Exhibit 4 - CUSTODIAL AGREEMENT
CUSTODIAN SERVICING AGREEMENT
THIS AGREEMENT is made and entered into as of this 1st day of January, 1999, by
and between Texas Capital Value Funds, Inc., a Maryland corporation
(hereinafter referred to as the "Company"), and Firstar Bank Milwaukee, N.A., a
corporation organized under the laws of the State of Wisconsin (hereinafter
referred to as the "Custodian").
WHEREAS, the Company is an open-end management investment company which is
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Company is authorized to create separate series, each with its own
separate investment portfolio; and
WHEREAS, the Company desires that the securities and cash of the Value & Growth
Portfolio (the "Fund") and each additional series of the Company listed on
Exhibit A attached hereto, as may be amended from time to time, shall be
hereafter held and administered by Custodian pursuant to the terms of this
Agreement.
NOW, THEREFORE, in consideration of the mutual agreements herein made, the
Company and Custodian agree as follows:
1. Definitions
The word "securities" as used herein includes stocks, shares, bonds, debentures,
notes, mortgages or other obligations, and any certificates, receipts, warrants
or other instruments representing rights to receive, purchase or subscribe for
the same, or evidencing or representing any other rights or interests therein,
or in any property or assets.
The words "officers' certificate" shall mean a request or direction or
certification in writing signed in the name of the Company by any two of the
President, a Vice President, the Secretary and the Treasurer of the Company, or
any other persons duly authorized to sign by the Board of Directors.
The word "Board" shall mean Board of Directors of the Texas Capital Value Funds,
Inc.
2. Names, Titles, and Signatures of the Company's Officers
An officer of the Company will certify to Custodian the names and signatures of
those persons authorized to sign the officers' certificates described in Section
1 hereof, and the names of the members of the Board of Directors, together with
any changes which may occur from time to time.
3. Receipt and Disbursement of Money
A. Custodian shall open and maintain a separate account or accounts in the
name of the Company, subject only to draft or order by Custodian acting pursuant
to the terms of this Agreement. Custodian shall hold in such account or
accounts, subject to the provisions hereof, all cash received by it from or for
the account of the Company. Custodian shall make payments of cash to, or for
the account of, the Company from such cash only:
(a) for the purchase of securities for the portfolio of the Fund
upon the delivery of such securities to Custodian, registered in the name of the
Company or of the nominee of Custodian referred to in Section 7 or in proper
form for transfer;
(b) for the purchase or redemption of shares of the common stock of the Fund
upon delivery thereof to Custodian, or upon proper instructions from the
Company;
(c) for the payment of interest, dividends, taxes, investment adviser's fees
or operating expenses (including, without limitation thereto, fees for legal,
accounting, auditing and custodian services and expenses for printing and
postage);
(d) for payments in connection with the conversion, exchange or surrender of
securities owned or subscribed to by the Fund held by or to be delivered to
Custodian; or
(e) for other proper corporate purposes certified by resolution of the Board
of Directors of the Company.
Before making any such payment, Custodian shall receive (and may rely upon) an
officers' certificate requesting such payment and stating that it is for a
purpose permitted under the terms of items (a), (b), (c), or (d) of this
Subsection A, and also, in respect of item (e), upon receipt of an officers'
certificate specifying the amount of such payment, setting forth the purpose for
which such payment is to be made, declaring such purpose to be a proper
corporate purpose, and naming the person or persons to whom such payment is to
be made, provided, however, that an officers' certificate need not precede the
disbursement of cash for the purpose of purchasing a money market instrument, or
any other security with same or next-day settlement, if the President, a Vice
President, the Secretary or the Treasurer of the Company issues appropriate oral
or facsimile instructions to Custodian and an appropriate officers' certificate
is received by Custodian within two business days thereafter.
B. Custodian is hereby authorized to endorse and collect all checks, drafts or
other orders for the payment of money received by Custodian for the account of
the Company.
C. Custodian shall, upon receipt of proper instructions, make federal funds
available to the Company as of specified times agreed upon from time to time by
the Company and the Custodian in the amount of checks received in payment for
shares of the Fund which are deposited into the Fund's account.
