EXHIBIT (g)
CUSTODIAN AGREEMENT
AGREEMENT dated this 23rd day of May, 2000, between Integrity Small-Cap
Fund of Funds, Inc. (the "Fund"), a corporation organized under the laws of the
State of North Dakota, having its principal office and place of business at
0 Xxxxx Xxxx, Xxxxx, Xxxxx Xxxxxx 00000, and First Western Bank & Trust (the
"Custodian"), a bank organized under the laws of the State of North Dakota
with its principal place of business at 000 Xxxxx Xxxxxxxx, Xxxxx,
Xxxxx Xxxxxx 00000.
WITNESSETH
That for and in consideration of the mutual promises hereinafter set forth,
the Fund and the Custodian agree as follows:
1. Definitions
Whenever used in this Agreement or in any Schedules to this Agreement, the
following words and phrases, unless the context otherwise requires, shall
have the following meanings:
(a) "Authorized Person" shall be deemed to include the President, the Vice
President, the Secretary, and the Treasurer of the Fund or any other
person whether or not any such person is an officer 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 or such
other certification as may be received by the Custodian from time to
time.
(b) "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.
(c) "Depository" shall mean the Depository Trust Company ("DTC"), a
clearing agency registered with the Securities and Exchange Commission
under Section 17A of the Securities Exchange Act of 1934, as amended,
its successor or successors and its nominee or nominees, in which the
Custodian is hereby specifically authorized to make deposits. The
term "Depository" shall further mean and include any other person to
be named in Written Instructions authorized to act as a depository
under the 1940 Act, its successor or successors, and its nominee or
nominees.
(d) "Money Market Security" shall be deemed to include, without
limitation, debt obligations issued or guaranteed as to interest and
principal by the Government of the United States or agencies or
instrumentalities thereof, commercial paper, bank certificates of
deposit, bankers' acceptances, and short-term corporate obligations,
where the purchase or sale of such securities normally requires
settlement in federal funds on the same day as such purchase or sale,
repurchase and reverse repurchase agreements with respect to any of
the foregoing types of securities, and any other instrument commonly
included in the term "Money Market Security" by commercial usage or
custom.
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(e) "Oral Instructions" shall mean verbal instructions actually received
by the Custodian from a person reasonably believed by the Custodian to
be an Authorized Person.
(f) "Prospectus" shall mean any current prospectus and statement of
additional information relating to the registration of the Fund's
Shares under the Securities Act of 1933, as amended, and the 1940 Act.
(g) "Security" or "Securities" shall be deemed to include bonds,
debentures, notes, stocks, shares, evidences of indebtedness, and
other securities and investments from time to time owned by the Fund.
(h) "Shares" refers to the units into which the shareholders' proprietary
interests in the Fund are divided.
(i) "Transfer Agent" shall mean the person who performs the transfer
agent, dividend disbursing agent, and shareholder servicing agent
functions for the Fund.
(j) "Written Instructions" shall mean a written or electronic
communication actually received by the Custodian from an Authorized
Person or from a person reasonably believed by the Custodian to be an
Authorized Person by telex or any other such system whereby the
receiver of such communication is able to verify through codes or
otherwise with a reasonable degree of certainty the authenticity of
the sender of such communication.
(k) The "1940 Act" refers to the Investment Company Act of 1940, and the
Rules and Regulations thereunder, all as amended from time to time.
2. Appointment of Custodian.
(a) The Fund hereby constitutes and appoints the Custodian as custodian of
all the Securities and moneys at the time owned by or in the
possession of the Fund during the period of this Agreement.
(b) The Custodian hereby accepts appointment as such custodian for the
Fund and agrees to perform the duties thereof as hereinafter set
forth.
3. Compensation.
(a) The Fund will compensate the Custodian for its services rendered
under this Agreement in accordance with the fees set forth in the Fee
Schedule annexed hereto as Schedule A and incorporated herein. Such
Fee Schedule does not include postage, for which the Custodian shall
be entitled to xxxx separately.
(b) Any compensation agreed to hereunder may be adjusted from time to time
by attaching to Schedule A of this Agreement a revised Fee Schedule,
dated and signed by an Authorized Officer of each party hereto.
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(c) The Custodian will xxxx the Fund as soon as practicable after the end
of each calendar month, and said xxxxxxxx will be detailed in
accordance with the Fee Schedule. The Fund will promptly pay to the
Custodian the amount of such billing.
