April 12, 2022
VIA EDGAR
U.S. Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
RE:
Bain Capital Specialty Finance, Inc.
Rule 17g-1 Filing of Fidelity Bond
Dear Sir or Madam:
On behalf of Bain Capital Specialty Finance, Inc. (the “Company”),
enclosed for filing, pursuant to Rule 17g-1 of the Investment Company Act of 1940, as amended, are the following:
| 1. | Copy of the fidelity bond covering the Company; |
| 2. | A Certificate of the Secretary of the Company containing the resolutions of the Board of Directors approving the amount, type, form
and coverage of the fidelity bond; and |
| 3. | Premiums have been paid for the period beginning April 5, 2022 through April 5, 2023. |
If you have any questions about this filing, please contact the undersigned
at 617-516-2000.
Sincerely,
/s/ Michael Treisman |
|
|
|
Michael Treisman |
|
Vice President and Secretary |
|
Bain Capital Specialty Finance, Inc. |
|
CERTIFICATE OF SECRETARY
The undersigned, Michael Treisman, Vice President
and Secretary of Bain Capital Specialty Finance, Inc. (the “Company”), a Delaware corporation, does hereby certify that:
| 1. | This certificate is being delivered to the Securities and Exchange Commission (the “SEC”) in connection with the filing
of the Company’s fidelity bond (the “Bond”) pursuant to Rule 17g-1 of the Investment Company Act of 1940, as amended,
and the SEC is entitled to rely on this certificate for purposes of the filing. |
| 2. | The undersigned is the duly elected, qualified and acting Secretary of the Company, and has custody of the corporate records of the
Company and is a proper officer to make this certification. |
| 3. | Attached hereto as Exhibit A is a copy of the resolutions approved by the Board of Directors of the Company, including
a majority of the Board of Directors who are not “interested persons” of the Company, approving the amount, type, form and
coverage of the Bond. |
| 4. | Premiums have been paid for the period beginning April 5, 2022 through April 5, 2023. |
IN WITNESS WHEREOF, the undersigned has caused this certificate to
be executed this 12th day of April 2022.
/s/ Michael Treisman |
|
|
|
Michael Treisman |
|
Vice President and Secretary |
|
Bain Capital Specialty Finance, Inc. |
|
EXHIBIT A
Approval of Fidelity Bond
RESOLVED,
that the Company, Adviser and Administrator shall be named as an insured under a joint fidelity bond having an aggregate coverage amount
as presented to and/or discussed with the Board, issued by a reputable fidelity insurance company, against larceny and embezzlement and
such other types of losses as are included in standard fidelity bonds, covering the officers and the other employees of the Company from
time to time, containing such provisions as may be required by the rules promulgated under the Investment Company Act of 1940, as
amended (“1940 Act”); and
RESOLVED,
that the joint fidelity bond in the amount and form presented to and/or discussed with the Board be, and the same hereby is, approved
after consideration of all factors deemed relevant by the Board, including the amount of the bond, the expected value of the assets of
the Company to which any person covered under the bond may have access, the estimated amount of the premium for such bond, the type and
terms of the arrangements made for the custody and safekeeping of the Company’s assets, and the nature of the securities in the
Company’s portfolio; and
RESOLVED,
that the share of the premium to be allocated to the Company, the Adviser and the Administrator for the bond, which is based upon their
proportionate share of the sum of the premiums that would have been paid if such fidelity bond coverage had been purchased separately,
be, and the same hereby is, approved, after the Board having given due consideration to, among other things, the number of other parties
insured under the bond, the nature of the business activities of those other parties, the amount of the bond and the extent to which the
share of the premium allocated to the Company under the bond is less than the premium the Company would have had to pay had it maintained
a single insured bond; and
RESOLVED,
that the officers of the Company be, and each of them hereby is, authorized to obtain said fidelity bond in substantially the form presented
to and/or discussed with the Board with the other named insureds under said bond providing that in the event that any recovery is received
under the bond as a result of a loss sustained by the Company and also by the other named insured, the Company shall receive an equitable
and proportionate share of the recovery, but in no event less than the amount it would have received had it provided and maintained a
single insured bond with the minimum coverage required by paragraph (d)(1) of Rule 17g-1 under the 1940 Act; and
RESOLVED,
that the proposed Joint Fidelity Bond Agreement among the Company, the Adviser and the Administrator as presented to the Board is approved
by the Board, including a majority of the independent directors, with such further changes therein as the officers of the Company may
determine to be necessary or desirable and proper, with the advice of the Company’s counsel, the execution of said Joint Fidelity
Bond Agreement by such officers to be conclusive evidence of such determination; and
RESOLVED,
that the Chief Financial Officer of the Company be, and hereby is, designated as the party responsible for making the necessary filings
and giving the notices with respect to such bond required by paragraph (g) of Rule 17g-1 under the 1940 Act; and
RESOLVED,
that the appropriate officers of the Company be, and each of them hereby is, authorized to make any and all payments and to do any and
all other acts, in the name of Company and on its behalf, as they, or any of them, may determine to be necessary or desirable and proper
in connection with or in furtherance of the foregoing resolutions.