D. If so directed by the Company, Custodian will invest any and all available
cash in overnight cash-equivalent investments as specified by the investment
manager.
4. Segregated Accounts
Upon receipt of proper instructions, the Custodian shall establish
and maintain a segregated account(s) for and on behalf of the Fund, into which
account(s) may be transferred cash and/or securities.
5. Transfer, Exchange, Redelivery, etc. of Securities
Custodian shall have sole power to release or deliver any securities of the
Company held by it pursuant to this Agreement. Custodian agrees to transfer,
exchange or deliver securities held by it hereunder only:
(a) for sales of such securities for the account of the Fund upon receipt by
Custodian of payment therefore;
(b) when such securities are called, redeemed or retired or otherwise become
payable;
(c) for examination by any broker selling any such securities in accordance
with "street delivery" custom;
(d) in exchange for, or upon conversion into, other securities alone or other
securities and cash whether pursuant to any plan of merger, consolidation,
reorganization, recapitalization or readjustment, or otherwise;
(e) upon conversion of such securities pursuant to their terms into other
securities;
(f) upon exercise of subscription, purchase or other similar rights
represented by such securities;
(g) for the purpose of exchanging interim receipts or temporary securities for
definitive securities;
(h) for the purpose of redeeming in kind shares of common stock of the Fund
upon delivery thereof to Custodian; or
(i) for other proper corporate purposes.
As to any deliveries made by Custodian pursuant to items (a), (b), (d), (e),
(f), and (g), securities or cash receivable in exchange therefor shall be
deliverable to Custodian.
Before making any such transfer, exchange or delivery, Custodian shall receive
(and may rely upon) an officers' certificate requesting such transfer, exchange
or delivery, and stating that it is for a purpose permitted under the terms of
items (a), (b), (c), (d), (e), (f), (g), or (h) of this Section 5 and also, in
respect of item (i), upon receipt of an officers' certificate specifying the
securities to be delivered, setting forth the purpose for which such delivery is
to be made, declaring such purpose to be a proper corporate purpose, and naming
the person or persons to whom delivery of such securities shall be made,
provided, however, that an officers' certificate need not precede any such
transfer, exchange or delivery of a money market instrument, or any other
security with same or next-day settlement, if the President, a Vice President,
the Secretary or the Treasurer of the Company issues appropriate oral or
facsimile instructions to Custodian and an appropriate officers' certificate is
received by Custodian within two business days thereafter.
6. Custodian's Acts Without Instructions
Unless and until Custodian receives an officers' certificate to the contrary,
Custodian shall: (a) present for payment all coupons and other income items
held by it for the account of the Fund, which call for payment upon presentation
and hold the cash received by it upon such payment for the account of the Fund;
(b) collect interest and cash dividends received, with notice to the Company,
for the account of the Fund; (c) hold for the account of the Fund hereunder all
stock dividends, rights and similar securities issued with respect to any
securities held by it hereunder; and (d) execute, as agent on behalf of the
Company, all necessary ownership certificates required by the Internal Revenue
Code of 1986, as amended (the "Code") or the Income Tax Regulations (the
"Regulations") of the United States Treasury Department (the "Treasury
Department") or under the laws of any state now or hereafter in effect,
inserting the Company's name on such certificates as the owner of the securities
covered thereby, to the extent it may lawfully do so.
7. Registration of Securities
Except as otherwise directed by an officers' certificate, Custodian shall
register all securities, except such as are in bearer form, in the name of a
registered nominee of Custodian as defined in the Internal Revenue Code and any
Regulations of the Treasury Department issued thereunder or in any provision of
any subsequent federal tax law exempting such transaction from liability for
stock transfer taxes, and shall execute and deliver all such certificates in
connection therewith as may be required by such laws or regulations or under the
laws of any state. All securities held by Custodian hereunder shall be at all
times identifiable in its records held in an account or accounts of Custodian
containing only the assets of the Company.
The Company shall from time to time furnish to Custodian appropriate instruments
to enable Custodian to hold or deliver in proper form for transfer, or to
register in the name of its
registered nominee, any securities which it may hold for the account of the
Company and which may from time to time be registered in the name of the
Company.
