EXHIBIT 8
CUSTODY AGREEMENT
Agreement made as of the ______ day of ___________, 1996, between
Matterhorn Growth Fund, Inc. (the "Fund"), a Maryland Corporation and having its
office at _______________________ acting for and on behalf of all mutual fund
portfolios as are currently authorized and issued by the Trust or may be
authorized and issued by the Trust subsequent to the date of this Agreement (the
"Fund"), which is operated and maintained by the Trust for the benefit of the
holders of shares of the Fund, and Star Bank, N.A. (the "Custodian"), a national
banking association having its principal office and place of business at Star
Bank Center, 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000, which Agreement provides
for the furnishing of custodian services to the Funds.
W I T N E S S E T H :
that for and in consideration of the mutual promises hereinafter set forth the
Trust, on behalf of the Funds, and the Custodian agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless the
context otherwise requires, shall have the following meanings:
1. "Authorized Person" shall be deemed to include the President,
Secretary, and the Vice President, or any other person, whether or
not any such person is an officer or employee of the Trust, duly
authorized by the Board of Trustees of the Trust to give Oral
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, subject in each case to
any limitations on the authority of such person as set forth in
Appendix A or any such Certificate.
2. "Book-Entry System" shall mean the Federal Reserve/Treasury
book-entry system for United States and federal agency securities,
its successor or successors and its nominee or nominees, provided the
Custodian has received a certified copy of a resolution of Board of
Trustees of the Trust specifically approving deposits in the
Book-Entry System.
3. "Certificate" shall mean any notice, instruction, or other instrument
in writing, authorized or required by this Agreement to be given to
the Custodian which is signed on behalf of the Fund by an Officer of
the Trust and is actually received by the Custodian.
4. "Depository" shall mean The Depository Trust Company ("DTC"), a
clearing agency registered with the Securities and Exchange
Commission, its successor or successors and its nominee or nominees.
The term "Depository" shall further mean and include any other person
or clearing agency authorized to act as a depository under the
Investment Company Act of 1940, its successor or successors and its
nominee or nominees, provided that the Custodian has received a
certified copy of a resolution of the Board of Trustees of the Trust
specifically approving such other person or clearing agency as a
depository.
5. "Dividend and Transfer Agent" shall mean the dividend and transfer
agent active, from time to time, in such capacity pursuant to a
written agreement with the Fund, changes in which the Trust shall
immediately report to the Custodian in writing.
6. "Money Market Security" shall be deemed to include, without
limitation, 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 and reverse
repurchase agreements with respect to the same) and bank time
deposits of domestic banks that are members of Federal Deposit
Insurance Trust, and short-term corporate obligations where the
purchase and sale of such securities normally require settlement in
federal fund or their equivalent on the same day as such purchase or
sale.
7. "Officers" shall be deemed to include the President, the Secretary,
and Vice President of the Trust listed in the Certificate annexed
hereto as Appendix A or such other Certificate as may be received by
the Custodian from time to time.
8. "Oral Instructions" shall mean oral instructions actually received by
the Custodian from an Authorized Person (or from a person which the
Custodian reasonably believes in good faith to be an Authorized
Person) and confirmed by Written Instructions from Authorized Persons
in such manner so that such Written Instructions are received by the
Custodian on or before the next business day.
9. "Prospectus" or "Prospectuses" shall mean the Fund's currently
effective prospectus and statements of additional information, as
filed with and declared effective by the Securities and Exchange
Commission.
10. "Security or Securities" shall mean Money Market Securities, common
or preferred stocks, options, futures, gold, silver, bonds,
debentures, corporate debt securities, 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 interest
therein, or any property or assets.
11. "Written Instructions" shall mean communication actually received by
the Custodian from one Authorized Person or from one person which the
Custodian reasonably believes in good faith to be an Authorized
Person in writing, telex or any other data transmission system
whereby the receiver of such communication is able to verify by codes
or otherwise with a reasonable degree of certainty the authenticity
of the senders of such communication.