4. Custody of Cash and Securities.
(a) Receipt and Holding of Assets. The Fund will deliver or cause to be
delivered to the Custodian all Securities and moneys owned by it at
any time during the period of this Agreement. The Custodian shall
segregate, keep, and maintain the assets of the Fund separate and
apart, including separate identification of Securities held in the
Book-Entry System. The Custodian will not be responsible for such
Securities and moneys until actually received by it. The Fund shall
instruct the Custodian from time to time in its sole discretion, by
means of Written Instructions, or in connection with the purchase or
sale of Money Market Securities, by means of Oral Instructions or
Written Instructions, as to the manner in which and in what amounts
Securities and moneys of the Fund are to be deposited on behalf of the
Fund in the Book-Entry System or the Depository; provided, however,
that prior to the initial deposit of Securities of the Fund in the
Book-Entry System or the Depository, the Custodian shall have received
Written Instructions specifically approving such deposits by the
Custodian in the Book-Entry System or the Depository.
(b) Accounts and Disbursements. The Custodian shall establish and
maintain a separate account for the Fund and shall credit to the
separate account of the Fund moneys received by it for the account of
the Fund and shall disburse the same only:
(1) in payment for Securities purchased for the Fund as provided in
Section 5 hereof;
(2) in payment of dividends or distributions with respect to the
Shares of the Fund as provided in Section 7 hereof;
(3) in payment of original issue or other taxes with respect to the
Shares of the Fund as provided in Section 8 hereof;
(4) in payment for Shares which have been redeemed by the Fund as
provided in Section 8 hereof;
(5) pursuant to Written Instructions, or with respect to Money Market
Securities, Oral Instructions or Written Instructions, setting
forth the name and address of the person to whom the payment is
to be made, the amount to be paid, and the purpose for which
payment is to be made; or
(6) in payment of fees and in reimbursement of the expenses and
liabilities of the Custodian attributable to the Fund as provided
in Section 11(h) hereof.
(c) Confirmation and Statements. Promptly after the close of business on
each day, the Custodian shall furnish the Fund with confirmations and
a summary of all transfers to or from the account of the Fund during
said day. Where Securities purchased are in a fungible bulk of
Securities registered in the name of the Custodian (or its nominee) or
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shown on the Custodian's account on the books of the Depository or
the Book-Entry System, the Custodian shall by book entry or otherwise
identify the quantity of those Securities belonging to the Fund. At
least monthly, the Custodian shall furnish the Fund with a detailed
statement of the Securities and moneys held for the Fund under this
Agreement.
(d) Registration of Securities and Physical Separation. 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 registered in the name of the Fund, in the name of any
duly appointed 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 Fund reserves the right to instruct the
Custodian as to the method of registration and safekeeping of the
Securities. The Fund 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 specifically allocated to the Fund which are
not held in the Book-Entry System or the Depository in a separate
account for the Fund in the name the Fund physically segregated at all
times from those of any other person or persons.
(e) Collection of Income and Other Matters Affecting Securities. Unless
otherwise instructed to the contrary by Written Instructions, the
Custodian by itself, or through the use of the Book-Entry System or
the Depository with respect to Securities therein deposited, shall
with respect to all Securities held for the Fund in accordance with
this Agreement:
(1) collect all income due or payable;
(2) present for payment and collect the amount payable upon all
Securities which may mature or be called, redeemed, or retired,
or otherwise become payable.
Notwithstanding the foregoing, the Custodian shall have no
responsibility to the Fund for monitoring or ascertaining of any
call, redemption, or retirement date with respect to put bonds
which are owned by the Fund and held by the Custodian or its
nominee. Nor shall the Custodian have any responsibility or
liability to the fund for any loss by the Fund for any missed
payment or other default resulting therefrom unless the Custodian
received timely notification from the Fund specifying the time,
place, and manner for the presentment of such put bond owned by
the Fund and held by the Custodian or its nominee. The Custodian
shall not be responsible and assumes no liability to the Fund for
the accuracy or completeness of any notification the Custodian
shall provide to the Fund with respect to put bonds;
(3) surrender Securities in temporary form for definitive Securities;
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(4) execute any necessary declarations or certificates of ownership
under the federal income tax laws or the laws or regulations of
any other taxing authority now or hereafter in effect; and
(5) 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 other Securities issued with respect to
any Securities held by the Custodian hereunder for the Fund.