8. Voting and Other Action
Neither Custodian nor any nominee of Custodian shall vote any of the securities
held hereunder by or for the account of the Fund, except in accordance with the
instructions contained in an officers' certificate. Custodian shall deliver, or
cause to be executed and delivered, to the Company all notices, proxies and
proxy soliciting materials with respect to such securities, such proxies to be
executed by the registered holder of such securities (if registered otherwise
than in the name of the Company), but without indicating the manner in which
such proxies are to be voted.
9. Transfer Tax and Other Disbursements
The Company shall pay or reimburse Custodian from time to time for any transfer
taxes payable upon transfers of securities made hereunder, and for all other
necessary and proper disbursements and expenses made or incurred by Custodian in
the performance of this Agreement.
Custodian shall execute and deliver such certificates in connection
with securities delivered to it or by it under this Agreement as may be required
under the provisions of the Internal Revenue Code and any Regulations of the
Treasury Department issued thereunder, or under the laws of any state, to exempt
from taxation any exempt transfers and/or deliveries of any such securities.
10. Concerning Custodian
Custodian shall be paid as compensation for its services pursuant to this
Agreement such compensation as may from time to time be agreed upon in writing
between the two parties. Until modified in writing, such compensation shall be
as set forth in Exhibit A attached hereto.
Custodian shall not be liable for any action taken in good faith upon any
certificate herein described or certified copy of any resolution of the Board,
and may rely on the genuineness of any such document which it may in good faith
believe to have been validly executed.
The Company agrees to indemnify and hold harmless Custodian and its nominee from
all taxes, charges, expenses, assessments, claims and liabilities (including
reasonable counsel fees) incurred or assessed against it or by its nominee in
connection with the performance of this Agreement, except such as may arise from
its or its nominee's own bad faith, negligent action, negligent failure to act
or willful misconduct. Custodian is authorized to
charge any account of the Fund for such items. In the event of any advance of
cash for any purpose made by Custodian resulting from orders or instructions of
the Company, or in the event that Custodian or its nominee shall incur or be
assessed any taxes, charges, expenses, assessments, claims or liabilities in
connection with the performance of this Agreement, except such as may arise from
its or its nominee's own bad faith, negligent action, negligent failure to act
or willful misconduct, any property at any time held for the account of the
Company shall be security therefor.
Custodian agrees to indemnify and hold harmless the Company from all charges,
expenses, assessments, and claims/liabilities (including reasonable counsel
fees) incurred or assessed against it in connection with the performance of this
Agreement, except such as may arise from the Fund's own bad faith, negligent
action, negligent failure to act, or willful misconduct.
11. Subcustodians
Custodian is hereby authorized to engage another bank or trust company as a
subcustodian for all or any part of the Company's assets, so long as any such
bank or trust company is itself qualified under the 1940 Act and the rules and
regulations thereunder and provided further that, if the Custodian utilizes the
services of a subcustodian, the Custodian shall remain fully liable and
responsible for any losses caused to the Company by the subcustodian as fully as
if the Custodian was directly responsible for any such losses under the terms of
this Agreement.
Notwithstanding anything contained herein, if the Company requires the Custodian
to engage specific subcustodians for the safekeeping and/or clearing of assets,
the Company agrees to indemnify and hold harmless Custodian from all claims,
expenses and liabilities incurred or assessed against it in connection with the
use of such subcustodian in regard to the Company's assets, except as may arise
from Custodian's own bad faith, negligent action, negligent failure to act or
willful misconduct.
12. Reports by Custodian
Custodian shall furnish the Company periodically as agreed upon with a statement
summarizing all transactions and entries for the account of Company. Custodian
shall furnish to the Company, at the end of every month, a list of the portfolio
securities for the Fund showing the aggregate cost of each issue. The books and
records of Custodian pertaining to its actions under this Agreement shall be
open to inspection and audit at reasonable times by officers of, and by auditors
employed by, the Company.
13. Term of Agreement
This Agreement shall become effective as of the date hereof and, unless sooner
terminated as provided herein, shall continue for a period of two years, and
thereafter shall continue automatically in effect for successive annual periods.
