Aberdeen Asia-Pacific Income Fund, Inc. (the “Fund”) (File Number 811-04611)

Policy No.

B080120412P14

Item 1.

Policyholder:

ABERDEEN ASIA-PACIFIC INCOME FUND INC.

Item 2.

Principal Address:

1735 Market Street, 32nd Floor, Philadelphia PA, 19103, USA

Item 3.

Limit of Liability:

USD1,900,000 aggregate cost and expenses inclusive.

(i)        USD100,000 aggregate under Insuring Agreement (H) (Depositor Damages);

(ii)       USD100,000 aggregate under Insuring Agreement (I) (Uncollectable Items of Deposit); and

(iii)      USD100,000 aggregate under Insuring Agreement (J) (Audit Expense); and

(iv)      USD100,000 aggregate under Insuring Agreement (K) (Unauthorized Signatures); and

(v)       sub-clause (e) of definition E) (Computer or Telephonic Fraud) USD100,000 aggregate.

(i)        USD5,000 each and every Loss under Insuring Agreement (H) (Depositor Damages);

(ii)       USD5,000 each and every Loss under Insuring Agreement (I) (Uncollectable Items of Deposit); and

(iii)      USD5,000 each and every Loss under Insuring Agreement (J) (Audit Expense); and

(iv)      USD5,000 each and every Loss under Insuring Agreement (K) (Unauthorized Signatures).

Item 5.

Premium:

Included in the premium set forth in the Declarations for Section 1

From:       14th May, 2014 at 12:01 a.m. (local time at the address stated in Item 1.)

To:           14th May, 2015 at 12:01 a.m. (local time at the address stated in Item 1.)

Item 7.

Amount of Fund Assets:

 USD 1,774,700,000

Fidelity.

the Employee; or

any person or organisation in collusion with such Employee; or

any other person or organisation (who were not a counterparty) intended by such Employee to make an improper financial benefit.

On Premises.

Loss of Property resulting directly from:

robbery, burglary, misplacement, mysterious unexplainable disappearance; and damage thereto or destruction thereof; or

theft, false pretences, common-law or statutory larceny, committed by a person present in an office or on the premises of the Insured,

Loss of or damage to:

furnishings, fixtures, supplies or equipment within an office of the Insured covered under this bond resulting directly from larceny or theft in or by burglary or robbery of such office, or attempt thereat, or by vandalism or malicious mischief; or

such office resulting from larceny or theft in, or by burglary or robbery of such office or attempt thereat, or to the interior of such office by vandalism or malicious mischief,

the Insured is the owner of such furnishings fixtures, supplies, equipment, or office or is liable for such loss or damage; and

the loss is not caused by fire.

In Transit.

a natural person acting as a messenger of the Insured (or another natural person acting as messenger or custodian during an emergency arising from the incapacity of the original messenger); or

a Transportation Company and being transported in an armoured motor vehicle; or

a Transportation Company and being transported in a conveyance other than an armoured motor vehicle provided that covered Property transported in such manner is limited to the following:

records, whether recorded in writing or electronically; and

Certificated Securities issued in registered from and not endorsed, or with restrictive endorsements; and

Negotiable Instruments not payable to bearer or not endorsed or with restrictive endorsements.

Forgery or Alteration.

Forgery or alteration of, on or in any Negotiable Instrument (except an Evidence of Debt), Acceptance, Withdrawal Order, receipt for the withdrawal of Property, Certificate of Deposit or Letter of Credit.

transferring, paying, redeeming or delivering funds or Property or establishing any credit or giving any value on the faith of any written or printed instructions, advices or requests directed to the Insured, which instructions, advices or requests purport to have been signed or endorsed by any customer or the Insured or by any financial institution but which instructions or advices either bear a signature which is a Forgery or have been altered without the knowledge and consent of such customer or financial institution;

any Financial Organisation transferring, paying, redeeming or delivering funds or Property or establishing any credit or giving any value on the faith of any written or printed instructions, advices or requests which instructions, advices or requests purport to have been signed by or on behalf of the Insured but which instructions, advices or requests either bear a signature which is a Forgery or have been fraudulently altered.