POLICYHOLDER NOTICE
Thank you for purchasing insurance from a member company of
American International Group, Inc. (AIG). The AIG member companies generally pay compensation to brokers and independent
agents, and may have paid compensation in connection with your policy. You
can review and obtain information about the nature and range of compensation paid by AIG member companies to brokers and independent
agents in the United States by visiting our website at www.aig.com/producercompensation or by calling
1-800-706-3102.
INVESTMENT
COMPANY BLANKET BOND
NATIONAL
UNION FIRE INSURANCE COMPANY
OF
PITTSBURGH, PA
(A
stock Insurance Company, herein Called the Underwriter)
DECLARATIONS
Item
1. |
Name
of Insured |
Bain
Capital Specialty Finance Inc. |
BOND
NUMBER |
|
|
|
24157061 |
|
Principal
Address: |
200
Clarendon St. |
|
|
|
Boston,
MA 02116-5021 |
|
(Herein
called the Insured)
Item
2. |
Bond
Period from 12:01 a.m on 04/05/2022 to 12:01 a.m. on 04/05/2023. |
| The
effective date of the termination or cancellation of this bond, standard time at the Principal
Address as to each of the said dates. |
Item
3. Limit of Liability – |
|
Subject to Section 9, 10, and 12 hereof: |
| |
| Limit
of Liability | | |
| Deductible
Amount | |
Insuring
Agreement A – FIDELITY | |
$ | 2,000,000 | | |
$ | 0 | |
Insuring
Agreement B – AUDIT EXPENSE | |
$ | 50,000 | | |
$ | 5,000 | |
Insuring
Agreement C – ON PREMISES | |
$ | 2,000,000 | | |
$ | 25,000 | |
Insuring
Agreement D – IN TRANSIT | |
$ | 2,000,000 | | |
$ | 25,000 | |
Insuring
Agreement E – FORGERY OR ALTERATION | |
$ | 2,000,000 | | |
$ | 25,000 | |
Insuring
Agreement F – SECURITIES | |
$ | 2,000,000 | | |
$ | 25,000 | |
Insuring
Agreement G – COUNTERFEIT CURRENCY | |
$ | 2,000,000 | | |
$ | 25,000 | |
Insuring
Agreement H – STOP PAYMENT | |
$ | 50,000 | | |
$ | 5,000 | |
Insuring
Agreement I – UNCOLLECTIBLE ITEMS OF DEPOSIT | |
$ | 50,000 | | |
$ | 5,000 | |
OPTIONAL
COVERAGES ADDED BY RIDER:
Insuring
Agreement J – COMPUTER SYSTEMS | |
| | | |
| | |
Insuring
Agreement K – UNAUTHORIZED SIGNATURES | |
$ | 50,000 | | |
$ | 5,000 | |
Insuring
Agreement L – AUTOMATED PHONE SYSTEMS | |
| | | |
| | |
Insuring
Agreement M – TELEFACSIMILE | |
| | | |
| | |
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 there from.
Item
4. | Office 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 other 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: |
Item 5. | The
Liability of the Underwriter is subject to the terms of the following riders attached hereto: |
| 103012
(10/09), 89644 (7/05), 103004 (10/09), |
| 91222
(12/09), SR5538, 41206 (9/84), 141636 (5/21) |
Item 6. | The
Insured by the acceptance of this bond gives notice to the Underwriter terminating or cancelling
prior bond(s) or policy(ies) No.(s) N/A such termination or cancellation to be
effective as of the time this bond becomes effective. |
Item 7. | Premium
Amount: $5,107.00 |
| FHFC
– Florida Hurricane Fund: |
Issue Date: 04/05/2022 |
By: |
|
|
|
|
|
Authorized Representative |
NATIONAL
UNION FIRE INSURANCE COMPANY
OF
PITTSBURGH, PA
RIDER
No. 1
To
be attached to and form part of Bond No 24157061.
in favor of Bain Capital Specialty Finance Inc..
effective
as of 04/05/2022.
In
consideration of the premium charged for the attached bond, it is hereby agreed that:
1. From and after the time this rider becomes effective the Insured under the attached bond are:
2.
The first named Insured shall act for itself and for each and all of the Insured for all the purposes of the attached
bond.