ARTICLE II
APPOINTMENT OF CUSTODIAN
1. The Trust, acting for and on behalf of the Fund, hereby constitutes
and appoints the Custodian as custodian of all the Securities and
monies at any time owned by the Fund during the period of this
Agreement ("Fund Assets").
2. The Custodian hereby accepts appointment as such Custodian and agrees
to perform the duties thereof as hereinafter set forth.
ARTICLE III
DOCUMENTS TO BE FURNISHED BY THE TRUST
The Trust hereby agrees to furnish to the Custodian the
following documents:
1. A copy of its Declaration of Trust (the "Declaration of Trust")
certified by its Secretary.
2. A copy of its By-Laws certified by its Secretary.
3. A copy of the resolution of its Board of Trustees appointing the
Custodian certified by its Secretary.
4. A copy of the most recent Prospectuses of the Trust.
5. A Certificate of the President and Secretary setting forth the names
and signatures of the present Officers of the Trust.
ARTICLE IV
CUSTODY OF CASH AND SECURITIES
1. The Trust will deliver or cause to be delivered to the Custodian all
Fund Assets, including cash received for the issuance of its shares,
at any time during the period of this Agreement. The Custodian will
not be responsible for such Fund Assets until actually received by
it. Upon such receipt, the Custodian shall hold in safekeeping and
physically segregate at all times from the property of any other
persons, firms or corporations all Fund Assets received by it from or
for the account of the Fund. The Custodian will be entitled to
reverse any credits made on the Fund's behalf where such credits have
been previously made and monies are not finally collected within 90
days of the making of such credits, provided that the Custodian shall
credit any credit previously reversed in the event months are finally
collected after each 90-day period. The Custodian is hereby
authorized by the Trust, acting on behalf of the Fund, to actually
deposit any Fund Assets in the Book-Entry System or in a Depository,
provided, however, that the Custodian shall always be accountable to
the Trust for the Fund Assets so deposited. Fund Assets deposited in
the Book-Entry System or the Depository will be represented in
accounts which include only assets held by the Custodian for
customers, including but not limited to accounts in which the
Custodian acts in a fiduciary or representative capacity.
2. The Custodian shall credit to a separate account or accounts in the
name of each respective Fund all monies received by it for the
account of such Fund, and shall disburse the same only:
(a) In payment for Securities purchased for the account of such Fund,
as provided in Article V;
(b) In payment of dividends or distributions, as provided in Article
VI hereof;
(c) In payment of original issue or other taxes, as provided in
Article VII hereof;
(d) In payment for shares of such Fund redeemed by it, as provided
in Article VII hereof;
(e) Pursuant to Certificates (i) directing payment and setting forth
the name and address of the person to whom the payment is to be
made, the amount of such payment and the purpose for which
payment is to be made (the Custodian not being required to
questions such direction) or (ii) if reserve requirements are
established for the Fund by law or by valid regulation, directing
the Custodian to deposit a specified amount of collected funds in
the form of U.S. dollars at a specified Federal Reserve bank and
stating the purpose of such deposit; or
(f) In reimbursement of the expenses and liabilities of the
Custodian, as provided in paragraph 10 of Article IX hereof.
3. Promptly after the close of business on each day the Funds are open
and valuing their portfolios, the Custodian shall furnish the Trust
with a detailed statement of monies held for the Fund under this
Agreement and with confirmations and a summary of all transfers to or
from the account of the Fund during said day. Where Securities are
transferred to the account of the Fund without physical delivery, the
Custodian shall also identify as belonging to the Fund a quantity of
Securities in a fungible bulk of Securities registered in the name of
the Custodian (or its nominee) or shown on the Custodian's account on
the books of the Book-Entry System or the Depository. At least
monthly and from time to time, the Custodian shall furnish the Trust
with a detailed statement of the Securities held for the Fund under
this Agreement.