Securities.

acquired, sold or delivered, or given value, extended credit or assumed liability on the faith of any original:

Certificated Security;

deed, mortgage or other instrument conveying title to or creating or discharging a lien upon real property;

Evidence of Debt;

Instruction; or

Statement of Uncertificated Security,

bears a signature of any maker, drawer, issuer, endorser, assignor, lessee, transfer agent, registrar, acceptor, surety, guarantor, or of any person signing in any other capacity which is a forgery; or

is altered; or

is lost or stolen:

guaranteed in writing or witnessed any signature upon any transfer, assignment, bill of sale, power of attorney, Guarantee or any items listed in (i) through (v) above:

acquired, sold or delivered, or given value, extended credit or assumed liability on the faith of any item listed in (i) through (v) above which is counterfeit.

Counterfeit Currency.

Computer or Telephonic Fraud and Malicious Code

Computer or Telephonic Fraud; and/or

the modification or deletion of any Electronic Data or Computer Program due to any Malicious Code.

those Electronic Communications which are transmitted through touch tone telephone communication systems or by telex, TWX or telefacsimile; and

all Telephonic Communications,

Depositor Damages

for having either complied with or failed to comply with any written notice of any depositor of the Insured or any authorized representative of such depositor to stop payment of any cheque or draft made or drawn by such depositor or any authorized representative of such depositor; or

for having refused to pay any cheque or draft made or drawn by any depositor of the Insured or any authorized representative of such depositor.

Uncollectable Items of Deposit

payments of dividends or fund shares, or withdrawals permitted form 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

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.

Audit Expense.

Unauthorized Signatures.

Larceny and Embezzlement.

Fraudulent Retention of Funds or Property

the misdirection or erroneous transfer of such funds or Property by the Insured or by a Financial Organisation acting upon instructions from the Insured, to a third party recipient account other than that actually intended; or

the transfer of such funds or Property by the Insured or by a Financial Organisation acting upon instructions from the Insured, to a third party recipient account in an amount greater than that actually intended.

Extortion

to do bodily harm to a director, officer, trustee or Employee of the Insured, or a relative or an invitee of such director, officer, trustee, Employee, who is, or allegedly is, being held captive or under threat;

to damage the premises, property (including Property) or other assets of the Insured or for which the Insured are legally liable;

to delete or modify the Insured’s Computer Programs or the Insured’s Electronic Data;

to sell or disclose confidential information to another person or party by reason of having gained unauthorised access to the Insured’s Computer System;

to cause the Insured to transfer, pay or deliver any funds or property (including Property) by means of a Computer System used or operated by the Insured,

the person receiving the threat has made a reasonable effort to report the extortionist’s threat to a director of the Insured;

a reasonable effort has been made to report the extortionist’s threat to local law enforcement authorities; and

in relation to sub-clause (c), (d) or (e) above, the aforementioned director is satisfied that the person making the threat is both capable of carrying it out and reasonably likely to do so and that the threatened action is technologically feasible.

Nominees.

Additional Exposures.

Additional Offices

Merger or Consolidation

Acquisition or Creation of Funds

If during the Bond Period, an Insured creates or acquires a fund, other than by reason of the events described in sub-clause (2) above; and if the total consolidated assets of such fund are less than or equal to the amount set forth in Item 7 of the Declarations then, subject to all the other provisions of this bond, coverage shall automatically apply to any Loss sustained by that fund.

If during the Bond Period, an Insured creates or acquires a fund, other than by reason of the events described in sub-clause (2) above; and if the total consolidated assets of such fund are greater than the amount set forth in Item 7 of the Declarations, no coverage shall apply to any Loss sustained by that fund unless the Insured provides the Insurer with full particulars of such acquisition or creation, agrees to any additional premium and/or amendment of the provisions of this bond the Insurer requires and pays any premium required.

There shall be no coverage for:

any Loss sustained by any such fund resulting from an act committed or an event occurring prior to the consummation of a transaction described in (i) or (ii) above; or

any Loss sustained by any such fund resulting from an act whenever committed or an event whenever occurring, which together with an act committed or an event occurring prior to the consummation of such transaction, would constitute a Single Loss (as defined under Section 4 C of this bond).

Fund Name Changes

Representation of Insured.

Joint Insured.