This Agreement may be terminated by either party upon giving ninety (90) days
prior written notice to the other party or such shorter period as is mutually
agreed upon by the parties. However, this Agreement may be replaced or modified
by a subsequent agreement between the parties.
14. Notices
Notices of any kind to be given by either party to the other party shall be in
writing and shall be duly given if mailed or delivered as follows: Notice to
Custodian shall be sent to:
Firstar Mutual Fund Services, LLC
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Company shall be sent to:
Texas Capital Value Funds
0000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
15. Duties in the Event of Termination
Upon any termination of this Agreement, pending appointment of a successor to
Custodian or a vote of the shareholders of the Fund to dissolve or to function
without a custodian of its cash, securities and other property, Custodian shall
not deliver cash, securities or other property of the Fund to the Company, but
may deliver them to a bank or trust company of its own selection that meets the
requirements of the 1940 Act as a Custodian for the Company to be held under
terms similar to those of this Agreement, provided, however, that Custodian
shall not be required to make any such delivery or payment until full payment
shall have been made by the Company of all liabilities constituting a charge on
or against the properties then held by Custodian or on or against Custodian, and
until full payment shall have been made to Custodian of all its fees,
compensation, costs and expenses, subject to the provisions of Section 10 of
this Agreement.
This Agreement may not be assigned by Custodian without the consent of the
Company, authorized or approved by a resolution of its Board of Directors.
16. Deposits of Securities in Securities Depositories
No provision of this Agreement shall be deemed to prevent the use by Custodian
of a central securities clearing agency or securities depository, provided,
however, that Custodian and the central securities clearing agency or securities
depository meet all applicable federal and state laws and regulations, and the
Board of Directors of the Company approves by resolution the use of such central
securities clearing agency or securities depository.
17. Records
Custodian shall keep records relating to its services to be performed hereunder,
in the form and manner, and for such period, as it may deem advisable and is
agreeable to the Company but not inconsistent with the rules and regulations of
appropriate government authorities, in particular Section 31 of the 1940 Act and
the rules thereunder. Custodian agrees that all such records prepared or
maintained by the Custodian relating to the services performed by Custodian
hereunder are the property of the Company and will be preserved, maintained, and
made available in accordance with such section and rules of the 1940 Act and
will be promptly surrendered to the Company on and in accordance with its
request.
18. Governing Law
This Agreement shall be governed by Wisconsin law. However, nothing herein
shall be construed in a manner inconsistent with the 1940 Act or any rule or
regulation promulgated by the Securities and Exchange Commission thereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by a duly authorized officer or one or more counterparts as of the day and year
first written above.
texas capital value funds, Inc. FIRSTAR BANK MILWAUKEE, N.A.
By:______________________________ By: ________________________________
Attest: __________________________
Attest:______________________________
Custody Services
Annual Fee Schedule - Domestic Funds
Exhibit A
Separate Series of Texas Capital Value Funds, Inc.
Name of Series Date Added
Value & Growth Portfolio January 1, 1999
Mid-Cap Focus _
Annual fee based upon market value of the fund group
First $50 Million @ 1.5 basis points per year
Next $50 Million @ 1 basis points per year
Balance @ .0 Xxxxx Xxxxx
Investment transactions (purchase, sale, exchange, tender, redemption, maturity,
receipt, delivery):
$8.00 per book entry security (depository or Federal Reserve system)
$25.00 per definitive security (physical)
$25.00 per mutual fund trade
$75.00 per Euroclear
$ 8.00 per principal reduction on pass-through certificates
$35.00 per option/futures contract
$15.00 per variation margin
$15.00 per Fed wire deposit or withdrawal
Variable Amount Demand Notes: Used as a short-term investment, variable amount
notes offer safety and prevailing high interest rates. Our charge, which is 1/4
of 1%, is deducted from the variable amount note income at the time it is
credited to your account.
Plus out-of-pocket expenses, and extraordinary expenses based upon complexity
Fees and out-of-pocket expenses are billed to the fund monthly, based upon
market value at the beginning of the month