(f) Delivery of Securities and Evidence of Authority. Upon receipt of
Written Instructions and not otherwise, except for Subparagraphs 5, 6,
7, and 8 which may be effected by Oral or Written Instructions, the
Custodian, directly or through the use of the Book-Entry System or the
Depository, shall:
(1) execute and deliver or cause to be executed and delivered to such
persons as may be designated in such Written Instructions,
proxies, consents, authorizations, and any other instruments
whereby the authority of the Fund as owner of any Securities may
be exercised;
(2) deliver or cause to be delivered 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;
(3) deliver or cause to be delivered any Securities held for the Fund
to any protective committee, reorganization committee, or other
person in connection with the reorganization, refinancing,
merger, consolidation, recapitalization, or sale of assets of any
corporation, and receive and hold under the terms of this
Agreement in the separate account for the Fund such certificates
of deposit, interim receipts, or other instruments or documents
as may be issued to it to evidence such delivery;
(4) make or cause to be made such transfers or exchanges of the
assets specifically allocated to the separate account of the Fund
and take such other steps as shall be stated in said Written
Instructions to be for the purpose of effectuating any duly
authorized plan of liquidation, reorganization, merger,
consolidation, or recapitalization of the Fund;
(5) deliver Securities owned by the Fund upon sale of such Securities
for the account of the Fund pursuant to Section 5;
(6) deliver Securities owned by the Fund upon the receipt of payment
in connection with any repurchase agreement related to such
Securities entered into by the Fund;
(7) deliver Securities owned by the Fund to the issuer thereof or its
agent when such Securities are called, redeemed, retired, or
otherwise become payable; provided, however, that in any such
case the cash or other consideration is to be delivered to the
Custodian. Notwithstanding the foregoing, the Custodian shall
have no
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responsibility to the Fund for monitoring or ascertaining
of any call, redemption, or retirement date with respect to put
bonds which are owned by the Fund and held by the Custodian or
its nominee. Nor shall the Custodian have any responsibility or
liability to the Fund for any loss by the Fund for any missed
payment or other default resulting therefrom unless the Custodian
received timely notification from the Fund specifying the time,
place, and manner for the presentment of such put bond owned by
the Fund and held by the Custodian or its nominee. The Custodian
shall not be responsible and assume no liability to the Fund for
the accuracy or completeness of any notification the Custodian
may furnish to the Fund with respect to put bonds;
(8) deliver Securities owned by the Fund for delivery in connection
with any loans of securities made by the Fund but only against
receipt of adequate collateral as agreed upon from time to time
by the Custodian and the Fund which may be in any form permitted
under the 1940 Act or any interpretations thereof issued by the
Securities and Exchange Commission or its staff;
(9) deliver Securities owned by the Fund for delivery as security in
connection with any borrowings by the Fund requiring a pledge of
Fund assets, but only against receipt of amounts borrowed;
(10) deliver Securities owned by the Fund upon receipt of instructions
from the Fund for delivery to the Transfer Agent or to the
holders of Shares of the Fund in connection with distributions in
kind, as may be described from time to time in the Fund's
Prospectus, in satisfaction of requests by holders of Shares for
repurchase or redemption; and
(11) deliver Securities owned by the Fund for any other proper
business purpose, but only upon receipt of, in addition to
Written Instructions, a certified copy of a resolution of the
Board of Directors signed by an Authorized Person and certified
by the Secretary of the Fund, 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 business
purpose, and naming the person or persons to whom delivery of
such Securities shall be made.
(g) Endorsement and Collection of Checks, Etc. The Custodian is hereby
authorized to endorse and collect all checks, drafts, or other orders
for the payment of money received by the Custodian for the account of
the Fund.
5. Purchase and Sale of Investments of the Fund.
(a) Promptly after each purchase of Securities for the Fund, 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, either Written Instructions or Oral Instructions, in
either case specifying with respect to each purchase:
(1) the name of the issuer and the title of the Securities;
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(2) the number of shares or the principal amount purchased and
accrued interest, if any;
(3) the date of purchase and settlement;
(4) the purchase price per unit;
(5) the total amount payable upon such purchase;
(6) the name of the person from whom or the broker through whom the
purchase was made, if any;
(7) whether or not such purchase is to be settled through the
Book-Entry System or the Depository; and
(8) whether the Securities purchased are to be deposited in the
Book-Entry System or the Depository.
The Custodian shall receive all Securities purchased by or for the
Fund and upon receipt of such Securities shall pay out of the moneys
held for the account of the Fund the total amount payable upon such
purchase, provided that the same conforms to the total amount payable
as set forth in such Written or Oral Instructions.
