CUSTODY AGREEMENT
This Agreement is dated as of September 28, 1995, by and
between ARK Funds, a Massachusetts business trust (the "Trust"),
and The First National Bank of Maryland, a national banking
association chartered under the laws of the United States (the
"Custodian").
W I T N E S S E T H:
WHEREAS, the Trust is an open-end management investment
company registered under the Investment Company Act of 1940, as
amended (the "1940 Act"), and is authorized to issue shares in
separate series, with each such series representing the
beneficial interest in a separate portfolio of securities and
other assets; and
WHEREAS, the Trust desires to retain the Custodian to serve
as custodian for the existing series of the Trust listed in
Exhibit A hereto (such series, together with all other series
subsequently established by the Trust and made subject to this
Agreement in accordance with Section 3.21, being hereinafter
referred to as the "Portfolios"); and the Custodian is willing to
furnish such services;
NOW THEREFORE, in consideration of the mutual covenants and
agreements hereinafter contained, the parties hereto agree as
follows:
ARTICLE I
CERTAIN DEFINITIONS
Whenever used in this Agreement the following words and
phrases, unless the context otherwise requires, shall have the
following meanings:
1.1 "Authorized Person" means any officer of the Trust or
other person duly authorized by resolution of the Board of
Trustees to give Proper Instructions on behalf of the Portfolios
and named in Exhibit B hereto or in such resolutions of the Board
of Trustees, certified by an officer of the Trust, as may be
received by the Custodian from time to time. The Trust will
provide the Custodian with authenticated specimen signatures of
each Authorized Person.
1.2 "Board of Trustees" means the trustees from time to
time serving under the Trust's Agreement and Declaration of
Trust, dated March 19, 1993, as from time to time amended.
1.3 "Business day" means any day recognized as a settlement
day by the New York Stock Exchange, Inc. and any other day for
which the Trust computes the net asset value of a Portfolio.
1.4 "CFTC" means the U.S. Commodity Futures Trading
Commission.
1.5 "Custody Account" means any of the accounts in the name
of a Portfolio which are provided for in Section 3.2.
1.6 "DTC" means the Depository Trust Company.
1.7 "NASD" means the National Association of Securities
Dealers, Inc.
1.8 "OCC" means The Options Clearing Corporation.
1.9 "Officer" of the Trust means the Chairman, President,
any Vice-President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer of the Trust.
1.10 "Proper Instructions" means:
(i) a writing (including, without limitation, a
facsimile transmission or tested telex) constituting a
request, direction, instruction or certification signed or
initiated by or on behalf of a Portfolio by one or more
Authorized Persons or reasonably believed by the Custodian
to have been signed by such Authorized Persons;
(ii) a telephone or other oral communication by one or
more Authorized Persons or reasonably believed by the
Custodian to have been communicated by such Authorized
Persons; or
(iii) communications transmitted electronically
through the Institutional Delivery System (IDS), or any
other similar electronic instruction system acceptable to
the Custodian and approved by resolution of the Board of
Trustees, a copy of which, certified by an officer of the
Trust, shall have been delivered to the Custodian.
The Trust shall cause all Proper Instructions in the form of
oral communications to be promptly confirmed in writing, as
specified in clause (i) of this Section 1.10. In the event that
an oral communication is not so confirmed, or in the event that a
written confirmation differs from the related oral communication,
the Trust will hold the Custodian harmless and without liability
for any claims or losses in connection with such oral
communication. Proper Instructions may be in the form of
standing instructions. In respect of trades reported on the
Trust's behalf through DTC, instructions from DTC (whether in a
DTC report or otherwise) shall constitute Proper Instructions.
1.11 "SEC" means the U.S. Securities and Exchange
Commission.
1.12 "Securities" include, without limitation, common and
preferred stocks, bonds, call options, put options, debentures,
notes, bank certificates of deposit, bankers' acceptances,
mortgage-backed securities, other money market instruments or
other obligations, and any certificates, receipts, warrants or
other instruments or documents representing rights to receive,
purchase or subscribe for the same, or evidencing or representing
any other rights or interests therein, or any similar property or
assets that the Custodian has the facilities to clear and to
service.
