INVESTMENT COMPANY
BLANKET BOND
NATIONAL UNION FIRE INSURANCE COMPANY
OF PITTSBURGH, PA.
(A Stock Insurance Company, Herein Called
the Underwriter)
DECLARATIONS
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Bond No.
94-555-89-72
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Item 1.
Name of Insured (herein called
Insured):
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BLUE CHIP VALUE FUND, INC.
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Principal Address
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1225 17
th
STREET
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26
th
Floor
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DENVER, CO 80202
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Item
2.
Bond
Period: from
12:01a.m.
November 15, 2008 to November 15, 2009
the effective date of the termination or cancellation of this bond,
standard time at the Principal Address as to each of said dates.
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Item 3.
Limit of Liability--Subject to Sections
9, 10 and 12 hereof,
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Amount
applicable to
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Limit of Liability
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Deductible
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Insuring
Agreement (A)-FIDELITY
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$600,000
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$0
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Insuring
Agreement (B)-AUDIT EXPENSE
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$600,000
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$0
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Insuring
Agreement (C)-ON PREMISES
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$600,000
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$0
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Insuring
Agreement (D)-IN TRANSIT
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$600,000
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$0
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Insuring
Agreement (E)-FORGERY OR ALTERATION
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$600,000
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$0
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Insuring
Agreement (F)-SECURITIES
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$600,000
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$0
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Insuring
Agreement (G)-COUNTERFEIT CURRENCY
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$600,000
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$0
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Insuring
Agreement (H)-STOP PAYMENT
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$100,000
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$0
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Insuring
Agreement (I)-UNCOLLECTIBLE ITEMS OF DEPOSIT
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$600,000
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$0
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Optional
Insuring Agreements and Coverages:
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Insuring
Agreement (J)-COMPUTER SYSTEMS FRAUD
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$600,000
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$0
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Insuring
Agreement (K)-UNAUTHORIZED SIGNATURES
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$600,000
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$0
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Insuring
Agreement (L)-VOICE INITIATED TRANSFERS
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$600,000
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$0
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Insuring
Agreement (M)-TELEFACSIMILE TRANSFER FRAUD
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$600,000
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$0
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If "Not Covered" is inserted above opposite any specified Insuring
Agreement or Coverage, such Insuring Agreement or Coverage and any other
reference thereto in this bond shall be deemed to be deleted therefrom.
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Item
4.
Offices or Premises Covered--Offices
acquired or established subsequent to the effective date of this bond
are covered according to the terms of General Agreement A. All the
Insured's offices or premises in existence at the time this bond
becomes effective are covered under this bond except the offices or
premises located as follows:
No Exceptions
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Item 5.
The liability of the
Underwriter is subject to the terms of the following riders attached hereto:
Riders
No. 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12
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Item
6.
The
Insured by the acceptance of this bond gives to the Underwriter terminating or
cancelling prior bond(s) or policy(ies) No.(s)
164-08-59
such
termination or cancellation to be effective as of the time this bond becomes
effective.
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By
____________________
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Authorized
Representative
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1
INVESTMENT
COMPANY BLANKET BOND
The Underwriter, in consideration of an agreed
premium, and subject to the Declarations made a part hereof, the General
Agreements, Conditions and Limitations and other terms of this bond, agrees
with the Insured, in accordance with the Insuring Agreements hereof to which an
amount of insurance is applicable as set forth in Item 3 of the Declarations
and with respect to loss sustained by the Insured at any time but discovered
during the Bond Period, to indemnify and hold harmless the Insured for:
INSURING
AGREEMENTS
(A) FIDELITY
Loss resulting from any
dishonest or fraudulent act(s), including Larceny or Embezzlement committed by
an Employee, committed anywhere and whether committed alone or in collusion
with others, including loss of Property resulting from such acts of an
Employee, which Property is held by the Insured for any purpose or in any
capacity and whether so held gratuitously or not and whether or not the Insured
is liable therefor.
Dishonest or fraudulent
act(s) as used in this Insuring Agreement shall mean only dishonest or
fraudulent act(s) committed by such Employee with the manifest intent:
(a)
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to cause the Insured to sustain such loss;
and
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(b)
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to obtain financial benefit for the
Employee, or for any other person or organization intended by the
Employee to receive such benefit, other than salaries, commissions,
fees, bonuses, promotions, awards, profit sharing, pensions or other
employee benefits earned in the normal course of employment.
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(B) AUDIT EXPENSE
Expense incurred by the
Insured for that part of the costs of audits or examinations required by any
governmental regulatory authority to be conducted either by such authority or
by an independent accountant by reason of the discovery of loss sustained by
the Insured through any dishonest or fraudulent act(s), including Larceny or
Embezzlement of any of the Employees. The total liability of the Underwriter
for such expense by reason of such acts of any Employee or in which such
Employee is concerned or implicated or with respect to any one audit or
examination is limited to the amount stated opposite Audit Expense in Item 3 of
the Declarations; it being understood, however, that such expense shall be
deemed to be a loss sustained by the Insured through any dishonest or
fraudulent act(s), including Larceny or Embezzlement of one or more of the
Employees and the liability under this paragraph shall be in addition to the
Limit of liability stated in Insuring Agreement (A) in Item 3 of the
Declarations.
(C) ON PREMISES
Loss of Property (occurring
with or without negligence or violence) through robbery, burglary, Larceny,
theft, holdup, or other fraudulent means, misplacement, mysterious
unexplainable disappearance, damage thereto or destruction thereof, abstraction
or removal from the possession, custody or control of the Insured, and loss of
subscription, conversion, redemption or deposit privileges through the
misplacement or loss of Property, while the Property is (or is supposed or
believed by the Insured to be) lodged or deposited within any offices or
premises located anywhere, except in an office listed in Item 4 of the
Declarations or amendment thereof or in the mail or with a carrier for hire
other than an armored motor vehicle company, for the purpose of transportation.
Offices and Equipment
(1)
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Loss of or damage to, furnishings,
fixtures, stationery, supplies or equipment, within any of the Insured's
offices covered under this bond caused by Larceny or theft in, or by
burglary, robbery or holdup of such office, or attempt thereat, or by
vandalism or malicious mischief; or
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(2)
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loss through damage to any such office by
Larceny or theft in, or by burglary, robbery or holdup of such office or
attempt thereat, or to the interior of any such office by vandalism or
malicious mischief provided, in any event, that the Insured is the owner
of such offices, furnishings, fixtures, stationery, supplies or
equipment or is legally liable for such loss or damage, always
excepting, however, all loss or damage through fire.
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2
(D) IN
TRANSIT
Loss of Property
(occurring with or without negligence or violence) through robbery, Larceny,
theft, holdup, misplacement, mysterious unexplainable disappearance, being lost
or otherwise made away with, damage thereto or destruction thereof, and loss of
subscription, conversion, redemption or deposit privileges through the
misplacement or loss of Property, while the Property is in transit anywhere in
the custody of any person or persons acting as messenger, except while in the
mail or with a carrier for hire, other than an armored motor vehicle company,
for the purpose of transportation, such transit to begin immediately upon
receipt of such Property by the transporting person or persons, and to end
immediately upon delivery thereof at destination.
(E) FORGERY OR ALTERATION
Loss through FORGERY or
ALTERATION of, on or in any bills of exchange, checks, drafts, acceptances,
certificates of deposit. promissory notes, or other written promises, orders or
directions to pay sums certain in money, due bills, money orders, warrants,
orders upon public treasuries, letters of credit, written instructions, advices
or applications directed to the Insured, authorizing or acknowledging the
transfer, payment, delivery or receipt of funds or Property, which instructions
or advices or applications purport to have been signed or endorsed by any
customer of the Insured, shareholder or subscriber to shares, whether
certificated or uncertificated, of any Investment Company or by any financial
or banking institution or stockbroker but which instructions, advices or
applications either bear the forged signature or endorsement or have been
altered without the knowledge and consent of such customer, shareholder or
subscriber to shares, whether certificated or uncertificated, of an Investment
Company, financial or banking institution or stockbroker, withdrawal orders or
receipts for the withdrawal of funds or 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, excluding,
however, any loss covered under Insuring Agreement (F) hereof whether or not
coverage for Insuring Agreement (F) is provided for in the Declarations of this
bond.