Legal Proceedings Against the Insured.

Acceptance means a draft, which the drawee has, by signature written thereon, engaged to honour as presented.

Account Code means a confidential and protected string of characters that identifies or authenticates a person and permits said person to gain access to a Telephone System for the purpose of making long distance toll calls or utilising voice mail box messaging capabilities or other similar functional features of a Telephone System.

Bond Period means the period of time from the inception date shown in Item 6 of the Declarations to the earlier of the expiration date shown in Item 6 of the Declarations or the effective date of cancellation of this bond.

Certificate of Deposit means an acknowledgment in writing by a Financial Organisation of receipt of Money with an engagement to repay it.

Certificated Security means a share, participation or other interest in property or an enterprise of the issuer or an obligation of the issuer, which is:

represented by an instrument issued in bearer or registered form;

of a type commonly dealt in on securities exchanges or markets or commonly recognized in any area in which it is issued or dealt in as a medium for investment; and

either one of a class or series or by its terms divisible into a class or series of shares, participations, interests or obligations.

Computer or Telephonic Fraud means:

the Impairment of:

any Electronic Data (including but not limited to any Electronic Data contained in any Electronic Communication); and/or

any Computer Programs; and/or

any Uncertificated Security; and/or

any Electronic Communications on which the Insured, or any Financial Organisation or Service Bureau acting on behalf of the Insured, have acted or relied; and/or

the Insured, or any Financial Organisation or Service Bureau acting on behalf of the Insured, having acted or relied upon any Electronic Communications or Telephonic Communications, purporting to have been, but were not, sent or made by:

any office or department of the Insured; and/or

another Financial Organisation; and/or

a customer or client of the Insured or an authorized representative of a customer or client of the Insured when acting in that capacity; and/or

a Service Bureau;

a Financial Organisation, a customer or client of the Insured, an authorized representative of a customer or client of the Insured when acting in that capacity or a Service Bureau having acted or relied upon any Electronic Communications or Telephonic Communications, purporting to have been, but were not, sent or made by:

the Insured; or

another Financial Organisation or Service Bureau acting on behalf of the Insured; and/or

the unauthorised use of an Account Code or System Password contained in a Telephone System owned or leased by the Insured, with the intention of directing telephone toll charges onto the Insured.

Computer Programs means a collection of instructions that describes a task, or set of tasks, to be carried out by a Computer System, including but not limited to application software, operating systems, firmware and compilers.

Computer System means a computer and all input, output, processing, storage (including but not limited to off-line media libraries), intranets and communication facilities including related communication or open systems networks and extranets which are connected directly or indirectly to such a device.

Counterfeit means an imitation of an actual valid original, which is intended to deceive and to be taken as the original.

Custodian means:

any party with which the Insured has a written or electronic agreement for the provision of purchasing services, safekeeping, registration and entitlement records for the Insured;

any regulated central securities depository.

is involved in the provision of custodial services; and

has a written or electronic agreement with the custodian detailed in sub-clause i) or ii) above for the provision of such services.

Deductible means the amount stated in Item 4 of the Declarations.

Discovered or Discovery means when any Responsible Officer first becomes aware of, or has any knowledge of, any act, omission or event which could reasonably be foreseen to give rise to a Loss covered by this bond, even though the exact amount or details of such Loss, act, omission or event are not known at the time of such discovery.

Electronic Communications means instructions, messages, information or payments that have been, or appear to have been:

transmitted electronically:

through an Electronic Communication System; or

over the Internet; or

communicated through the delivery of Recording Media.

Electronic Communication System means systems which permit the electronic transmission of instructions, messages, information or payments, including but not limited to:

touch tone telephone communication systems;

telex, TWX or telefacsimile; and

Computer Systems which operate automated teller machines or point of sale terminals.

Electronic Data means facts or information converted to a form usable in a Computer System or an Electronic Communications System and which is stored on or capable of being stored on Recording Media.