4. All Securities held for the Fund, which are issued or issuable only
in bearer form, except such Securities as are held in the Book-Entry
System, shall be held by the Custodian in that form; all other
Securities held for the Fund may be held by a registered nominee of
the Custodian as the Custodian may from time to time determine, or in
the name of the Book-Entry System or the Depository or their
successor or successors, or their nominee or nominees. The Trust
agrees to furnish to the Custodian appropriate instruments to enable
the Custodian to hold or deliver in proper form for transfer, or to
register in the name of its registered nominee or in the name of the
Book-Entry System or the Depository, any Securities which it may hold
for the account of the Fund and which may from time to time be
registered in the name of the Fund. The Custodian shall hold all such
Securities which are not held in the Book-Entry System or by the
Depository or a Sub-Custodian in a separate account or accounts in
the name of the Fund, segregated at all times from those of any other
Fund maintained and operated by the Trust and from those of any other
person or persons.
5. Unless otherwise instructed to the contrary by a Certificate, the
Custodian shall with respect to all Securities held for the Fund in
accordance with this Agreement:
(a) Collect all income due or payable to the Fund with respect to
Fund Assets;
(b) Present for payment and collect the amount payable upon all
Securities which may mature or be called, redeemed, or retired,
or otherwise become payable;
(c) Surrender Securities in temporary form for definitive
Securities;
(d) Execute, as Custodian, 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; and
(e) Hold directly, or through the Book-Entry System or the
Depository with respect to Securities therein deposited, for the
account of the Fund, all rights and similar securities issued
with respect to any Securities held by the Custodian hereunder.
6. Upon receipt of a Certificate and not otherwise, the Custodian,
directly or through the use of the Book-Entry System or the
Depository, shall:
(a) 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 owner of any
Securities may be exercised;
(b) Deliver any Securities held for the Fund 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;
(c) Deliver any Securities held for the account of the Fund to any
protective committee, reorganization, refinancing, 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; and
(d) 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.
7. The Custodian shall promptly deliver to the Trust 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.
8. The Custodian shall promptly deliver to the Trust all material
received by the Custodian and pertaining to Securities held by the
Fund with respect to tender or exchange offers, calls for redemption
or purchase, expiration of rights, name changes, stock splits and
stock dividends, or any other activity involving ownership rights in
such Securities.
ARTICLE V
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
1. Promptly after each purchase of Securities by the Fund, the Trust
shall deliver to the Custodian (i) with respect to each purchase of
Securities which are not Money Market Securities, a Certificate or
Written Instructions, and (ii) with respect to each purchase of Money
Market Securities, Written Instructions, a Certificate or Oral
Instructions, specifying with respect to each such purchase: (a) The
name of the issuer and the title of the Securities, (b) the principal
amount purchased and accrued interest, if any, (c) the date of
purchase and settlement, (d) the purchase price per unit, (e) the
total amount payable upon such purchase and (f) the name of the
person from whom or the broker through whom the purchase was made.
The Custodian shall upon receipt of Securities purchased by or for
the Fund, pay out of the monies held for the account of the Fund the
total amount payable to the person from whom or the broker through
whom the purchase was made, provided that the same conforms to the
total amount payable as set forth in such Certificate, Written
Instructions or Oral Instructions. With respect to any repurchase
agreement transaction for the Funds, the Custodian shall assure that
the collateral reflected on the transaction advice is received by the
Custodian.
