Contract for Deposit, Custody, and Securities Administration Services with Voluntary Pension Savings Fund Administrators

CONTRACT FOR DEPOSIT, CUSTODY, AND SECURITIES ADMINISTRATION SERVICES TO BE SIGNED WITH VOLUNTARY PENSION SAVINGS FUND ADMINISTRATORS

Approved by the Board of Directors in Extraordinary Session No. JD-09/2020 on July 30, 2020, and by the Standards Committee of the Central Reserve Bank of El Salvador, in Session No. CN-13/2020 on August 19, 2020.

NUMBER ______________________.- In the city of San Salvador, at _______ hours on the day ___________________________________________.- Before me, ____________________Notary, of this domicile, appears, ____________________ of ___________ years of age, ________________ whom I know, with identity document number _______________________, who acts and appears in the name and representation in their capacity as President and Legal Representative of the company CENTRAL DEPOSIT OF SECURITIES, VARIABLE CAPITAL ANONYMOUS SOCIETY, of this domicile, with tax identification number zero six hundred fourteen- one hundred ten thousand one hundred ninety-four one hundred three zero, authorized to operate by the Securities Superintendency, now the Superintendency of the Financial System, in Board of Directors session CD-THIRTY-TWO/NINETY-EIGHT, on date ___________________ of __________, hereinafter also referred to as “CEDEVAL”; and on the other hand appears _______________________________, whom I know, holder of their unique identity document number _______________________________, acting in the name and representation, in their capacity as President and Legal Representative of the ____________________ in their capacity as Institution Administrator of Voluntary Pension Savings Funds duly authorized, of this domicile, with tax identification number _______________________________, hereinafter also referred to as “The Participant”; and in the capacity in which they appear THEY SAY: That by means of this instrument they grant a contract for DEPOSIT, CUSTODY, AND SECURITIES ADMINISTRATION SERVICES, which shall be governed by the following clauses: I) SERVICES OFFERED BY CEDEVAL: CEDEVAL will provide the participant with deposit, custody, and administration services for the securities in which each of the Voluntary Pension Savings Funds it administers invests; it will also provide the following services: Exercise of patrimonial rights; transfer, clearing, and settlement of securities and processing in multiple currencies; through the securities account or accounts opened for this purpose by the participant in CEDEVAL, in accordance with what is established in the Securities Market Law, the General Internal Regulations, and the CEDEVAL Operations Manual, as well as the norms established for this purpose by the Board of Directors of CEDEVAL, limiting said services to what is established in the Law for the Savings System for Pensions, the applicable regulations for voluntary pension savings funds approved by the Central Reserve Bank of El Salvador through its Standards Committee, and the resolutions of the Superintendency of the Financial System. The services referred to in this clause will be provided to the participant in their capacity as Secondary Direct Participant, in accordance with what is established in the CEDEVAL Operations Manual. II) OBLIGATIONS OF CEDEVAL: 1) CEDEVAL will be liable to the participant for any loss, disappearance, deterioration, or
destruction of the securities and for errors and delays registered in the provision of its services under the terms regulated in the first clause of this contract. 2) Upon signing this contract, CEDEVAL delivers to the participant a copy of its General Internal Regulations and its Operations Manual, understanding that these form an integral part of this contract; CEDEVAL will communicate to the participant any modification to these documents or norms. 3) CEDEVAL will make available to the participant, on a permanent basis, information regarding any movement produced, such as inflows and outflows of titles, interest collections, redemptions, maturities, or any other that implies a change in the relevant records of the account or accounts of the Voluntary Pension Savings Funds for which the custody service has been contracted. 4) CEDEVAL will make available to the Superintendency, daily information concerning the financial instruments and current accounts owned by the Funds that are in its possession or in its electronic records. It will also allow the Superintendency to examine the ownership of the Funds in custody at its facilities and the respective electronic records. 5) CEDEVAL will keep the resources or values of the Funds available upon request of the participant. 6) CEDEVAL will be liable for patrimonial losses that occur as a result of the negligence of the custodian in the provision of the services established in the first clause of this contract, recognizing an interest rate for the recognition of the profitability that the Fund failed to receive, equivalent to the average of the last six months of the Basic Passive Interest Rate for one hundred eighty days, published by the Central Reserve Bank of El Salvador. 