1.13 "Securities System" means (i) any clearing agency
registered with the SEC under Section 17A of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), which acts as
a system for the central handling of securities where all
securities of any particular class or series of an issuer
deposited within the system are treated as fungible and may be
transferred or pledged by bookkeeping entry without physical
delivery of the Securities; and (ii) the book-entry system as
provided in Subpart O of Treasury Circular Xx. 000, 00 XXX 000,
Xxxxxxx X of 31 CFR Part 350, and the book-entry regulations of
federal agencies substantially in the form of Subpart O.
1.14 "Shares" means, with respect to a Portfolio, the units
of beneficial interest in such Portfolio issued by the Trust.
ARTICLE II
APPOINTMENT OF CUSTODIAN
2.1 Appointment. The Trust hereby constitutes and appoints
the Custodian as custodian of the assets of the Portfolios for
the term and subject to the provisions of this Agreement.
2.2 Acceptance. The Custodian hereby accepts appointment
as such custodian and agrees to perform the duties thereof as
hereinafter set forth. In performing the services to be provided
to the Trust hereunder, the Custodian agrees to comply with all
relevant provisions of the 1940 Act and the regulations,
including but not limited to Rule 17f-2, promulgated thereunder.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
3.1 Segregation. All securities and non-cash property held
by the Custodian for the account of a Portfolio, except
securities maintained in a Securities System pursuant to Section
3.6, shall be physically segregated from other securities and non-
cash property in the possession of the Custodian (including the
securities and non-cash property of another Portfolio) and shall
be identified as subject to this Agreement.
3.2 Custody Accounts. As to each Portfolio, the Custodian
shall open and maintain in its trust department a custody account
or accounts in the name of the Trust coupled with the name of
such Portfolio, subject only to draft or order of the Custodian,
in which the Custodian shall enter and carry all securities, cash
and other assets of such Portfolio which are delivered to it.
3.3 Appointment of Sub-Custodians. In its discretion, the
Custodian may appoint, and at any time remove, any bank or trust
company which has been approved by the Board of Trustees and is
qualified to act as a custodian under the 1940 Act, as sub-
custodian, to hold securities and cash of the Portfolios and to
carry out such other provisions of this Agreement as it may
determine, and may also open and maintain one or more banking
accounts with such a bank or trust company (any such accounts to
be in the name of the Custodian on behalf of its customers and
subject only to its draft or order pursuant to the terms of this
Agreement); provided, however, that the Custodian shall have no
more or less responsibility or liability to the Trust on account
of any actions or omissions of such sub-custodian so employed
than any such sub-custodian has to the Custodian.
3.4 Appointment of Agents. The Custodian may at any time
or times in its discretion appoint (and may at any time remove)
any other bank or trust company which is itself qualified under
the 1940 Act to act as a custodian, as its agent to carry out
such of the provisions of this Agreement as the Custodian may
from time to time direct; provided, however, that the appointment
of any agent shall not relieve the Custodian of its
responsibilities or liabilities hereunder.
3.5 Delivery of Assets to Custodian. The Trust on behalf
of the Portfolios shall deliver, or cause to be delivered, to the
Custodian all securities, cash and other assets of the Portfolios
other than securities, cash or other assets to be delivered to
any sub-custodian appointed pursuant to Section 3.3, including
(i) all payments of income, payments of principal or capital
distributions received by the Portfolios with respect to such
securities, cash or other assets owned by the Portfolios at any
time during the period of this Agreement, and (ii) all cash
received by the Portfolios for the issuance, at any time during
such period, of Shares. The Custodian shall not be responsible
for such securities, cash or other assets until actually received
by it.
3.6 Securities Systems. The Custodian may deposit and/or
maintain securities of the Portfolios in a Securities System,
subject to the following provisions:
(a) Prior to a deposit of securities of the Portfolios in a
particular Securities System, the Trust shall deliver
to the Custodian a resolution of the Board of Trustees,
certified by an officer of the Trust, specifically
approving the use of such Securities System as a
depository for the Portfolios and authorizing and
instructing the Custodian on an ongoing basis to
deposit in such Securities System all securities
eligible for deposit therein and to make use of such
Securities System to the extent possible and practical
in connection with its performance hereunder,
including, without limitation, in connection with
settlements of purchases and sales of securities, loans
of securities, and deliveries and returns of collateral
consisting of securities.
(b) Securities of the Portfolios kept in a Securities
System shall be kept in an account (the "Depository
Account") of the Custodian in such Securities System
which includes only assets held by the Custodian as a
fiduciary, custodian or otherwise for customers.