2. Promptly after each sale of Securities by the Trust for the account
of the Fund, the Trust shall deliver to the Custodian (i) with
respect to each sale of Securities which are not Money Market
Securities, a Certificate or Written Instructions, and (ii) with
respect to each sale of Money Market Securities, Written
Instructions, a Certificate or Oral Instructions, specifying with
respect to each such sale: (a) the name of the issuer and the title
of the Security, (b) the principal amount sold, and accrued interest,
if any, (c) the date of sale, (d) the sale price per unit, (e) the
total amount payable to the Fund upon such sale and (f) the name of
the broker through whom or the person to whom the sale was made. The
Custodian shall deliver the Securities upon receipt of the total
amount payable to the Fund upon such sale, as set forth in each
certificate, written instructions, or oral instructions, provided
that the same conforms to the total amount principal as set forth in
such Certificate, Written Instructions or Oral Instructions. Subject
to the foregoing, the Custodian may accept payment in such form as
shall be satisfactory to it, and may deliver Securities and arrange
for payment in accordance with the customs prevailing among dealers
in Securities.
3. Promptly after the time as of which the Trust, on behalf of a Fund,
either -
(a) writes an option on Securities or writes a covered put option in
respect of a Security, or
(b) notifies the Custodian that its obligations in respect of any
put or call option, as described in the Trust's Prospectus,
require that the Fund deposit Securities or additional Securities
with the Custodian, specifying the type and value of Securities
required to be so deposited, or
(c) notifies the Custodian that its obligations in respect of any
other Security, as described in each Fund's respective
Prospectus, require that the Fund deposit Securities or
additional Securities with the Custodian, specifying the type and
value of Securities required to be so deposited, the Custodian
will cause to be segregated or identified as deposited, pursuant
to the Fund's obligations as set forth in such Prospectus,
Securities of such kinds and having such aggregate values as are
required to meet the Fund's obligations in respect thereof. The
Trust will provide to the Custodian, as of the end of each
trading day, the market value of each Fund's option liability if
any and the market value of its portfolio of common stocks.
4. On contractual settlement date, the account of each respective Fund
will be charged for all purchases settling on that day, regardless of
whether or not delivery is made. On contractual settlement date, sale
proceeds will likewise be credited to the account of such Fund
irrespective of delivery.
In the case of "sale fails", the Custodian may request the assistance
of the Fund in making delivery of the failed Security.
ARTICLE VI
PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
1. The Trust shall furnish to the Custodian a copy of the resolution of
the Board of Trustees, certified by the Secretary, either (i) setting
forth the date of the declaration of any dividend or distribution in
respect of shares of the Fund, 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 Fund shareholders of
record as of that date and the total amount to be paid by the
Dividend and Transfer Agent of the Fund 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 Written Instructions or 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 Fund
shareholders entitled to payment shall be determined, the amount
payable per share to Fund shareholders of record as of that date and
the total amount to be paid by the Dividend and Transfer Agent on the
payment date.
2. Upon the payment date specified in such resolution, Written
Instructions or Certificate, as the case may be, the Custodian shall
arrange for such payments to be made by the Dividend and Transfer
Agent out of monies held for the account of the Fund.
ARTICLE VII
SALE AND REDEMPTION OF SHARES OF THE FUND
1. The Custodian shall receive and credit to the account of each Fund
such payments for shares of such Fund issued or sold from time to
time as are received from the distributor for the Fund's shares, from
the Dividend and Transfer Agent of the Fund, or from the Trust.
2. Upon receipt of Written Instructions, the Custodian shall arrange for
payment of redemption proceeds to be made by the Dividend and
Transfer Agent out of the monies held for the account of the
respective Fund in the total amount specified in the Written
Instructions.
3. Notwithstanding the above provisions regarding the redemption of any
shares of the Fund, whenever shares of the Fund are redeemed pursuant
to any check redemption privilege which may from time to time be
offered by the Fund, the Custodian, unless otherwise subsequently
instructed by Written Instructions shall, upon receipt of any Written
Instructions setting forth that the redemption is in good form for
redemption in accordance with the check redemption procedure, honor
the check presented as part of such check redemption privilege out of
the money held in the account of the Fund for such purposes.