3. Knowledge possessed or discovery made by the Corporate Risk Management Department, Internal Audit Department, or General
Counsel Department, of any Insured or by any partner or officer thereof shall for all the purposes of the attached bond constitute
knowledge or discovery by all the Insured.
4. If,
prior to the termination of the attached bond in its entirety, the attached bond is terminated as to any Insured, there shall be no liability
for any loss sustained by such Insured unless discovered before the time such termination as to such Insured becomes effective.
5. The
liability of the Underwriter for loss or losses sustained by any or all of the Insured shall not exceed the amount for which the
Underwriter would be liable had all such loss or losses been sustained by any one of the Insured. Payment by the Underwriter
to the first named Insured of loss sustained by any Insured shall fully release the Underwriter on account of such loss.
6.
If the first named Insured ceases for any reason to be covered under the attached bond, then the Insured next named shall thereafter
be considered as the first named Insured for all the purposes of the attached bond.
7.
The attached bond shall be subject to all its agreements, limitations and conditions
except as herein expressly modified.
8. This rider shall become effective as 12:01 a.m. on 04/05/2022.
Signed,
Sealed and dated
|
By: |
|
|
|
Authorized Representative |
This
endorsement, effective at 12:01 a.m. 04/05/2022 forms a part of
Policy
Number: 24157061
Issued
to: Bain Capital Specialty Finance Inc.
By: National
Union Fire Ins of Pittsburgh
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 sanctions laws of
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)
ALL
OTHER TERMS, CONDITIONS AND EXCLUSIONS REMAIN UNCHANGED.
©
American International Group, Inc. All rights reserved.
|
By: |
|
|
|
Authorized Representative |
NATIONAL
UNION FIRE INSURANCE COMPANY
OF
PITTSBURGH, PA
INSURING
AGREEMENT K
To
be attached to and form a part of Investment Company Blanket Bond No. 24157061.
in
favor of Bain Capital Specialty Finance Inc..
It
is agreed that:
| (1) | The
attached bond is amended by adding an additional Insuring Agreement as follows: |
UNAUTHORIZED
SIGNATURES
| | Loss
resulting directly from the insured having accepted, paid or cashed any check or withdrawal order, draft, 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 the application on file with
the Insured as a signatory on such account. |
| (2) | It
shall be a condition precedent to the Insured's right of recovery under this rider that the
Insured shall have on file signatures of all persons who are authorized signatories on such
account. |
| (3) | The
Single Loss Limit of Liability for the coverage provided by this rider shall be $50,000, it being understood, however, that such liability
shall be part of, and not in addition to, the Aggregate Limit of Liability stated in item 3. of the Declarations of the attached bond. |
| (4) | The
Underwriter shall not be liable under the Unauthorized Signatures Rider for any loss on account of any in-strument unless the
amount of such instrument shall be excess of $5,000(herein called Deductible Amount), and unless such loss on account of such instrument,
after deducting all recoveries on account of such instru-ment made prior to the payment of such loss by the Underwriter, shall be in
excess of such Deductible Amount and then for such excess only, but in no event more than the amount of the attached bond, or the amount
of coverage under the Unauthorized Signatures Rider, if the amount of such coverage is less than the amount of the attached bond. |
| (5) | 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. |
| (6) | The
rider is effective as of 12:01 a.m. standard time on 04/05/2022 as specified in the
bond. |
|
By: |
|
|
|
Authorized Representative |
NATIONAL UNION FIRE INSURANCE COMPANY
OF PITTSBURGH, PA
AMENDMENT TO TERMINATION
To
be attached to and form part of Investment Company Blanket Bond No. 24157061.
in favor of
Bain Capital Specialty Finance Inc..
It is agreed that:
1. The attached bond is hereby amended
by deleting Section 13. TERMINATION in its entirety and replacing it with the following:
SECTION13. TERMINATION
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 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. |
| 3. | This rider is effective as of 12:01 a.m. on 04/05/2022. |
|
By: |
|
|
|
Authorized Representative |
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
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) | to cause the Insured to sustain such loss; and |
| (b) | 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. |
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.
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) | 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 |
| (2) | 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. |
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.
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) | through the Insured’s 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 |
| (b) | 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 |
| (c) | raised or otherwise altered, or lost, or stolen, or |
| (2) | through the Insured’s 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. |
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.
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.
Mechanically produced facsimile signatures
are treated the same as handwritten signatures.
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.
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 customer’s, shareholder’s or subscriber’s account based
upon Uncollectible Items of Deposit of a customer, shareholder or subscriber credited by the Insured or the Insured’s agent to such
customer’s, shareholder’s or subscriber’s 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).
