder of or subscriber to shares issued by any Investment Company, or
(c) any financial or banking institution or stockbroker; or (3) withdrawal
orders or receipts for the withdrawal of Property, or receipts or certificates
of deposit for Property and bearing the name of the Insured as issuer or of
another Investment Company for which the Insured acts as agent. This Insuring
Agreement E does not cover loss caused by Forgery or Alteration
of Securities or loss covered under Insuring Agreement A.
F. SECURITIES
Loss resulting from the Insured, in good faith, in the ordinary course of
business, and in any capacity whatsoever, whether for its own account or for
the account of others, having acquired, accepted or recei ved, or sold or
delivered, or given any value, extended any credit or assumed any liability on
the faith of any Securities, where such loss results from the fact
that such Securities (1) were Counterfeit, or (2) were lost or stolen, or
(3) contain a Forgery or Alteration, and notwithstanding whether or not the act
of the Insured causing such loss violated the constitution, by-laws, rules or
regulations of any Self Regulatory Organization, whether or not the Insured
was a member thereof, EXCLUDING loss covered under Insuring Agreement A.
G. COUNTERFEIT CURRENCY
Loss caused by the Insured in good faith having received or accepted (1) any
money orders which prove to be Counterfeit or to contain an Alteration or
(2) paper currencies or coin of the United States of America or Canada which
prove to be Counterfeit. This Insuring Agreement G does not cover loss covered
under Insuring Agreement A.
H. UNCOLLECTIBLE ITEMS OF DEPOSIT
Loss resulting from the payment of dividends, issuance of Fund shares or
redemptions or exchanges permitted from an account with the Fund as a
consequence of
(1) uncollectible Items of Deposit of a Fund's customer, shareholder or
subscriber credited by the Insured or its agent to such person's Fund account,
or (2) any Item of Deposit processed through an automated clearing house
which is reversed by a Fund's customer, shareholder or subscriber and is
deemed uncollectible by the Insured;PROVIDED, that (a) Items of Deposit shall
not be deemed uncollectible until the Insured's collection procedures have
failed, (b) exchanges of shares between Funds with exchange
privileges shall be covered hereunder only if all such Funds are insured by
the Underwriter for uncollectible Items of Deposit, and (c) the Insured Fund
shall have implemented and maintained a policy to hold Items of Deposit for
the minimum number of days stated in its Application (as amended from time
to time) before paying any dividend or permitting any withdrawal with respect
to such Items of Deposit (other than exchanges between Funds). Regardless of
the number of transactions between Funds in an exchange program, the minimum
number of days an Item of Deposit must be held shall begin from the date the
Item of Deposit was first credited to any Insured Fund.
This Insuring Agreement H does not cover loss covered under Insuring
Agreement A.
I. PHONE/ELECTRONIC TRANSACTIONS
Loss caused by a Phone/Electronic Transaction, where the request for such
Phone/Electronic Transaction:
(1) is transmitted to the Insured or its agents by voice over the telephone or
by Electronic Transmission; and
(2) is made by an individual purporting to be a Fund shareholder or subscriber
or an authorized agent of a Fund shareholder or subscriber; and
(3) is unauthorized or fraudulent and is made with the manifest intent to
deceive; PROVIDED, that the entity recei ving such request generally maintains
and follows during the Bond Period all Phone/Electronic Transaction Security
Procedures with respect to all Phone/Electronic Transactions; and
EXCLUDING loss resulting from:
(1) the failure to pay for shares attempted to be purchased; or
(2) any redemption of Investment Company shares which had been improperly
credited to a shareholder's account where such shareholder (a) did not cause,
directly or indirectly, such shares to be credited to such account, and (b)
directly or indirectly received any proceeds or other benefit from such
redemption; or
(3) any redemption of shares issued by an Investment Company where the
proceeds of such redemption were requested to be paid or made payable to other
than (a) the Shareholder of Record, or (b) any other person or bank account
designated to receive redemption proceeds (i) in the initial account
application, or (ii) in writing (not to include Electronic Transmission)
accompanied by a signature guarantee; or
(4) any redemption of shares issued by an Investment Company where the
proceeds of such redemption were requested to be sent to other than any address
for such account which was designated (a) in the initial account application,
or (b) in writing (not to include Electronic Transmission), where such writing
is received at least one (1) day prior to such redemption request, or (c) by
voice over the telephone or by Electronic Transmission at least fifteen (15)
days prior to such redemption; or
(5) the intentional failure to adhere to one or more Phone/Electronic
Transaction Security Procedures; or
(6) a Phone/Electronic Transaction request transmitted by electronic mail or
transmitted by any method not subject to the Phone/Electronic Transaction
Security Procedures; or
(7) the failure or circumvention of any physical or electronic protection
device, including any firewall, that imposes restrictions on the flow of
electronic traffic in or out of any Computer System.
This Insuring Agreement I does not cover loss covered under Insuring
Agreement A,"Fidelity" or Insuring Agreement J, "Computer Security".
GENERAL AGREEMENTS
A. ADDITIONAL OFFICES OR EMPLOYEES- CONSOLIDATION OR MERGER-- NOTICE
1. Except as provided in paragraph 2 below, this Bond shall apply to any
additional office(s) established by the Insured during the Bond Period and to
all Employees during the Bond Period, without the need to give notice thereof
or pay additional premiums to the Underwriter for the Bond Period.
2. If during the Bond Period an Insured Investment Company shall merge or
consolidate with an institution in which such Insured is the surviving entity,
or purchase substantially all the assets or capital stock of another
institution, or acquire or create a separate investment portfolio, and shall
within sixty (60) days notify the Underwriter thereof, then this Bond shall
automatically apply to the Property and Employees resulting from such merger,
consolidation, acquisition or creation from the date thereof; provided, that
the Underwriter may make such coverage contingent upon the payment of an
additional premium.
B. WARRANTY
No statement made by or on behalf of the Insured, whether contained in the
Application or otherwise, shall be deemed to be an absolute warranty, but only
a warranty that such statement is true to the best of the knowledge of the
person responsible for such statement.
C. COURT COSTS AND ATTORNEYS' FEES
The Underwriter will indemnify the Insured against court costs and reasonable
attorneys' fees incurred and paid by the Insured in defense of any legal
proceeding brought against the Insured seeking recovery for any loss which,
if established against the Insured, would constitute a loss covered under the
terms of this Bond; provided, however, that with respect to Insuring
Agreement A this indemnity shall apply only in the event that
1 . an Employee admits to having committed or is adjudicated to have committed
a Dishonest or Fraudulent Act or Theft which caused the loss; or
2. in the absence of such an admission or adjudication, an arbitrator or
arbitrators acceptable to the Insured and the Underwriter concludes, after a
review of an agreed statement of facts, that an Employee has committed a
Dishonest or Fraudulent Act or Theft which caused the loss.