ARTICLE VIII
INDEBTEDNESS
In connection with any borrowings, the Trust, on behalf of the Fund, will cause
to be delivered to the Custodian by a bank or broker (including the Custodian,
if the borrowing is from the Custodian), requiring Securities as collateral for
such borrowings, a notice or undertaking in the form currently employed by any
such bank or broker setting forth the amount which such bank or broker will loan
to the Fund against delivery of a stated amount of collateral. The Trust 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 Trust, acting on behalf of the Fund, or
other loan agreement, (c) the date and time, if known, on which is to be entered
into, (d) the date on which the loan becomes due and payable, (e) the total
amount payable to the Fund on the borrowing date, (f) the market value of
Securities collateralizing the loan, including the name of the issuer, the title
and the number of shares or the principal amount of any particular Securities
and (g) a statement that such loan is in conformance with the Investment Company
Act of 1940 and the Fund's then current Prospectus. The Custodian shall deliver
on the borrowing date specified in a Certificate the specified collateral and
the executed promissory note, if any, against delivery by the lending bank or
broker of the total amount of the loan payable, provided that the same conforms
to the total amount payable as set forth in the Certificate. The Custodian may,
at the option of the lending bank or broker, keep such collateral in its
possession, but such collateral shall be subject to all rights therein given the
lending bank or broker, by virtue of any promissory note or loan agreement. The
Custodian shall deliver in the manner directed by the Trust from time to time
such Securities as additional collateral as may be specified in a Certificate to
collateralized further any transaction described in this paragraph. The Trust
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. In the event that the Trust fails
to specify in a Certificate or Written Instructions the name of the issuer, the
title and number of shares or the principal amount of any particular Securities
to be delivered as collateral by the Custodian, the Custodian shall not be under
any obligation to deliver any Securities. The Custodian may require such
reasonable conditions with respect to such collateral and its dealings with
third-party lenders as it may deem appropriate.
ARTICLE IX
CONCERNING THE CUSTODIAN
1. Except as otherwise provided herein, the Custodian shall not be
liable for any loss or damage, including counsel fees, resulting from
its action or omission to act or otherwise, except for any such loss
or damage arising out of its negligence or willful misconduct. The
Trust, on behalf of the Fund and only from Fund Assets (or insurance
purchased by the Trust with respect to its liabilities on behalf of
the Fund hereunder), shall defend, indemnify and hold harmless the
Custodian and its Trustees, 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
Trust's duties with respect to the Fund hereunder or any other action
or inaction of the Trust or its Trustees, Officers, Employees or
Agents as to the Fund, except such as may arise from the negligent
action, omission or willful misconduct of the Custodian, its
Trustees, Officers, Employees or Agents. The Custodian shall defend,
indemnify and hold harmless the Trust and its Trustees, Officers,
Employees or Agents with respect to any loss, claim, liability or
cost (including reasonable attorneys' fees) arising or alleged to
arise from or relating to the Custodian's duties with respect to the
Fund hereunder or any other action or inaction of the Custodian or
its Trustees, Officers, Employees, Agents, nominees or Sub-Custodians
as to the Fund, except such as may arise from the negligent action,
omission or willful misconduct of the Trust, its Trustees, Officers,
Employees or Agents. The Custodian may, with respect to questions of
law apply for and obtain the advice and opinion of counsel to the
Trust at the expense of the Fund, or of its own counsel at its own
expense, 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 to the Trust, and shall be similarly protected
with respect to anything done or omitted by it in good faith in
conformity with advice or opinion of its counsel, unless counsel to
the Fund shall, within a reasonable time after being notified of
legal advice received by the Custodian, have a differing
interpretation of such question of law. The Custodian shall be liable
to the Trust for any proximate loss or damage resulting from the use
of the Book-Entry System or any Depository arising by reason of any
negligence, misfeasance or misconduct on the part of the Custodian or
any of its employees, agents, nominees or Sub-Custodians but not for
any special, incidental, consequential, or punitive damages;
provided, however, that nothing contained herein shall preclude
recovery from the Custodian by the Trust, on behalf of the Fund, of
principal and of interest to the date of recovery on, Securities
incorrectly omitted from the Fund's account or penalties imposed on
the Trust, in connection with the Fund, for any failures to deliver
Securities.
