CUSTODY AGREEMENT
This agreement (the "Agreement") is entered into as of the _____ day of
___________, 1996, by and between The World Funds, Inc., (the "Fund"), an
open-end diversified investment business corporation organized under the laws of
Maryland and having its office at 0000 Xxxxxx Xxxxx Xxxxx 000, Xxxxxxxx,
Xxxxxxxx, 00000 for the benefit of the Vontobel U.S. Value Fund series (the
"Series"), and Star Bank, National Association, (the "Custodian"), a national
banking association having its principal office at 000 Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxx, 00000.
WHEREAS, the Fund and the Custodian desire to enter into this Agreement
to provide for the custody and safekeeping of the assets of the Series as
required by the Investment Company Act of 1940, as amended (the "Act").
WHEREAS, the Fund hereby appoints the Custodian as custodian of all the
Series' Securities and moneys at any time owned by the Series during the term of
this Agreement (the "Series Assets").
WHEREAS, the Custodian hereby accepts such appointment as Custodian and
agrees to perform the duties thereof as hereinafter set forth.
THEREFORE, in consideration of the mutual promises hereinafter set
forth, the Fund and the Custodian agree as follows:
ARTICLE I
Definitions
The following words and phrases, when used in this Agreement, unless
the context otherwise requires, shall have the following meanings:
Authorized Person - the Chairman, President, Secretary, Treasurer,
Controller, or Senior Vice President of the Fund, or any other person, whether
or not any such person is an officer or employee of the Fund, duly authorized by
the Board of Directors of the Fund to give Oral Instructions and Written
Instructions on behalf of the Fund, and listed in the Certificate annexed hereto
as Appendix A, or such other Certificate as may be received by the Custodian
from time to time.
Book-Entry System - the Federal Reserve Bank book-entry system for
United States Treasury securities and federal agency securities.
Depository - The Depository Trust Company ("DTC"), a limited purpose
trust company its successor(s) and its nominee(s) or any other person or
clearing agent.
Dividend and Transfer Agent - the dividend and transfer agent appointed,
from time to time, pursuant to a written agreement between the dividend and
transfer agent and the Fund.
Foreign Securities - a) securities issued and sold primarily outside of
the United States by a foreign government, a national of any foreign country, or
a corporation or other organization incorporated or organized under the laws of
any foreign country or; b) securities issued or guaranteed by the government of
the United States, by any state, by any political subdivision or agency thereof,
or by any entity organized under the laws of the United States or of any state
thereof, which have been issued and sold primarily outside of the United States.
Money Market Security - debt obligations issued or guaranteed as to
principal and/or interest by the government of the United States or agencies or
instrumentalities thereof, commercial paper, obligations (including certificates
of deposit, bankers' acceptances, repurchase agreements and reverse repurchase
agreements with respect to the same), and time deposits of domestic banks and
thrift institutions whose deposits are insured by the Federal Deposit Insurance
Corporation, and short-term corporate obligations where the purchase and sale of
such securities normally require settlement in federal funds or their equivalent
on the same day as such purchase and sale, all of which mature in not more than
thirteen (13) months.
Officers - the Chairman, President, Secretary, Treasurer, Controller,
and Senior Vice President of the Fund listed in the Certificate annexed hereto
as Appendix A, or such other Certificate as may be received by the Custodian
from time to time.
Oral Instructions - verbal instructions received by the Custodian from
an Authorized Person (or from a person that the Custodian reasonably believes in
good faith to be an Authorized Person) and confirmed by Written Instructions in
such a manner that such Written Instructions are received by the Custodian not
later than the business day immediately following receipt of such Oral
Instructions.
Prospectus - the Fund's then currently effective prospectus and
Statement of Additional Information, as filed with and declared effective from
time to time by the Securities and Exchange Commission.
Security or Securities - Money Market Securities, common stock,
preferred stock, options, financial futures, bonds, notes, debentures, corporate
debt securities, mortgages, 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 interest therein, or any
property or assets.