Employee means:

any of the Insureds officers or employees while performing services for the Insureds offices; and

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

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

guest students pursuing their studies or duties in any of the Insureds offices; and

directors or trustees of the Insured 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

any individual or individuals assigned to perform the usual duties of an employee within the premises for the Insured, by any agency furnishing temporary personnel on a contingent or part-time basis; and

each natural person, partnership or corporation authorized by written or electronic agreement with the Insured to perform services as electronic data processor of checks or other accounting records of the Insured; and

any employee or any partner of any named Insured; and

any consultant whilst performing services or duties on behalf of the Insured.

Evidence of Debt means an instrument, including a Negotiable Instrument, executed by a customer of the Insured and held by the Insured which in the regular course of business is treated as evidencing the customer’s debt to the Insured.

Financial Organisation means:

any bank, credit institution, financial institution, undertaking for collective investment in Certificated Securities or Uncertificated Securities, investment firm, asset management company, building society, friendly society, or similar organisation;

a regulated investment exchange or automated clearing house;

any Custodian.

Forgery means the signing of the name of another person or organization with intent to deceive; it does not mean a signature, which consists in whole, or in part of one’s own name signed with or without authority, in any capacity, for any purpose.

Fraudulent Retention means:

the wrongful retention of funds or Property by a third party recipient without contractual or other legal right to such retention;

the inability to recover any funds or Property erroneously transferred into the account of a third party recipient, despite all reasonable efforts to secure such recovery, solely because:

the third party recipient is unknown; or

such funds or Property have been misappropriated.

Guarantee means a written undertaking obligating the signer to pay the debt of another to the Insured or its assignee or to a financial institution from which the Insured has purchased participation in the debt if the debt is not paid in accordance with its terms.

Impairment means fraudulent, dishonest, malicious or criminal:

preparation; and/or

input; and/or

modification; and/or

deletion,

Instruction means a written order to the issuer of an Uncertificated Security requesting that the transfer, pledge or release from pledge of the Uncertificated Security specified be registered.

Insured means:

the Policyholder; and

any other entity designated as an “Additional Named Insured” under this bond.

Insurer means AXIS Specialty Europe SE.

Legal Proceeding means any legal proceeding brought to determine the Insured’s liability for any Loss, claim or damage which, if established, would constitute a collectible Loss under this bond.

Lending or Loan means any of the following:

all extensions of credit by the Insured and all transactions creating a creditor or lessor relationship in favour of the Insured, including but not limited to transactions by which the Insured assumes an existing creditor or lessor relationship and includes any such extensions of credit, whether authorised or unauthorised; and/or

any note, account, agreement or other Evidence of Debt assigned or sold to, or discounted or otherwise acquired by the Insured, including but not limited to the purchase, discounting or other acquisition of false or genuine accounts or invoices.

Letter of Credit means an engagement in writing by a Financial Organisation or other person made at the request of a customer that the Financial Organisation or other person will honour drafts or other demands for payment upon compliance with the conditions specified in the Letter of Credit.

Limit of Liability means the amount stated in Item 3 of the Declarations.

Loss means:

direct financial loss sustained by the Insured and as set out in the Bond; and/or

Verification and Reconstitution Expenses.

Malicious Code means any unauthorised, corrupting or harmful software code, including but not limited to computer viruses, Trojan horses, keystroke loggers, spyware, adware, worms and logic bombs.

Money means a medium of exchange in current use authorized or adopted by a domestic or foreign government as a part of its currency.

Negotiable Instrument means any writing:

signed by the maker or drawer; and

containing any unconditional promise or order to pay a sum certain in Money and no other promise, order, obligation or power given by the maker or drawer; and

is payable on demand or at a definite time; and

is payable to order or bearer.

Policyholder means organisation specified in Item 1 of the Declarations.

Property means Money, Certificated Securities, Uncertificated Securities, Negotiable Instruments, Certificates of Deposit, documents of title, Acceptances, Evidences of Debt, security agreements, Withdrawal Orders, certificates of origin or title, Letters of Credit, insurance policies, abstracts of title, deeds and mortgages on real estate, revenue and other stamps, tokens, unsold state lottery tickets, books of account and other records whether recorded in writing or electronically, gems, jewellery, precious metals of all kinds and in any form, and tangible items of personal property which are not hereinbefore enumerated.

Recording Media means the physical components or materials on which Electronic Data or Computer Programs can be recorded.

Responsible Officer means the Policyholder’s Chief Compliance Officer (or designated alternate).