7) CEDEVAL must not carry out securities lending operations with the financial instruments belonging to the Funds, nor lend securities from third parties to the Funds. III) OBLIGATIONS OF THE PARTICIPANT: 1) Open the necessary securities account or accounts for the provision of the services established in this instrument through the Securities Account Contract and the Account Opening Request in CEDEVAL, for each of the voluntary pension savings funds it administers; these documents form an integral part of this contract and establish the individual service contracting for each fund separately from any other account. 2) Comply with the applicable provisions regarding the administration of voluntary pension savings funds, in relation to the operations that generate the service and custody of securities. 3) Pay the applicable commissions for the contracted services. 4) Communicate to CEDEVAL any notification or instruction in accordance with the established procedures. 5) Communicate in writing the name and position of the persons authorized by each of the funds to be recorded in the Signature and Access Key Registration Form for the Electronic Custody and Administration System -SECAV-, to have access to the CEDEVAL System and to be
able to perform securities movements, as well as to obtain information from the account or accounts of the Fund in accordance with the Operations Manual and the General Internal Regulations of CEDEVAL. IV) COST OF SERVICES: The participant will pay the tariffs fixed for the services provided, in accordance with the norms, regulations, and instructions of CEDEVAL, which will be reviewed annually. These will be published in accordance with the Securities Market Law prior to their effectiveness, in accordance with what is established by the General Regulations of CEDEVAL and other applicable regulations. The charges in the concept of commission that CEDEVAL makes will be made directly to the participant and in no case can they be applied to investments, coupon collection, or redemption of titles. The costs for the services are recorded in an annex that forms an integral part of this contract. V) SPECIAL AGREEMENTS: 1) The documents and norms related in this contract form part of it, and will be applied as pertinent to the services established in this instrument. 2) Any other service that is subsequently incorporated into the General Internal Regulations of CEDEVAL and that is not currently offered to the participant, may be provided prior to approval issued by the Superintendency of the Financial System and communicated to CEDEVAL through the participant. 3) The participant authorizes CEDEVAL to supply to the Superintendency of the Financial System all information concerning the financial instruments owned by the Voluntary Pension Savings Fund, which are in custody and within the records of electronic annotations in CEDEVAL accounts, data that will be provided under the conditions and time that said Superintendency establishes. 4) In case of controversies regarding the interpretation or application of this contract, the contracting parties will submit to the procedure established in article fifty-four of the Securities Market Law. 5) The contracting parties may not assign or subcontract the rights and obligations derived from this contract. 6) This contract may only be modified in its conditions, terms, and deadlines by mutual agreement between the parties, observing the same formalities of this one. 7) For the purpose that the participant carries out securities purchase operations abroad, CEDEVAL will open a cash account at the international custodian, identified with the name of the participant, and will inform the participant and the Superintendency of the Financial System of the name of the custodian and the number of said account; the participant will send the funds to settle the operations directly to said account. All costs associated with that account will be assumed by the participant. CEDEVAL will inform the participant and said Superintendency of the receipt of the funds on the day this occurs, and will send them a monthly report of the account movements. 8) In the case of securities sale operations abroad, the participant must indicate
the bank account number of a local bank, into which the funds from the sale of securities must be credited. 9) In cases of purchase or sale of securities abroad, the transfer of securities will be carried out based on notices that the account holders give to the custodian through the designated Brokerage House, complying with what is established in Chapter V of the Law on Electronic Annotations of Securities in Account. 10) CEDEVAL recognizes and accepts that the debts that the participant may have with the custodian cannot be enforced against the securities of the Custodied Funds, or against the balance of the current accounts of said Funds; 11) In the event that there is any reason for which CEDEVAL is obliged to cease providing the service object of this contract, it must notify the participant at least sixty days in advance. 