Written Instructions - communication received in writing by the
Custodian from an Authorized Person.
ARTICLE II
Documents and Notices to be Furnished by the Fund
A. The following documents, including any amendments thereto,
will be provided contemporaneously with the execution of the Agreement, to the
Custodian by the Fund:
1. A copy of the Articles of Incorporation of the Fund
certified by the Secretary.
2. A copy of the By-Laws of the Fund certified by
the Secretary.
3. A copy of the resolution of the Board of Directors of the
Fund appointing the Custodian, certified by the Secretary.
4. A copy of the then current Prospectus of the Series.
5. A Certificate of the President and Secretary of the Fund
setting forth the names and signatures of the Officers of
the Fund.
B. The Fund agrees to notify the Custodian in writing of the
appointment of any Dividend and Transfer Agent.
ARTICLE III
Receipt of Fund Assets
A. During the term of this Agreement, the Fund will deliver or
cause to be delivered to the Custodian all moneys constituting Series
Assets. The Custodian shall be entitled to reverse any deposits made on the
Fund's behalf where such deposits have been entered and moneys are not
finally collected within 30 days of the making of such entry.
B. During the term of this Agreement, the Fund will deliver or
cause to be delivered to the Custodian all Securities constituting Series
Assets. The Custodian will not have any duties or responsibilities with
respect to such Securities until actually received by the Custodian.
C. As and when received, the Custodian shall deposit to the
account(s) of the Series any and all payments for shares of the Series issued
or sold from time to time as they are received from the Fund's distributor or
Dividend and Transfer Agent or from the Fund itself.
ARTICLE IV
Disbursement of Fund Assets
A. The Fund shall furnish to the Custodian a copy of the
resolution of the Board of Directors of the Fund, certified by the Fund's
Secretary, either (i) setting forth the date of the declaration of any dividend
or distribution in respect of shares of the Series, the date of payment
thereof, the record date as of which Fund shareholders entitled to payment
shall be determined, the amount payable per share to Series shareholders of
record as of that date, and the total amount to be paid by the Dividend and
Transfer Agent on the payment date, or (ii) authorizing the declaration of
dividends and distributions in respect of shares of the Fund on a daily basis
and authorizing the Custodian to rely on a Certificate setting forth the date of
the declaration of any such dividend or distribution, the date of payment
thereof, the record date as of which Series shareholders entitled to payment
shall be determined, the amount payable per share to Series shareholders of
record as of that date, and the total amount to be paid by the Dividend and
Transfer Agent on the payment date. On the payment date specified in such
resolution or Certificate described above, the Custodian shall segregate
such amounts from moneys held for the account of the Series so that they are
available for such payment.
B. Upon receipt of Written Instructions so directing it, the
Custodian shall segregate amounts necessary for the payment of redemption
proceeds to be made by the Dividend and Transfer Agent from moneys held for the
account of the Series so that they are available for such payment.
C. Upon receipt of a Certificate directing payment and setting
forth the name and address of the person to whom such payment is to be made,
the amount of such payment, and the purpose for which payment is to be made,
the Custodian shall disburse amounts as and when directed from the Series
Assets. The Custodian is authorized to rely on such directions and shall be
under no obligation to inquire as to the propriety of such directions.
D. Upon receipt of a Certificate directing payment, the Custodian
shall disburse moneys from the Series Assets in payment of the Custodian's
fees and expenses as provided in Article VIII hereof.
E. Upon receipt of a Certificate directing payment and setting
forth the name and address of the person to whom such payment is to be made,
the amount of such payment, and the purpose for which payment is to be made,
the Custodian shall disburse amounts to any imprest account maintained for
the Series as and when directed from the Series Assets. The Custodian is
authorized to rely on such directions and shall be under no obligation to
inquire as to the propriety of such directions.