Restricted Notification means when the Insured is prevented from disclosing the existence of any Loss to the Insurer after it has been Discovered due to any legal or regulatory prohibition, following any investigation or enquiry commenced by or on behalf of any regulatory, police or prosecuting authority anywhere in the world.

Service Bureau means a natural person, partnership or corporation authorised by written or electronic agreement with the Insured to perform data processing services using Computer Systems.

Statement of Uncertificated Security means a written statement of the issuer of an Uncertificated Security containing:

a description of the issue of which the Uncertificated Security is a part;

the number of shares or units: transferred to the registered owner; pledged by the registered owner to the registered pledgee; released from pledge by the registered pledgee; registered in the name of the registered owner on the date of the statements; or subject to pledge on the date of the statement;

the name and address of the registered owner and registered pledge;

a notation of any liens and restrictions of the issuer and any adverse claims to which the Uncertificated Security is or may be subject or a statement that there are none of those liens, restrictions or adverse claims; and

the date the transfer of the shares or units to the new registered owner of the shares or units was registered, the pledge of the registered pledgee was registered or of the statement, if it is a periodic or annual statement.

System Password means a confidential and protected string of characters that identifies or authenticates a person and permits said person to gain access to the Telephone System or any portion thereof in order to perform security functions, system administration or maintenance functions.

Telephonic Communications means instructions, messages, information or payments made over the telephone or by Voice over Internet Protocol (VoIP), or other forms of IP or broadband telephony.

Telephone System means a private branch exchange, a third party hosted telephony service, voice mail processor, automated call-back attendant or a Computer System with a similar capacity.

Tested means a method of authenticating the contents of a communication by utilising:

a valid test key, including but not limited to a digital signature, public key cryptography, asymmetric cryptography or other similar technologies or encryption methods, for the purpose of protecting the integrity of that communication; or

a Personal Identification Number (PIN); or

a “call back” procedure to an authorised person, other than the individual initiating the communication.

Transportation Company means any organization, which provides its own or leased vehicles for transportation or which provides freight forwarding or air express services.

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:

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;

of a type commonly dealt in on securities exchanges or markets; and

each one of a class or series or by its terms divisible into a class or series of shares, participations, interests or obligations.

Verification and Reconstitution Expenses means expenses incurred or fees paid by the Insured, with the prior written approval by the Insurer (such approval not to be unreasonably delayed or withheld), for the verification or reconstitution or removal of:

Computer Programs or Electronic Data which have been the subject of Impairment; or

Malicious Code.

Withdrawal Order means a non-negotiable instrument, other than an Instruction, signed by a customer of the Insured authorizing the Insured to debit the customer’s account in the amount of funds stated therein.

Loss resulting directly or indirectly from forgery or alteration, except when covered under Insuring Agreement (A), (D), (E) or (G);

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 (C), 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;

Loss resulting directly or indirectly 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;

Loss resulting directly or indirectly from any director or trustee of the Insured (other than one employed as a salaried, pensioned or elected official or an Employee of the Insured), except:

when performing acts coming within the scope of the usual duties of an Employee, or

while acting as a member of any committee duly elected or appointed by resolution of the board of directors or trustees of the Insured to perform specific, as distinguished from general, directorial acts on behalf of the Insured;

Loss resulting directly or indirectly from the complete or partial non-payment of, or default upon, any loan or transaction involving the Insured as a lender or borrower, or extension of credit, including the purchase, discounting or other acquisition of false or genuine accounts, invoices, notes, agreements or Evidences of Debt, whether such loan, transaction or extension was procured in good faith or through trick, artifice, fraud or false pretences; except when covered under Insuring Agreements (A), (D), (E) or (G);

loss resulting from any violation by the Insured or by any Employee:

of any law regulating:

the issuance, purchase or sale of securities;

securities transactions upon security exchanges or over the counter market;

investment companies; or

of any rule or regulation made pursuant to any such law, unless it is established by the Insured that the act or acts which caused the said loss involved fraudulent or dishonest conduct which would have caused a loss to the Insured in a similar amount in the absence of such laws, rules or regulations:

Loss resulting directly or indirectly from the failure of a financial or depository institution, or its receiver or liquidator, to pay or deliver, on demand of the Insured, funds or Property of the Insured held by it in any capacity, except when covered under Insuring Agreements (A), (B)(1)(a) or (G);

Loss caused by an Employee, except when covered under Insuring Agreement (A) or when covered under Insuring Agreement (B) or (C) and resulting directly from misplacement, mysterious unexplainable disappearance or destruction of or damage to the Property;

Loss resulting directly or indirectly from transactions in a customer’s account, whether authorized or unauthorized, except the unlawful withdrawal and conversion of Money, securities or precious metals, directly from a customer’s account by an Employee provided such unlawful withdrawal and conversion is covered under Insuring Agreement (A) or unless covered by Insuring Agreement (G).

damages resulting from any civil, criminal or other legal proceeding in which the Insured is alleged to have engaged in racketeering activity except when the Insured establishes that the act or acts giving rise to such damages were committed by an Employee under circumstances which result directly in a loss to the Insured covered by Insuring Agreement (A). For the purposes of this exclusion “racketeering activity” is defined in 18 United States Code 1961 et seq., as amended.

Loss resulting directly or indirectly from the use or purported use of credit, debit, charge, access, convenience, identification, cash management or other cards:

in obtaining credit or funds; or

in gaining access to 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; or

in gaining access to point of sale terminals; customer-bank communication terminals, or similar electronic terminals of electronic funds transfer systems,

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, except when covered under Insuring Agreement (A) or (G);

Loss through the surrender of property away from an office of the Insured as a result of a threat:

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

to do damage in the premises of property of the Insured,

Loss resulting directly or indirectly from payments made or withdrawals from a depositor’s or customer’s account involving erroneous credits to such account, unless such payments or withdrawals are physically received by such depositor or customer or representative of such depositor or customer who is within the office of the Insured at the time of such payment or withdrawal, or except when covered under Insuring Agreement (A) or (G);

Loss involving items of deposit, which are not finally paid for any reason, including but not limited to Forgery or any other fraud, except when covered under Insuring Agreement (A) or (G);

Loss resulting directly or indirectly from counterfeiting, except when covered under Insuring Agreements (A), (E), (F) or (G);

Loss of any tangible item of personal property which is not specifically enumerated in the paragraph defining Property if such property is specifically covered by other insurance of any kind and in any amount obtained by the Insured;

Loss of property while:

in the mail; or

in the custody of any Transportation Company, unless covered under Insuring Agreement (C);

Loss of potential income, including but not limited to interest and dividends, not received by the Insured because of a loss covered under this bond, except when covered under Insuring Agreement (I);

damages 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 bond;

all fees, costs and expenses incurred by the Insured:

in establishing the existence of or amount of Loss covered under this bond, except to the extent covered under the Insuring Agreement (J) (Audit Expense); or

as a party to any legal proceeding whether or not such legal proceeding exposes the Insured to Loss covered by this bond, except to the extent covered under General Agreement E) (Legal Proceedings Against the Insured);

indirect or consequential loss of any nature;

loss resulting directly or indirectly from any dishonest or fraudulent act or acts committed by any non-employee who is a securities, commodities, money, mortgage, real estate, loan, insurance, property management, investment banking broker, agent or other representative of the same general character;

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.

caused by an identifiable Employee or a person or persons in collusion with any Employee.

resulting from the accessing of any confidential information.

resulting from mechanical failure, faulty construction, error in design, latent defect, wear or tear, gradual deterioration, electrical disturbance, Recording Media failure or breakdown or any malfunction or error in programming or errors or omissions in processing.

by reason of the input of Electronic Data by a third party who had authorised access to an authentication mechanism.

where the third party referred to above obtained access beyond the level for which that third party was authorised,

theft of funds or Property transferred to any third party recipient as a result of any such input provided there is no collusion between such third party recipient and the person effecting such transfer and that it is a condition of coverage hereunder that the Insured takes all reasonable steps to secure the recovery of such funds.

resulting from Computer Programs which were corrupted or which contained fraudulent or malicious features at the time of their acquisition from a vendor or consultant, where those Computer Programs were developed for sale to or are sold to multiple consumers.

no other purchaser of said Computer Programs has notified the same vendor or consultant of the same fraudulent features during a period of sixty (60) days from the date of Discovery;

at the time of Discovery such fraudulent features were contained solely on the Computer Programs sold to the Insured;

such fraudulent features were inserted subsequent to the date of acquisition by the Insured.