(b) Promptly after each sale of Securities of the Fund, 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, either Written
or Oral Instructions, in either case specifying with respect to such
sale:
(1) the name of the issuer and the title of the Securities;
(2) the number of shares or principal amount sold and accrued
interest, if any;
(3) the date of sale;
(4) the sale price per unit;
(5) the total amount payable to the Fund upon such sale;
(6) the name of the broker through whom or the person to whom the
sale was made; and
(7) whether or not such sale is to be settled through the Book-Entry
System or the Depository. The Custodian shall deliver or cause
to be delivered the Securities to the broker or other person
designated by the Fund upon receipt of the total amount payable
to the Fund upon such sale, provided that the same conforms to
the total amount payable to the Fund as set forth in such Written
or such Oral Instructions. Subject to the foregoing, the
Custodian may accept payment in
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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.
6. Lending of Securities.
(a) If the Fund is permitted as disclosed in its current Prospectus to
lend Securities, within 24 hours after each loan of Securities, the
Fund shall deliver to the Custodian Written Instructions specifying
with respect to each such loan:
(1) the name of the issuer and the title of the Securities;
(2) the number of shares or the principal amount loaned;
(3) the date of loan and delivery;
(4) the total amount to be delivered to the Custodian including the
amount of cash collateral and the premium, if any, separately
identified;
(5) the name of the broker, dealer, or financial institution to which
the loan was made; and
(6) whether the Securities loaned are to be delivered through the
Book-Entry System or the Depository.
(b) Promptly after each termination of a loan of Securities, the Fund
shall deliver to the Custodian Written Instructions specifying with
respect to each such loan termination and return of Securities:
(1) the name of the issuer and the title of the Securities to be
returned;
(2) the number of shares or the principal amount to be returned;
(3) the date of termination;
(4) the total amount to be delivered by the Custodian (including the
cash collateral for such Securities minus any offsetting credits
as described in said Written Instructions);
(5) the name of the broker, dealer, or financial institution from
which the Securities will be returned; and
(6) whether such return is to be effected through the Book-Entry
System or the Depository.
The Custodian shall receive all Securities returned from the broker,
dealer, or financial institution to which such Securities were loaned and
upon receipt thereof shall pay the total amount payable upon such return of
Securities as set forth in the Written Instructions. Securities returned
to the Custodian shall be held as they were prior to such loan.
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7. Payment of Dividends or Distribution.
(a) The Fund shall furnish to the Custodian the resolution of the Board of
Directors of the Fund certified by the Secretary (i) authorizing the
declaration of dividends or distributions on a specified periodic
basis and authorizing the Custodian to rely on Oral or Written
Instructions specifying the date of the declaration of such dividends
or distributions, the date of payment thereof, the record date as of
which shareholders entitled to payment shall be determined, the amount
payable per Share to the shareholders of record as of the record date,
and the total amount payable to the Transfer Agent on the payment
date, or (ii) setting forth the date of declaration of any dividends
or distributions by the Fund, the date of payment thereof, the record
date as of which shareholders entitled to payment shall be determined,
the amount payable per Share to the shareholders of record as of the
record date, and the total amount payable to the Transfer Agent on the
payment date.
(b) Upon the payment date specified in such resolution, Oral Instructions,
or Written Instructions, as the case may be, the Custodian shall pay
out the total amount payable to the Transfer Agent of the Fund.
8. Sale and Redemption of Shares.
(a) Whenever the Fund shall sell any Shares, the Fund shall deliver or
cause to be delivered to the Custodian Written Instructions duly
specifying:
(1) the number of Shares sold, trade date, and price; and
(2) the amount of money to be received by the Custodian for the sale
of such Shares.
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(b) Upon receipt of such money from the Transfer Agent, the Custodian
shall credit such money to the Fund.
(c) Upon issuance of any Shares in accordance with the foregoing
provisions of this Section 8, the Custodian shall pay all original
issue or other taxes required to be paid in connection with such
issuance upon the receipt of Written Instructions specifying the
amount to be paid.
(d) Except as provided hereafter, whenever any Shares of the Fund are
redeemed, the Fund shall cause the Transfer Agent to promptly furnish
to the Custodian Written Instructions specifying:
(1) the number of Shares redeemed; and
(2) the amount to be paid for the Shares redeemed.
The Custodian understands that the information contained in such
Written Instructions will be derived from the redemption of Shares
as reported to the Fund by the Transfer Agent.