Any check or draft (a)
made payable to a fictitious payee and endorsed in the name of such fictitious
payee or (b) procured in a transaction with the maker or drawer thereof or with
one acting as an agent of such maker or drawer or anyone impersonating another
and made or drawn payable to the one so impersonated and endorsed by anyone
other than the one impersonated, shall be deemed to be forged as to such
endorsement.
Mechanically reproduced
facsimile signatures are treated the same as handwritten signatures.
(F) SECURITIES
Loss sustained by the
Insured, including loss sustained by reason of a violation of the constitution,
by-laws, rules or regulations of any Self Regulatory Organization of which the
Insured is a member or which would have been imposed upon the Insured by the
constitution, by-laws, rules or regulations of any Self Regulatory Organization
if the Insured had been a member thereof,
(1)
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through the Insureds having, in good
faith and in the course of business, whether for its own account or for
the account of others, in any representative, fiduciary, agency or any
other capacity, either gratuitously or otherwise, purchased or otherwise
acquired, accepted or received, or sold or delivered, or given any
value, extended any credit or assumed any liability, on the faith of, or
otherwise acted upon, any securities, documents or other written
instruments which prove to have been
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(a)
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counterfeited,
or
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(b)
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forged
as to the signature of any maker, drawer, issuer, endorser, assignor, lessee,
transfer agent or registrar, acceptor, surety or guarantor or as to the
signature of any person signing in any other capacity, or
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(c)
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raised
or otherwise altered, or lost, or stolen, or
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(2)
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through the Insureds having, in good faith
and in the course of business, guaranteed in writing or witnessed any
signatures whether for valuable consideration or not and whether or not
such guaranteeing or witnessing is ultra vires the
Insured, upon any transfers, assignments, bills of sale, powers of attorney,
guarantees, endorsements or other obligations upon or in connection with any
securities, documents or other written instruments and which pass or purport to
pass title to such securities, documents or other written instruments;
EXCLUDING, losses caused by FORGERY or ALTERATION of, on or in those instruments
covered under Insuring Agreement (E) hereof.
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Securities, documents or
other written instruments shall be deemed to mean original (including original
counterparts) negotiable or non-negotiable agreements which in and of
themselves represent an equitable interest, ownership, or debt, including an
assignment thereof which instruments are in the ordinary course of business,
transferable by delivery of such agreements with any necessary endorsement or
assignment.
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The word
"counterfeited" as used in this Insuring Agreement shall be deemed to
mean any security, document or other written instrument which is intended to
deceive and to be taken for an original.
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Mechanically produced
facsimile signatures are treated the same as handwritten signatures.
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(G) COUNTERFEIT
CURRENCY
Loss through the receipt
by the Insured, in good faith, of any counterfeited money orders or altered
paper currencies or coin of the United States of America or Canada issued or
purporting to have been issued by the United States of America or Canada or
issued pursuant to a United States of America or Canadian statute for use as
currency.
(H) STOP PAYMENT
Loss against any and all
sums which the Insured shall become obligated to pay by reason of the Liability
imposed upon the Insured by law for damages:
For having either
complied with or failed to comply with any written notice of any customer,
shareholder or subscriber of the Insured or any Authorized Representative of
such customer, shareholder or subscriber to stop payment of any check or draft
made or drawn by such customer, shareholder or subscriber or any Authorized
Representative of such customer, shareholder or subscriber, or
For having refused to
pay any check or draft made or drawn by any customer, shareholder or subscriber
of the Insured or any Authorized Representative of such customer, shareholder
or subscriber.
(I) UNCOLLECTIBLE
ITEMS OF DEPOSIT
Loss resulting from
payments of dividends or fund shares, or withdrawals permitted from any
customers, shareholders or subscribers account based upon Uncollectible
Items of Deposit of a customer, shareholder or subscriber credited by the
Insured or the Insureds agent to such customers, shareholders or
subscribers Mutual Fund Account; or
loss resulting from any Item of Deposit processed through an
Automated Clearing House which is reversed by the customer, shareholder or
subscriber and deemed uncollectible by the Insured.
Loss
includes dividends and interest accrued not to exceed 15% of the Uncollectible
Items which are deposited.
This Insuring Agreement
applies to all Mutual Funds with exchange privileges if all Fund(s) in the
exchange program are insured by a National Union Fire Insurance Company of
Pittsburgh, PA for Uncollectible Items of Deposit. Regardless of the number of
transactions between Fund(s), the minimum number of days of deposit within the
Fund(s) before withdrawal as declared in the Fund(s) prospectus shall begin
from the date a deposit was first credited to any Insured Fund(s).
4
GENERAL AGREEMENTS
A
. ADDITIONAL OFFICES OR EMPLOYEES-CONSOLIDATION
OR MERGER-NOTICE
1.
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If the Insured shall, while this bond is in force, establish any
additional office or offices, such office or offices shall be
automatically covered hereunder from the dates of their establishment,
respectively. No notice to the Underwriter of an increase during any
premium period in the number of offices or in the number of Employees at
any of the offices covered hereunder need be given and no additional
premium need be paid for the remainder of such premium period.
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2.
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If an Investment
Company, named as Insured herein, shall, while this bond is in force, merge or
consolidate with, or purchase the assets of another institution, coverage for
such acquisition shall apply automatically from the date of acquisition. The
Insured shall notify the Underwriter of such acquisition within 60 days of said
date, and an additional premium shall be computed only if such acquisition
involves additional offices or employees.
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B. WARRANTY
No statement made by or
on behalf of the Insured, whether contained in the application or otherwise,
shall be deemed to be a warranty of anything except that it is true to the best
of the knowledge and belief of the person making the statement.
C. COURT COSTS AND ATTORNEYS' FEES
(Applicable
to all Insuring Agreements or Coverages now or hereafter forming part of this
bond)
The
Underwriter will indemnify the Insured against court costs and reasonable
attorneys' fees incurred and paid by the Insured in defense, whether or not
successful, whether or not fully litigated on the merits and whether or not
settled of any suit or legal proceeding brought against the Insured to enforce
the Insured's liability or alleged liability on account of any loss, claim or
damage which, if established against the Insured, would constitute a loss
sustained by the Insured 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)
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an Employee admits to being guilty of any dishonest
or fraudulent act(s),
including Larceny or Embezzlement; or
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(2)
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an Employee is adjudicated to be guilty of
any dishonest or fraudulent act(s),
including Larceny or Embezzlement;
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(3)
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in the absence of (1) or (2) above an
arbitration panel agrees, after a review of an agreed statement of
facts, that an Employee would be found guilty of dishonesty if such
Employee were prosecuted.
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The Insured shall
promptly give notice to the Underwriter of any such suit or legal proceeding
and at the request of the Underwriter shall furnish it 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 suit or 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 suit
or legal proceeding.
If the amount of the
Insured's liability or alleged liability is greater than the amount recoverable
under this bond, or if a Deductible Amount is applicable, or both, the
liability of the Underwriter under this General Agreement is limited to the proportion
of court costs and attorneys' fees incurred and paid by the Insured or by the
Underwriter that the amount recoverable under this bond bears to the total of
such amount plus the amount which is not so recoverable. Such indemnity shall
be in addition to the Limit of Liability for the applicable Insuring Agreement
or Coverage.
D. FORMER EMPLOYEE
Acts of an Employee, as
defined in this bond, are covered under Insuring Agreement (A) only while the
Employee is in the Insured's employ. Should loss involving a former Employee of
the Insured be discovered subsequent to the termination of employment, coverage
would still apply under Insuring Agreement (A) if the direct proximate cause of
the loss occurred while the former Employee performed duties within the scope
of his/her employment.