GENERAL AGREEMENTS
A . ADDITIONAL OFFICES OR EMPLOYEES-CONSOLIDATION
OR MERGER-NOTICE
| 1. | 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. |
| 2. | 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. |
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) | an
Employee admits to being guilty of any dishonest or fraudulent act(s), including Larceny
or Embezzlement; or |
| (2) | an
Employee is adjudicated to be guilty of any dishonest or fraudulent act(s), including Larceny
or Embezzlement; |
| (3) | 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. |
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.
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.
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:
| (1) | any
of the Insured’s officers, partners, or employees, and |
| (2) | 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 |
| (3) | 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 |
| (4) | guest
students pursuing their studies or duties in any of the Insured’s offices, and |
| (5) | 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 |
| (6) | 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 |
| (7) | 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 |
| (8) | those
persons so designated in Section 15, Central Handling of Securities, and |
| (9) | any
officer, partner or Employee of |
| b) | an underwriter
(distributor), |
| c) | a transfer
agent or shareholder accounting record-keeper, or |
| d) | an
administrator authorized by written agreement to keep financial and/or other required records, |
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.
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.
Brokers, or other agents under contract
or representatives of the same general character shall not be considered Employees.
| (b) | “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. |
| (c) | “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. |
| (d) | “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. |
| (e) | “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. |
SECTION 2. EXCLUSIONS
THIS BOND DOES NOT COVER:
| (a) | 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). |
| (b) | 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. |
| (c) | 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. |
| (d) | 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. |
| (e) | 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). |
| (f) | loss
resulting from any violation by the Insured or by any Employee |
| (1) | 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 |
| (2) | 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). |
| (g) | 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. |
| (h) | 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). |
| (i) | all
damages of any type for which the Insured is legally liable, except direct compensatory damages
arising from a loss covered under this bond. |
| (j) | loss
through 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 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 |
| (2) | to
do damage to the premises or Property of the Insured, except when covered under Insuring
Agreement (A). |
| (k) | 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). |
| (l) | 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). |
| (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. |
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.
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.
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.
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.
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 |
| (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 |
| (c) | all
wrongful acts, other than those specified in (a) above, of any one person shall be deemed
to be one loss, or |
| (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 |
| (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.
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 |
| (b) | 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 |
| (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. |
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;
| (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.
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, |
| (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 |
| (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. |
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 |
| (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.
Notification
CHANGE
TO INSURER'S ADDRESS
Please be advised
that all references to the address 175 Water Street, New York, NY 10038 contained in the Policy, Policy Declarations, riders, endorsements,
and Policy notices are hereby deleted in their entirety and replaced with the following: 1271 Ave of the Americas FL 37, New York, NY
10020-1304
All other terms and conditions of the Policy remain the same.
This rider, effective at 12:01 AM 04/05/2022 |
forms a part of |
Policy number: 24157061
Issued to: Bain Capital Specialty Finance Inc.
By:National Union Fire Ins of
Pittsburgh
Product Name: ICBB
COMPUTER CRIME COVERAGE RIDER
(ICBB VERSION)
In consideration of the premium charged, it is hereby understood and
agreed that bond is hereby amended as follows:
1. | All the terms and conditions of the Investment Company Blanket Bond, Form No. 41206 (09/84),
shall apply to coverage as is afforded by this endorsement unless specifically stated otherwise herein or in any endorsement attached
hereto. |
2. | Item 3 of the Declarations is hereby amended by adding the following under Optional Insuring Agreements
and Coverages section: |
| |
Limit of Liability | | |
Deductible | |
(CC-1) Computer Systems Fraud | |
$ | 2,000,000 | | |
$ | 25,000 | |
(CC-2) Data Processing Service Operations | |
$ | 2,000,000 | | |
$ | 25,000 | |
(CC-3) Voice Initiated Transfer Fraud | |
$ | 2,000,000 | | |
$ | 25,000 | |
(CC-4) Telefacsimile Transfer Fraud | |
$ | 2,000,000 | | |
$ | 25,000 | |
(CC-5) Destruction of Data or Programs by Hacker | |
$ | 2,000,000 | | |
$ | 25,000 | |
(CC-6) Destruction of Data or Programs by Virus | |
$ | 2,000,000 | | |
$ | 25,000 | |
(CC-7) Voice Computer Systems Fraud | |
$ | 2,000,000 | | |
$ | 25,000 | |
3. The Declarations page is hereby amended by adding the following
after Item 6 thereof:
Item 7.
Voice Initiated Transfer Fraud
Under the terms of the Voice Initiated Transfer Fraud Insuring
Agreement, the Insured must place verification call-back for each transfer in excess of $25,000.
Telefacsimile Transfer Fraud
Under the terms of the Telefacsimile Transfer Fraud Insuring
Agreement, the Insured must place a Verification call-back for each transfer in excess of $25,000.