ARTICLE V
Custody of Fund Assets
A. The Custodian shall open and maintain a separate bank
account or accounts in the United States in the name of the Fund for the
assets of the Series, subject only to draft or order by the Custodian acting
pursuant to the terms of this Agreement, and shall hold all cash received by it
from or for the account of the Series, other than cash maintained by the Fund
in a bank account established and used by the Series in accordance with Rule
17f-3 under the Act. Moneys held by the Custodian on behalf of the Series may
be deposited by the Custodian to its credit as Custodian in the banking
department of the Custodian. Such moneys shall be deposited by the Custodian
in its capacity as such, and shall be withdrawable by the Custodian only in
such capacity.
B. The Custodian shall hold all Securities delivered to it in
safekeeping in a separate account or accounts maintained at Star Bank, N.A. for
the benefit of the Series.
C. All Securities held which are issued or issuable only in
bearer form, shall be held by the Custodian in that form; all other Securities
held for the Series shall be registered in the name of the Custodian or its
nominee. The Fund agrees to furnish to the Custodian appropriate instruments
to enable the Custodian to hold, or deliver in proper form for transfer, any
Securities that it may hold for the account of the Fund and which may, from
time to time, be registered in the name of the Series.
D. With respect to all Securities held for the Series, the
Custodian shall on a timely basis (concerning items 1 and 2 below, as defined
in the Custodian's Standards of Service Guide, as amended from time to time,
annexed hereto as Appendix C):
1.) Collect all income due and payable with respect to
such Securities;
2.) Present for payment and collect amounts payable upon
all Securities which may mature or be called, redeemed, or retired, or otherwise
become payable;
3.) Surrender Securities in temporary form for
definitive Securities; and
4.) Execute, as agent, any necessary declarations or
certificates of ownership under the Federal income tax laws or the laws or
regulations of any other taxing authority, including any foreign taxing
authority, now or hereafter in effect.
E. Upon receipt of a Certificate and not otherwise, the Custodian
shall:
1.) Execute and deliver to such persons as may be designated
in such Certificate proxies, consents, authorizations, and any other instruments
whereby the authority of the Fund as beneficial owner of any Securities may be
exercised;
2.) Deliver any Securities in exchange for other Securities
or cash issued or paid in connection with the liquidation, reorganization,
refinancing, merger, consolidation, or recapitalization of any corporation, or
the exercise of any conversion privilege;
3.) Deliver any Securities to any protective committee,
reorganization committee, or other person in connection with the reorganization,
definancing, merger, consolidation, recapitalization, or sale of assets of any
corporation, and receive and hold under the terms of this Agreement such
certificates of deposit, interim receipts or other instruments or documents as
may be issued to it to evidence such delivery;
4.) Make such transfers or exchanges of the assets of the
Fund and take such other steps as shall be stated in said Certificate to be for
the purpose of effectuating any duly authorized plan of liquidation,
reorganization, merger, consolidation or recapitalization of the Fund; and
5.) Deliver any Securities held for the Series to the
depository agent for tender or other similar offers.
F. The Custodian shall promptly deliver to the Fund all notices,
proxy material and executed but unvoted proxies pertaining to shareholder
meetings of Securities held by the Fund. The Custodian shall not vote or
authorize the voting of any Securities or give any consent, waiver or approval
with respect thereto unless so directed by a Certificate or Written
Instruction.
G. The Custodian shall promptly deliver to the Fund all
information received by the Custodian and pertaining to Securities held by the
Fund with respect to tender or exchange offers, calls for redemption or
purchase, or expiration of rights.
ARTICLE VI
Purchase and Sale of Securities
A. Promptly after each purchase of Securities by the Fund for
the Series, the Fund shall deliver to the Custodian (i) with respect to
each purchase of Securities which are not Money Market Securities,
Written Instructions, and (ii) with respect to each purchase of Money Market
Securities, Written Instructions or Oral Instructions, specifying with respect
to each such purchase the;
1.) name of the issuer and the title of the
Securities,
2.) principal amount purchased and accrued
interest, if any,
3.) date of purchase and settlement,
4.) purchase price per unit,
5.) total amount payable, and
6.) name of the person from whom, or the broker through
which, the purchase was made.