The Insured shall promptly give notice to the Underwriter of any such legal
proceeding and upon request shall furnish the Underwriter with copies of all
pleadings and other papers therein. At the Underwriter's election the Insured
shall permit the Underwriter to conduct the defense of such legal proceeding
in the Insured's name, through attorneys of the Underwriter's selection. In
such event, the Insured shall give all reasonable information
and assistance which the Underwriter shall deem necessary to the proper
defense of such legal proceeding.
If the amount of the Insured's liability or alleged liability in any such
legal proceeding is greater than the amount which the Insured would be
entitled to recover under this Bond (other than pursuant to this General
Agreement C), or if a Deductible Amount is applicable,
or both, the indemnity liability of the Underwriter under this General
Agreement C is limited to the proportion of court costs and attorneys' fees
incurred and paid by the Insured or by the Underwriter that the amount which
the Insured would be entitled to recover under this Bond (other than pursuant
to this General Agreement C) bears to the sum of such amount plus the amount
which the Insured is not entitled to recover. Such indemnity shall be in
addition to the Limit of Liability for the applicable Insuring Agreement.
D. INTERPRETATION
This Bond shall be interpreted with due regard to the purpose of fidelity
bonding under Rule I 7g- I of the Investment Company Act of 1940 (i.e., to
protect innocent third parties from harm) and to the structure of the
investment management industry (in which a loss of Property resulting from a
cause described in any Insuring Agreement ordinarily gives rise to a potential
legal liability on the part of the Insured), such that the term "loss" as used
herein shall include an Insured's legal liability for direct compensatory
damages resulting directly from a misappropriation, or measurable diminution
in value, of Property.
THIS BOND, INCLUDING THE FOREGOING INSURING AGREEMENTS AND GENERAL AGREEMENTS,
IS SUBJECT TO THE FOLLOWING PROVISIONS, CONDITIONS AND LIMITATIONS:
SECTION 1. DEFINITIONS
The following terms used in this Bond shall have the meanings stated in this
Section:
A. "Alteration" means the marking, changing or altering in a material way
of the terms, meaning or legal effect of a document with the intent to deceive.
B. "Application" means the Insured's application (and any attachments and
materials submitted in connection therewith) furnished to the Underwriter for
this Bond.
C. "Computer System" means (1) computers with related peripheral components,
including storage components, (2) systems and applications software,
(3) terminal devices, (4) related communications networks or customer
communication systems, and (5) related electronic funds transfer systems; by
which data or monies are electronically collected, transmitted, processed,
stored or retrieved.
D. "Counterfeit" means, with respect to any item, one which is false but is
intended to deceive and to be taken for the original authentic item.
E. "Deductible Amount" means, with respect to any Insuring Agreement, the
amount set forth under the heading "Deductible Amount" in Item 3 of the
Declarations or in any Rider for such Insuring Agreement, applicable to each
Single Loss covered by such Insuring Agreement.
F. "Depository" means any "securities depository" (other than any foreign
securities depository) in which an Investment Company may deposit its
Securities in accordance with Rule 17f-4 under the Investment Company
Act of 1940.
G. "Dishonest or Fraudulent Act" means any dishonest or fraudulent act,
including "larceny and embezzlement" as defined in Section 37 of the Investment
Company Act of 1940, committed with the conscious manifest intent (1) to cause
the Insured to sustain a loss and (2) to obtain financial benefit for the
perpetrator or any other person (other than salaries, commissions, fees,
bonuses, awards, profit sharing, pensions or other employee benefits). A
Dishonest or Fraudulent Act does not mean or include a reckless act, a
negligent act, or a grossly negligent act.
H. "Electronic Transmission" means any transmission effected by electronic
means, including but not limited to a transmission effected by telephone tones,
Telefacsimile, wireless device, or over the Internet.
I. "Employee" means:
(1) each officer, director, trustee, partner or employee of the Insured, and
(2) each officer, director, trustee, partner or employee of any predecessor
of the Insured whose principal assets are acquired by the Insured by
consolidation or merger with, or purchase of assets or capital stock of,
such predecessor, and
(3) each attorney performing legal services for the Insured and each employee
of such attorney or of the law firm of such attorney while performing services
for the Insured, and
(4) each student who is an authorized intern of the Insured, while in any of
the Insured's offices, and
(5) each officer, director, trustee, partner or employee of
(a) an investment adviser,
(b) an underwriter (distributor),
(c) a transfer agent or shareholder accounting recordkeeper, or
(d) an administrator authorized by written agreement to keep financial
and/or other required records,
for an Investment Company named as an Insured, BUT ONLY while (i) such officer,
partner or employee is performing acts coming within the scope of the usual
duties of an officer or employee of an Insured, or (ii) such officer, director,
trustee, partner or employee is acting as a member of any committee duly
elected or appointed to examine or audit or have custody of or access to the
Property of the Insured, or (iii) such director or trustee (or anyone acting
in a similar capacity) is acting outside the scope of the usual duties of a
director or trustee;PROVIDED, that the term "Employee"
shall not include any officer, director, trustee, partner or employee of a
transfer agent, shareholder accounting recordkeeper or administrator (x) which
is not an "affiliated person" (as defined in Section 2(a) of the Investment
Company Act of 1940) of an Investment Company named as Insured or of the
adviser or underwriter of such Investment Company, or (y) which is a "Bank"
(as defined in Section 2(a) of the Investment Company Act of 1940), and
(6) each individual assigned, by contract or by any agency furnishing temporary
personnel, in either case on a contingent or part-time basis, to perform the
usual duties of an employee in any office of the Insured, and
(7) each indi vidual assigned to perform the usual duties of an employee or
officer of any entity authorized by written agreement with the Insured to
perform services as electronic data processor of checks or other accounting
records of the Insured, but excluding a processor which acts as transfer agent
or in any other agency capacity for the Insured in
issuing checks, drafts or securities, unless included under subsection (5)
hereof, and
(8) each officer, partner or employee of
(a) any Depository or Exchange,
(b) any nominee in whose name is registered any Security included in the
systems for the central handling of securities established and maintained
by any Depository, and
(c) any recognized service company which provides clerks or other personnel
to any Depository or Exchange on a contract basis,
while such officer, partner or employee is performing services for any
Depository in the operation of systems for the central handling of
securities, and
(9) in the case of an Insured which is an "employee benefit plan" (as defined
in Section 3 of the Employee Retirement Income Security Act of 1974 ("ERISA"))
for officers, directors or employees of another Insured ("In-House Plan"), any
"fiduciary" or other "plan official" (within the meaning of Section 412 of
ERISA) of such In-House Plan, provided that such fiduciary or other plan
official is a director, partner, officer, trustee or employee of an Insured
(other than an In-House Plan).
Each employer of temporary personnel and each entity referred to in subsections
(6) and (7) and their respective partners, officers and employees shall
collectively be deemed to be one person for all the purposes of this Bond.
Brokers, agents, independent contractors, or representatives of the same
general character shall not be considered Employees, except as provided in
subsections (3), (6), and (7).