4. | The Insuring Agreements are hereby amended by adding the following Insuring Agreements to the Bond: |
COMPUTER SYSTEMS FRAUD
(CC-1) Loss resulting directly from a fraudulent:
| (1) | entry of Electronic Data or Computer Program into, or |
| (2) | change of Electronic Data or Computer Program within |
any Computer System operated by the
Insured, whether owned or leased; or any Computer System identified in the application for this bond; or a Computer System first used
by the Insured during the bond period; as provided by General Agreement B; provided the entry or change causes:
| (i) | Property to be transferred, paid or delivered, |
| (ii) | an account of the Insured, or of its customer, to be added, deleted, debited or credited, or |
| (iii) | an unauthorized account or a fictitious account to be debited or credited. |
In this Insuring Agreement, fraudulent entry or change shall
include such entry or change made by an Employee of the Insured acting in good faith:
| (a) | on an instruction from a software contractor who has a written agreement with the Insured to design, implement
or service programs for a Computer System covered by this Insuring Agreement, or |
| (b) | on an instruction transmitted by Tested telex or similar means of Tested communication identified in the
application for this bond purportedly sent by a customer, financial institution or automated clearing house. |
DATA PROCESSING SERVICE OPERATIONS
(CC-2) Loss sustained by a Client of the Insured resulting
directly from a fraudulent:
| (1) | entry of Electronic Data or a Computer Program into, or |
| (2) | change of Electronic Data or a Computer Program within a Computer System covered under the terms of the
COMPUTER SYSTEMS FRAUD Insuring Agreement, or |
| (3) | entry or change of Electronic Data during electronic transmission or physical transit from the Insured
to its Client, provided that the entry or change causes: |
| (i) | Property to be transferred, paid or delivered, |
| (ii) | an account of the Client, or a customer of the Client, to be added, deleted, debited or credited, or |
| (iii) | an unauthorized account or a fictitious account to be debited or credited, |
and for which loss the Insured is legally liable to the Client
as a provider of data processing services for such Client.
In this Insuring Agreement, fraudulent entry or change shall
include such entry or change made by an Employee of the Insured acting in good faith:
| (a) | on an instruction from a software contractor who has a written agreement with the Insured to design, implement
or service programs for a Computer System covered by this Insuring Agreement, or |
| (b) | on an instruction transmitted by Tested telex or similar means of Tested communication identified in the
application for this bond purportedly sent by a customer, financial institution or automated clearing house. |
In this Insuring Agreement, Client means an entity for which
the Insured serves as data processor under the terms of a written agreement.
VOICE INITIATED TRANSFER FRAUD
(CC-3) |
Loss resulting
directly from the Insured having, in good faith, transferred Funds from a Customer’s account through a Computer System covered under
the terms of the COMPUTER SYSTEMS FRAUD Insuring Agreement in reliance upon a fraudulent voice instruction transmitted by telephone
which was purported to be from: |
| (1) | an officer, director, partner or employee of a Customer of the Insured who was authorized by the Customer
to instruct the Insured to make such transfer, |
| (2) | an individual person who is a Customer of the Insured, or |
| (3) | an Employee of the Insured in another office of the Insured who was authorized by the Insured to instruct
other Employees of the Insured to transfer Funds, |
and was received by an Employee of the
Insured specifically designated to receive and act upon such instructions, but the voice instruction was not from a person described in
(1), (2) or (3) above, provided that:
| (i) | such voice instruction was electronically recorded by the Insured and required password(s) or code
word(s) given; and |
| (ii) | if the transfer was in excess of the amount shown on the Declarations Page as the verification call-back
amount for this Insuring Agreement, the voice instruction was verified by a call-back according to a prearranged procedure. |
As used in this Insuring Agreement, Customer
means an entity or individual which has a written agreement with the Insured authorizing the Insured to rely on voice instructions to
initiate 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.
TELEFACSIMILE TRANSFER FRAUD
(CC-4) |
Loss
resulting directly from the Insured having, in good faith, transferred or delivered Funds, Certificated Securities or Uncertificated
Securities through a Computer System covered under the terms of the COMPUTER SYSTEMS FRAUD 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; |
provided that, if the transfer was in excess of
the amount shown on the Declarations as the verification call-back amount for this Insuring Agreement, the instructions was verified by
a call-back according to a prearranged procedure.
As used 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 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.