In any case in which one party hereto may be asked to indemnify the
other or hold the other harmless, the party from whom indemnification
is sought (the "Indemnifying Party") shall be advised of all
pertinent facts concerning the situation in question, and the party
claiming a right to indemnification (the "Indemnified Party") will
use reasonable care to identify and notify the Indemnifying Party
promptly concerning any situation which presents or appears to
present a claim for indemnification against the Indemnifying Party.
The Indemnifying Party shall have the option to defend the
Indemnified Party against any claim which may be the subject of the
indemnification, and in the event the Indemnifying Party so elects,
such defense shall be conducted by counsel chosen by the Indemnifying
Party and satisfactory to the Indemnified Party and the Indemnifying
Party will so notify the Indemnified Party and thereupon such
Indemnifying Party shall take over the complete defense of the claim
and the Indemnifying Party shall sustain no further legal or other
expenses in such situation for which indemnification has been sought
under this paragraph, except the expenses of any additional counsel
retained by the Indemnified Party. In no case shall any party
claiming the right to indemnification confess any claim or make any
compromise in any case in which the other party has been asked to
indemnify such party (unless such confession or compromise is made
with such other party's prior written consent).
The obligations of the parties hereto under this paragraph shall
survive the termination of this Agreement.
2. 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:
(a) 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;
(b) The legality of the sale of any Securities by or for the account
of the Fund, or the propriety of the amount for which the same
are sold;
(c) The legality of the issue or sale of any shares of the Fund, or
the sufficiency of the amount to be received therefor;
(d) The legality of the redemption of any shares of the Fund, or the
propriety of the amount to be paid therefor;
(e) The legality of the declaration or payment of any dividend by
the Trust in respect of shares of the Fund;
(f) The legality of any borrowing by the Trust, on behalf of the
Fund, using Securities as collateral;
(g) The sufficiency of any deposit made pursuant to a Certificate
described in clause (ii) of paragraph 2(e) of Article IV hereof,
3. The Custodian shall not be liable for any money or collected fund in
U.S. dollars deposited in a Federal Reserve Bank in accordance with a
Certificate described in clause (ii) of paragraph 2(e) of Article IV
hereof, nor be liable for or considered to be the Custodian of any
money, whether or not represented by any check, draft, or other
instrument for the payment of money, received by it on behalf of the
Fund until the Custodian actually receives and collects such money
directly or by the final crediting of the account representing the
Fund's interest at the Book-Entry System or Depository.
4. The Custodian shall not be under any duty or obligation to take
action to effect collection of any amount due to the Fund from the
Dividend and Transfer Agent of the Fund nor to take any action to
effect payment or distribution by the Dividend and Transfer Agent of
the Fund of any amount paid by the Custodian to the Dividend and
Transfer Agent of the Fund in accordance with this Agreement.
5. Income due or payable to the Fund with respect to Fund Assets will be
credited to the account of the Fund as follows:
(a) Dividends will be credited on the first business day following
payable date irrespective of collection.
(b) Interest on fixed rate municipal bonds and debt securities
issued or guaranteed as to principal and/or interest by the
government of the United States or agencies or instrumentalities
thereof (excluding securities issued by the Government National
Mortgage Association) will be credited on payable date
irrespective of collection.
(c) Interest on fixed rate corporate debt securities will be
credited on the first business day following payable date
irrespective of collection.
(d) Interest on variable and floating rate debt securities and debt
securities issued by the Government National Mortgage Association
will be credited upon the Custodian's receipt of funds.
(e) Proceeds from options will be credited upon the Custodian's
receipt of funds.