5
THE FOREGOING
INSURING AGREEMENTS AND
GENERAL
AGREEMENTS ARE SUBJECT TO
THE FOLLOWING CONDITIONS
AND LIMITATIONS:
SECTION 1. DEFINITIONS
The following terms, as
used in this bond, shall have the respective meanings stated in this Section:
(a)
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"Employee" means:
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(1)
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any
of the Insured's officers, partners, or employees, and
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(2)
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any
of the officers or employees 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
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(3)
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attorneys
retained by the Insured to perform legal services for the Insured and the
employees of such attorneys while such attorneys or the employees of such
attorneys are performing such services for the Insured, and
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(4)
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guest students pursuing
their studies or duties in any of the Insured's offices, and
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(5)
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directors or trustees of
the Insured, the investment advisor, underwriter (distributor), transfer agent,
or shareholder accounting record keeper, or administrator authorized by written
agreement to keep financial and/or other required records, but only while
performing acts coming within the scope of the usual duties of an officer or
employee or while 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, and
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(6)
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any individual or individuals assigned to perform
the usual duties of an employee within the premises of the Insured, by
contract, or by any agency furnishing temporary personnel on a contingent or
part-time basis, and
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(7)
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each
natural person, partnership or corporation 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 any such processor who acts as
transfer agent or in any other agency capacity in issuing checks, drafts or
securities for the Insured, unless included under Sub-section (9) hereof, and
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(8)
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those
persons so designated in Section 15, Central Handling of Securities, and
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(9)
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any
officer, partner or Employee of
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a)
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an investment advisor,
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b)
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an underwriter
(distributor),
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c)
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a transfer agent or
shareholder accounting record-keeper, or
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d)
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an administrator authorized
by written agreement to keep financial and/or other required records,
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for an Investment
Company named as Insured while performing acts coming within the scope of the
usual duties of an officer or Employee of any Investment Company named as Insured
herein, or while 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 any such
Investment Company, provided that only Employees or partners of a transfer
agent, shareholder accounting record-keeper or administrator which is an
affiliated person as defined in the Investment Company Act of 1940, of an
Investment Company named as Insured or is an affiliated person of the adviser,
underwriter or administrator of such Investment Company, and which is not a
bank, shall be included within the definition of Employee.
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Each employer of
temporary personnel or processors as set forth in Sub-Sections (6) and of
Section 1(a) and their partners, officers and employees shall collectively be deemed
to be one person for all the purposes of this bond, excepting, however, the
last paragraph of Section 13.
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Brokers, or other
agents under contract or representatives of the same general character shall
not be considered Employees.
(b)
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"Property" means money
(i.e.. currency, coin, bank notes, Federal Reserve notes), postage and
revenue stamps, U.S. Savings Stamps, bullion, precious metals of all
kinds and in any form and articles made therefrom, jewelry, watches, necklaces,
bracelets, gems, precious and semi-precious stones, bonds, securities,
evidences of debts, debentures, scrip, certificates, interim receipts,
warrants, rights, puts, calls, straddles, spreads, transfers, coupons, drafts,
bills of exchange, acceptances, notes, checks, withdrawal orders, money orders,
warehouse receipts, bills of lading, conditional sales contracts, abstracts of
title, insurance policies, deeds, mortgages under real estate and/or chattels
and upon interests therein, and assignments of such policies, mortgages and instruments,
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 including Electronic Representations of
such instruments enumerated above (but excluding all data processing records)
in which the Insured has an interest or in which the Insured acquired or should
have acquired 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 which are held by the
Insured for any purpose or in any capacity and whether so held by the Insured
for any purpose or in any capacity and whether so held gratuitously or not and
whether or not the Insured is liable therefor.
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(c)
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"Forgery" means the
signing of the name of another with intent to deceive; it does not
include the signing of one's own name with or without authority, in any
capacity, for any purpose.
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(d)
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"Larceny and Embezzlement"
as it applies to any named Insured means those acts as set forth in
Section 37 of the Investment Company Act of 1940.
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(e)
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"Items of Deposit"
means any one or more checks and drafts. Items of Deposit shall not be
deemed uncollectible until the Insured's collection procedures have
failed.
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SECTION 2. EXCLUSIONS
THIS BOND DOES NOT COVER:
(a)
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loss
effected directly or indirectly by means of forgery or alteration of, on or in
any instrument, except when covered by Insuring Agreement (A), (E), (F) or (G).
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(b)
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loss due to riot or civil
commotion outside the United States of America and Canada; or loss due
to military, naval or usurped power, war or insurrection unless such
loss occurs in transit in the circumstances recited in Insuring
Agreement (D), and unless, when such transit was initiated, there was no
knowledge of such riot, civil commotion, military, naval or usurped
power, war or insurrection on the part of any person acting for the
Insured in initiating such transit.
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(c)
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loss, in time
of peace or war, directly or indirectly caused by or resulting from the
effects of nuclear fission or fusion or radioactivity; provided,
however, that this paragraph shall not apply to loss resulting
from industrial uses of nuclear energy.
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(d)
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loss
resulting from any wrongful act or acts of any person who is a member of the
Board of Directors of the Insured or a member of any equivalent body by
whatsoever name known unless such person is also an Employee or an elected
official, partial owner or partner of the Insured in some other capacity, nor,
in any event, loss resulting from the act or acts of any person while acting in
the capacity of a member of such Board or equivalent body.
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(e)
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loss
resulting from the complete or partial non-payment of, or default upon, any
loan or transaction in the nature of, or amounting to, a loan made by or
obtained from the Insured or any of its partners, directors or Employees,
whether authorized or unauthorized and whether procured in good faith or through
trick, artifice, fraud or false pretenses. unless such loss is covered under
Insuring Agreement (A), (E) or (F).
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(f)
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loss resulting
from any violation by the Insured or by any Employee
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(1)
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of
law regulating (a) the issuance, purchase or sale of securities, (b) securities
transactions upon Security Exchanges or over the counter market, (c) Investment
Companies, or (d) Investment Advisors, or
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(2)
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of
any rule or regulation made pursuant to any such law, unless such loss, in the
absence of such laws, rules or regulations, would be covered under Insuring
Agreements (A) or (E).
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(g)
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loss of Property or loss of privileges
through the misplacement or loss of Property as set forth in Insuring
Agreement (C) or (D) while the Property is in the custody of any armored
motor vehicle company, unless such loss shall be in excess of the amount
recovered or received by the Insured under (a) the Insured's contract
with said armored motor vehicle company, (b) insurance carried by said
armored motor vehicle company for the benefit of users of its service,
and (c) all other insurance and indemnity in force in whatsoever form
carried by or for the benefit of users of said armored motor vehicle
company's service, and then this bond shall cover only such excess.
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(h)
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potential
income, including but not limited to interest and dividends, not
realized by the Insured because of a loss covered under this bond,
except as included under Insuring Agreement (I).
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(i)
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all damages of
any type for which the Insured is legally liable, except direct
compensatory damages arising from a loss covered under this bond.
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(j)
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loss through
the surrender of Property away from an office of the Insured as a result
of a threat
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(1)
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to do bodily harm to any
person, except loss of Property in transit in the custody of any person
acting as messenger provided that when such transit was initiated there
was no knowledge by the Insured of any such threat, or
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(2)
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to do damage to the
premises or Property of the Insured, except when covered under Insuring
Agreement (A).
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(k)
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all costs, fees and other expenses
incurred by the Insured in establishing the existence of or amount of
loss covered under this bond unless such indemnity is provided for under
Insuring Agreement (B).
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8
(l)
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loss resulting from
payments made or withdrawals from the account of a customer of the
Insured, shareholder or subscriber to shares involving funds
erroneously credited to such account, unless such payments are made to
or withdrawn by such depositor or representative of such person, who is
within the premises of the drawee bank of the Insured or within the office of the Insured at the time of
such payment or withdrawal or unless such payment is covered under Insuring
Agreement (A).
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|
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(m)
|
any loss resulting from
Uncollectible Items of Deposit which are drawn from a financial
institution outside the fifty states of the United States of America,
District of Columbia, and territories and possessions of the United
States of America, and Canada.
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SECTION 3. ASSIGNMENT OF RIGHTS
This bond does not
afford coverage in favor of any Employers of temporary personnel or of
processors as set forth in sub-sections (6) and (7) of Section 1(a) of this
bond, as aforesaid, and upon payment to the Insured by the Underwriter on
account of any loss through dishonest or fraudulent act(s) including Larceny or
Embezzlement committed by any of the partners, officers or employees of such
Employers, whether acting alone or in collusion with others, an assignment of
such of the Insured's rights and causes of action as it may have against such
Employers by reason of such acts so committed shall, to the extent of such
payment, be given by the Insured to the Underwriter, and the Insured shall
execute all papers necessary to secure to the Underwriter the rights herein
provided for.