The Custodian shall, against receipt of Securities purchased by or for the
Series, pay out of the Series Assets, the total amount payable to the person
from whom or the broker through which the purchase was made, provided that the
same conforms to the total amount payable as set forth in such Written
Instructions or Oral Instructions, as the case may be.
B. Promptly after each sale of Securities by the Fund for the
Series, the Fund shall deliver to the Custodian (i) with respect to each sale of
Securities which are not Money Market Securities, Written Instructions, and (ii)
with respect to each sale of Money Market Securities, Written Instructions or
Oral Instructions, specifying with respect to each such sale the;
1.) name of the issuer and the title of the Securities,
2.) principal amount sold and accrued interest, if any,
3.) date of sale and settlement,
4.) sale price per unit,
5.) total amount receivable, and
6.) name of the person to whom, or the broker through
which, the sale was made.
The Custodian shall deliver the Securities against receipt of the total amount
receivable, provided that the same conforms to the total amount receivable as
set forth in such Written Instructions or Oral Instructions, as the case may be.
C. On contractual settlement date, the account of the Series will
be charged for all purchased Securities settling on that day, regardless of
whether or not delivery is made. Likewise, on contractual settlement date,
proceeds from the sale of Securities settling that day will be credited to the
account of the Series, irrespective of delivery.
D. Purchases and sales of Securities effected by the Custodian will
be made on a delivery versus payment basis. The Custodian may, in its
sole discretion, upon receipt of a Certificate, elect to settle a purchase or
sale transaction in some other manner, but only upon receipt of
acceptable indemnification from the Fund.
E. The Custodian shall, upon receipt of a Written Instructions so
directing it, establish and maintain a segregated account or accounts for and on
behalf of the Series. Cash and/or Securities may be transferred into such
account or accounts for specific purposes, to-wit:
1.) in accordance with the provision of any agreement among
the Fund, the Custodian, and a broker-dealer registered under the Securities and
Exchange Act of 1934, as amended, and also a member of the National Association
of Securities Dealers (NASD) (or any futures commission merchant registered
under the Commodity Exchange Act), relating to compliance with the rules of the
Options Clearing Corporation and of any registered national securities exchange,
the Commodity Futures Trading Commission, any registered contract market, or any
similar organization or organizations requiring escrow or other similar
arrangements in connection with transactions by the Fund for the Series;
2.) for purposes of segregating cash or government
securities in connection with options purchased, sold, or written by the Fund or
commodity futures contracts or options thereon purchased or sold by the Fund for
the Series;
3.) for the purpose of compliance by the Series with the
procedures required for reverse repurchase agreements, firm commitment
agreements, standby commitment agreements, and short sales by Act Release No.
10666, or any subsequent release or releases or rule of the Securities and
Exchange Commission relating to the maintenance of segregated accounts by
registered investment companies; and
4.) for other corporate purposes, only in the case of this
clause 4 upon receipt of a copy of a resolution of the Board of Directors of the
Fund, certified by the Secretary of the Fund, setting forth the purposes of such
segregated account.
F. Except as otherwise may be agreed upon by the parties hereto,
the Custodian shall not be required to comply with any Written Instructions
to settle the purchase of any Securities on behalf of the Series unless there
is sufficient cash in the account(s) at the time or to settle the sale of
any Securities from an account(s) unless such Securities are in deliverable
form. Notwithstanding the foregoing, if the purchase price of such Securities
exceeds the amount of cash in the account(s) at the time of such purchase, the
Custodian may, in its sole discretion, advance the amount of the difference
in order to settle the purchase of such Securities. The amount of any such
advance shall be deemed a loan from the Custodian to the Fund for the respective
Series payable on demand and bearing interest accruing from the date such
loan is made up to but not including the date such loan is repaid at a rate per
annum customarily charged by the Custodian on similar loans.