(e) Upon receipt from the Transfer Agent of advice setting forth the
number of Shares received by the Transfer Agent for redemption and
that such Shares are valid and in good form for redemption, the
Custodian shall make payment to the Transfer Agent of the total amount
specified in Written Instructions issued pursuant to Paragraph (d) of
this Section 8.
9. Indebtedness
(a) The Fund will cause to be delivered to the Custodian by any bank
(excluding the Custodian) from which the Fund borrows money for
temporary administrative or emergency purposes using Securities as
collateral for such borrowings, a notice or undertaking in the form
currently employed by any such bank setting forth the amount which
such bank will loan to the Fund against delivery of a stated amount of
collateral. The Fund shall promptly deliver to the Custodian Written
or Oral Instructions stating with respect to each such borrowing:
(1) the name of the bank;
(2) 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 other loan agreement;
(3) the time and date, if known, on which the loan is to be entered
into (the "borrowing date");
(4) the date on which the loan becomes due and payable;
(5) the total amount payable to the Fund on the borrowing date;
(6) the market value of Securities to be delivered as collateral for
such loan, including the name of the issuer, the title and the
number of shares, or the principal amount of any particular
Securities;
(7) whether the Custodian is to deliver such collateral through the
Book-Entry System or the Depository; and
(8) a statement that such loan is in conformance with the 1940 Act
and the Fund's Prospectus.
Upon receipt of the Written or Oral Instructions referred to in
Subparagraph (a) above, the Custodian shall deliver on the borrowing date
the specified collateral and the executed promissory note, if any, against
delivery by the lending bank of the total amount of the loan payable,
provided that the same conforms to the total amount payable as set forth in
the Written or Oral Instructions. The Custodian may, at the option of the
lending bank, keep such collateral in its possession, but such collateral
shall be subject to all rights therein given the lending bank by virtue of
any promissory note or loan agreement. The Custodian shall deliver as
additional collateral in the manner directed by the Fund from time to time
such Securities as may be specified in Written or Oral Instructions to
collateralize further any transaction described in this Section 9. The
Fund shall cause all Securities released from collateral status to be
Returned
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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 Fund fails to specify in Written or Oral Instructions all of
the information required by this Section 9, the Custodian shall not be
under any obligation to deliver any Securities. Collateral returned to the
Custodian shall be held hereunder as it was prior to being used as
collateral.
10. Persons Having Access to Assets of the Fund.
(a) No Director, Officer, Employee, or Agent of the Fund, and no officer,
director, employee, or agent of the Investment Adviser shall have
physical access to the assets of the Fund held by the Custodian or be
authorized or permitted to withdraw any investments of the Fund, nor
shall the Custodian deliver any assets of the Fund to any such person.
No officer, director, employee, or agent of the Custodian who holds
any similar position with the Fund, or the Investment Adviser, shall
have access to the assets of the Fund.
(b) The individual employees of the Custodian duly authorized by the Board
of Directors of the Custodian to have access to the assets of the Fund
are listed in the certification annexed hereto as Appendix C. The
Custodian shall advise the Fund of any change in the individuals
authorized to have access to the assets of the Fund by written notice
to the Fund accompanied by a certified copy of the authorizing
resolution of the Custodian's Board of Directors approving such
change.
(c) Nothing in this Section 10 shall prohibit any Officer, Employee, or
Agent of the Fund or any officer, director, employee, or agent of the
Investment Adviser from giving Oral Instructions or Written
Instructions to the Custodian so long as it does not result in
delivery of or access to assets of the Fund prohibited by Paragraph
(a) of this Section 10.
11. Concerning the Custodian.
(a) Standard of Conduct. Except as otherwise provided herein, neither the
Custodian nor its nominee shall be liable for any loss or damage,
including reasonable counsel fees, resulting from its action or
omission to act or otherwise, except for any such loss or damage
arising out of its own negligence or willful misconduct. The
Custodian may, with respect to questions of law, apply for and obtain
the advice and opinion of counsel to the Fund at the expense of the
Fund, or of its own 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 such advice or opinion; provided, however,
that if such reliance involves a potential material loss to the Fund,
the Custodian will advise the Fund of any such actions to be taken in
accordance with advice of counsel to the Custodian. The Custodian
shall be liable to the Fund for any loss or damage resulting from the
use of the Book-Entry System or the Depository arising by reason of
any negligence, misfeasance, or misconduct on the part of the
Custodian or any of its employees or agents.