DESTRUCTION OF DATA OR PROGRAMS BY HACKER
(CC-5) |
Loss that
is Restoration Costs resulting directly from the malicious destruction of, or damage to, Electronic Data or Computer Programs owned by
the Insured or for which the Insured is legally liable while stored within a Computer System covered under the terms of the COMPUTER
SYSTEMS FRAUD Insuring Agreement. |
Special Condition:
Under this Insuring Agreement, a single “Loss” shall comprise of all covered costs incurred by the Insured between
the time destruction or damage is discovered and the time the affected Computer Program(s) or Electronic Data is/are restored or
repaired (or a determination has been made that such restoration or repair is impossible). Recurrence of destruction or damage after the
Computer Program(s) or Electronic Data is/are restored or repaired shall constitute a separate single “Loss.”
DESTRUCTION OF DATA OR PROGRAMS BY VIRUS
(CC-6) |
Loss that
is Restoration Costs resulting directly from the malicious destruction of, or damage to, Electronic Data or Computer Programs owned by
the Insured or for which the Insured is legally liable while stored within a Computer System covered under the terms of the COMPUTER
SYSTEMS FRAUD Insuring Agreement if such destruction or damage was caused by a computer program or similar instruction which was written
or altered to incorporate a hidden instruction designed to destroy or damage Electronic Data or Computer Programs in the Computer System
in which the computer program or instruction so written or so altered is used. |
Special
Condition: Under this Insuring Agreement, a single “Loss” shall comprise of all covered costs incurred by the Insured
between the time destruction or damage is discovered and the time the affected Computer Program(s) or Electronic Data is/are restored
or repaired (or a determination has been made that such restoration or repair is impossible). Recurrence of destruction or damage after
the Computer Program(s) or Electronic Data is/are restored or repaired shall constitute a separate single “Loss.”
VOICE COMPUTER SYSTEM FRAUD
(CC-7) |
Loss resulting
directly from charges for voice telephone long-distance toll calls which were incurred due to the fraudulent use or fraudulent manipulation
of an Account Code or System Password required to obtain access to a Voice Computer System owned or leased by the Insured, installed on
the Insured’s premises, whose System Administration is performed and controlled by the Insured; provided, however, that the unauthorized
access was not made possible by: |
| (1) | failure to incorporate a System Password feature or failure to change the System Password at least once
every 30 days thereafter, or |
| (2) | failure to have a call-disconnect feature in operation to automatically terminate a caller’s access
to the Voice Computer System after not more than three unsuccessful attempts to input an Account Code. |
Special
Condition: Under this Insuring Agreement, a single “Loss” consists of loss resulting from toll call charges made
only on telephone lines directly controlled by one Voice Computer System and only toll call charges occurring for a period of not more
than 30 days inclusive of the date on which the first such toll call charge was made.
5. | GENERAL AGREEMENT A. ADDITIONAL OFFICES OR EMPLOYEES–CONSOLIDATION, MERGER–NOTICE is hereby
deleted in its entirety and is replaced with the following: |
ADDITIONAL OFFICES OR EMPLOYEES
OR COMPUTER SYSTEMS –
CONSOLIDATION, MERGER OR PURCHASE OF ASSETS OR COMPUTER SYSTEMS
| A. | If the Insured shall, while this bond is in force, establish any additional offices, other than by consolidation
or merger with, or purchase or acquisition of assets or liabilities or computer systems of, another institution, such offices and computer
systems shall be automatically covered hereunder from the date of such establishment without the requirement of notice to the Underwriter
or the payment of additional premium for the remainder of the premium period. |
If the Insured shall, while this bond
is in force, consolidate or merge with, or purchase or acquire assets or liabilities or computer systems of, another institution, the
Insured shall not have such coverage as is afforded under this bond for loss which:
| (a) | has occurred or will occur in offices or premises or computer systems, or |
| (b) | has been caused or will be caused by an employee or employees of such institution, or |
| (c) | has arisen or will arise out of the assets or liabilities or computer systems acquired by the Insured
as a result of such consolidation, merger or purchase of assets or liabilities or computer systems, |
unless the Insured shall:
| (i) | give the Underwriter written notice within 60
days of the proposed consolidation, merger or purchase of assets or liabilities or computer systems prior to the proposed effective date
of such action; and |
| (ii) | obtain the written consent of the Underwriter to extend the coverage provided by this bond to such additional
offices or premises or computer systems, Employees and other exposures; and |
| (iii) | upon obtaining such consent, pay to the Underwriter an additional premium. |
6. | Solely for the coverage provided by this rider, in Section 1. DEFINITIONS of the CONDITIONS AND LIMITATIONS
of this bond, definition (b) “Property” is hereby amended to include Electronic Data and Computer Programs. |
7. | Solely for the coverage provided by this rider, Section 1. DEFINITIONS of the CONDITIONS AND LIMITATIONS
of this bond is hereby amended by adding the following definitions to the end thereof: |
| (i) | “Account Code” means a confidential and protected string of characters which identifies or
authenticates a person and permits that person to gain access to a Voice Computer System for the purpose of making toll calls or utilizing
voice mail box messaging capabilities or other similar functional features of the System. |
| (ii) | “Computer Program” means a set of related electronic instructions which direct the operations
and functions of a computer or devices connected to it which enable the computer or devices to receive, process, store or send Electronic
Data. |
| (iii) | “Computer System” means: |
| (1) | computers with related peripheral components, including storage components wherever located; |
| (2) | systems and applications software; |
| (4) | related communication networks, including the internet |
by which Electronic Data are electronically collected, transmitted,
processed, stored and retrieved.
| (iv) | “Electronic Data” means facts or information converted to a form usable in a Computer System
by Computer Programs and which is stored on magnetic tapes or disks, or optical storage disks or other bulk media. |
|
(iv) |
“Funds” means Money on deposit in an account. |
| (v) | “Restoration Costs” means reasonable and necessary costs or expenses incurred by the Insured
with the Insurer’s prior written consent to restore or repair damaged or destroyed Electronic Data or Computer Programs within a
Computer System; provided that if it is determined that such Electronic Data
or Computer Programs cannot be restored or repaired, then Restoration Costs means solely those reasonable costs or expenses incurred by
the Insured, with the Insurer’s prior written consent, to reach such determination. |
Notwithstanding the foregoing, Restoration
Costs shall not include, and in no event shall any Insuring Agreement of this bond cover:
| (1) | any costs related directly or indirectly to the damage or destruction of Electronic Data or Computer Programs
that the Insured did not have a license to use; or |
| (2) | any costs or expenses incurred to redo the work product, research or analysis that was the basis of any
damaged or destroyed Electronic Data or Computer Programs. |
(vi) | “System Administration” means the performance of security functions including but not limited
to defining authorized persons to access a Voice Computer System and adding, changing and deleting Account Codes or passwords in connection
therewith; and invoking or revoking a System option which directs telephone call routing or which adds, moves or drops telephone lines
or which performs any other similar activity allowed by a hardware or software-based System option that has been incorporated by a manufacturer
or vendor into a System or any component thereof provided said System option is not intended for the sole use of such manufacturer or
vendor. |
(vii) | “System Maintenance” means the performance of hardware
and software installation, diagnostics and corrections and similar activities that are performed in the usual custom and practice by
a manufacturer or vendor to establish or maintain the basic operational functionality of a Voice Computer System or any component thereof. |
(viii) | “System Password” means a confidential and protected string of characters which identifies
or authenticates a person and permits that person to gain access to a Voice Computer System or any portion thereof for the purpose of
performing System Administration or System Maintenance activities. |
(ix) | “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 the duplicate image on paper. |
(x) | “Tested” means a method of authenticating the contents of a communication by placing a valid
test key on it which has been agreed upon by the Insured and a customer, automated clearing house, or another financial institution for
the purpose of protecting the integrity of the communication in the ordinary course of business. |
(xi) | “Uncertificated Security” means a share, participation or other interest in property of, or
an enterprise of, the issuer or an obligation of the issuer, which is: |
| (1) | not represented by an instrument and the transfer of which is registered upon books maintained for that
purpose by or on behalf of the issuer; |
| (2) | of a type commonly dealt in securities, exchanges or markets; and |
| (3) | either one of a class or series or by its terms divisible into a class or series of shares, participations,
interests or obligations. |
(xii) “Voice
Computer System” means a Computer System installed in one location which functions as a private branch exchange (PBX), voice mail
processor, automated call attendant or provides a similar capability used for the direction or routing of telephone calls in a voice communications
network.