Aggregate Limit of Liability.

the Insurer shall have no further liability for Loss or Losses regardless of when discovered and whether or not previously reported to the Insurer; and

The Insurer shall have no obligation under General Agreement F to continue the defense of the Insured, and upon notice by the Insurer to the Insured that the Aggregate Limit of Liability has been exhausted; the Insured shall assume all responsibility for its defense at its own cost.

Single Loss Limit of Liability.

Single Loss Defined.

any one act or series of related acts of burglary, robbery or attempt thereat, in which no Employee is implicated; or

any one act or series of related unintentional or negligent acts or omissions on the part of any person (whether an Employee or not) resulting in damage to or destruction or misplacement of property; or

all acts or omissions other than those specified in (a) and (b) preceding, caused by any person (whether an Employee or not) or in which such person is implicated; or

any one casualty or event not specified in (a), (b) or (c) preceding.

The Insured shall give written notice to the Insurer of any Loss as soon as reasonably practicable after it has been Discovered and in any event within thirty (30) days after the end of the Bond Period.

The requirement contained in sub-clause A) above to give notice of a Loss shall be suspended and of no effect if such notice is in respect of a Restricted Notification. The suspension of the requirement to notify the Insurer of any Loss under sub-clause A) above in respect of a Restricted Notification shall end when and to the extent that the relevant legal or regulatory prohibition is lifted. Such notification, if permitted to do so by the regulatory, police or prosecuting authority, shall be accompanied by evidence as to why the Insured was initially prevented from disclosing the existence of any Loss to the Insurer. On such notification, the Loss shall be deemed to have been Discovered and the Insurer notified at the time the Responsible Officer first became aware of the Loss.

Within 6 months after such Discovery (or, where a Restricted Notification applies, within 6 months of the relevant legal or regulatory prohibition being lifted), the Insured shall furnish to the Insurer proof of loss, duly sworn, with full known particulars. At the Insured’s request, and upon agreement of the Insurer, such period of time shall be extended to permit the Insured more time to determine the amount and/or particulars of its loss.

Lost Certificated Securities listed in a proof of loss shall be identified by certificate or bond numbers if such securities were issued therewith.

Legal proceedings for the recovery of any Loss hereunder shall not be brought prior to the expiration of 60 days after the original proof of Loss is filed with the Insurer or after the expiration of 24 months from the Discovery of such Loss.

If any limitation in this bond is prohibited by any law controlling the construction hereof, such limitation shall be deemed to be amended so as to equal the minimum period of limitation provided by such law.

This bond affords coverage only in favour of the Insured. No suit, action or legal proceedings shall be brought hereunder by any one other than the named Insured.

If the Insured is an institution under the supervision of the Federal Home Loan Bank Board, it is understood and agreed that in case of any Loss hereunder discovered either by the Insured or by the Federal Home Loan Bank of which the Insured is a member, the said Federal Home Loan Bank is empowered to give notice of the Loss to the Insurer within the period limited therefore.

Deductions

Securities

If Certificated Securities are able to be reissued then the Insured may reissue them, or arrange for them to be reissued, with the prior approval of the Insurer (such approval shall not be unreasonably delayed or withheld) and the value of those Certificated Securities shall be the actual cost of their reissue plus any interest charges incurred in doing so.

To the extent that the Limit of Liability is not exhausted by the Insured in the reissuing of Certificated Securities in accordance with sub-clause B) (i) above, the amount of Loss shall also include any premium required to be paid by the Insured to purchase lost instrument bonds for the reissuing of duplicate Certificated Securities without reference to their total face value.

The amount of Loss shall also include any sums which the Insured may be required to pay either during the Bond Period or any time thereafter by reason of any lost instrument bonds issued or purchased by the Insured as referred to in sub-clause B) (ii) above.

The Insured shall pay the cost of obtaining such lost instrument bond referred to in sub-clause B) (iii) above for that portion of the Loss which falls within the applicable

Retention or which is in excess of the Limit of Liability remaining available for the payment of Loss.