SECTION 4. LOSS -NOTICE -PROOF- LEGAL PROCEEDINGS
This bond is for the use
and benefit only of the Insured named in the Declarations and the Underwriter
shall not be liable hereunder for loss sustained by anyone other than the
Insured unless the Insured, in its sole discretion and at its option, shall
include such loss in the Insured's proof of loss. At the earliest practicable
moment after discovery of any loss hereunder the Insured shall give the
Underwriter written notice thereof and shall also within six months after such
discovery furnish to the Underwriter affirmative proof of loss with full
particulars. If claim is made under this bond for loss of securities or shares,
the Underwriter shall not be liable unless each of such securities or shares is
identified in such proof of loss by a certificate or bond number or, where such
securities or shares are uncertificated, by such identification means as agreed
to by the Underwriter. The Underwriter shall have thirty days after notice and
proof of loss within which to investigate the claim, but where the loss is
clear and undisputed, settlement shall be made within forty-eight hours; and
this shall apply notwithstanding the loss is made up wholly or in part of
securities of which duplicates may be obtained. Legal proceedings for recovery
of any loss hereunder shall not be brought prior to the expiration of sixty
days after such proof of loss is filed with the Underwriter nor after the
expiration of twenty-four months from the discovery of such loss, except that
any action or proceeding to recover hereunder on account of any judgment
against the Insured in any suit mentioned in General Agreement C or to recover
attorneys' fees paid in any such suit, shall be begun within twenty-four months
from the date upon which the judgment in such suit shall become final. If any
limitation embodied in this bond is prohibited by any law controlling the
construction hereof, such limitation shall be deemed to be amended so as to be
equal to the minimum period of limitation permitted by such law.
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Discovery occurs when
the Insured
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|
(a)
|
becomes
aware of facts, or
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(b)
|
receives
written notice of an actual or potential claim by a third party which alleges
that the Insured is liable under circumstance
|
which would cause a reasonable person to assume
that a loss covered by the bond has been or will be incurred even though the
exact amount or details of loss may not be then known.
SECTION 5. VALUATION OF PROPERTY
The value of any
Property, except books of accounts or other records used by the Insured in the
conduct of its business, for the loss of which a claim shall be made hereunder,
shall be determined by the average market value of such Property on the
business day next preceding the discovery of such loss; provided, however, that
the value of any Property replaced by the Insured prior to the payment of claim
therefor shall be the actual market value at the time of replacement; and
further provided that in case of a loss or misplacement of interim
certificates, warrants, rights, or other securities, the production which is
necessary to the exercise of subscription, conversion, redemption or deposit
privileges, the value thereof shall be the market value of such privileges
immediately preceding the expiration thereof if said loss or misplacement is
not discovered until after their expiration. If no market price is quoted for
such Property or for such privileges, the value shall be fixed by agreement
between the parties or by arbitration.
9
In case of any loss or
damage to Property consisting of books of accounts or other records used by the
Insured in the conduct of its business, the Underwriter shall be liable under
this bond only if such books or records are actually reproduced and then for not
more than the cost of blank books, blank pages or other materials plus the cost
of labor for the actual transcription or copying of data which shall have been
furnished by the Insured in order to reproduce such books and other records.
SECTION 6.
VALUATION OF PREMISES AND FURNISHINGS
In case of damage to any
office of the Insured, or loss of or damage to the furnishings, fixtures,
stationery, supplies, equipment, safes or vaults therein, the Underwriter shall
not be liable for more than the actual cash value thereof, or for more than the
actual cost of their replacement or repair. The Underwriter may, at its
election, pay such actual cash value or make such replacement or repair. If the
Underwriter and the Insured cannot agree upon such cash value or such cost of
replacement or repair, such shall be determined by arbitration.
SECTION 7. LOST SECURITIES
If the Insured shall
sustain a loss of securities the total value of which is in excess of the limit
stated in Item 3 of the Declarations of this bond, the liability of the
Underwriter shall be limited to payment for, or duplication of, securities
having value equal to the limit stated in Item 3 of the Declarations of this
bond.
If the Underwriter shall
make payment to the Insured for any loss of securities, the Insured shall
thereupon assign to the Underwriter all of the Insured's rights, title and
interests in and to said securities.
With respect to
securities the value of which do not exceed the Deductible Amount (at the time
of the discovery of the loss) and for which the Underwriter may at its sole
discretion and option and at the request of the Insured issue a Lost Instrument
Bond or Bonds to effect replacement thereof, the Insured will pay the usual
premium charged therefor and will indemnify the Underwriter against all loss or
expense that the Underwriter may sustain because of the issuance of such Lost
Instrument Bond or Bonds.
With respect to
securities the value of which exceeds the Deductible Amount (at the time of
discovery of the loss) and for which the Underwriter may issue or arrange for
the issuance of a Lost Instrument Bond or Bonds to effect replacement thereof,
the Insured agrees that it will pay as premium therefor a proportion of the
usual premium charged therefor, said proportion being equal to the percentage
that the Deductible Amount bears to the value of the securities upon discovery
of the loss, and that it will indemnify the issuer of said Lost Instrument Bond
or Bonds against all loss and expense that is not recoverable from the
Underwriter under the terms and conditions of this INVESTMENT COMPANY BLANKET
BOND subject to the Limit of Liability hereunder.
SECTION 8. SALVAGE
In case of recovery,
whether made by the Insured or by the Underwriter, on account of any loss in excess
of the 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 net
amount of such recovery, less the actual costs and expenses of making same,
shall be applied to reimburse the Insured in full for the excess portion of
such loss, and the remainder, if any, shall be paid first in reimbursement of
the Underwriter and thereafter in reimbursement of the Insured for that part of
such loss within the Deductible Amount. The Insured shall execute all necessary
papers to secure to the Underwriter the rights provided for herein.
10
SECTION 9. NON-REDUCTION AND NON- ACCUMULATION OF LIABILITY AND TOTAL LIABILITY
At all times prior to
termination hereof this bond shall continue in force for the limit stated in
the applicable sections of Item 3 of the Declarations of this bond
notwithstanding any previous 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 all loss resulting from
(a)
|
any
one act of burglary, robbery or holdup, or attempt thereat, in which no Partner
or Employee is concerned or implicated shall be deemed to be one loss, or
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(b)
|
any
one unintentional or negligent act on the part of any one person resulting in
damage to or destruction or misplacement of Property, shall be deemed to be one
loss, or
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(c)
|
all
wrongful acts, other than those specified in (a) above, of any one person shall
be deemed to be one loss, or
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(d)
|
all
wrongful acts, other than those specified in (a) above, of one or more persons
(which dishonest act(s) or act(s) of Larceny or Embezzlement include, but are
not limited to, the failure of an Employee to report such acts of others) whose
dishonest act or acts intentionally or unintentionally, knowingly or
unknowingly, directly or indirectly, aid or aids in any way, or permits the
continuation of, the dishonest act or acts of any other person or persons shall
be deemed to be one loss with the act or acts of the persons aided, or
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(e)
|
any
one casualty or event other than those specified in (a), (b), (c) or (d)
preceding, shall be deemed to be one loss, and
|
shall be limited to the applicable Limit of Liability
stated in Item 3 of the Declarations of this bond irrespective of the total
amount of such loss or losses and shall not be cumulative in amounts from year
to year or from period to period.
Sub-section (c) is not
applicable to any situation to which the language of sub-section (d) applies.
SECTION 10. LIMIT OF LIABILITY
With respect to any loss
set forth in the PROVIDED clause of Section 9 of this bond which is recoverable
or recovered in whole or in part under any other bonds or policies issued by
the Underwriter to the Insured or to any predecessor in interest of the Insured
and terminated or cancelled or allowed to expire and in which the period for
discovery has not expired at the time any such loss thereunder is discovered,
the total liability of the Underwriter under this bond and under other bonds or
policies shall not exceed, in the aggregate, the amount carried hereunder on
such loss or the amount available to the Insured under such other bonds or
policies, as limited by the terms and conditions thereof, for any such loss if
the latter amount be the larger.
SECTION 11. OTHER INSURANCE
If the Insured shall
hold, as indemnity against any loss covered hereunder, any valid and
enforceable insurance or suretyship, the Underwriter shall be liable hereunder
only for such amount of such loss which is in excess of the amount of such
other insurance or suretyship, not exceeding, however, the Limit of Liability
of this bond applicable to such loss.
SECTION 12. DEDUCTIBLE
The Underwriter shall
not be liable under any of the Insuring Agreements of this bond on account of
loss as specified, respectively, in sub-sections (a), (b), (c), (d) and (e) of
Section 9, NON-REDUCTION AND NON- ACCUMULATION OF LIABILITY AND TOTAL LIABILITY, unless the amount of such loss, after deducting the net amount of all
reimbursement and/or recovery obtained or made by the Insured, other than from
any bond or policy of insurance issued by an insurance company and covering
such loss, or by the Underwriter on account thereof prior to payment by the
Underwriter of such loss, shall exceed the Deductible Amount set forth in Item
3 of the Declarations hereof (herein called Deductible Amount) and then for
such excess only, but in no event for more than the applicable Limit of
Liability stated in Item 3 of the Declarations.
11
The Insured will bear,
in addition to the Deductible Amount, premiums on Lost Instrument Bonds as set
forth in Section 7.
There shall be no
deductible applicable to any loss under Insuring Agreement A sustained by any
Investment Company named as Insured herein.
SECTION 13. TERMINATION
The Underwriter may
terminate this bond as an entirety by furnishing written notice specifying the
termination date which cannot be prior to 60 days after the receipt of such
written notice by each Investment Company named as Insured and the Securities
and Exchange Commission, Washington, D.C. The Insured may terminate this bond
as an entirety by furnishing written notice to the Underwriter. When the
Insured cancels, the Insured shall furnish written notice to the Securities and
Exchange Commission, Washington. D.C. prior to 60 days before the effective
date of the termination. The Underwriter shall notify all other Investment
Companies named as Insured of the receipt of such termination notice and the
termination cannot be effective prior to 60 days after receipt of written
notice by all other Investment Companies. Premiums are earned until the
termination date as set forth herein.
This Bond will terminate
as to any one Insured immediately upon taking over of such Insured by a
receiver or other liquidator or by State or Federal officials, or immediately
upon 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. or immediately upon such Insured ceasing to exist,
whether through merger into another entity, or by disposition of all of its
assets.
The Underwriter shall
refund the unearned premium computed at short rates in accordance with the
standard short rate cancellation tables if terminated by the Insured or pro
rata if terminated for any other reason.
This Bond shall
terminate
(a)
|
as
to any Employee as soon as any partner, officer or supervisory Employee of the
Insured, who is not in collusion with such Employee, shall learn of any
dishonest or fraudulent act(s), including Larceny or Embezzlement on the part
of such Employee without prejudice to the loss of any Property then in transit
in the custody of such Employee (See Section 16[d]), or
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(b)
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as
to any Employee 60 days after receipt by each Insured and by the Securities and
Exchange Commission of a written notice from the Underwriter of its desire to
terminate this bond as to such Employee, or
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(c)
|
as
to any person, who is a partner, officer or employee of any Electronic Data
Processor covered under this bond, from and after the time that the Insured or
any partner or officer thereof not in collusion with such person shall have
knowledge or information that such person has committed any dishonest or
fraudulent act(s), including Larceny or Embezzlement in the service of the
Insured or otherwise, whether such act be committed before or after the time
this bond is effective.
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SECTION 14. RIGHTS AFTER TERMINATION OR CANCELLATION
At any time prior to the
termination or cancellation of this bond as an entirety, whether by the Insured
or the Underwriter, the Insured may give to the Underwriter notice that it
desires under this bond an additional period of 12 months within which to
discover loss sustained by the Insured prior to the effective date of such
termination or cancellation and shall pay an additional premium therefor.
Upon receipt of such
notice from the Insured, the Underwriter shall give its written consent
thereto; provided, however, that such additional period of time shall terminate
immediately;
12
(a)
|
on
the effective date of any other insurance obtained by the Insured, its
successor in business or any other party, replacing in whole or in part the
insurance afforded by this bond, whether or not such other insurance provides
coverage for loss sustained prior to its effective date, or
|
(b)
|
upon
takeover of the Insured's business by any State or Federal official or agency,
or by any receiver or liquidator, acting or appointed for this purpose
|
without the necessity of the Underwriter giving
notice of such termination. In the event that such additional period of time is
terminated, as provided above, the Underwriter shall refund any unearned
premium.
The right to purchase
such additional period for the discovery of loss 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 for the operation or for the
liquidation thereof or for any other purpose.
SECTION 15. CENTRAL HANDLING OF SECURITIES
Securities included in
the systems for the central handling of securities established and maintained
by Depository Trust Company, Midwest Depository Trust Company, Pacific
Securities Depository Trust Company, and Philadelphia Depository Trust Company,
hereinafter called Corporations, to the extent of the Insured's interest
therein as effective by the making of appropriate entries on the books and
records of such Corporations shall be deemed to be Property.
The words
"Employee" and "Employees" shall be deemed to include the
officers, partners, clerks and other employees of the New York Stock Exchange,
Boston Stock Exchange, Midwest Stock Exchange, Pacific Stock Ex- change and
Philadelphia Stock Exchange, hereinafter called Exchanges, and of the above
named Corporations, and of any nominee in whose name is registered any security
included within the systems for the central handling of securities established
and maintained by such Corporations, and any employee of any recognized service
company, while such officers, partners, clerks and other employees and
employees of service companies perform services for such Corporations in the
operation of such systems. For the purpose of the above definition a recognized
service company shall be any company providing clerks or other personnel to
said Exchanges or Corporation on a contract basis.
The Underwriter shall
not be liable on account of any loss(es) in connection with the central
handling of securities within the systems established and maintained by such
Corporations, unless such loss(es) shall be in excess of the amount(s)
recoverable or recovered under any bond or policy of insurance indemnifying
such Corporations, against such loss(es), and then the Underwriter shall be
liable hereunder only for the Insured's share of such excess loss(es), but in
no event for more than the Limit of Liability
applicable hereunder.
For the purpose of
determining the Insured's share of excess loss(es) it shall be deemed that the
Insured has an interest in any certificate representing any security included
within such systems equivalent to the interest the Insured then has in all
certificates representing the same security included within such systems and that
such Corporations shall use their best judgement in apportioning the amount(s)
recoverable or recovered under any bond or policy of insurance indemnifying
such Corporations against such loss(es) in connection with the central handling
of securities within such systems among all those having an interest as
recorded by appropriate entries in the books and records of such Corporations
in Property involved in such loss(es) on the basis that each such interest
shall share in the amount(s) so recoverable or recovered in the ratio that the
value of each such interest bears to the total value of all such interests and
that the Insured's share of such excess loss(es) shall be the amount of the
Insured's interest in such Property in excess of the amount(s) so apportioned
to the Insured by such Corporations.
This bond does not
afford coverage in favor of such Corporations or Exchanges or any nominee in
whose name is registered any security included within the systems for the
central handling of securities established and maintained by such Corporations,
and upon payment to the Insured by the Underwriter on account of any loss(es)
within the systems, an assignment of such of the Insured's rights and causes of
action as it may have against such Corporations or Exchanges shall to the
extent of such payment, be given by the Insured to the Underwriter, and the
Insured shall execute all papers necessary to secure to the Underwriter the
rights provided for herein.
13
SECTION 16. ADDITIONAL COMPANIES INCLUDED AS INSURED
If more than one
corporation, co-partnership or person or any combination of them be included as
the Insured herein:
(a)
|
the
total liability of the Underwriter hereunder for loss or losses sustained by
any one or more or all of them shall not exceed the limit for which the
Underwriter would be liable hereunder if all such loss were sustained by any
one of them,
|
(b)
|
the
one first named herein shall be deemed authorized to make, adjust and receive
and enforce payment of all claims hereunder and shall be deemed to be the agent
of the others for such purposes and for the giving or receiving of any notice
required or permitted to be given by the terms hereof, provided that the
Underwriter shall furnish each named Investment Company with a copy of the bond
and with any amendment thereto, together with a copy of each formal filing of
the settlement of each such claim prior to the execution of such settlement,
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(c)
|
the Underwriter shall
not be responsible for the proper application of any payment made hereunder to
said first named Insured,
|
(d)
|
knowledge
possessed or discovery made by any partner, officer or supervisory Employee of
any Insured shall for the purposes of Section 4 and Section 13 of this bond
constitute knowledge or discovery by all the Insured, and
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(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.
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SECTION 17. NOTICE AND CHANGE OF CONTROL
Upon the Insured's
obtaining knowledge of a transfer of its outstanding voting securities which
results in a change in control (as set forth in Section 2(a) (9) of the
Investment Company Act of 1940) of the Insured, the Insured shall within thirty
(30) days of such knowledge give written notice to the Underwriter setting
forth:
(a)
|
the
names of the transferors and transferees (or the names of the beneficial owners
if the voting securities are requested in another name), and
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(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.
Failure to give the
required notice shall result in termination of coverage of this bond, effective
upon the date of stock transfer for any loss in which any transferee is
concerned or implicated.
Such notice is not
required to be given in the case of an Insured which is an Investment Company.
SECTION 18. CHANGE OR MODIFICATION
This bond or any
instrument amending or effecting same may not be changed or modified orally. No
changes in or modification thereof shall be effective unless made by written
endorsement issued to form a part hereof over the signature of the
Underwriter's Authorized Representative. When a bond covers only one Investment
Company no change or modification which would adversely affect the rights of
the Investment Company shall be effective prior to 60 days after written
notification has been furnished to the Securities and Exchange Commission, Washington, D.C. by the Insured or by the Underwriter. If more than one Investment
Company is named as the Insured herein, the Underwriter shall give written
notice to each Investment Company and to the Securities and Exchange
Commission, Washington, D.C. not less than 60 days prior to the
effective
date of any change or modification which would adversely affect the rights of
such Investment Company.
IN WITNESS WHEREOF, the Underwriter has caused
this bond to be executed on the Declarations Page.
14
ENDORSEMENT
NO. 1
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
|
by
National Union Fire
Insurance Company of Pittsburgh, PA
It
is agreed that:
1. The attached bond
is amended by adding an additional insuring agreement as follows:
COMPUTER SYSTEMS
Loss
resulting directly from a fraudulent
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(1)
|
entry of data into,
or
|
(2)
|
change of data or
programs within
|
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a
Computer System; provided the fraudulent entry or change causes
|
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(a)
|
Property to be
transferred, paid or delivered,
|
(b)
|
an account of the
Insured, or of its customer, to be added, deleted, debited or credited:
|
(c)
|
an unauthorized
account of a fictitious account to be debited or credited;
|
|
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(3)
|
voice instructions
or advices having been transmitted to the Insured or its agent(s) by telephone;
|
|
|
and
provided further, the fraudulent entry or change is made or caused by an
individual acting with the intent to:
|
|
|
(i)
|
cause the Insured
or its agent(s) to sustain a loss, and
|
(ii)
|
obtain financial
benefit for that individual or for other persons intended by that individual to
receive financial benefit,
|
(iii)
|
and further provided such voice instruction or advices:
|
|
|
(a)
|
were made by a
person who purported to represent an individual authorized to make such voice
instruction or advices; and
|
(b)
|
were electronically
recorded by the Insured or its agent(s).
|
(4)
It shall be a condition to recovery under the Computer Systems Rider that the
Insured or its agent(s)shall to the best of their ability electronically record
all voice instructions or advices received over telephone. The Insured or its
agent(s) warrant that they shall make their best efforts to maintain the
electronic recording system on a continuous basis. Nothing, however, in this
Rider shall bar the Insured from recovery where no recording is available
because of mechanical failure of the device used in making such recording, or
because of failure of the media used to record conversation from any cause, or
error or omission of any Employee(s) or agent(s) of the Insured.
ENDORSEMENT
NO. 1 (CONTINUED)
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
|
|
SCHEDULE OF SYSTEMS
All computer systems
utilized by the Insured
2. As used in this
Rider, Computer System means:
|
|
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(a)
|
computers with
related peripheral components, including storage components, wherever located,
|
(b)
|
systems and
application software,
|
(c)
|
terminal devices,
|
(d)
|
related
communication networks or customer communication systems, and
|
(e)
|
related Electronic
Funds Transfer Systems,
|
|
|
by
which data are electronically collected, transmitted, processed, stored, and
retrieved.
|
|
|
3. In
addition to the exclusions in the attached bond, the following exclusions are
applicable to this Insuring Agreement:
|
|
|
(a)
|
loss resulting
directly or indirectly from the theft of confidential information, material or
data; and
|
(b)
|
loss resulting
directly or indirectly from entries or changes made by an individual authorized
to have access to a Computer System who acts in good faith on instructions,
unless such instructions are given to that individual by a software contractor
(or by a partner, officer or employee thereof) authorized by the Insured to
design, develop, prepare, supply service, write or implement programs for the
Insured's Computer System.
|
|
|
4. The
following portions of the attached bond are not applicable to this Rider:
|
|
|
(a)
|
the initial
paragraph of the bond preceding the Insuring Agreements which reads "...at
any time but discovered during the Bond Period."
|
(b)
|
Section
9-NON-REDUCTION AND NON-ACCUMULATION OF LIABILITY AND TOTAL LIABILITY
|
(c)
|
Section 10-LIMIT OF
LIABILITY
|
5. The
Coverage afforded by this rider applies only to loss discovered by the Insured
during the period this Rider is in force.
6. All
loss or series of losses involving the fraudulent activity of one individual,
or involving fraudulent activity in which one individual is implicated, whether
or not that individual is specifically identified, shall be treated as one
loss. A Series of losses involving unidentified
ENDORSEMENT
NO. 1 (CONTINUED)
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
|
|
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 one loss.
7. The
Limit of Liability for the coverage provided by this Endorsement shall be
$600,000
(
Six Hundred Thousand Dollars
)
, it being understood
however, that such liability shall be part of and not in addition to the Limit
of Liability stated in Item 3 of the Declarations of the attached bond.
8. The
Underwriter shall be liable hereunder for the amount by which one loss shall be
in excess of
$NIL ($ZERO)
, (herein called the
Deductible amount) but not in excess of the Limit of Liability stated above.
9. If
any loss is covered under this Insuring Agreement and any other Insuring
Agreement or Coverage, the maximum amount payable for such loss shall not
exceed the largest amount available under any one Insuring Agreement or
Coverage.
10. Coverage
under this Rider shall terminate upon termination or cancellation of the bond
to which this Rider is attached. Coverage under this rider may also be
terminated or cancelled without cancelling the bond as an entirety:
(a)
|
60 days after
receipt by the Insured of written notice from the Underwriter of its desire to
terminate or cancel coverage under this Rider, or
|
(b)
|
immediately upon
receipt by the Underwriter of a written request from the Insured to terminate
or cancel coverage under this Rider.
|
The
Underwriter shall refund to the Insured the unearned premium for this coverage
under this Rider. The refund shall be computed at short rates if this Rider is
terminated or cancelled or reduced by notice from, or at the instance of, the
Insured.
11. Section
4-LOSS-NOTICE-PROOF-LEGAL PROCEEDING of the Conditions and Limitations of this
bond is amended by adding the following sentence:
"Proof
of Loss resulting from Voice Instructions or advices covered under this bond
shall include Electronic Recording of such Voice Instructions or advices."
12. Not withstanding the foregoing, however,
coverage afforded by this Rider is not designed to provide protection against
loss covered under a separate Electronic and Computer Crime Policy by whatever
title assigned or by whatever Underwriter written. Any loss which is covered
under such separate Policy is excluded from coverage under this bond; and the
Insured agrees to make claim for such loss under its separate Policy.
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By
____________________
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Authorized
Representative
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ENDORSEMENT
NO. 2
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
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issued to:
BLUE CHIP VALUE FUND, INC.
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by
National Union Fire Insurance
Company of Pittsburgh, PA
1.
The
attached bond is amended by adding an additional Insuring Agreement as follows:
TELEFACSIMILE
TRANSFER FRAUD
Loss
resulting from the Insured having, in good faith, transferred or delivered
Funds or securities through a Computer System covered under the terms of the
Computer Systems Insuring Agreement in reliance upon a fraudulent instruction
received through a Telefacsimile Device, and which instruction
(1)
purports
and reasonably appears to have originated from
(a) a Customer of the Insured,
(b) another financial institution, or
(c) another office of the Insured
but, in fact, was not originated by the Customer or
entity whose identification it bears and
(2)
contains
a valid test code which proves to have been used by a person who was not
authorized to make use of it and,
(3)
contains
the name of a person authorized to initiate such transfer; and
provided that, if the transfer was in excess of
$0
,
the instruction was verified by a call-back according to prearranged procedure.
In this Insuring Agreement, Customer means an entity
or individual which has a written agreement with the Insured authorizing the
Insured to rely on Telefacsimile Device instructions to initiate such transfers
and has provided the Insured with the names of persons authorized to initiate
such transfers, and with which the Insured has established an instruction
verification mechanism, and Funds means money on deposit in an account.
2. In
addition to the Conditions and Limitations in the bond and Computer Systems
Insuring Agreement Rider, the following provisions are applicable to the Telefacsimile Transfer Fraud Insuring Agreement:
Telefacsimile Device means a machine capable of
sending or receiving a duplicate image of a document by means of electronic
impulses transmitted through a telephone line and which reproduces that
duplicate image on paper
This Insuring Agreement does not cover loss
resulting directly or indirectly from the assumption of liability by the
Insured by contract unless the liability arises from a loss covered by the
Telefacsimile Transfer Fraud Insuring Agreement and would be imposed on the
Insured regardless of the existence of the contract.
ENDORSEMENT
NO. 2 (CONTINUED)
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
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issued to:
BLUE CHIP VALUE FUND, INC.
|
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Proof of loss for claim under the Telefacsimile
Transfer Fraud Insuring Agreement must include a copy of the document
reproduced by the Telefacsimile Device.
3. The exclusion
below, as found in this financial institutions bond, does not apply to the
Computer Systems Fraud Insuring Agreement.
loss involving any Uncertificated Security except
an Uncertificated Security of any Federal reserve Bank of the United States or
when covered under Insuring Agreement (A);
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By
____________________
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Authorized
Representative
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ENDORSEMENT
NO. 3
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
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|
issued to:
BLUE CHIP VALUE FUND, INC.
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UNAUTHORIZED SIGNATURES
It is agreed that:
1.
|
The attached bond is amended to include the
following insuring agreement:
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Loss resulting directly from
the Insured having accepted, paid or cashed any check or withdrawal order made
or drawn on a customer's account which bears the signature or endorsement of
one other than a person whose name and signature is on file with the Insured as
a signatory on such account. It shall be a condition precedent to the Insured's
right of recovery under this Coverage that the Insured shall have on file
signature of all persons who are signatories on such account.
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2.
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The
Limit of Liability on the Agreement is
$600,000
subject to a deductible
of $0.
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3.
|
Nothing
herein contained shall be held to vary, alter, waive or extend any of the
terms, limitations, conditions or agreements of the attached policy other than
as above stated.
|
ALL OTHER TERMS AND CONDITIONS OF THE POLICY REMAIN UNCHANGED.
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By
____________________
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Authorized
Representative
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ENDORSEMENT
NO. 4
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
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|
issued to:
BLUE CHIP VALUE FUND, INC.
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1. Insuring
Agreement F, COUNTERFEIT CURRENCY, is deleted and replaced by the following:
(F) Loss resulting directly
from the receipt by the Insured, in good faith, of any Counterfeit Money of the
United State of America, Canada or any other country.
3. Nothing
herein contained shall be held to vary, alter, waive, or extend any of the
terms, limitations, conditions, or provisions of the attached bond other than
above stated.
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By
____________________
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Authorized
Representative
|
ENDORSEMENT
NO. 5
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
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STOPPAY
It
is agreed that:
1.
In
consideration of the additional premium included herein, this policy is
extended to indemnify the Insured against any and all sums which the Insured
shall become obligated to pay by reason of the Liability imposed upon the
Insured by law for damages.
2.
For
having either complied with or failed to comply with any written notice of any depositor
of the Insured or any authorized Representative of such depositor to stop payment
of any cheque or draft made or drawn by such deposit or any Authorized
Representative of such depositor, or
3.
For having refused to pay any cheque or draft made or drawn by any depositor of
the Insured or any Authorized Representative of such depositor.
Provided
always that:
a) The Insured shall bear the first
$0
for each and every loss.
b) The Underwriters Liability under this rider shall
be limited to
$600,000
for any one loss and in all during each policy
year, subject to a
$600,000
Annual Aggregate.
c) The term "Policy Year" as used in this
Rider shall mean each period of twelve calendar months commencing the effective date
of the attached bond.
4.
Nothing herein contained shall be held to vary, alter, waive or extend any of
the terms,
conditions, provisions, agreements or limitations of the bond, other than as
stated
herein.
ALL OTHER TERMS AND CONDITIONS OF THE POLICY REMAIN UNCHANGED
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By
____________________
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Authorized
Representative
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ENDORSEMENT
NO. 6
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
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|
issued to:
BLUE CHIP VALUE FUND, INC.
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VOICE INITIATED FUNDS
TRANSFERS
It
is agreed that:
1.
The attached bond is amended by adding an additional insuring Agreement as
follows:
Loss
resulting directly from the Insured having transferred any funds on the faith
of any
voice initiated funds transfer instructions directed to the Insured authorizing
the transfer of funds in a customer's account to other financial institutions
for credit to persons designated by the customer, and which instructions were
made over the telephone to those employees of the Insured specifically
authorized to receive said instructions at the Insured's offices, and
fraudulently purport to have been made by a person authorized and appointed by
a customer to request by telephone the transfer of such funds, but which
instructions were not made by said customer, or by any officer, director,
partner, or employee of said customer, or were fraudulently made by an officer,
director, partner, or employee of said customer whose duty, responsibility or
authority did not permit him to make, initiate, authorize, validate, or
authenticate customer voice initiated transfer instruction, which fraudulent
acts were committed by said person who intended to cause the Insured, or the
customer, to sustain such loss and to obtain personal financial benefit for
such person or another person or entity.
Proof
of loss filed as a direct result of claims arising from voice instructions or
advices
covered under this Insuring Agreement must include electronic recordings of
such voice instructions or advices. Electronic recording must also include
call back
verification of such voice instruction.
Special
Definition
"Customer"
as used in this Insuring Agreement means any corporate, partnership or trust
customer or similar business entity which has a written agreement with the
Insured
for customer voice initiated funds transfers.
2.
The Underwriter's total liability under this rider shall be limited to
$600,000
each
and every loss and
$0
in the aggregate, it being
understood, however,
that such liability is part of and not in addition to the limits of liability
stated
in Sections 3 and 4 of the Declarations, and is subject to an each and every
loss
deductible of
$0
.
ENDORSEMENT
NO. 6 (CONTINUED)
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
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ALL OTHER TERMS AND CONDITIONS OF THE POLICY REMAIN UNCHANGED
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By
____________________
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Authorized
Representative
|
ENDORSEMENT
NO. 7
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
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THIS ENDORSEMENT CHANGES THE
POLICY. PLEASE READ IT CAREFULLY.
COVERAGE TERRITORY
ENDORSEMENT
Payment
of loss under this policy shall only be made in full compliance with all United
States of America economic or trade sanction laws or regulations, including,
but not limited to, sanctions, laws and regulations administered and enforced
by the U.S. Treasury Department's Office of Foreign Assets Control
("OFAC").
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By
____________________
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Authorized
Representative
|
ENDORSEMENT
NO. 8
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
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FORMS INDEX ENDORSEMENT
The
contents of the Policy is compromised of the following forms:
FORM NUMBER
|
EDITION DATE
|
FORM TITLE
|
SR6196
PENMAN
MNSCPR
MNSCPR
PENMAN
PENMAN
89644
78859
MNSCPR
MNSCPR
MNSCPR
MNSCPR
|
07/05
10/01
|
COMPUTER
SYSTEMS FRAUD INSURING AGREEMENT
TELEFACSIMILE
TRANSFER FRAUD
UNAUTHORIZED
SIGNATURES
COUNTERFEIT
CURRRENCY
STOPPAY
VOICE
INITIATED FUNDS TRANSFERS
COVERAGE
TERRITORY ENDORSEMENT (OFAC)
FORMS
INDEX ENDORSEMENT
CLAIMS
EXPENSE
AMENDED
DISCOVERY
CREDIT
RATINGS TRIGGER
90
DAY NOC
|
ALL OTHER TERMS, CONDITIONS AND EXCLUSIONS REMAIN UNCHANGED.
|
|
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By
____________________
|
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Authorized
Representative
|
ENDORSEMENT
NO. 9
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
|
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90 DAY NOC
It is agreed
that:
1. The
attached bond is hereby amended by deleting Section 13., TERMINATION, in its
entirety and substituting the following:
The
Underwriter may terminate this bond as an entirety by furnishing written notice
specifying the termination date which cannot be prior to 90 days after the
receipt of such written notice by each Investment Company named as Insured and
the Securities and Exchange Commission, Washington, D.C. The Insured may
terminate this bond as an entirety by furnishing written notice to the
Underwriter. When the Insured cancels, the Insured shall furnish written
notice to the Securities and Exchange Commission, Washington, D.C. prior to 90
days before the effective date of the termination. The Underwriter shall
notify all other Investment Companies named as Insured of the receipt of such
termination notice and the termination cannot be effective prior to 90 days
after receipt of written notice by all other Investment Companies. Premiums
are earned until the termination date as set forth herein.
This
Bond will terminate as to any one Insured, (other than a registered management
investment company), immediately upon taking over of such Insured by a receiver
or other liquidator or by State or Federal officials, or immediately upon the
filing of a petition under any State or Federal statute relative to bankruptcy
or reorganization of the Insured, or assignment for he benefit of creditors of
the Insured, or immediately upon such Insured ceasing to exist, whether through
merger into another entity, or by disposition of all of its assets.
This Bond will terminate as to any registered
management investment company upon the expiration of 90 days after written
notice has been given to the Securities and Exchange Commission, Washington, D.C.
The Underwriter
shall refund the unearned premium computed at short rates in
accordance with the standard short rate cancellation tables if terminated by the Insured or pro rata terminated for any other
reason.
This bond shall
terminate
a. as
to any Employee as soon as any partner, officer or supervisory Employee of the
Insured, who is not in collusion with such Employee, shall learn of any dishonest
or fraudulent act(s), including Larceny or Embezzlement on the part of such
Employee without prejudice to the loss of any Property then in transit in the
ENDORSEMENT
NO. 9 (CONTINUED)
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
|
|
custody
of such Employee and upon the expiration of ninety (90) days after written
notice has been given to the Securities and Exchange Commission, Washington,
D.C. (See Section 16(d)) and to the Insured Investment Company, or
b. as
to any Employee 90 days after receipt by each Insured and by the Securities and
Exchange Commission of a written notice from the Underwriter of its desire to
terminate this bond as to such Employee, or
c. as
to any person, who is a partner, officer or employee of any Electronic Data
Processor covered under this bond, from and after the time that the Insured or
any partner or officer thereof not in collusion with such person shall have
knowledge or information that such person has committed any dishonest or
fraudulent act(s), including Larceny or Embezzlement in the service of the
Insured or otherwise, whether such act be committed before or after the time
this bond is effective and upon the expiration of ninety (90) days after
written notice has been given by the Underwriter to the Securities and Exchange
Commission, Washington DC and to the insured Investment Company.
2. Nothing
herein contained shall be held to vary, alter, waive, or extend any of the
terms, limitations, conditions, or provisions of the attached bond other than
as above stated.
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|
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By
____________________
|
|
Authorized
Representative
|
ENDORSEMENT
NO. 10
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
|
It is agreed
that:
1.
|
The
attached bond is hereby amended by adding to it an additional Insuring
Agreement as follows:
|
|
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|
Reasonable
expenses necessarily incurred and paid by the Insured in preparing any valid
claim for loss as defined in Insuring Agreements A, B, C, D, E, and F, and any
other valid coverage added by rider which loss exceeds the Single Loss
Deductible Amount of
$2,500
.
The Underwriter's maximum liability
for such expenses paid by the Insured in preparing any one such claim shall be
limited to
$50,000, such aggregate limit is provided as part of, and not in
addition to, the Aggregate Limit of Liability shown on the Declaration Page; a
$2,500 deductible will apply to each and every loss.
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2.
|
Exclusion
(k) is hereby deleted in its entirety.
|
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|
|
3.
|
Nothing
herein contained shall be held to vary, alter, waive or extend any of the
terms, limitations, conditions or agreements or the attached policy other than
as above stated.
|
|
|
|
|
|
By
____________________
|
|
Authorized
Representative
|
ENDORSEMENT
NO. 11
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
|
|
AMENDED DISCOVERY
It is agreed
that:
1.
SECTION 4. LOSS -NOTICE -PROOF- LEGAL PROCEEDINGS is amended by
deleting the following:
Discovery occurs
when the Insured
(a) becomes aware of facts, or
(b) receives written notice of an actual or potential claim by a third party which
alleges that the Insured is liable under circumstance which would cause a
reasonable person to assume that a loss covered by the bond has been or will be
incurred even though the exact amount or details of loss may not be then known.
2.
SECTION 4. LOSS -NOTICE -PROOF- LEGAL PROCEEDINGS is amended by
adding the following:
Discovery occurs
when the President, Chief Compliance Officer, or General Counsel
(a) becomes aware of facts, or
(b) receives written notice of an actual or potential claim by a third party which
alleges that the Insured is liable under circumstance which would cause a
reasonable person to assume that a loss covered by the bond has been or will be
incurred even though the exact amount or details of loss may not be then known.
3. Nothing herein contained shall be held to vary, alter, waive or
extend any of the terms, limitations conditions or agreements or the attached
bond other than as above stated.
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|
By
____________________
|
|
Authorized
Representative
|
ENDORSEMENT
NO. 12
This endorsement, effective
12:01 AM
|
November 15, 2008
|
forms a part of policy number
94-555-89-72
|
|
|
issued to:
BLUE CHIP VALUE FUND, INC.
|
|
|
CANCELLATION
CLAUSE AMENDED ENDORSEMENT
(CREDIT RATING
TRIGGER)
In consideration of the premium charged,
it is hereby understood and agreed that Clause 13.
TERMINATION
of this
policy is amended by adding the following paragraph to the end thereof:
Notwithstanding
the foregoing, in the event that a financial strength rating is issued (1)
below A- by A.M. Best Co., or (2) below BBB by Standard & Poors Ratings
Services, for the
Insurer
(hereinafter Credit Rating Downgrade), this
policy may be canceled by the
Named Entity
by mailing written prior notice
to the
Insurer
or by surrender of this policy to the
Insurer
or
its authorized agent. If this policy is canceled by the
Named Entity
within 30 days after such Credit Rating Downgrade, the
Insurer
shall
retain the pro rata proportion of the premium herein.
ALL OTHER TERMS, CONDITIONS AND EXCLUSIONS REMAIN UNCHANGED.
© American
International Group, Inc. All rights reserved.
|
|
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|
By
____________________
|
|
Authorized
Representative
|
Blue Chip Value Fund, Inc.
Minutes of
the Board of Directors Meeting
November 11, 2008
(Excerpt relating to Fidelity bond)
Approval
of Fidelity Bond Coverage
.
RESOLVED,
that the Fund ratifies the extension of the Fidelity Bond (the Policy) having
coverage of $600,000 for the period October 1, 2008 through November 15, 2008; and
FURTHER
RESOLVED, that the Fund renew the Policy for the period November 16, 2008 through November 15, 2009 having coverage of at least $525,000 based on the level
of the Funds gross assets as of September 30, 2008, the most recent fiscal quarter end; and
FURTHER
RESOLVED, that the Treasurer be, and hereby is, re-designated as the officer
responsible for making the necessary filings and giving the notices required by
paragraph (g) of Rule 17g-1 under the 1940 Act.
FURTHER RESOLVED, that the officers
of the Fund be, and each of them hereby is, authorized to take all such
actions, including without limitation the execution and delivery of all
requisite documents, in order to effect the intent of the foregoing
resolutions, and that any actions heretofore taken to effect the foregoing
resolutions be, and they hereby are, ratified, confirmed and approved.
Certificate of the
Treasurer
The premium for the bond has
been paid through November 15, 2009.
Jasper R. Frontz,
Treasurer
Blue Chip Value Fund, Inc. (NYSE:BLU)
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