(b) Limit of Duties. Without limiting the generality of the foregoing,
the Custodian shall be under no duty or obligation to inquire into,
and shall not be liable for:
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(1) the validity of the issue of any Securities purchased by 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 the Fund, or the
propriety of the amount for which the same are sold;
(3) the legality of the issue or sale of any Shares, or the
sufficiency of the amount to be received therefor;
(4) the legality of the redemption of any Shares or the propriety of
the amount to be paid therefor;
(5) the legality of the declaration or payment of any dividend or
other distribution of the Fund; or
(6) the legality of any borrowing for temporary or emergency
administrative purposes.
(c) No Liability Until Receipt. The Custodian shall not 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 in the
Book-Entry System or the Depository.
(d) Collection Where Payment Refused. 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
Written Instructions and (ii) it shall be assured to its satisfaction
of reimbursement of its costs and expenses in connection with any such
action.
(e) Appointment of Agents and Sub-Custodians. The Custodian may appoint
one or more banking institutions, including but not limited to banking
institutions located in foreign countries, to act as Depository or
Depositories or as Sub-Custodian or as Sub-Custodians of Securities
and moneys at any time owned by the Fund, upon terms and conditions
specified in Written Instructions. The Custodian shall use reasonable
care in selecting a Depository and/or Sub-Custodian located in a
country other that the United States ("Foreign Sub-Custodian") and
shall oversee the maintenance of any Securities or moneys of the Fund
by any Foreign Sub-Custodian.
Any agreement between the Custodian and any Depository or
Sub-Custodian shall impose on such Depository or Sub-Custodian
responsibilities and liabilities similar in nature and scope to those
imposed by this Agreement relating to the function to be performed by
such Depository or Sub-Custodian.
(f) No Duty to Ascertain Authority. 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
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the Fund are such as may properly be held by the Fund under the
provisions of the Fund's Prospectus.
(g) Compensation of the Custodian. The Custodian shall be entitled to
receive, and the Fund agrees to pay to the Custodian, such
compensation as may be agreed upon from time to time between the
Custodian and the Fund. The Custodian may charge against any money
specifically allocated to the Fund such compensation and any expenses
incurred by the Custodian in the performance of its duties pursuant to
such agreement with respect to the Fund. Any charges associated with
DTC transactions shall be billed to the Fund at cost. The Custodian
shall also be entitled to charge against any money held by it and
specifically allocated to the Fund the amount of any loss, damage,
liability, or expense incurred with respect to the Fund including
counsel fees, for which it shall be entitled to reimbursement under
the provisions of this Agreement.
The expenses which the Custodian may charge against such account
include, but are not limited to, the expenses of Sub-Custodians and
foreign branches of the Custodian incurred in settling transactions
involving the purchase and sale of Securities of the Fund.
(h) Reliance on Certificates and Instructions. The Custodian shall be
entitled to rely upon any Written Instructions or Oral Instructions
actually received by the Custodian pursuant to the applicable Sections
of this Agreement and reasonably believed by the Custodian to be
genuine and to be given by an Authorized Person. The Fund agrees to
forward to the Custodian Written Instructions from an Authorized
Person confirming such Oral Instructions in such manner so that such
Written Instructions are received by the Custodian, whether by hand
delivery, telex, or otherwise, by the close of business on the same
day that such Oral Instructions are given to the Custodian. The Fund
agrees that the fact that such confirming instruction 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 Fund. The Fund agrees that the Custodian shall incur no
liability to the Fund in acting upon Oral Instructions given to the
Custodian hereunder concerning such transactions, provided that such
instructions reasonably appear to have been received from a duly
Authorized Person.
(i) Inspection of Books and Records. The Custodian shall create and
maintain all records relating to its activities and obligations under
this Agreement in such manner as will meet the obligations of the Fund
under the 1940 Act, with particular attention to Section 31 thereof
and Rule 31a-1 and 31a-2 thereunder, applicable federal and state tax
laws, and any other law or administrative rules or procedures which
may be applicable to the Fund. All such records shall be the property
of the Fund, and it shall at all times during the regular business
hours of the Custodian be open for inspection by duly authorized
Officers, Employees, or Agents of the Fund and employees and agents of
the Securities and Exchange Commission. The Custodian shall, at the
Fund's request, supply the Fund with a tabulation of Securities owned
by the Fund and held by the Custodian.
The Custodian shall take all reasonable action, as the Fund may from
time to time request, to obtain favorable opinions from the Fund's
independent accountant with respect to its activities hereunder in
connection with the preparation of the Fund's Form
13
N-1A and Form N-SAR or other reports to or requirements of the
Securities and Exchange Commission.