6. Notwithstanding paragraph 5 of this Article IX, 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 of reimbursement of its costs and expenses in connection
with any such action or, at the Custodian's option, prepayment
7. The Custodian may appoint one or more financial or banking
institutions, as Depository or Depositories or as Sub-Custodian or
Sub-Custodians, including, but not limited to, banking institutions
located in foreign countries, of Securities and monies at any time
owned by the Fund, upon terms and conditions approved in a
Certificate. Current Depository (s) and Sub-Custodian(s) are noted in
Appendix B. The Custodian shall not be relieved of any obligation or
liability under this Agreement in connection with the appointment or
activities of such Depositories or Sub-Custodians.
8. 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 Fund
under the provisions of the Declarations of Trust and the Trust's
By-Laws.
9. The Custodian shall treat all records and other information relating
to the Trust, the Fund and the Fund's Assets as confidential and
shall not disclose any such records or information to any other
person unless: (a) the Trust shall have consented thereto in writing
or (b) such disclosure is compelled by law.
10. The Custodian shall be entitled to receive and the Trust agrees to
pay to the Custodian, for the Fund's account from Fund Assets only,
such compensation as shall be determined pursuant to Appendix C,
attached hereto, or as shall be determined pursuant to amendments to
such Appendix approved by the Custodian and the Trust, on behalf of
the Fund. The Custodian shall be entitled, upon 10 days written
notice to the Trust, to charge against any money held by it for the
accounts of the Fund the amount of any loss, damage, liability or
expense, including reasonable counsel fees, for which it shall be
entitled to reimbursement under the provisions of this Agreement as
determined by agreement of the Custodian and the Trust or by the
final order of any court or arbitrator having jurisdiction and as to
which all rights of appeal shall have expired. The expenses which the
Custodian may charge against the accounts of the Fund include, but
are not limited to, the reasonable expenses of Sub-Custodians
incurred in settling transactions involving the purchase and sale of
Securities of the Fund.
11. The Custodian shall be entitled to rely upon any Certificate if such
reliance is made in good faith. The Custodian shall be entitled to
rely upon any Oral Instructions and any Written Instructions actually
received by the Custodian pursuant to Article IV or V hereof. The
Trust agrees to forward to the Custodian Written Instructions from
Authorized Persons confirming Oral Instructions in such manner so
that such Written Instructions are received by the Custodian, whether
by hand delivery, telex or otherwise, on the first business day
following the day on which such Oral Instructions are given to the
Custodian. The Trust agrees that the fact that such confirming
instructions are not received by the Custodian shall in no way affect
the validity of the transactions or enforceability of the
transactions hereby authorized by the Trust. The Trust agrees that
the Custodian shall incur no liability to the Fund in acting upon
Oral Instructions given to the Custodian hereunder concerning such
transactions, except as otherwise set forth herein.
12. The Custodian will (a) 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 Investment Company Act of 1940,
with particular attention to Section 31 thereof and Rules 31 a-1 and
31 a-2 thereunder, and (b) preserve for the periods prescribed by
applicable Federal statute or regulation all records required to be
so preserved. The books and records of the Custodian shall be open to
inspection and audit at reasonable times and with prior notice by
Officers and auditors employed by the Trust.
13. The Custodian and its Sub-Custodians shall promptly send to the
Trust, for the account of the Fund, any report received on the
systems of internal accounting control of the Book-Entry System or
the Depository and with such reports on their own systems of internal
accounting control as the Trust may reasonably request from time to
time.
14. 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, except as
otherwise set forth herein. The Custodian is not a selling agent for
shares of the Fund and performance of its duties as a custodial agent
shall not be deemed to be a recommendation to the Custodian's
depositors or others of shares of the Fund as an investment.