J. "Exchange" means any national securities exchange registered under the
Securities Exchange Act of 1934.
K. "Forgery" means the physical signing on a document of the name of
another person (whether real or fictitious) with the intent to deceive. A
Forgery may be by means of mechanically reproduced facsimile signatures as well
as handwritten signatures. Forgery does not include the signing of an
individual's own name, regardless of such individual's authority, capacity or
purpose.
L. "Items of Deposit" means one or more checks or drafts.
M. "Investment Company" or "Fund" means an investment company registered under
the Investment Company Act of 1940.
N. "Limit of Liability" means, with respect to any Insuring Agreement, the
limit of liability of the Underwriter for any Single Loss covered by such
Insuring Agreement as set forth under the heading "Limit of Liability" in
Item 3 of the Declarations or in any Rider for such Insuring Agreement.
0. "Mysterious Disappearance" means any disappearance of Property which,
after a reasonable investigation has been conducted, cannot be explained.
P. "Non-Fund" means any corporation, business trust, partnership, trust or
other entity which is not an Investment Company.
Q. "Phone/Electronic Transaction Security Procedures" means security procedures
for Phone/ Electronic Transactions as provided in writing to the Underwriter.
R. "Phone/Electronic Transaction" means any ( I ) redemption of shares issued
by an Investment Company, (2) election concerning dividend options available to
Fund shareholders, (3) exchange of shares in a registered account of one Fund
into shares in an identically registered account of another Fund in the same
complex pursuant to exchange privileges of the two Funds, or (4) purchase of
shares issued by an Investment Company, which redemption, election, exchange
or purchase is requested by voice over the telephone or through an Electronic
Transmission.
S. "Property" means the following tangible items: money, postage and revenue
stamps, precious metals, Securities, bills of exchange, acceptances, checks,
drafts, or other written orders or directions to pay sums certain in money,
certificates of deposit, due bills, money orders, letters of credit, financial
futures contracts, conditional sales contracts, abstracts of title, insurance
policies, deeds, mortgages, and assignments of any of the foregoing, and other
valuable papers, including books of account and other
records used by the Insured in the conduct of its business, and all other
instruments similar to or in the nature of the foregoing (but excluding all
data processing records), (1) in which the Insured has a legally
cognizable interest, (2) in which the Insured acquired or should have acquired
such an interest by reason of a predecessor's declared financial condition at
the time of the Insured's consolidation or merger with, or purchase of the
principal assets of, such predecessor or (3) which are held by the Insured for
any purpose or in any capacity.
T. "Securities" means original negotiable or non-negotiable agreements or
instruments which represent an equitable or legal interest, ownership or debt
(including stock certificates, bonds, promissory notes, and assignments
thereof), which are in the ordinary course of business
and transferable by physical delivery with appropriate endorsement or
assignment. "Securities" does not include bills of exchange, acceptances,
certificates of deposit, checks, drafts, or other written orders or directions
to pay sums certain in money, due bills, money orders, or letters of credit.
U. "Security Company" means an entity which provides or purports to provide
the transport of Property by secure means, including, without limitation, by
use of armored vehicles or guards.
V. "Self Regulatory Organization" means any association of investment advisers
or securities dealers registered under the federal securities laws, or any
Exchange.
W. "Shareholder of Record" means the record owner of shares issued by an
Investment Company or, in the case of joint ownership of such shares, all
record owners, as designated (1) in the initial account application, or
(2) in writing accompanied by a signature guarantee, or (3) pursuant to
procedures as set forth in the Application.
X. "Single Loss" means:
(1) all loss resulting from any one actual or attempted Theft committed by
one person, or
(2) all loss caused by any one act (other than a Theft or a Dishonest or
Fraudulent Act) committed by one person, or
(3) all loss caused by Dishonest or Fraudulent Acts committed by one
person, or
(4) all expenses incurred with respect to any one audit or examination, or
(5) all loss caused by any one occurrence or event other than those specified
in subsections (1) through (4) above.
All acts or omissions of one or more persons which directly or indirectly aid
or, by failure to report or otherwise, permit the continuation of an act
referred to in subsections (1) through (3) above of any other person shall be
deemed to be the acts of such other person for purposes of this subsection.
All acts or occurrences or events which have as a common nexus any fact,
circumstance, situation, transaction or series of facts, circumstances,
situations, or transactions shall be deemed to be one act, one occurrence,
or one event.
Y. "Telefacsimile" means a system of transmitting and reproducing fixed
graphic material (as, for example, printing) by means of signals transmitted
over telephone lines or over the Internet.
Z. "Theft" means robbery, burglary or hold-up, occurring with or without
violence or the threat of violence.
SECTION 2. EXCLUSIONS
THIS BOND DOES NOT COVER:
A. Loss resulting from (1) riot or civil commotion outside the United States
of America and Canada, or (2) war, revolution, insurrection, action by armed
forces, or usurped power, wherever occurring; except if such loss occurs while
the Property is in transit, is otherwise covered under Insuring Agreement D,
and when such transit was initiated, the Insured or any person
initiating such transit on the Insured's behalf had no knowledge of such riot,
civil commotion, war, revolution, insurrection, action by armed forces, or
usurped power.
B. Loss in time of peace or war resulting from nuclear fission or fusion or
radioactivity, or biological or chemical agents or hazards, or fire, smoke, or
explosion, or the effects of any of the foregoing.
C. Loss resulting from any Dishonest or Fraudulent Act committed by any person
while acting in the capacity of a member of the Board of Directors or any
equivalent body of the Insured or of any other entity.
D. Loss resulting from any nonpayment or other default of any loan or similar
transaction made by the Insured or any of its partners, directors, officers or
employees, whether or not authorized and whether procured in good faith or
through a Dishonest or Fraudulent Act, unless such loss is otherwise covered
under Insuring Agreement A, E or F.
E. Loss resulting from any violation by the Insured or by any Employee of any
law, or any rule or regulation pursuant thereto or adopted by a Self Regulatory
Organization, regulating the issuance, purchase or sale of securities,
securities transactions upon security exchanges or over the counter markets,
Investment Companies, or investment advisers, unless such loss, in the absence
of such law, rule or regulation, would be covered under Insuring
Agreement A, E or F.
F. Loss resulting from Property that is the object of Theft, Dishonest or
Fraudulent Act, or Mysterious Disappearance while in the custody of any
Security Company, unless such loss is covered under this Bond and is in excess
of the amount recovered or received by the Insured under (1) the Insured's
contract with such Security Company, and (2) insurance or indemnity of any kind
carried by such Security Company for the benefit of, or otherwise
available to, users of its service, in which case this Bond shall cover only
such excess, subject to the applicable Limit of Liability and Deductible
Amount.
G. Potential income, including but not limited to interest and dividends,
not realized by the Insured because of a loss covered under this Bond, except
when covered under Insuring Agreement H.
H. Loss in the form of (1) damages of any type for which the Insured is
legally liable, except direct compensatory damages, or (2) taxes, fines, or
penalties, including without limitation two-thirds of treble damage awards
pursuant to judgments under any statute or regulation.