ARTICLE VII
Fund Indebtedness
In connection with any borrowings by the Fund for the Series, the Fund
will cause to be delivered to the Custodian by a bank or broker requiring
Securities as collateral for such borrowings (including the Custodian if the
borrowing is from the Custodian), a notice or undertaking in the form currently
employed by such bank or broker setting forth the amount of collateral. The Fund
shall promptly deliver to the Custodian a Certificate specifying with respect to
each such borrowing:
(a) the name of the bank or broker,
(b) the amount and terms of the borrowing, which may be set
forth by incorporating by reference an attached promissory note duly endorsed by
the Fund, or a loan agreement,
(c) the date, and time if known, on which the loan is to be
entered into,
(d) the date on which the loan becomes due and payable,
(e) the total amount payable to the Series on the borrowing
date, and
(f) the description of the Securities securing the loan,
including the name of the issuer, the title and the number of shares or the
principal amount. The Custodian shall deliver on the borrowing date
specified in the Certificate the required collateral against the lender's
delivery of the total loan amount then payable, provided that the same conforms
to that which is described in the Certificate. The Custodian shall deliver, in
the manner directed by the Fund, such Securities as additional collateral, as
may be specified in a Certificate, to secure further any transaction described
in this Article VII. The Fund shall cause all Securities released from
collateral status to be returned directly to the Custodian and the Custodian
shall receive from time to time such return of collateral as may be tendered to
it. The Custodian may, at the option of the lender, keep such collateral in its
possession, subject to all rights therein given to the lender because of the
loan. The Custodian may require such reasonable conditions regarding such
collateral and its dealings with third-party lenders as it may deem appropriate.
ARTICLE VIII
Concerning the Custodian
A. Except as otherwise provided herein, the Custodian shall not
be liable for any loss or damage resulting from its action or omission to act or
otherwise, except for any such loss or damage arising out of its own gross
negligence or willful misconduct. The Fund shall defend, indemnify and hold
harmless the Custodian and its directors, officers, employees and agents with
respect to any loss, claim, liability or cost (including reasonable attorneys'
fees) arising or alleged to arise from or relating to the Fund's duties
hereunder or any other action or inaction of the Fund or its Directors,
officers, employees or agent, except such as may arise from the negligent
action, omission, willful misconduct or breach of this Agreement by the
Custodian. The Custodian may, with respect to questions of law, apply for and
obtain the advice and opinion of counsel, at the expense of the Fund, and shall
be fully protected with respect to anything done or omitted by it in good faith
in conformity with the advice or opinion of counsel. The provisions under this
paragraph shall survive the termination of this Agreement.
B. Without limiting the generality of the foregoing, the
Custodian, acting in the capacity of Custodian hereunder, shall be under no
obligation to inquire into, and shall not be liable for:
1.) The validity of the issue of any Securities purchased
by or for the account of the Fund, the legality of the purchase thereof, or the
propriety of the amount paid therefor;
2.) The legality of the sale of any Securities by or for
the account of the Series, or the propriety of the amount for which the same are
sold;
3.) The legality of the issue or sale of any shares of
Series, or the sufficiency of the amount to be received therefor;
4.) The legality of the redemption of any shares of the
Series, or the propriety of the amount to be paid therefor;
5.) The legality of the declaration or payment of any
dividend by the Fund in respect of shares of the Series;
6.) The legality of any borrowing by the Series on
behalf of the Fund, using Securities as collateral;
C. The Custodian shall not be under any duty or obligation to
take action to effect collection of any amount due to the Series from any
Dividend and Transfer Agent of the Fund nor to take any action to effect
payment or distribution by any Dividend and Transfer Agent of the Fund of any
amount paid by the Custodian to any Dividend and Transfer Agent of the Fund in
accordance with this Agreement.