| 8. | Solely for the coverage provided by this rider, Section 2. EXCLUSIONS of the CONDITIONS AND LIMITATIONS
of the bond is hereby amended by adding the following exclusions to the end thereof: |
THIS BOND DOES NOT COVER:
| (i) | any loss of the type or kind covered by any other Insuring Agreement provided in this financial institution
bond, regardless of any deductible amount or limit of liability; |
| (ii) | loss caused by a director or Employee of the Insured or by a person in collusion with any director or
Employee of the Insured; (Collusion shall include the willful withholding of knowledge from the Insured by any director or Employee that
a fraudulent act by a person not an Employee has been or will be perpetrated against the Insured.); |
| (iii) | loss resulting directly or indirectly from entry or change of Electronic Data or Computer Programs in
a Computer System, unless covered under the COMPUTER SYSTEMS FRAUD or DATA PROCESSING SERVICE OPERATIONS Insuring Agreements; |
| (iv) | loss resulting directly or indirectly from the Insured having transferred Funds in reliance on the validity
of a voice instruction, unless covered under the COMPUTER SYSTEMS FRAUD or VOICE INITIATED TRANSFER FRAUD Insuring Agreements; |
| (v) | loss resulting directly or indirectly by the Insured having transferred or delivered Funds, Certificated
Securities or Uncertificated Securities in reliance on an instruction received through a Telefacsimile Device, unless covered under the
TELEFACSIMILE TRANSFER FRAUD Insuring Agreement; |
| (vi) | loss resulting directly or indirectly from theft of confidential information; |
| (vii) | loss resulting directly or indirectly from the assumption of liability by the Insured by contract unless
the liability arises from a loss covered by this rider and would be imposed on the Insured regardless of the existence of the contract; |
| (viii) | the cost of duplication of Electronic Data or Computer Programs, unless covered under the DESTRUCTION
OF DATA OR PROGRAMS BY HACKER or DESTRUCTION OF DATA OR PROGRAMS BY VIRUS Insuring Agreements; |
| (ix) | loss involving a Voice Computer System, unless covered under the VOICE COMPUTER SYSTEM FRAUD Insuring
Agreement; |
| (x) | loss resulting directly or indirectly from: |
| (1) | written instructions or advices, or |
| (2) | telegraphic or cable instructions or advices; |
unless the instructions or advices are Tested and the
loss is covered under the COMPUTER SYSTEMS FRAUD or DATA PROCESSING SERVICE
OPERATIONS Insuring Agreements;
| (xi) | loss resulting directly or indirectly from negotiable instruments, securities, documents or other written
instruments which bear a forged signature, or are counterfeit, altered or otherwise fraudulent and which are used as source documentation
in the preparation of Electronic Data or manually keyed into a data terminal; |
| (xii) | loss resulting directly or indirectly from the fraudulent preparation, or fraudulent modification of Computer
Programs unless covered under the COMPUTER SYSTEMS FRAUD or DATA PROCESSING SERVICE OPERATIONS Insuring Agreements; |
| (xiii) | loss resulting directly or indirectly from: |
| (a) | mechanical failure, faulty construction, error in design, latent defect, fire, wear or tear, gradual deterioration,
electrical disturbance or electrical surge which affects a Computer System; or |
| (b) | failure or breakdown of electronic data processing media; or |
| (c) | error or omission in programming or processing; |
| (xiv) | loss as a result of a threat to Computer System operations; |
| (xv) | loss resulting directly or indirectly from the use of a telephone credit, debit, charge, identification
or similar card to gain access to the Insured’s Voice Computer System; |
| (xvi) | loss resulting directly or indirectly from the input of Electronic Data into a Computer System terminal
device either on the premises of a customer of the Insured or under the control of such customer by a person who had authorized access
to the customer’s authentication mechanism. |
| (xvii) | loss resulting directly or indirectly from payments made or withdrawals from a depositor’s account
involving items of deposit which are not finally paid for any reason; |
| (xviii) | loss of potential income, including but not limited to interest and dividends; |
| (xix) | loss of any type for which the Insured is legally liable, except compensatory damages, but not multiples
thereof, arising directly from a loss covered under this policy; |
| (xx) | any fees, costs and expenses incurred by the Insured; |
| (xxi) | indirect or consequential loss of any nature; |
| (xxii) | loss involving automated mechanical devices which on behalf of the Insured, disburse money, accept deposits,
cash checks, drafts or similar written instruments, or make credit card loans; |
| (xxiii) | loss due to riot or civil commotion or loss due to military, naval or usurped power, war or insurrection; |
| (xxiv) | loss resulting directly or indirectly from the effects of nuclear fission or fusion or radioactivity;
provided, however, that this exclusion shall not apply to loss resulting from industrial uses of nuclear energy; |
| (xxv) | loss as a result of a threat: |
| (1) | to do bodily harm to any person; |
| (2) | to do damage to the premises or property of the Insured; or |
| (3) | to Computer Systems operations. |
| 9. | Solely for the coverage provided by this rider, Section 4. LOSS – NOTICE - PROOF – LEGAL
PROCEEDINGS of the CONDITIONS AND LIMITATIONS of the bond is hereby amended by adding the following to the end thereof: |
It is further understood and agreed that:
| (i) | Proof of loss for claim under the Voice Initiated Transfer Fraud Insuring Agreement must include electronic
recordings of such voice instructions and the verification call-back, if such call-back was required; and |
| (ii) | Proof of loss for claim under the Telefacsimile Transfer Fraud Insuring Agreement must include a copy
of the document reproduced by the Telefacsimile Device. |
ALL OTHER TERMS, CONDITIONS AND EXCLUSIONS
REMAIN UNCHANGED.
© American International Group, Inc. All rights reserved.
|
|
|
AUTHORIZED REPRESENTATIVE |
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