12. Term and Termination
(a) This Agreement shall become effective on the date first set forth
above (the "Effective Date") and shall continue in effect thereafter
as the parties may mutually agree.
(b) Either of the parties hereto may terminate this Agreement by giving to
the other party a notice in writing specifying the date of such
termination, which shall be not less than 60 days after the date of
receipt of such notice. In the event such notice is given by the
Fund, it shall be accompanied by a certified resolution of the Board
of Directors of the Fund, electing to terminate this Agreement and
designating a successor custodian or custodians, which shall be a
person qualified to so act under the 1940 Act. In the event such
notice is given by the Custodian, the Fund shall, on or before the
termination date, deliver to the Custodian a certified resolution of
the Board of Directors of the Fund, designating a successor custodian
or custodians. In the absence of such designation by the Fund, the
Custodian may designate a successor custodian, which shall be a person
qualified to so act under the 0000 Xxx. If the Fund fails to
designate a successor custodian, the Fund shall upon the date
specified in the notice of termination of this Agreement and upon the
delivery by the Custodian 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 its own custodian;
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 Book-Entry System which cannot be
delivered to the Fund.
(c) Upon the date set forth in such notice under Paragraph (b) of this
Section 12, this Agreement shall terminate to the extent specified in
such notice, and the Custodian shall upon receipt of a notice of
acceptance by the successor custodian on that date deliver directly to
the successor custodian all Securities and moneys then held by the
Custodian, after deducting all fees, expenses, and other amounts for
the payment or reimbursement of which it shall then be entitled with
respect to the Fund.
13. Miscellaneous.
(a) Annexed hereto as Appendix A is a certification signed the President
and the Secretary of the Fund setting forth the names and the
signatures of the present Authorized Persons. The Fund agrees to
furnish to the Custodian a new certification in similar form in the
event that any such present Authorized Persons ceases to be such an
Authorized person or in the event that other or additional Authorized
Persons are elected or appointed. Until such new certification 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
certification.
(b) Annexed hereto as Appendix B is a certification signed by the
President and the Secretary of the Fund setting forth the
names of the present Directors of the Fund who are authorized to give
Oral and Written Instructions to the Custodian. The Fund agrees
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to furnish to the Custodian a new certification in similar form in the
event any such present Director ceases to be a Director of the Fund,
ceases to have authority to provide Oral or Written Instructions to
the Custodian, or in the event that other or additional Directors are
elected or appointed who may be authorized to provide Oral or Written
Instructions to the Custodian. Until such new certification shall be
received, the Custodian shall be fully protected in acting under the
provisions of this Agreement upon the signature of the Directors as
set forth in the last delivered certification.
(c) 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 000 Xxxxx Xxxxxxxx, Xxxxx, Xxxxx Xxxxxx 00000, or at
such other place as the Custodian may from time to time designate in
writing.
(d) Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Fund, shall be sufficiently given
if addressed to the Fund and mailed or delivered to it at its offices
at 0 Xxxxx Xxxx, Xxxxx, Xxxxx Xxxxxx 00000, or at such other place as
the Fund may from time to time designate in writing.
(e) This Agreement 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 as may be permitted or required by the 1940
Act.
(f) 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
without the written consent of the Custodian, or by the Custodian
without the written consent of the Fund authorized or approved by a
resolution of the Board of Directors of the Fund, and any attempted
assignment without such written consent shall be null and void.
(g) This Agreement shall be construed in accordance with the laws of the
State of North Dakota.
(h) It is expressly agreed to that the obligations of the Fund hereunder
shall not be binding upon any of the Directors, Shareholders,
Nominees, Officers, Agents, or Employees of the Fund, personally, but
bind only the corporate property of the Fund. The execution and
deliver of this Agreement have been authorized by the Directors of the
Fund and signed by an authorized Officer of the Fund, acting as such,
and neither such authorization by such Directors nor such execution
and delivery by such Officer shall be deemed to have been made by any
of them individually or to impose any liability on any of them
personally, but shall bind only the corporate property of the Fund.
(i) The captions of the Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
(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.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunder duly authorized as of the day
and year first above written.
INTEGRITY SMALL-CAP FUND OF FUNDS, INC.