D. Notwithstanding Section D of Article V, the Custodian shall not
be under any duty or obligation to take action to effect collection of any
amount, if the Securities upon which such amount is payable are in default,
or if payment is refused after due demand or presentation, unless and until
(i) it shall be directed to take such action by a Certificate and (ii) it
shall be assured to its satisfaction (including prepayment thereof) of
reimbursement of its costs and expenses in connection with any such action.
E. The Fund acknowledges and hereby authorizes the Custodian to
hold Securities through its various agents described in Appendix B annexed
hereto. The Fund hereby represents that such authorization has been duly
approved by the Board of Directors of the Fund as required by the Act.
The Custodian acknowledges that although certain Series Assets are held by
its agents, the Custodian remains primarily liable for the safekeeping of the
Series Assets.
In addition, the Fund acknowledges that the Custodian may appoint one or more
financial institutions, as agent or agents or as sub-custodian or
sub-custodians, including, but not limited to, banking institutions located in
foreign countries, for the purpose of holding Securities and moneys at any time
owned by the Series. The Custodian shall not be relieved of any obligation or
liability under this Agreement in connection with the appointment or activities
of such agents or sub-custodians. Any such agent or sub-custodian shall be
qualified to serve as such for assets of investment companies registered under
the Act. Upon request, the Custodian shall promptly forward to the Fund any
documents it receives from any agent or sub-custodian appointed hereunder which
may assist directors of registered investment companies fulfill their
responsibilities under Rule 17f-5 of the Act.
F. The Custodian shall not be under any duty or obligation to
ascertain whether any Securities at any time delivered to or held by it for the
account of the Fund are such as properly may be held by the Series under the
provisions of the Articles of Incorporation and the Fund's By-Laws.
G. The Custodian shall treat all records and other information
relating to the Fund and the Series Assets as confidential and shall not
disclose any such records or information to any other person unless (i) the Fund
shall have consented thereto in writing or (ii) such disclosure is required by
law.
H. The Custodian shall be entitled to receive and the Fund agrees
pay to the Custodian from the assets of the Series such compensation as shall be
determined pursuant to Appendix D attached hereto, or as shall be determined
pursuant to amendments to such Appendix D. The Custodian shall be entitled to
charge against any money held by it for the account of the Series, the amount of
any of its fees, any loss, damage, liability or expense, including counsel fees
relating to such Series. The expenses which the Custodian may charge against the
account of the Series include, but are not limited to, the expenses of agents or
sub-custodians incurred in settling transactions involving the purchase and sale
of Securities of the Fund.
I. The Custodian shall be entitled to rely upon any Oral
Instructions and any Written Instructions. The Fund agrees to forward to the
Custodian Written Instructions confirming Oral Instructions in such a manner so
that such Written Instructions are received by the Custodian, whether by hand
delivery, facsimile or otherwise, not later than the following business day on
which such Oral Instructions were given. The Fund agrees that the failure of
the Custodian to receive such confirming instructions shall in no way affect
the validity of the transactions or enforceability of the transactions hereby
authorized by the Fund. The Fund agrees that the Custodian shall incur no
greater liability to the Fund for acting upon Oral Instructions given to
the Custodian hereunder concerning such transactions than would arise as to
a similar transaction pursuant to a Written Instruction. J. The Custodian will
(i) set up and maintain proper books of account and complete records of all
transactions in the accounts maintained by the Custodian hereunder in such
manner as will meet the obligations of the Fund under the Act, with particular
attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder and those
records are the property of the Fund, and (ii) preserve for the periods
prescribed by applicable Federal statute or regulation all records required to
be so preserved. All suchbooks and records shall be the property of the Fund,
and shall be open to inspection and audit at reasonable times and with prior
notice by Officers and auditors employed by the Fund.