I. Loss resulting from the surrender of Property away from an office of the
Insured as a result of a threat
(1) to do bodily harm to any person, except where the Property is in transit
in the custody of any person acting as messenger as a result of a threat to do
bodily harm to such person, if the Insured had no knowledge of such threat at
the time such transit was initiated, or
(2) to do damage to the premises or Property of the Insured, unless such loss
is otherwise covered under Insuring Agreement A.
J. All costs, fees and other expenses incurred by the Insured in
establishing the existence of or amount of loss covered under this Bond, except
to the extent certain audit expenses are covered under Insuring Agreement B.
K. Loss resulting from payments made to or withdrawals from any account,
involving funds erroneously credited to such account, unless such loss is
otherwise covered under Insuring Agreement A.
L. Loss resulting from uncollectible Items of Deposit which are drawn upon a
financial institution outside the United States of America, its territories and
possessions, or Canada.
M. Loss resulting from the Dishonest or Fraudulent Acts, Theft, or other acts
or omissions of an Employee primarily engaged in the sale of shares issued by
an Investment Company to persons other than (1) a person registered as a broker
under the Securities Exchange Act of 1934 or (2) an "accredited investor" as
defined in Rule 50 I (a) of Regulation D under the Securities Act of 1933,
which is not an individual.
N. Loss resulting from the use of credit, debit, charge, access, convenience,
identification, cash management or other cards, whether such cards were issued
or purport to have been issued by the Insured or by anyone else, unless such
loss is otherwise covered under Insuring Agreement A.
0. Loss resulting from any purchase, redemption or exchange of securities
issued by an Investment Company or other Insured, or any other instruction,
request, acknowledgement, notice or transaction invol ving securities issued by
an Investment Company or other Insured or the dividends in respect thereof,
when any of the foregoing is requested, authorized or directed or purported
to be requested, authorized or directed by voice over the telephone or by
Electronic Transmission, unless such loss is otherwise covered under
Insuring Agreement A or Insuring Agreement I.
P. Loss resulting from any Dishonest or Fraudulent Act or Theft committed
by an Employee as defined in Section 1 .1(2), unless such loss (I) could not
have been reasonably discovered by the due diligence of the Insured at or prior
to the time of acquisition by the Insured of the assets acquired from a
predecessor, and (2) arose out of a lawsuit or valid claim brought against
the Insured by a person unaffiliated with the Insured or with any person
affiliated with the Insured.
Q. Loss resulting from the unauthorized entry of data into, or the deletion or
destruction of data in, or the change of data elements or programs within, any
Computer System, unless such loss is otherwise covered under Insuring
Agreement A.
SECTION 3. ASSIGNMENT OF RIGHTS
Upon payment to the Insured hereunder for any loss, the Underwriter shall be
subrogated to the extent of such payment to all of the Insured' s rights and
claims in connection with such loss; provided, however, that the Underwriter
shall not be subrogated to any such rights or claims one named Insured under
this Bond may have against another named Insured under this Bond. At the
request of the Underwriter, the Insured shall execute all assignments or other
documents and take such action as the Underwriter may deem necessary or
desirable to secure and perfect such rights and claims, including the execution
of documents necessary to enable the Underwriter to bring suit in the name of
the Insured.
Assignment of any rights or claims under this Bond shall not bind the
Underwriter without the Underwriter's written consent.
SECTION 4. LOSS-NOTICE-PROOF-LEGAL PROCEEDINGS
This Bond is for the use and benefit only of the Insured and the Underwriter
shall not be liable hereunder to anyone other than the Insured. As soon as
practicable and not more than sixty (60) days after discovery, the Insured
shall give the Underwriter written notice thereof and, as soon as practicable
and within one year after such discovery, shall also furnish to the Underwriter
affirmative proof of loss with full particulars. The Underwriter may extend the
sixty day notice period or the one year proof of loss period if the Insured
requests an extension and shows good cause therefor.
See also General Agreement C (Court Costs and Attorneys' Fees).
The Underwriter shall not be liable hereunder for loss of Securities unless
each of the Securities is identified in such proof of loss by a certificate or
bond number or by such identification means as the Underwriter may require. The
Underwriter shall have a reasonable period after receipt of a proper
affirmative proof of loss within which to investigate the claim, but where the
Property is Securities and the loss is clear and undisputed, settlement shall
be made within forty-eight (48) hours even if the loss involves Securities of
which duplicates may be obtained.
The Insured shall not bring legal proceedings against the Underwriter to
recover any loss hereunder prior to sixty (60) days after filing such proof of
loss or subsequent to twenty-four (24) months after the discovery of such loss
or, in the case of a legal proceeding to recover hereunder on account of any
judgment against the Insured in or settlement of any suit mentioned in General
Agreement C or to recover court costs or attorneys' fees paid in any such suit,
twenty-four (24) months after the date of the final judgment in or settlement
of such suit. If any limitation in this Bond is prohibited by any applicable
law, such limitation shall be deemed to be amended to be equal to the
minimum period of limitation permitted by such law.
Notice hereunder shall be given to Manager, Professional Liability Claims,
ICI Mutual Insurance Company, 1401 H St. NW, Washington, DC 20005.
SECTION 5. DISCOVERY
For all purposes under this Bond, a loss is discovered, and discovery of a
loss occurs, when the Insured
(1) becomes aware of facts, or
(2) receives notice of an actual or potential claim by a third party which
alleges that the Insured is liable under circumstances, which would cause a
reasonable person to assume that loss covered by this Bond has been or is
likely to be incurred even though the exact amount or details of loss may not
be known.
SECTION 6. VALUATION OF PROPERTY
For the purpose of determining the amount of any loss hereunder, the value of
any Property shall be the market value of such Property at the close of
business on the first business day before the discovery of such loss;
except that
(1) the value of any Property replaced by the Insured prior to the payment
of a claim therefor shall be the actual market value of such Property at the
time of replacement, but not in excess of the market value of such Property on
the first business day before the discovery of the loss of such Property;
(2) the value of Securities which must be produced to exercise subscription,
conversion, redemption or deposit privileges shall be the market value of such
privileges immediately preceding the expiration thereof if the loss of such
Securities is not discovered until after such expiration, but if there is no
quoted or other ascertainable market price for such Property or privileges
referred to in clauses (I) and (2), their value shall be fixed by agreement
between the parties or by arbitration before an arbitrator or
arbitrators acceptable to the parties; and
(3) the value of books of accounts or other records used by the Insured in
the conduct of its business shall be limited to the actual cost of blank books,
blank pages or other materials if the books or records are reproduced plus the
cost of labor for the transcription or copying of data furnished by the
Insured for reproduction.