12) CEDEVAL, in accordance with what is established in article 63 of the Law on Electronic Annotations of Securities in Account and article 30 of the Investment Funds Law, undertakes to keep strict confidentiality regarding the information to which it has access in accordance with the contracted service. VI) VALIDITY OF THE CONTRACT: This contract will take effect from the day ________________________. The contracting parties by common agreement may terminate it, or when either of the parties notifies the other of its intention to cancel it with at least 60 days' advance notice, provided that there are no pending obligations to be fulfilled by any of them. However, if within the determined period it is not possible to transfer the securities, by common agreement the parties may establish a new period until the transfer of the securities can be effected. The breach of any of the established obligations will give the other the right to terminate it, being able to claim damages and losses arising from the breach. This contract may also be terminated when the service or services that CEDEVAL provides to the participant do not meet the requirements established by the applicable regulation. Either of the parties may terminate the contract unilaterally for the following causes: 1) By the declaration of bankruptcy or suspension of payments judicially issued in favor of the other party; 2) By the commission by one of the parties of fraudulent or negligent acts carried out in their capacity as a regulated company; 3) By either of the parties being involved or being identified as a participant, facilitator, or instigator of activities associated with any kind of crimes, especially activities related to money laundering and asset laundering and terrorism financing or other crimes generating money laundering and assets. For termination due to the aforementioned causes, any of the parties alleging it must comply with the applicable internal procedure for the case. Thus the appearers expressed themselves, whom I declare to know and the undersigned Notary certifies: If I had seen the certification extended by the Superintendency of the
Financial System in which it is stated that the Central Deposit of Securities, Variable Capital Anonymous Society - CEDEVAL, S.A. DE C.V.- is authorized to provide deposit, custody, and securities administration services to the Institutions Administrators of Pension Funds. And I (name of the notary) DO GIVE WITNESS: That the legal representation with which the appearers act is legitimate and sufficient, having seen: I Testimony of the deed of constitution of the Society “CENTRAL DEPOSIT OF SECURITIES, VARIABLE CAPITAL ANONYMOUS SOCIETY”, which can be abbreviated as CEDEVAL, S. A de C.V., granted in this city, on the day ___________________________, before the offices of the notary ______________________, from which it is stated that its denomination, nature, and domicile are those already expressed, its purpose is the deposit, custody, administration, clearing, settlement, and transfer of securities and administration of securities, among others, its term is for an indefinite period, the legal representation of the society corresponds to the President of the Board of Directors, with powers to act in acts such as the present; deed registered on the day twenty-eight of February of nineteen hundred ninety-four, at number sixteen folio three hundred twelve and following, of book one thousand six of the society register from the commerce register. II- Certification of point of minutes signed by the Secretary of the Board of Directors of Central Deposit of Securities Anonymous Society of Variable Capital, in which it is stated that the President is _________________for the period of the year to and Credential duly registered in the Commerce Register at number ______________________ of date _____________________________________. III- Testimony of deed of constitution of the Society xxxxx (the participant), granted in ___________, on the day ___________________________, before the offices of the notary ______________________, from which it is stated that its denomination, nature, and domicile are those already expressed, its purpose is _____________ its term is for an indefinite period, the legal representation of the society corresponds to the President of the Board of Directors, with powers to act in acts such as the present; deed registered on the day _________, at number ______________, of book _________________of the commerce register. II- Certification of point of minutes signed by the Secretary of the Board of Directors of ______________, in which it is stated that the President is _________________for the period of the year to and Credential duly registered in the Commerce Register at number ______________________ of date _____________________________________. Approved by the Board of Directors in Extraordinary Session No. JD-09/2020 on July 30 2020 and by the Standards Committee of the Central Reserve Bank of El Salvador, in Session No. CN-13/2020 on August 19, 2020.