ARTICLE X
TERMINATION
1. 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 Trust, on behalf of the Fund, it shall be accompanied by
a copy of a resolution of the Board of Trustees of the Trust,
certified by the Secretary or any Assistant Secretary, electing to
terminate this Agreement and designating a successor custodian or
custodians, each of which shall be a bank or trust company having not
less than $2,000,000 aggregate capital, surplus and undivided
profits. In the event such notice is given by the Custodian, the
Trust shall, on or before the termination date, deliver to the
Custodian a copy of a resolution of its Board of Trustees, 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
Trust, the Custodian may designate a successor custodian which shall
be a bank or trust company having not less than $2,000,000 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 monies then owned by the Fund and held
by it as Custodian. Upon termination of this agreement, the Trust
shall pay to the Custodian on behalf of the Fund such compensation as
may be due as of the date of such termination. The Trust agrees on
behalf of the Fund that the Custodian shall be reimbursed for its
reasonable costs in connection with the termination of this
Agreement.
2. If a successor custodian is not designated by the Trust, on behalf of
the Fund, or by the Custodian in accordance with the preceding
paragraph, or the designated successor cannot or will not serve, the
Trust shall upon the delivery by the Custodian to the Trust of all
Securities (other than Securities held in the Book-Entry System which
cannot be delivered to the Trust) and monies then owned by the Fund,
other than monies deposited and the delivery of any such documents or
the taking of any other actions necessary to transfer custody by the
Custodian to the Trust of all securities held in the books - entry
system and all monies owned by the Fund on deposit (with a Federal
Reserve Bank pursuant to a Certificate described in clause (ii) of
paragraph 2(e) of Article IV), 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
under paragraph 1 of article IX herein.
ARTICLE XI
MISCELLANEOUS
1. Appendix A sets forth the names and the signatures of all Authorized
Persons. The Trust agrees to furnish to the Custodian, on behalf of
the Fund, 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 present
Authorized Persons as set forth in the last delivered Appendix A.
2. No recourse under any obligation of this Agreement or for any claim
based thereon shall be had against any organizer, shareholder,
Officer, Trustee, past, present or future as such, of the Trust or of
any such predecessor or successor, whether by virtue of any
constitution, statute or rule of law or equity, or by 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 Fund Assets, and that no such personal
liability whatever shall attach to, or is or shall be incurred by,
the organizers, shareholders, Officers, Trustees of the Trust or of
any predecessor or successor, or any of them as such, because of the
obligations contained in this Agreement or implied therefrom and that
any and all such liability is hereby expressly waived and released by
the Custodian as a condition of, and as a consideration for, the
execution of this Agreement.
3. The obligations set forth in this Agreement as having been made by
the Trust have been made by the Trustees of the Trust, acting as such
Trustees for and on behalf of the Fund, pursuant to the authority
vested in them under the laws of the State of ______________, the
Declaration of Trust and the By-Laws of the Trust. This Agreement has
been executed by Officers of the Trust as Officers, and not
individually, and the obligations contained herein are not binding
upon any of the Trustees, Officers, Agents or holders of shares,
personally, but bind only the Trust and then only to the extent of
Fund Assets.
4. Such provisions of the Prospectuses of the Fund 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 Trust.
5. 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.
6. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Trust shall be sufficiently given
when delivered to the Trust or on the second business day following
the time such notice is deposited in the U.S. mail postage prepaid
and addressed to the Trust at its office at _____________________ or
at such other place as the Trust may from time to time designate in
writing.
7. This Agreement with the exception of Appendices A & B 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 Trustees
of the Trust.
8. 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 Trust or
by the Custodian, and no attempted assignment by the Trust or the
Custodian shall be effective without the written consent of the other
party hereto.
9. 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.
ATTEST: _____________________
BY: _____________________ BY: _______________________
TITLE: _____________________ TITLE: ____________________
ATTEST: Star Bank, N.A.
BY: _____________________ BY: _______________________
TITLE: _____________________ TITLE: ____________________
APPENDIX A
Authorized Persons Specimen Signatures
President: ___________________ ____________________
Vice President: ___________________ ____________________
Secretary: ___________________ ____________________
Treasurer: ___________________ ____________________
Adviser Employees: ___________________ ____________________
APPENDIX B
The following Depository(s) and Sub-Custodian(s) 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