By: /Xxxxxx X. Xxxxxxx/
Xxxxxx X. Xxxxxxx
President
Attest: /Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Secretary
Agreed and Accepted By:
FIRST WESTERN BANK & TRUST
By: /Xxxxx Xxxxxxxxx/
Xxxxx Xxxxxxxxx
Vice President and Trust Department Manager
Attest: /Xxxxx Xxxxxxxx/
Name: Xxxxx Xxxxxxxx
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APPENDIX A
We, Xxxxxx X. Xxxxxxx and Xxxxx X. Xxxxx, Directors of the Integrity
Small-Cap Fund of Funds, Inc. (the "Fund"), a corporation organized under the
laws of the State of North Dakota, do hereby certify that the following
individuals have been duly authorized as Authorized Persons to give Oral
Instructions and Written Instructions on behalf of the Fund, and the signatures
set forth opposite their respective names are their true and correct
signatures:
Authorized Persons Signatures
Xxxxxx X. Xxxxxxx /Xxxxxx X. Xxxxxxx/
Xxxxx X. Xxxxx /Xxxxx X. Xxxxx/
Xxxxxxx X. Xxxxx /Xxxxxxx X. Xxxxx/
INTEGRITY SMALL-CAP FUND OF FUNDS, INC.
/Xxxxxx X. Xxxxxxx/
Xxxxxx X. Xxxxxxx
Director
/Xxxxx X. Xxxxx/
Xxxxx X. Xxxxx
Director
00
XXXXXXXX X
We, Xxxxxx X. Xxxxxxx and Xxxxx X. Xxxxx, Directors of Integrity Small-Cap
Fund of Funds, Inc. (the "Fund"), a corporation organized under the laws of the
State of North Dakota, do hereby certify that the following individuals serve
in the following positions with the Fund and have been duly elected to such
positions and qualified therefor in conformity with the Fund's Bylaws; and the
signatures set forth opposite their names are their true and correct
signatures:
Name Position Signature
Xxxxxx X. Xxxxxxx President and Director /Xxxxxx X. Xxxxxxx/
Xxxxx X. Xxxxx Vice President and Director /Xxxxx X. Xxxxx/
INTEGRITY SMALL-CAP FUND OF FUNDS, INC.
/Xxxxxx X. Xxxxxxx/
Xxxxxx X. Xxxxxxx
Director
/Xxxxx X. Xxxxx/
Xxxxx X. Xxxxx
Director
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APPENDIX C
I, Xxxxxxx X. Xxxxxxxx, Vice President and Cashier of First Western Bank &
Trust (the "Custodian"), hereby certify pursuant to Section 10(b) of the
Custodian Agreement, that the following employees have been duly authorized by
the Custodian's Board of Directors to have access to the assets of the
Integrity Small-Cap Fund of Funds, Inc.:
Xxxxx Xxxxxxxxx, Vice President and Trust Department Manager; Xxxxxx X.
Xxxxxxx, Trust Operations Officer; Xxxxx Xxxxxx, Trust Compliance & Review
Officer
Signed and dated this 23rd day of May, 2000.
/Xxxxxxx X. Xxxxxxxx/
Xxxxxxx X. Xxxxxxxx
Vice President and Cashier
First Western Bank & Trust
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SCHEDULE A
FEE SCHEDULE
CUSTODIAN CHARGES
FIRST WESTERN BANK & TRUST
Montana Tax-Free Fund, Inc., Integrity Fund of Funds, Inc., Integrity
Small-Cap Fund of Funds, Inc., and any other mutual funds for which ND Money
Management, Inc., serves as investment adviser (hereinafter referred to as the
"Funds") shall compensate First Western Bank & Trust (the "Custodian") for
services rendered pursuant to the Custodian Agreements entered into with each
of the Funds as follows:
For the period beginning February 1, 1998, and monthly thereafter, the
Funds shall pay the Custodian a fee at the annual rate of .00015 of combined
net assets of the Funds; provided, however, that the Funds shall pay the
Custodian a minimum monthly fee of five hundred dollars ($500).
By way of example only, if the Funds had combined net assets of ten million
dollars ($10,000,000) on February 1, 1998, the fee for the month would be $500
(.00015 x $10,000,000 = $1,500 / 12 = $125, so the minimum monthly fee of $500
would apply). If the combined net assets of the Funds on February 1 were one
hundred million dollars ($100,000,000), the fee for the month of February would
be $1,250 (.00015 x $100,000,000 / 12 = $1,250).
The Custodian shall compute the fee payable pursuant to the Fee Schedule and
provide each of the Funds with detailed bills showing their proportionate share
of the fee as soon as practicable after the end of each calendar month. The
Funds shall each promptly pay the Custodian their proportionate share of the
fee.
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