The Insurer shall reimburse the Insured for the cost of obtaining such lost instrument bond referred to in sub-clause B) (iii) above for the amount of Loss which exceeds the applicable Retention and is within the Limit of Liability.

If for any reason it is not possible to re-issue Certificated Securities the value of such Certificated Securities shall be determined by the closing London market value of such Certificated Securities on the day of Discovery of the Loss (or if Discovered during a weekend or national holiday, on the next business day thereafter). The basis of valuation shall include any accrued interest (including coupons), dividends and privileges up to the date of Discovery of the Loss.

The valuation of Certificated Securities shall include external interest or interest charges up to the date of Discovery of the Loss necessarily incurred by the Insured, or for which the Insured is legally liable, as the direct result of a loss of Certificated Securities covered under this bond.

In case of a loss of subscription, conversion, redemption or other similar privileges the value of such privileges shall be the closing London market value of such privileges immediately preceding the expiration thereof.

Precious Metals

Electronic Data, Electronic Communications and Computer Programs

To the extent that a Loss comprises solely the cost of reconstituting Electronic Data, Electronic Communications or Computer Programs following the Impairment of such Electronic Data, Electronic Communications or Computer Programs, the valuation of such Electronic Data, Electronic Communications or Computer Programs shall be the cost of labour for the actual transcription or copying in order to reproduce such Electronic Data, Electronic Communications or Computer Programs, including the cost of purchasing a software licence necessary to reproduce such Electronic Data, Electronic Communications or Computer Programs.

If Electronic Data cannot be reproduced and that Electronic Data represents:

securities, or other instruments having a value, then the valuation shall be as indicated in sub-clause (b), Securities above; or

Evidences of Debt, then the valuation of such items shall be as indicated in sub-clause B), Securities above; if such Evidences of Debt cannot be valued as indicated in sub-clause B), Securities above, then the Evidences of Debt shall be valued in accordance with sub-clause H), Lending. In the event that it is not possible to value the Evidences of Debt as indicated in sub-clause B), Securities above or in accordance with in sub-clause H), Lending below, then the valuation of such Evidences of Debt shall be the actual monetary value of the debt on the day of Discovery of the Loss (or if Discovered during a weekend or national holiday, on the next business day);

Money, then the valuation of such Electronic Data shall be its actual monetary value at the time of the Loss. However, in the event that such Loss is suffered in a currency other than the currency stated in the Declarations, then the valuation of such Electronic Data shall be as indicated in sub-clause (h), Currency Valuation below.

Recording Media

Books of Accounts and Records

Other Property

Lending

Currency Valuation

In the event of payment under this bond, the Insured shall deliver, if so requested by the Insurer, an assignment of such of the Insured’s rights, title and interest and causes of action as it has against any person or entity to the extent of the Loss payment.

In the event of payment under this bond, the Insurer shall be subrogated to all of the Insured’s rights of recovery therefore against any person or entity to the extent of such payment.

Recoveries, whether effected by the Insurer or by the Insured shall be applied net of the expense of such recovery first to the satisfaction of the Insured’s Loss which would otherwise have been paid but for the fact that it is in excess of either the Single or Aggregate Limit of Liability, secondly, to the Insurer as reimbursement of amounts paid in settlement of the Insured’s claim, and thirdly, to the Insured in satisfaction of any Deductible Amount. Recovery on account of Loss of securities as set forth in the second paragraph of Section 6 or recovery from reinsurance and/or indemnity of the Insurer shall not be deemed a recovery as used herein.

Upon the Insurer’s request and at reasonable times and places designated by the Insurer the Insured shall:

submit to examination by the Insurer and subscribe to the same under oath; and

produce for the Insurer’s examination all pertinent records; and

cooperate with the Insurer in all matters pertaining to the Loss.

The Insured shall execute all papers and render assistance to secure the Insurer the rights and causes of action provided for herein. The Insured shall do nothing after discovery of Loss to prejudice such rights or causes of action.

references to “Loss Discovered during the Bond Period” in the attached bond shall be amended to read: “Loss Discovered during the Bond Period or the Extended Reporting Period (if applicable)”;

the following Section is added: