Limit
of Liability
|
Deductible
Amount
|
|
Insuring
Agreement A - FIDELITY
|
$750,000
|
$10,000
|
Insuring
Agreement B - AUDIT EXPENSE
|
$50,000
|
$NIL
|
Insuring
Agreement C - PREMISES
|
$750,000
|
$10,000
|
Insuring
Agreement D - TRANSIT
|
$750,000
|
$10,000
|
Insuring
Agreement E - FORGERY OR ALTERATION
|
$750,000
|
$10,000
|
Insuring
Agreement F - SECURITIES
|
$750,000
|
$10,000
|
Insuring
Agreement G - COUNTERFEIT CURRENCY
|
$750,000
|
$10,000
|
Insuring
Agreement H - STOP PAYMENT
|
$50,000
|
$5,000
|
Insuring
Agreement I - UNCOLLECTIBLE ITEMS OF DEPOSIT
OPTIONAL
COVERAGES ADDED BY RIDER:
|
$50,000
|
$5,000
|
Insuring
Agreement J - COMPUTER SYSTEMS
|
$750,000
|
$10,000
|
Insuring
Agreement K - UNAUTHORIZED SIGNATURE
|
$50,000
|
$5,000
|
Insuring
Agreement L - TELEFACSIMILE COVERAGE
|
$750,000
|
$10,000
|
Insuring
Agreement M - VOICE INITIATED TRANSACTION
|
$750,000
|
$10,000
|
(A) |
FIDELITY
|
(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.
|
(B) |
AUDIT
EXPENSE
|
(C) |
ON
PREMISES
|
(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 hold-up 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 hold-up 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.
|
(D) |
IN
TRANSIT
|
(E) |
FORGERY
OR ALTERATION
|
(F) |
SECURITIES
|
(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:
|
(a) |
counterfeited,
or
|
(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.
|
(G) |
COUNTERFEIT
CURRENCY
|
(H) |
STOP
PAYMENT
|
(I) |
UNCOLLECTIBLE
ITEMS OF DEPOSIT
|
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 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.
|
B. |
WARRANTY
|
C. |
COURT
COSTS AND ATTORNEYS' FEES
|
(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.
|
D. |
FORMER
EMPLOYEE
|
(a) |
"Employee"
means:
|
(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 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:
|
(a) |
an
investment advisor,
|
(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,
|
(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 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.
|
(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.
|
(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 depositors 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.
|
(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
circumstances,
|
(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 other 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
|
(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.
|
(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.
|
(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 of 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.
|
(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.
|
Attached
to and Forming Part of
Bond Or Policy No. |
Date
Rider Executed
|
*
Effective Date of Rider
|
490PB0859
|
12:01
A.M. Standard Time as
Specified in the Bond or Policy |
|
*ISSUED
TO
Lehman Brothers First Trust Income Opportunity
Fund
|
1. |
The
attached bond is amended by adding an additional Insuring Agreement
as
follows:
|
(1) |
entry
of data into, or
|
(2) |
change
of data elements or program within a Computer System listed in
the
SCHEDULE below, provided the fraudulent entry or change
causes
|
(a) |
Property
to be transferred, paid or
delivered,
|
(b) |
an
account of the Insured, or of its customer, to be added, deleted,
debited
or credited, or
|
(c) |
an
unauthorized account or a fictitious account to be debited or
credited,
and provided further, the fraudulent entry or change is made
or caused by
an individual acting with the manifest intent
to
|
(i) |
cause
the Insured to sustain a loss, and
|
(ii) |
obtain
financial benefit for that individual or for other persons intended
by
that individual to receive financial
benefit.
|
2. |
As
used in this Rider, Computer System
means
|
(a) |
computers
with related peripheral components, including storage components,
wherever
located,
|
(b) |
systems
and applications software,
|
(c) |
terminal
devices, and
|
(d) |
related
communication networks
|
3. |
In
addition to the exclusions in the attached bond, the following
exclusions
are applicable to this Insuring
Agreement:
|
(a) |
loss
resulting directly or indirectly from the theft of confidential
information, material or data; and
|
(b) |
loss
resulting directly or indirectly from entries or changes made
by an
individual authorized to have access to a Computer System who
acts in good
faith on instructions, unless such instructions are given to
that
individual by a software contractor (or by a partner, officer
or employee
thereof) authorized by the Insured to design, develop, prepare,
supply,
service, write or implement programs for the Insured's Computer
System.
|
4. |
The
following portions of the attached bond are not applicable to
this
Rider:
|
(a) |
the
portion preceding the Insuring Agreements which reads "at any
time but
discovered during the Bond Period";
|
(b) |
Section
9 NONREDUCTION AND NON-ACCUMULATION OF LIABILITY of the Conditions
and
Limitations; and
|
(c) |
Section
10 LIMIT OF LIABILITY of the Conditions and
Limitations.
|
5. |
The
coverage afforded by this Rider applies only to loss discovered
by the
Insured during the period this Rider is in
force.
|
6. |
All
loss or series of losses involving the fraudulent activity
of one
individual, or involving fraudulent activity in which one individual
is
implicated, whether or not that individual is specifically
identified,
shall be treated as one loss. A series of losses involving
unidentified
individuals but arising from the same method of operation may
be deemed by
the Underwriter to involve the same individual and in that
event shall be
treated as one loss.
|
7. |
The
Limit of Liability for the coverage provided by this Rider shall
be Seven
Hundred and Fifty Thousand Dollars ($750,000),
it
being understood, however, that such liability shall be a part
of and not
in addition to the Limit of Liability stated in Item 3 of the
Declarations
of the attached bond or any amendment
thereof.
|
8. |
The
Underwriter shall be liable hereunder for the amount by which
one loss
exceeds the Deductible Amount applicable to the attached bond,
but not in
excess of the Limit of Liability stated
above.
|
9. |
If
any loss is covered under this Insuring Agreement and any other
Insuring
Agreement or Coverage, the maximum amount payable for such loss
shall not
exceed the largest amount available under any one Insuring Agreement
or
Coverage.
|
10. |
Coverage
under this Rider shall terminate upon termination or cancellation
of the
bond to which this Rider is attached. Coverage under this Rider
may also
be terminated or canceled without canceling the bond as an
entirety
|
(a) |
60
days after receipt by the Insured of written notice from the
Underwriter
of its desire to terminate or cancel coverage under this Rider,
or
|
(b) |
immediately
upon
receipt by the Underwriter of a written request from the Insured
to
terminate or cancel coverage under this
Rider.
|
Attached
to and Forming Part of
Bond Or Policy No. |
Date
Rider Executed
|
*
Effective Date of Rider
|
490PB0859
|
12:01
A.M. Standard Time as
Specified in the Bond or Policy |
|
*ISSUED
TO
Lehman Brothers First Trust Income Opportunity
Fund
|
1. |
The
attached bond is amended by inserting an additional Insuring
Agreement as
follows:
|
(A) |
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.
|
(B) |
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.
|
2. |
The
total liability of the Underwriter under Insuring Agreement
K is
limited to the sum of Fifty Thousand ($50,000), it being
understood,
however, that such liability shall be part of and not in
addition to the
Limit of Liability stated in Item 3 of the Declarations
of the attached
bond or amendment thereof.
|
3. |
With
respect to coverage afforded under this Rider, the Deductible
Amount shall
be Five Thousand Dollars ($5,000).
|
Attached
to and Forming Part of
Bond Or Policy No. |
Date
Rider Executed
|
*
Effective Date of Rider
|
490PB0859
|
12:01
A.M. Standard Time as
Specified in the Bond or Policy |
|
*ISSUED
TO
Lehman Brothers First Trust Income Opportunity
Fund
|
1. |
The
attached Bond is amended by adding an additional Insuring
Agreement as
follows:
|
2. |
Definitions.
The following terms used in this Insuring Agreement shall
have the
following meanings:
|
a. |
"Telefacsimile
System" means a system of transmitting and reproducing
fixed graphic
material (as, for example, printing) by means of signals
transmitted over
telephone lines.
|
b. |
"Telefacsimile
Transaction" means any Fax Redemption, Fax Election,
Fax Exchange, or Fax
Purchase.
|
c. |
"Fax
Redemption" means any redemption of shares issued by
an Investment Company
which is requested through a Telefacsimile
System.
|
d. |
"Fax
Election" means any election concerning dividend options
available to Fund
shareholders which is requested through a Telefacsimile
System.
|
e. |
"Fax
Exchange" means any exchange of shares in a registered
account of one Fund
into shares in an identically registered account of another
Fund in the
same complex pursuant to exchange privileges of the two
Funds, which
exchange is requested through a Telefacsimile
System.
|
f. |
"Fax
Purchase" means any purchase of shares issued by an Investment
Company
which is requested through a Telefacsimile
System.
|
g. |
"Designated
Fax Procedures" means the following
procedures:
|
(1) |
Retention:
All Telefacsimile Transaction requests shall be retained
for at least
six
(6)
months. Requests shall be capable of being retrieved
and produced in
legible form within a reasonable time after retrieval
is
requested.
|
(2) |
IdentityTest:
The identity of the sender in any request for a Telefacsimile
Transaction
shall be tested before executing that Telefacsimile Transaction,
either by
requiring the sender to include on the face of the request
a unique
identification number or to include key specific account
information.
Requests of Dealers must be on company letterhead and
be signed by an
authorized representative. Transactions by occasional
users are to be
verified by telephone confirmation.
|
(3) |
Contents:
A
Telefacsimile Transaction shall not be executed unless
the request for
such Telefacsimile Transaction is dated and purports
to have been signed
by (a) any shareholder or subscriber to shares issued
by a Fund, or (b)
any financial or banking institution or
stockbroker.
|
(4) |
Written Confirmation:
A
written confirmation of each Telefacsimile Transaction shall be
sent to
the shareholder(s) to whose account such Telefacsimile Transaction
relates, at the record address, by the end of the Insured's next
regular
processing cycle, but no later than five (5) business days following
such
Telefacsimile Transaction.
|
h. |
"Designated"
means or refers to a written designation signed by a shareholder
of record
of a Fund, either in such shareholder's initial application for
the
purchase of Fund shares, with or without a Signature Guarantee,
or in
another document with a Signature
Guarantee.
|
i. |
"Signature
Guarantee" means a written guarantee of a signature, which guarantee
is
made by an Eligible Guarantor Institution as defined in Rule 17Ad-15(a)(2)
under the Securities Exchange Act of
1934.
|
3. |
Exclusions.It
is further understood and agreed that this Insuring Agreement
shall not
cover:
|
a. |
Any
loss covered under Insuring Agreement A, "Fidelity," of this Bond;
and
|
b. |
Any
loss resulting from:
|
(1) |
Any
Fax Redemption, where the proceeds of such redemption were requested
to be
paid or made payable to other than (a) the shareholder of record,
or (b) a
person Designated in the initial application or in writing at least
one
(1) day prior to such redemption to receive redemption proceeds,
or (c) a
bank account Designated in the initial application or in writing
at least
one (1) day prior to such redemption to receive redemption proceeds;
or
|
(2) |
Any
Fax Redemption of Fund shares which had been improperly credited
to a
shareholder's account, where such shareholder (a) did not cause,
directly
or indirectly, such shares to be credited to such account, and
(b)
directly or indirectly received any proceeds or other benefit from
such
redemption; or
|
(3) |
Any
Fax Redemption from any account, where the proceeds of such redemption
were requested to be sent to any address other than the record
address or
another address for such account which was designated (a) over
the
telephone or by telefacsimile at least fifteen (15) days prior
to such
redemption, or (b) in the initial application or in writing at
least one
(1) day prior to such redemption;
or
|
(4) |
The
intentional failure to adhere to one or more Designated Fax Procedures;
or
|
(5) |
The
failure to pay for shares attempted to be
purchased.
|
4. |
The
Single Loss Limit of Liability under Insuring Agreement L is limited
to
the sum of Seven Hundred and Fifty Thousand ($750,000) it being
understood, however, that such liability shall be part of and not
in
addition to the Limit of Liability stated in Item 3 of the Declarations
of
the attached Bond or amendments
thereof.
|
5. |
With
respect to coverage afforded under this Rider the applicable Single
loss
Deductible Amount is Ten Thousand
($10,000)
|
Attached
to and Forming Part of
Bond Or Policy No. |
Date
Rider Executed
|
*
Effective Date of Rider
|
490PB0859
|
12:01
A.M. Standard Time as
Specified in the Bond or Policy |
|
*ISSUED
TO
Lehman Brothers First Trust Income Opportunity
Fund
|
1. |
The
attached bond is amended by adding an additional Insuring Agreement
as
follows:
|
2. |
Definitions.
The following terms used in this Insuring Agreement shall have
the
following meanings:
|
a. |
"Voice-initiated
Transaction" means any Voice-initiated Redemption, Voice-initiated
Election, Voice-initiated Exchange, or Voice-initiated
Purchase.
|
b. |
"Voice-initiated
Redemption" means any redemption of shares issued by an Investment
Company
which is requested by voice over the
telephone.
|
c. |
"Voice-initiated
Election" means any election concerning dividend options available
to Fund
shareholders which is requested by voice over the
telephone.
|
d. |
"Voice-initiated
Exchange" means any exchange of shares in a registered account
of one Fund
into shares in an identically registered account of another Fund
in the
same complex pursuant to exchange privileges of the two Funds,
which
exchange is requested by voice over the
telephone.
|
e. |
"Voice-initiated
Purchase" means any purchase of shares issued by an Investment
Company
which is requested by voice over the
telephone.
|
f. |
"Designated
Procedures" means the following
procedures:
|
(1) |
Recordings:
All Voice-initiated Transaction requests shall be recorded, and
the
recordings shall be retained for at least six
(6)
months. Information contained on the recordings shall be capable
of being
retrieved and produced within a reasonable time after retrieval
of
specific information is requested, at a success rate of no less
than
85%.
|
(2) |
IdentityTest:
The identity of the caller in any request for a Voice-initiated
Redemption
shall be tested before executing that Voice-initiated Redemption,
either
by requesting the caller to state a unique identification number
or to
furnish key specific account
information.
|
(3) |
Written Confirmation:
A
written confirmation of each Voice-initiated Transaction and
of each
change of the record address of a Fund shareholder requested
by voice over
the telephone shall be mailed to the shareholder(s) to whose
account such
Voice-initiated Transaction or change of address relates, at
the
|
g. |
"Investment
Company" or "Fund" means an investment company registered under
the
Investment Company Act of 1940.
|
h. |
"Officially
Designated"
means or refers to a written designation signed by a shareholder
of record
of a Fund, either in such shareholder's initial application
for the
purchase of Fund shares, with or without a Signature Guarantee,
or in
another document with a Signature
Guarantee.
|
i. |
"Signature
Guarantee" means a written guarantee of a signature, which
guarantee is
made by a financial or banking institution whose deposits are
insured by
the Federal Deposit Insurance Corporation or by a broker which
is a member
of any national securities exchange registered under the Securities
Exchange Act of 1934.
|
3. |
Exclusions.
It
is further understood and agreed that this Insuring Agreement
shall not
cover:
|
a. |
Any
loss covered under Insuring Agreement A, "Fidelity, " of this
Bond; and
|
b. |
Any
loss resulting from:
|
(1) |
Any
Voice-initiated Redemption, where the proceeds of such redemption
were
requested to be paid or made payable to other than (a) the
shareholder of
record, or (b) a person Officially Designated to receive redemption
proceeds, or (c) a bank account Officially
Designated
to receive redemption proceeds; or
|
(2) |
Any
Voice-initiated Redemption of Fund shares which had been improperly
credited to a shareholder's account, where such shareholder
(a) did not
cause, directly or indirectly, such shares to be credited to
such account,
and (b) directly or indirectly received any proceeds or other
benefit from
such redemption; or
|
(3) |
Any
Voice-initiated Redemption from any account, where the proceeds
of such
redemption were requested to be sent (a) to any address other
than the
record address for such account, or (b) to a record address
for such
account which was either (i) designated over the telephone
fewer than
thirty (30) days prior to such redemption, or (ii) designated
in writing
less than on (1) day prior to such redemption;
or
|
(4) |
The
intentional failure to adhere to one or more Designated Procedures;
or
|
(5) |
The
failure to pay for shares attempted to be purchased;
or
|
(6) |
Any
Voice-initiated Transaction requested by voice over the telephone
and
received by an automated system which receives and converts
such request
to executable instructions.
|
4. |
The
total liability of the Underwriter under Insuring Agreement
M is limited
to Seven Hundred Fifty Thousand Dollars ($750,000), it being
understood,
however, that such liability shall be part of and not in
addition to the
Limit of Liability stated in Item 3 of the Declarations of
the attached
bond or amendment thereof.
|
5. |
With
respect to coverage afforded under this Rider the applicable
Deductible
Amount is Ten Thousand Dollars
($10,000).
|
Attached
to and Forming Part of
Bond Or Policy No. |
Date
Rider Executed
|
*
Effective Date of Rider
|
490PB0859
|
12:01
A.M. Standard Time as
Specified in the Bond or Policy |
|
*ISSUED
TO
Lehman Brothers First Trust Income Opportunity
Fund
|
1. |
Sub-section
7 of Section 1(a) in the Definition of Employee, is deleted and
replaced
by the following:
|
(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 (does not include
the
creating, preparing, modifying or maintaining the Insured's computer
software or programs), 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"
|
Attached
to and Forming Part of
Bond Or Policy No. |
Date
Rider Executed
|
*
Effective Date of Rider
|
490PB0859
|
12:01
A.M. Standard Time as
Specified in the Bond or Policy |
|
*ISSUED
TO
Lehman Brothers First Trust Income Opportunity
Fund
|
1.
|
Section
1, Definitions, under General Agreements is amended to include
the
following paragraph:
|
Attached
to and Forming Part of
Bond Or Policy No. |
Date
Rider Executed
|
*
Effective Date of Rider
|
490PB0859
|
12:01
A.M. Standard Time as
Specified in the Bond or Policy |
|
*ISSUED
TO
Lehman Brothers First Trust Income Opportunity
Fund
|
1. |
Section
2. Exclusion, under General Agreement is amended to include the
following
sub-section:
|
(n) |
loss
from the use of credit, debit, charge, access, convenience,
identification, cash management or other cards, whether such cards
were
issued or purport to have been issued by the Insured or by anyone
else,
unless such loss is otherwise covered under Insuring agreement
A.
|
(o) |
The
underwriter shall not be liable under the attached bond for loss
due to
liability imposed upon the Insured as a result of the unlawful
disclosure
of non-public material information by the Insured or any Employee,
or as a
result of any Employee acting upon such information, whether authorized
or
unauthorized.
|