K. The Custodian shall send to the Fund any report received on the
systems of internal accounting control of the Custodian, or its agents or
sub-custodians, as the Fund may reasonably request from time to time.
L. The Custodian performs only the services of a custodian and
shall have no responsibility for the management, investment or reinvestment of
the Securities from time to time owned by the Fund. The Custodian is not a
selling agent for shares of the Series and performance of its duties as
custodian shall not be deemed to be a recommendation to the Fund's depositors
or others of shares of the Series as an investment.
M. The Custodian shall take all reasonable action, that the Fund
may from time to time request, to assist the Fund in obtaining favorable
opinions from the Fund's independent accountants, with respect to the
Custodian's activities hereunder, in connection with the preparation of the
Fund's Form N-1A, Form N-SAR, or other annual reports to the Securities and
Exchange Commission. N. The Fund hereby pledges to and grants the Custodian a
security interest in any Series Assets to secure the payment of any liabilities
of the Series to the Custodian, whether acting in its capacity as Custodian
or otherwise, or on account of money borrowed from the Custodian. This pledge is
in addition to any other pledge of collateral by the Fund to the Custodian.
ARTICLE X
Termination
A. Either of the parties hereto may terminate this Agreement for
any reason by giving to the other party a notice in writing specifying the
date of such termination, which shall be not less than ninety (90) days after
the date of giving of such notice.
If such notice is given by the Fund, it shall be accompanied by a copy of a
resolution of the Board of Directors of the Fund, certified by the
Secretary of the Fund, electing to terminate this Agreement and designating a
successor custodian or custodians. In the event such notice is given by the
Custodian, the Fund shall, on or before the termination date, deliver to
the Custodian a copy of a resolution of the Board of Directors of the Fund,
certified by the Secretary, designating a successor custodian or custodians
to act on behalf of the Fund. In the absence of such designation by the Fund,
the Custodian may designate a successor custodian which shall be a bank
or trust company having not less than $100,000,000 aggregate capital,
surplus, and undivided profits. Upon the date set forth in such notice this
Agreement shall terminate, and the Custodian, provided that it has received
a notice of acceptance by the successor custodian, shall deliver, on that date,
directly to the successor custodian all Securities and moneys then owned by the
Fund and held by it as Custodian. Upon termination of this Agreement, the
Fund shall pay to the Custodian on behalf of the Fund such compensation as
may be due as of the date of such termination. The Fund agrees on behalf of
the Fund that the Custodian shall be reimbursed for its reasonable costs in
connection with the termination of this Agreement.
B. If a successor custodian is not designated by the Fund, or by
the Custodian in accordance with the preceding paragraph, or the designated
successor cannot or will not serve, the Fund shall, upon the delivery by the
Custodian to the Fund of all Securities (other than Securities held in the
Book-Entry System which cannot be delivered to the Fund) and moneys then owned
by the Fund, be deemed to be the custodian for the Fund, and the Custodian
shall thereby be relieved of all duties and responsibilities pursuant to this
Agreement, other than the duty with respect to Securities held in the Book-Entry
System, which cannot be delivered to the
Fund, which shall be held by the Custodian in accordance with this Agreement.
ARTICLE XI
MISCELLANEOUS
A. Appendix A sets forth the names and the signatures of all
Authorized Persons, as certified by the Secretary of the Fund. The Fund agrees
to furnish to the Custodian a new Appendix A in form similar to the attached
Appendix A, if any present Authorized Person ceases to be an Authorized Person
or if any other or additional Authorized Persons are elected or appointed.
Until such new Appendix A shall be received, the Custodian shall be fully
protected in acting under the provisions of this Agreement upon Oral
Instructions or signatures of the then current Authorized Persons as set forth
in the last delivered Appendix A.
B. No recourse under any obligation of this Agreement or for any
claim based thereon shall be had against any organizer, shareholder,
Officer, Director, past, present or future as such, of the Fund or of any
predecessor or successor, either directly or through the Fund or any such
predecessor or successor, whether by virtue of any constitution, statute or
rule of law or equity, or be the enforcement of any assessment or penalty or
otherwise; it being expressly agreed and understood that this Agreement and
the obligations thereunder are enforceable solely against the Fund, and that
no such personal liability whatever shall attach to, or is or shall be
incurred by, the organizers, shareholders, Officers, Directors of the Fund or
of any predecessor or successor, or any of them as such. To the extent that
any such liability exists, it is hereby expressly waived and released by
the Custodian as a condition of, and as a consideration for, the execution of
this Agreement.
C. The obligations set forth in this Agreement as having been
made by the Fund have been made by the Board of Directors, acting as such
Directors for and on behalf of the Fund, pursuant to the authority vested in
them under the laws of the State of Maryland, the Articles of Incorporation and
the By-Laws of the Fund. This Agreement has been executed by Officers of the
Fund as officers, and not individually, and the obligations contained herein
are not binding upon any of the Directors, Officers, agents or holders of
shares, personally, but bind only the Fund.
D. Provisions of the Prospectus and any other documents
(including advertising material) specifically mentioning the Custodian (other
than merely by name and address) shall be reviewed with the Custodian by the
Fund prior to publication and/or dissemination or distribution, and shall be
subject to the consent of the Custodian.
E. Any notice or other instrument in writing, authorized or
required by this Agreement to be given to the Custodian, shall be
sufficiently given if addressed to the Custodian and mailed or delivered to it
at its offices at Star Bank Center, 000 Xxxxxx Xxxxxx, X. X. 0000, Xxxxxxxxxx,
Xxxx 00000, attention Mutual Fund Custody Department, or at such other place as
the Custodian may from time to time designate in writing.
F. Any notice or other instrument in writing, authorized or
required by this Agreement to be given to the Fund shall be sufficiently
given when delivered to the Fund or on the second business day following
the time such notice is deposited in the U.S. mail postage prepaid and
addressed to the Fund at its office at 0000 Xxxxxx Xxxxx Xxxxx 000, Xxxxxxxx,
Xxxxxxxx, 00000 or at such other place as the Fund may from time to time
designate in writing.
G. This Agreement, with the exception of the Appendices, may
not be amended or modified in any manner except by a written agreement executed
by both parties with the same formality as this Agreement, and authorized and
approved by a resolution of the Board of Directors of the Fund.
H. This Agreement shall extend to and shall be binding upon the
parties hereto, and their respective successors and assigns; provided,
however, that this Agreement shall not be assignable by the Fund or by the
Custodian, and no attempted assignment by the Fund or the Custodian shall be
effective without the written consent of the other party hereto.
I. This Agreement shall be construed in accordance with the laws
of the State of Ohio.
J. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but such counterparts shall,
together, constitute only one instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective Officers, thereunto duly authorized as of the day
and year first above written.
The World Funds, Inc.
By: /s/ XXXX XXXXX, III
------------------------
Xxxx Xxxxx, III
ATTEST: ________________________
Title: Chairman
Star Bank, N.A.
ATTEST: By: /s/ XXXXXX X. XXXXXXX
---------------------------
Xxxxxx X. Xxxxxxx
____________________________
Title: Vice President
APPENDIX A
Authorized Persons
Specimen Signatures
Chairman:
President:
Secretary:
Treasurer:
Controller:
Adviser Employees:
Transfer Agent/Fund Accountant
Employees:
APPENDIX B
The following agents are employed currently by Star Bank, N.A. for securities
processing and control . . .
The Depository Trust Company (New York)
0 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
The Federal Reserve Bank
Cincinnati and Cleveland Branches
Bankers Trust Company
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
(For Foreign Securities and certain non-DTC
eligible Securities)
APPENDIX C
Standards of Service Guide
APPENDIX D
Schedule of Compensation