SECTION 7. LOST SECURITIES
The maximum liability of the Underwriter hereunder for lost Securities shall
be the payment for, or replacement of, such Securities having an aggregate
value not to exceed the applicable Limit of Liability. If the Underwriter shall
make payment to the Insured for any loss of Securities, the Insured shall
assign to the Underwriter all of the Insured's right,
title and interest in and to such Securities. In lieu of such payment, the
Underwriter may, at its option, replace such lost Securities, and in such case
the Insured shall cooperate to effect such replacement. To effect the
replacement of lost Securities, the Underwriter may issue
or arrange for the issuance of a lost instrument bond. If the value of such
Securities does not exceed the applicable Deductible Amount (at the time of the
discovery of the loss), the Insured will pay the usual premium charged for the
lost instrument bond and will indemnify the issuer of such bond against all
loss and expense that it may sustain because of the issuance of such bond.
If the value of such Securities exceeds the applicable Deductible Amount (at
the time of discovery of the loss), the Insured will pay a proportion of the
usual premium charged for the lost instrument bond, equal to the percentage
that the applicable Deductible Amount bears to the value of such Securities
upon discovery of the loss, and will indemnify the issuer of such bond against
all loss and expense that is not recovered from the Underwriter under the terms
and conditions of this Bond, subject to the applicable Limit of Liability.
SECTION 8. SALVAGE
If any recovery is made, whether by the Insured or the Underwriter, on account
of any loss within the applicable Limit of Liability hereunder, the Underwriter
shall be entitled to the full amount of such recovery to reimburse the
Underwriter for all amounts paid hereunder with respect to such loss. If any
recovery is made, whether by the Insured or the Underwriter, on account of any
loss in excess of the applicable Limit of Liability hereunder plus the
Deductible Amount applicable to such loss from any source other than
suretyship, insurance, reinsurance, security or indemnity taken by or for the
benefit of the Underwriter, the amount of such recovery, net of the actual
costs and expenses of recovery, shall be applied to
reimburse the Insured in full for the portion of such loss in excess of such
Limit of Liability, and the remainder, if any, shall be paid first to reimburse
the Underwriter for all amounts paid hereunder with respect to such loss and
then to the Insured to the extent of the portion of such loss within the
Deductible Amount. The Insured shall execute all documents which the
Underwriter deems necessary or desirable to secure to the Underwriter the
rights provided for herein.
SECTION 9. NON-REDUCTION AND NON-ACCUMULATION OF LIABILITY AND TOTAL LIABILITY
Prior to its termination, this Bond shall continue in force up to the Limit of
Liability for each Insuring Agreement for each Single Loss, notwithstanding any
previous loss (other than such Single Loss) for which the Underwriter may have
paid or be liable to pay hereunder; PROVIDED, however, that regardless of the
number of years this Bond shall continue in force and the number of
premiums which shall be payable or paid, the liability of the Underwriter under
this Bond with respect to any Single Loss shall be limited to the applicable
Limit of Liability irrespective of the total amount of such Single Loss and
shall not be cumulative in amounts from year to year or from period to period.
SECTION 10. MAXIMUM LIABILITY OF UNDERWRITER; OTHER BONDS OR POLICIES
The maximum liability of the Underwriter for any Single Loss covered by any
Insuring Agreement under this Bond shall be the Limit of Liability applicable
to such Insuring Agreement, subject to the applicable Deductible Amount and the
other provisions of this Bond. Recovery for any Single Loss may not be made
under more than one Insuring Agreement. If any Single Loss covered under this
Bond is recoverable or recovered in whole or in part because of an unexpired
discovery period under any other bonds or policies issued by the Underwriter to
the Insured or to any predecessor in interest of the Insured, the maximum
liability of the Underwriter shall be the greater of either (1) the applicable
Limit of Liability under this Bond, or (2) the maximum liability of the
Underwriter under such other bonds or policies.
SECTION 11. OTHER INSURANCE
Notwithstanding anything to the contrary herein, if any loss covered by this
Bond shall also be covered by other insurance or suretyship for the benefit
of the Insured, the Underwriter shall be liable hereunder only for the portion
of such loss in excess of the amount recoverable under such other insurance or
suretyship, but not exceeding the applicable Limit of Liability of this Bond.
SECTION 12. DEDUCTIBLE AMOUNT
The Underwriter shall not be liable under any Insuring Agreement unless the
amount of the loss covered thereunder, after deducting the net amount of all
reimbursement and/or recovery received by the Insured with respect to such loss
(other than from any other bond, suretyship or insurance policy or as an
advance by the Underwriter hereunder) shall exceed the applicable Deductible
Amount; in such case the Underwriter shall be liable only for such excess,
subject to the applicable Limit of Liability and the other terms of this Bond.
No Deductible Amount shall apply to any loss covered under Insuring Agreement
A sustained by any Investment Company named as an Insu red.
SECTION 13. TERMINATION
The Underwriter may terminate this Bond as to any Insured or all Insureds only
by written notice to such Insured or Insureds and, if this Bond is terminated
as to any Investment Company, to each such Investment Company terminated
thereby and to the Securities and Exchange Commission, Washington, D.C., in
all cases not less than sixty (60) days prior to the effecti ve date of
termination specified in such notice.
The Insured may terminate this Bond only by written notice to the Underwriter
not less than sixty (60) days prior to the effective date of the termination
specified in such notice. Notwithstanding the foregoing, when the Insured
terminates this Bond as to any Investment Company, the effective date of
termination shall be not less than sixty (60) days from the date the
Underwriter provides written notice of the termination to each such Investment
Company terminated thereby and to the Securities and Exchange Commission,
Washington, D.C.
This Bond will terminate as to any Insured that is a Non-Fund immediately and
without notice upon (I ) the takeover of such Insured's business by any State
or Federal official or agency, or by any receiver or liquidator, or (2) the
filing of a petition under any State or Federal statute relative to bankruptcy
or reorganization of the Insured, or assignment for the benefit of creditors of
the Insured.
Premiums are earned until the effective date of termination. The Underwriter
shall refund the unearned premium computed at short rates in accordance with
the Underwriter's standard short rate cancellation tables if this Bond is
terminated by the Insured or pro rata if this Bond is terminated by the
Underwriter.
Upon the detection by any Insured that an Employee has committed any
Dishonest or Fraudulent Act(s) or Theft, the Insured shall immediately remove
such Employee from a position that may enable such Employee to cause the
Insured to suffer a loss by any subsequent Dishonest or Fraudulent Act(s) or
Theft. The Insured, within two (2) business days of such detection, shall
notify the Underwriter with full and complete particulars of the detected
Dishonest or Fraudulent Act(s) or Theft.
For purposes of this section, detection occurs when any partner, officer, or
supervisory employee of any Insured, who is not in collusion with such
Employee, becomes aware that the Employee has committed any Dishonest or
Fraudulent Act(s) or Theft.
This Bond shall terminate as to any Employee by written notice from the
Underwriter to each Insured and, if such Employee is an Employee of an Insured
Investment Company, to the Securities and Exchange Commission, in all cases
not less than sixty (60) days prior to the effective date of termination
specified in such notice.
SECTION 14. RIGHTS AFTER TERMINATION
At any time prior to the effective date of termination of this Bond as to any
Insured, such Insured may, by written notice to the Underwriter, elect to
purchase the right under this Bond to an additional period of twelve (12)
months within which to discover loss sustained by
such Insured prior to the effective date of such termination and shall pay an
additional premium therefor as the Underwriter may require.
Such additional discovery period shall terminate immediately and without notice
upon the takeover of such lnsured's business by any State or Federal official
or agency, or by any receiver or liquidator. Promptly after such termination
the Underwriter shall refund to the Insured any unearned premium.
The right to purchase such additional discovery period may not be exercised by
any State or Federal official or agency, or by any receiver or liquidator,
acting or appointed to take over the Insured's business.
SECTION 15. CENTRAL HANDLING OF SECURITIES
The Underwriter shall not be liable for loss in connection with the central
handling of securities within the systems established and maintained by any
Depository ("Systems"), unless the amount of such loss exceeds the amount
recoverable or recovered under any bond or policy or participants' fund
insuring the Depository against such loss (the "Depository's
Recovery"); in such case the Underwriter shall be liable hereunder only for
the Insured's share of such excess loss, subject to the applicable Limit of
Liability, the Deductible Amount and the other terms of this Bond.
For determining the Insured's share of such excess loss, (1) the Insured
shall be deemed to have an interest in any certificate representing any
security included within the Systems equivalent to the interest the Insured
then has in all certificates representing the same
security included within the Systems; (2) the Depository shall have reasonably
and fairly apportioned the Depository's Recovery among all those having an
interest as recorded by appropriate entries in the books and records of the
Depository in Property involved in such loss, so that each such interest shall
share in the Depository's Recovery in the ratio that the
value of each such interest bears to the total value of all such interests;
and (3) the Insured's share of such excess loss shall be the amount of the
Insured's interest in such Property in excess of the amount(s) so apportioned
to the Insured by the Depository.
This Bond does not afford coverage in favor of any Depository or Exchange or
any nominee in whose name is registered any security included within the
Systems.
SECTION 16. ADDITIONAL COMPANIES INCLUDED AS INSURED
If more than one entity is named as the Insured:
A. the total liability of the Underwriter hereunder for each Single Loss shall
not exceed the Limit of Liability which would be applicable if there were only
one named Insured,regardless of the number of Insured entities which sustain
loss as a result of such Single Loss,
B. the Insured first named in Item I of the Declarations shall be deemed
authorized to make, adjust, and settle, and receive and enforce payment of,
all claims hereunder as the agent of each other Insured for such purposes and
for the giving or receiving of any notice required or permitted to be given
hereunder; provided, that the Underwriter shall
promptly furnish each named Insured Investment Company with (1) a copy of this
Bond and any amendments thereto, (2) a copy of each formal filing of a claim
hereunder by any other Insured, and (3) notification of the terms of the
settlement of each such claim prior to the execution of such settlement,
C. the Underwriter shall not be responsible or have any liability for the
proper application by the Insured first named in Item I of the Declarations
of any payment made hereunder to the first named Insured,
D. for the purposes of Sections 4 and 13, knowledge possessed or discovery
made by any partner, officer or supervisory Employee of any Insured shall
constitute knowledge or discovery by every named Insured,
E. if the first named Insured ceases for any reason to be covered under this
Bond, then the Insured next named shall thereafter be considered as the first
named Insured for the purposes of this Bond, and
F. each named Insured shall constitute "the Insured" for all purposes of this
Bond.
SECTION 17. NOTICE AND CHANGE OF CONTROL
Within thirty (30) days after learning that there has been a change in
control of an Insured by transfer of its outstanding voting securities the
Insured shall give written notice to the Underwriter of:
A. the names of the transferors and transferees (or the names of the beneficial
owners if the voting securities are registered in another name), and
B. the total number of voting securities owned by the transferors and the
transferees (or the beneficial owners), both immediately before and after the
transfer, and
C. the total number of outstanding voting securities.
As used in this Section, "control" means the power to exercise a controlling
influence over the management or policies of the Insured.
SECTION 18. CHANGE OR MODIFICATION
This Bond may only be modified by written Rider forming a part hereof over the
signature of the Underwriter's authorized representative. Any Rider which
modifies the coverage provided by Insuring Agreement A, Fidelity, in a manner
which adversely affects the rights of an Insured Investment Company shall not
become effective until at least sixty (60) days after the Underwriter has given
written notice thereof to the Securities and Exchange Commission,
Washington, D.C., and to each Insured Investment Company affected thereby.
SECTION 19. COMPLIANCE WITH APPLICABLE TRADE AND ECONOMIC SANCTIONS
This Bond shall not be deemed to provide any coverage, and the Underwriter
shall not be required to pay any loss or provide any benefit hereunder, to
the extent that the provision of such coverage, payment of such loss or
provision of such benefit would cause
the Underwriter to be in violation of any applicable trade or economic
sanctions, laws or regulations, including, but not limited to, any sanctions,
laws or regulations administered and enforced by the U.S. Department of
Treasury Office of Foreign Assets Control (OFAC).
IN WITNESS WHEREOF, the Underwriter has caused this Bond to be executed on
the Declarations Page.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER N0. 1
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
In consideration of the premiu m charged for this Bond, it is hereby
understood and agreed that Item 1 of the Declarations, Name of Insured, shall
include the following:
State Farm Mutual Automobile Insurance Company
State Farm Associates' Funds Trust, a series fund consisting of:
o State Farm Balanced Fund
o State Farm Growth Fund
o State Farm Interim Fund
o State Farm Municipal Bond Fund
State Farm Mutual Fund Trust, a series fund consisting of:
o State Farm Bond Fund
o State Farm Equity and Bond Fund
o State Farm Equity Fund
o State Farm International Equity Fund
o State Farm International Index Fund
o State Farm LifePath 2020 Fund
o State Farm LifePath 2030 Fund
o State Farm LifePath 2040 Fund
o State Farm LifePath 2050 Fund
o State Farm LifePath Retirement Fund
o State Farm Money Market Fund
o State Farm S&P 500 Index Fund
o State Farm Small/Mid Cap Equity Fund
o State Farm Small Cap Index Fund
o State Farm Tax Advantage Bond Fund
State Farm Variable Product Trust, a series fund consisting of:
o VP Bond Fund
o VP International Equity Fund
o VP International Equity Index Fund
o VP Large Cap Equity Fund
o VP Large Cap Equity Index Fund
o VP Money Market Fund
o VP Small/Mid Cap Equity Fund
o VP Small Cap Equity Index Fund
o VP Stock and Bond Balanced Fund
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER N0. 2
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
In consideration of the premium charged for this Bond, it is hereby understood
and agreed that this Bond (other than Insuring Agreements C and D) does not
cover loss resulting from or in connection with any business, activities, or
acts or omissions of (including services rendered by) any Insured which is not
an Insured Fund ("Non-Fund") or any Employee of a Non-Fund, except loss,
otherwise covered by the terms of this Bond, resulting from or in connection
with (1) services rendered by a Non-Fund to an Insured Fund, or to
shareholders of such Fund in connection with the issuance, transfer, or
redemption of their Fund shares, or (2) in the case of a Non-Fund substantially
all of whose business is rendering the services described in (1) above, the
general business, activities or operations of such Non-Fu nd, excluding (a)
the rendering of services (other than those described in (1) above) to any
person, or (b) the sale of goods or property of any kind.
It is further understood and agreed that with respect to any Non-Fund, Insuring
Agreements C and D only cover loss of Property which a Non-Fu nd uses or holds,
or in which a Non-Fund has an interest, in each case wholly or partially in
connection with the rendering of services by a Non-Fund to an Insured Fund,
or to shareholders of such Fund in connection with the issuance, transfer,
or redemption of their Fund shares.
Except as above stated, nothing herein shall be held to alter, waive or extend
any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 3
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
'
In consideration of the premium charged for this Bond, it is hereby understood
and agreed that the exclusion set forth at Section 2.M of this Bond shall not
apply with respect to loss resulting from the Dishonest or Fraudulent Acts,
Theft, or other acts or omissions of an Employee in connection with offers or
sales of securities issued by an Insured Fund if such Employee (a) is an
employee of that Fund or of its investment adviser, principal underwriter,
or affiliated transfer agent, and (b) is communicating with purchasers of such
securities only by telephone or in writi ng, and (c) does not receive
commissions on such sales; provided, that such Dishonest or Fraudulent Acts,
Theft, or other acts or omissions do not involve, and such loss does not
arise from, a statement or representation which is not (1) contained in a
currently effective prospectus or statement of additional information
regarding such securities, which has been filed with the
Securities and Exchange Commission, or (2) made as part of a scripted response
to a question regarding that Fund or such securities, if the script has been
filed with, and not objected to by, the Financial Industry Regulatory
Authority; and if the entire scripted response has been read to the caller,
and if any response concerning the performance of such securities is not
outdated.
Except as above stated, nothing herein shall be held to alter, waive or extend
any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER N0. 4
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
In consideration of the premium charged for this Bond, it is hereby understood
and agreed that the Deductible Amou nt for Insuring Agreement E, Forgery or
Alteration, and Insuring Agreement F, Securities, shall not apply with respect
to loss through Forgery of a signature on the following documents:
(1) letter requesting redemption of $50,000 or less payable by check to
the shareholder of record and addressed to the address of record; or
(2) letter requesting redemption of $50,000 or less by wire transfer to the
record shareholder's bank account of record; or
(3) written request to a trustee or custodian for a Designated Retirement
Account ("DRA") which holds shares of an Insured Fund, where such
request (a) purports to be from or at the instruction of the Owner of
such ORA, and (b) directs such trustee or custodian to transfer $50,000
or less from such ORA to a trustee or custodian for another ORA
established for the benefit of such Owner;
provided, that the Limit of Liability for a Single Loss as described above
shall be $50,000 and that the Insured shall bear 20% of each such loss. This
Rider shall not apply in the case of any such Single Loss which exceeds
$50,000; in such case the Deductible Amounts and Limits of Liability set forth
in Item 3 of the Declarations shall control.
For purposes of this Rider:
(A) "Designated Retirement Account" means any retirement plan or account
described or qualified under the Internal Revenue Code of 1986,
as amended, or a subaccount thereof.
(B) "Owner" means the individual for whose benefit the DRA, or a
subaccount thereof, is established.
Except as above stated, nothing herein shall be held to alter, waive or extend
any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 5
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
In consideration of the premium charged for this Bond. it is hereby understood
and agreed that this Bond does not cover any loss resulting from or in
connection with the acceptance of any Third Party Check, unless
(l) such Third Party Check is used to open or increase an account which is
registered in the name of one or more of the payees on such Third Party
Check, and
(2) reasonable efforts are made by the Insured , or by the entity receiving
Third Party Checks on behalf of the Insured, to verify all endorsements on all
Third Party Checks made payable in amounts greater than $100,000
(provided, however, that the isolated failure to make such efforts in a
particular instance will not preclude coverage, subject to the exclusions
herein and in the Bond),
and then only to the extent such loss is otherwise covered under this Bond.
For purposes of this Rider, "Third Party Check" means a check made payable to
one or more parties and offered as payment to one or more other parties.
It is further understood and agreed that notwithstanding anything to the
contrary above or elsewhere in the Bond, this Bond does not cover any loss
resulting from or in connection with the acceptance of a Third Party
Check where:
(1) any payee on such Third Party Check reasonably appears to be a corporation
or other entity; or
(2) such Third Party Check is made payable in an amount greater than $100,000
and does not include the purported endorsements of all payees on such
Third Party Check.
It is further understood and agreed that this Rider shall not apply with
respect to any coverage that may be available under Insuring Agreement A,
"Fidelity."
Except as above stated, nothing herein shall be held to alter, waive or extend
any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 6
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
In consideration for the premium charged for this Bond, it is hereby
understood and agreed that, with respect to Insuring Agreement I only, the
Deductible Amount set forth in Item 3 of the Declarations ("Phone/Electronic
Deductible") shall not apply with respect to a Single Loss, otherwise covered
by Insuring Agreement I, caused by:
(1) a Phone/Electronic Redemption requested to be paid or made payable by
check to the Shareholder of Record at the address of record; or
(2) a Phone/Electronic Redemption requested to be paid or made payable by
wire transfer to the Shareholder of Record's bank account of record,
provided, that the Limit of Liability for a Single Loss as described in (1)
or (2) above shall be the lesser of 80% of such loss or $40,000 and that the
Insured shall bear the remainder of each such Loss. This Rider shall not apply
if the application of the Phone/Electronic Deductible to the Single Loss would
result in coverage of greater than $40,000 or more; in such case the
Phone/Electronic Deductible and Limit of Liability set forth in Item 3 of the
Declarations shall control.
For purposes of this Rider, "Phone/Electronic Redemption" means any redemption
of shares issued by an Investment Company, which redemption is requested
(a) by voice over the telephone, or (b) through an automated telephone tone
or voice response system.
Except as above stated, nothing herein shall be held to alter, waive or extend
any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 7
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
In consideration of the premium charged for this Bond, it is hereby understood
and agreed that notwithstanding anything to the contrary in this
Bond (including Insuring Agreement I), this Bond does not cover loss caused
by a Phone/Electronic Transaction requested:
by transmissions over the Internet (including any connected or
associated intranet or extranet) or utilizing modem or similar
connections; or
by telefacsimile
except insofar as such loss is covered under Insuri ng Agreement A "Fidelity"
of this Bond.
Except as above stated, nothing herei n shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 8
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
Most property and casualty insurers, including ICI Mutual Insurance
Company, a Risk Retention Group ("ICI Mutual"), are subject to the
requirements of the Terrorism Risk Insurance Act of 2002, as amended (the
"Act"). The Act establishes a federal insurance backstop under which ICI
Mutual and these other insurers will be partially reimbursed for future
"insured losses" resulting from certified "acts of terrorism." (Each of these
bolded terms is defined by the Act.) The Act also places certain disclosure
and other obligations on ICI Mutual and these other insurers.
Pursuant to the Act, any future losses to ICI Mutual caused by certified "acts
of terrorism" will be partially reimbursed by the United States government
under a formula established by the Act. Under this formula, the United States
government will reimburse ICI Mutual for the Federal Share of Compensation
of ICI Mutual's "insured losses" in excess of ICI Mutual's "insurer
deductible" until total "insured losses" of all participating insurers in
excess of a statutorily established aggregate deductible reach the Cap on
Annual Liability. If total "insured losses" of all property and casualty
insurers in excess of a statutorily established aggregate deductible reach
the Cap on Annual Liability during any applicable period, the Act provides
that the insurers will not be liable under their bonds for their portions
of such losses that exceed such amount. Amounts otherwise payable under
this policy may be reduced as a result.
This policy has no express exclusion for "acts of terrorism."However, coverage
under this policy remains subject to all applicable terms, conditions and
limitations of the policy (including exclusions) that are permissible under the
Act. The portion of the premium that is attributable to any coverage
potentially available under the policy for "acts of terrorism" is
one percent (1%).
As used herein, "Federal Share of Compensation" shall mean:
85% in calendar year 2015;
84% in calendar year 2016;
83% in calendar year 2017;
82% in calendar year 2018;
81% in calendar year 2019; and
80% in calendar year 2020.
As used herein, "Cap on Annual Liability" shall mean, with respect to total
"insured losses" of all participating insurers:
$100 billion in calendar year 2015;
$120 billion in calendar year 2016;
$140 billion in calendar year 2017;
$160 billion in calendar year 2018;
$180 billion in calendar year 2019; and
$200 billion in calendar year 2020.
ICI MUTUAL INSURANCE COMPANY,
a Risk Retention Group
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 9
INSURED BOND NUMBER
State Farm Investment Management Corporation 87036117B
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
April 1, 2017 April 1, 2017 to April 1, 2018 /S/Swenitha Nalli
In consideration of the premium charged for this Bond, it is hereby understood
and agreed that notwithstanding Section 2.Q of this Bond, this Bond is amended
by adding an additional Insuring Agreement J as follows:
J. COMPUTER SECURITY
Loss (including loss of Property) resulting directly from Computer Fraud;
provided that the Insured has adopted in writing and generally maintains and
follows during the Bond Period all Computer Security Procedures. The isolated
failure of the Insured to maintain and follow a particular Computer Security
Procedure in a particular instance will not preclude coverage under this
Insuring Agreement, subject to the specific exclusions herein and in the Bond.
l. Definitions. The following terms used in this Insuring Agreement shall
have the following meanings:
a. "Authorized User" means any person or entity designated by the Insured
(through contract, assignment of User Identification, or otherwise) as
authorized to use a Covered Computer System, or any part thereof. An
individual who invests in an In ured Fund shall not be considered to be an
Authorized User solely by virtue of being an investor.
b. "Computer Fraud" means the unauthorized entry of data into, or the deletion
or destruction of data in, or change of data elements or programs within, a
Covered Computer System which:
(1) is committed by any Unauthorized Third Party anywhere , alone or in
collusion with other Unauthorized Third Parties; and
(2) is committed with the conscious manifest intent (a) to cause the Insured to
sustain a loss, and (b) to obtain financial benefit for the perpetrator or any
other person; and
(3) causes (x) Property to be transferred, paid or delivered; or (y) an
account of the Insured, or of its customer, to be added, deleted,
debited or credited; or (z) an unauthorized or fictitious account to be
debited or credited.
c. "Computer Security Procedures" means procedures for prevention of
unauthorized computer access and use and administration of computer access
and use as provided in writing to the Underwriter.
d. "Covered Computer System" means any Computer System as to which the
Insured has possession, custody and control.
e. "Unauthorized Third Party" means any person or entity that, at the time
of the Computer Fraud, is not an Authorized User.
f. "User Identification" means any unique user name (i.e., a series of
characters) that is assigned to a person or entity by the Insured.
2. Exclusions. It is further understood and agreed that this Insuring
Agreement J shall not cover:
a. Any loss covered u nder Insuring Agreement A, "Fidelity," of this Bond; and
b. Any loss resulti ng directly or indirectly from Theft or misappropriation of
confidential or proprietary information, material or data (including but not
limited to trade secrets, computer programs or customer information); and
c. Any loss resulting from the intentional failure to adhere to one or more
Computer Security Procedures; and
d. Any loss resulting from a Computer Fraud committed by or in
collusion with: (1) any Authorized User (whether a natural person or an
entity); or (2) in the case of any Authorized User which is an entity, (a) any
director, officer, partner, employee or agent of such Authorized
User, or (b) any entity which controls, is controlled by, or is
under common control with such Authorized User ("Related
Entity"), or (c) any director, officer, partner, employee or agent of
such Related Entity; or
(3) in the case of any Authorized User who is a natural person, (a)
any entity for which such Authorized User is a director, officer,
partner, employee or agent ("Employer Entity"), or (b) any
director, officer, partner, employee or agent of such Employer
Entity, or (c) any entity which controls, is controlled by, or is
under common control with such Employer Entity ("Employer-
Related Entity"), or (d) any director, officer, partner, employee or
agent of such Employer-Related Entity;
e. Any loss resulting from physical damage to or destruction of any Covered
Computer System, or any part thereof, or any data, data elements or media
associated therewith; and
f. Any loss not directly and proximately caused by Computer Fraud (including,
without limitation, disruption of business and extra expense); and
g. Payments made to any person(s) who has threatened to deny or has denied
authorized access to a Covered Computer System or otherwise has threatened to
disrupt the business of the Insured.
For purposes of this Insuring Agreement, "Single Loss," as defined in Section
1 .X of this Bond, shall also include all loss caused by Computer Fraud(s)
committed by one person, or in which one person is implicated, whether or
not that person is specifically identified. A series of losses involving
unidentified individuals, but arising from the same method
of operation, may be deemed by the Underwriter to involve the same individual
and in that event shall be treated as a Single Loss.
It is further understood and agreed that nothing in this Rider shall affect
the exclusion set forth in Section 2.0 of this Bond.
Coverage under this Insuring Agreement shall terminate upon termination of
this Bond. Coverage under this Insuring Agreement may also be terminated
without terminating this Bond as an entirety:
(a) by written notice from the Underwriter not less than sixty (60) days
prior to the effective date of termination specified in such notice; or
(b) immediately by written notice from the Insured to the Underwriter.
Except as above stated, nothing herein shall be held to alter, waive or extend
any of the terms of this Bond.
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