(c) The records of the Custodian with respect to securities
of any Portfolio which are maintained in a Securities
System shall identify by book-entry those securities
belonging to the Portfolio.
(d) If securities purchased by a Portfolio are to be held
in a Securities System, the Custodian shall pay for
such securities upon (i) receipt of advice from the
Securities System that such securities have been
transferred to the Depository Account, and (ii) the
making of an entry on the records of the Custodian to
reflect such payment and transfer for the account of
such Portfolio. If securities sold by a Portfolio are
held in a Securities System, the Custodian shall
transfer such securities upon (i) receipt of advice
from the Securities System that payment for such
securities has been transferred to the Depository
Account, and (ii) the making of an entry on the records
of the Custodian to reflect such transfer and payment
for the account of such Portfolio.
(e) Upon request, the Custodian shall provide the Trust
with copies of any report (obtained by the Custodian
from a Securities System in which securities of the
Portfolios are kept) on the internal accounting
controls and procedures for safeguarding securities
deposited in such Securities System.
(f) Anything to the contrary in this Agreement
notwithstanding, the Custodian shall not be liable to
the Trust for any loss or damage to any Portfolio
resulting from the use by the Custodian of a Securities
System, unless such loss or damage is caused by or
results from the negligence or willful misconduct on
the part of the Custodian or its agents or any of its
(or their) employees; provided, however, that in the
event of any such loss or damage the Custodian shall
take reasonable steps to enforce effectively such
rights as it may have against the Securities System.
At its election, the Trust shall be subrogated to the
rights of the Custodian with respect to any claim
against a Securities System or any other person for any
loss or damage to the Portfolios arising from the use
of such Securities System, if and to the extent that
the Portfolios have not been made whole for any such
loss or damage.
3.7 Collection of Income. Subject to the provisions of
Section 3.15, the Custodian shall collect on a timely basis all
income and other payments with respect to registered securities
held hereunder to which each Portfolio shall be entitled either
by law or pursuant to custom in the securities business, and
shall collect on a timely basis all income and other payments
with respect to bearer securities if, on the date of payment by
the issuer, such securities are held by the Custodian or its
agent hereunder and shall credit such income, as collected, to
such Portfolio's Custody Account. Without limiting the
generality of the foregoing, the Custodian shall detach and
present for payment all coupons and other income items requiring
presentation as and when they become due and shall collect
interest when due on securities held hereunder. The collection
of income due the Portfolios on securities loaned pursuant to the
provisions of Section 3.9(j) shall be the responsibility of the
Trust. The Custodian will have no duty or responsibility in
connection therewith, other than to provide the Trust with such
information or data as may be necessary to assist the Trust in
arranging for the timely delivery to the Custodian of the income
to which a Portfolio is properly entitled.
The Custodian shall promptly notify the Trust whenever
income due on securities is not collected in due course and will
provide the Trust with monthly reports of the status of past due
income. Except as set forth herein, the Custodian shall not be
required to enforce collection, by legal means or otherwise, of
any money or property due and payable with respect to securities
held for a Portfolio if such securities are in default or payment
is not made after due demand or presentation.
3.8 Disbursement of Moneys from Custody Accounts. Upon
receipt of Proper Instructions from or on behalf of a Portfolio,
the Custodian shall disburse moneys from the Custody Account of
the Portfolio, but only in the following cases:
(a) For the purchase of securities for the account of the
Portfolio but only (i) in the case of securities (other
than options on securities, futures contracts and
options on futures contracts), against the delivery to
the Custodian (or any sub-custodian or agent appointed
pursuant to Section 3.3 or Section 3.4, respectively)
of such securities to be registered as provided in
Section 3.15 in proper form for transfer, or if the
purchase of such securities is effected through a
Securities System, in accordance with the conditions
set forth in Section 3.6; (ii) in the case of options
on securities, against delivery to the Custodian (or
such sub-custodian) of such receipts as are required by
the customs prevailing among dealers in such options;
(iii) in the case of futures contracts and options on
futures contracts, against delivery to the Custodian
(or such sub-custodian) of evidence of title thereto in
favor of the Portfolio or any nominee referred to in
Section 3.15; and (iv) in the case of repurchase or
reverse repurchase agreements entered into by the
Portfolio and any other party, against delivery of the
purchased securities either in certificate form or
through an entry crediting the Custodian's (or such sub-
custodian's) account at a Securities System with such
securities;
(b) In connection with the conversion, exchange or
surrender of securities owned by the Portfolio as set
forth in Section 3.9(g);
(c) For the payment of any dividends or distributions
declared by the Trust on Shares of the Portfolio;
(d) In payment of the redemption price of Shares of the
Portfolio as provided in Section 5.1;
(e) For the payment of any expense or liability incurred by
the Portfolio, including but not limited to the
following payments for the account of the Portfolio:
interest; taxes; investment management or advisory,
administration, accounting, auditing, transfer agent,
custody, trustees' and legal fees; and other operating
expenses of the Portfolio; in all cases, whether or not
such expenses are to be in whole or part capitalized or
treated as deferred expenses;
(f) For transfer in accordance with the provisions of any
agreement among the Trust on behalf of the Portfolio,
the Custodian and a broker-dealer registered under the
1934 Act and a member of the NASD, relating to
compliance with rules of the OCC and of any registered
national securities exchange (or of any similar
organization or organizations), regarding escrow or
other arrangements in connection with transactions by
the Portfolio;
(g) For transfer in accordance with the provisions of any
agreement among the Trust on behalf of the Portfolio,
the Custodian and a futures commission merchant
registered under the Commodity Exchange Act, relating
to compliance with the rules of the CFTC and/or any
contract market (or any similar organization or
organizations), regarding account deposits in
connection with transactions by the Portfolio;
(h) For the funding of any uncertified time deposit or
other interest-bearing account with any banking
institution (including the Custodian), which deposit or
account has a term of one year or less; and
(i) For any other proper purpose, but only upon receipt of,
in addition to Proper Instructions, a copy of a
resolution of the Board of Trustees, certified by an
officer of the Trust, specifying the amount and purpose
of such payment, declaring such purpose to be a proper
corporate purpose, and naming the person or persons to
whom such payment is to be made.
3.9 Delivery of Securities from Custody Accounts. Upon
receipt of Proper Instructions from or on behalf a Portfolio, the
Custodian shall release and deliver securities from the Custody
Account of the Portfolio, but only in the following cases:
(a) Upon the sale of securities for the account of the
Portfolio but only against receipt of payment therefor;
(b) In the case of a sale effected through a Securities
System, in accordance with the provisions of Section
3.6;
(c) To the depositary agent in connection with tender or
other similar offers for securities of the Portfolio;
(d) To the issuer thereof or its agent when such securities
are called, redeemed, retired, or otherwise become
payable; provided that, in any such case, the cash or
other consideration is to be delivered to the
Custodian;
(e) To the issuer thereof or its agent (i) for transfer
into the name of the Portfolio, the Custodian or any
sub-custodian or agent appointed pursuant to Section
3.3 or Section 3.4, respectively, or any nominee or
nominees of any of the foregoing, or (ii) for exchange
for a different number of certificates or other
evidence representing the same aggregate face amount or
number of units; provided that, in any such case, the
new securities are to be delivered to the Custodian;
(f) To the broker selling securities or its clearing agent,
for examination in accordance with the "street
delivery" custom; provided that, in any such case, the
Custodian shall have no responsibility or liability for
any loss arising from the delivery of such securities
prior to receiving payment for such securities except
as may arise from the Custodian's own negligence or
willful misconduct;
(g) For exchange or conversion pursuant to any plan of
merger, consolidation, recapitalization, reorganization
or readjustment of the securities or the issuer of such
securities, or pursuant provisions for conversion
contained in such securities, or pursuant to any
deposit agreement, including surrender or receipt of
underlying securities in connection with the issuance
or cancellation of depositary receipts; provided that,
in any such case, the new securities and cash, if any,
are to be delivered to the Custodian;
(h) Upon receipt of payment therefor pursuant to any
repurchase or reverse repurchase agreement related to
such securities entered into by the Portfolio;
(i) In the case of warrants, rights or similar securities,
upon the exercise thereof, the surrender thereof in the
exercise of such warrants, rights or similar securities
or the surrender of interim receipts or temporary
securities for definitive securities; provided that, in
any such case, the new securities and cash, if any, are
to be delivered to the Custodian;
(j) For delivery in connection with any loans of securities
of the Portfolio, but only against receipt by the
Custodian of such collateral as shall have specified to
the Custodian in Proper Instructions, except that in
connection with any loans for which collateral is to be
credited to the Custodian's account in the book-entry
system authorized by the U.S. Department of the
Treasury, the Custodian will not be held liable or
responsible for the delivery of securities owned by the
Portfolio prior to the receipt of such collateral;
(k) For delivery as security in connection with any
borrowings by the Portfolio requiring a pledge of
assets, but only against receipt by the Custodian of
the amounts borrowed;
(l) Pursuant to any authorized plan of liquidation,
reorganization, merger, consolidation or
recapitalization of the Portfolio or the Trust;
(m) For delivery in accordance with the provisions of any
agreement among the Trust on behalf of the Portfolio,
the Custodian and a broker-dealer registered under the
1934 Act and a member of the NASD, relating to
compliance with the rules of the OCC and of any
registered national securities exchange (or of any
similar organization or organizations), regarding
escrow or other arrangements in connection with
transactions by the Portfolio;
(n) For delivery in accordance with the provisions of any
agreement among the Trust on behalf of the Portfolio,
the Custodian and a futures commission merchant
registered under the Commodity Exchange Act, relating
to compliance with the rules of the CFTC and/or any
contract market (or any similar organization or
organizations), regarding account deposits in
connection with transactions by the Portfolio;
(o) Upon receipt of instructions from the transfer agent
for the Trust, for delivery to such transfer agent or
to the holders of Shares of the Portfolio in connection
with distributions in kind, in satisfaction of requests
by such holders for repurchase or redemption; and
(p) For any other proper purpose, but only upon receipt of,
in addition to Proper Instructions, a copy of a
resolution of the Board of Trustees, certified by an
officer of the Trust, specifying the securities to be
delivered and the purpose for which such delivery is to
be made, declaring such purpose to be a proper
corporate purpose, and naming the person or persons to
whom delivery of such securities shall be made.
3.10 Bank Accounts. The Custodian may open and maintain a
separate bank account or accounts in the name of each Portfolio,
subject only to draft or order by the Custodian acting pursuant
to the terms of this Agreement, and shall hold in such account or
accounts, subject to the provisions hereof, all cash received by
it from or for the account of the Portfolio, other than cash
maintained in a joint repurchase account with other affiliated
Portfolios or in a bank account established and used in
accordance with Rule 17f-3 under the 1940 Act. Funds held by the
Custodian for a Portfolio may be deposited by it to its credit as
Custodian in the banking department of the Custodian or in such
other banks or trust companies as it may in its discretion deem
necessary or desirable; provided, however, that every such bank
or trust company shall be qualified to act as a custodian under
the 1940 Act and that each such bank or trust company and the
funds to be deposited with each such bank or trust company shall
be approved by the vote of a majority of the Board of Trustees of
the Trust. Such funds shall be deposited by the Custodian in its
capacity as custodian and shall be withdrawable by the Custodian
only in that capacity. If requested by the Trust, the Custodian
shall furnish the Trust, not later than twenty (20) days after
the last business day of each month, an internal reconciliation
of the closing balance as of that day in all accounts described
in this section to the balance shown on the daily cash report for
that day rendered to the Trust.
3.11 Payments for Shares. The Custodian shall make such
arrangements with the transfer agent for the Trust, as will
enable the Custodian to receive the cash consideration due to
each Portfolio and will deposit into the Custody Account of the
Portfolio such payments as are received from the transfer agent.
The Custodian will provide timely notification to the Trust and
the transfer agent of any receipt by it of payments for Shares of
the Portfolios.
3.12 Availability of Federal Funds. Upon mutual agreement
between the Trust and the Custodian, the Custodian shall make
federal funds available to the Portfolios as of specified times
agreed upon from time to time by the Trust and the Custodian in
the amount of checks, clearing house funds, and other non-federal
funds received in payment for Shares of the Portfolios which are
deposited into the Custody Accounts.
3.13 Actions Not Requiring Proper Instructions. The
Custodian may in its discretion, without express authority from
or on behalf of a Portfolio:
(a) Make payments to itself or others for minor expenses of
handling securities or other similar items relating to
its duties under this Agreement, provided that all such
payments shall be accounted for to the Portfolio;
(b) Endorse for collection, in the name of the Portfolio,
checks, drafts and other negotiable instruments;
(c) Surrender interim receipts or securities in temporary
form for securities in definitive form; and
(d) In general, and except as otherwise directed in Proper
Instructions, attend to all non-discretionary details
in connection with the sale, exchange, substitution,
purchase, transfer and other dealings with the
securities and assets of the Portfolio.
3.14 Ownership Certificates for Tax Purposes. The Custodian
shall 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 prepare and submit reports to the Internal Revenue
Service and to the Trust at such time, in such manner and
containing such information as is prescribed by the Internal
Revenue Service.
3.15 Registration and Transfer of Securities. All
securities held for a Portfolio that are issued or issuable only
in bearer form shall be held by the Custodian in that form,
provided that any such securities shall be held in a Securities
System if eligible therefor. All other securities held for a
Portfolio may be registered in the name of such Portfolio, the
Custodian, or any sub-custodian or agent appointed pursuant to
Section 3.3 or Section 3.4, respectively, or in the name of any
nominee of any of them, or in the name of a Securities System or
any nominee thereof. All securities accepted by the Custodian on
behalf of a Portfolio under the terms of this Agreement shall be
in "street name" or other good delivery form. If, however, the
Custodian is directed to maintain securities of a Portfolio in
"street name", the Custodian shall utilize its best efforts only
timely to collect income due the Portfolio on such securities and
to notify the Portfolio on a best efforts basis only of relevant
corporate actions including, without limitation, pendency of
calls, maturities, tender or exchange offers. The Trust shall
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 any of the nominees hereinabove referred
to or in the name of a Securities System, any securities
registered in the name of a Portfolio.
3.16 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
Trust under the 1940 Act, with particular attention to Section 31
thereof and Rules 31a-1 and 31a-2 thereunder. All such records
shall be the property of the Trust and 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 Trust and employees and agents of the SEC. The Custodian
shall, at the Trust's request, supply the Trust with a tabulation
of securities owned by each Portfolio and held by the Custodian
and shall, when requested to do so by the Trust and for such
compensation as shall be agreed upon between the Trust and the
Custodian, include certificate numbers in such tabulations.
3.17 Portfolio Reports by Custodian. The Custodian shall
furnish the Trust with a daily activity statement by Portfolio
and a summary of all transfers to or from each Portfolio's
Custody Account on the day following such transfers. At least
monthly and from time to time, the Custodian shall furnish the
Trust with a detailed statement, by Portfolio, of the securities
and moneys held for each Portfolio under this Agreement.
3.18 Other Reports by Custodian. The Custodian shall
provide the Trust, at such times as the Trust may reasonably
require, with reports by independent public accountants on the
accounting system, internal accounting control and procedures for
safeguarding securities, futures contracts and options on futures
contracts, including securities deposited and/or maintained in a
Securities System, relating to the services provided by the
Custodian under this Agreement; such reports shall be of
sufficient scope and in sufficient detail as may reasonably be
required by the Trust to provide reasonable assurance that any
material inadequacies would be disclosed by such examination,
and, if there are no such inadequacies, the reports shall so
state.
3.19 Proxies and Other Materials. The Custodian shall cause
all proxies relating to securities which are not registered in
the name of a Portfolio to be promptly executed by the registered
holder, without indication of the manner in which such proxies
are to be voted, and shall promptly deliver to the Trust such
proxies, all proxy soliciting materials and all notices to such
securities.
3.20 Information on Corporate Actions. Subject to the
provisions of Section 3.15, the Custodian shall transmit promptly
to the Trust for each Portfolio all written information
(including, without limitation, pendency of calls and maturities
of securities and expirations of rights in connection therewith
and notices of exercise of call and put options written by the
Trust on behalf of a Portfolio and the maturity of futures
contracts purchased or sold by the Trust on behalf of a
Portfolio) received by the Custodian from issuers of the
securities being held for the Portfolio. With respect to tender
or exchange offers, the Custodian shall transmit promptly to the
Trust all written information received by the Custodian from the
issuers of securities whose tender or exchange offer is sought
from the party (or his agents) making the tender or exchange
offer. If the Trust desires to take action on behalf of a
Portfolio with respect to any tender offer, exchange offer, or
any other similar transaction, the Trust shall notify the
Custodian at least three (3) business days prior to the date on
which the Custodian is to take such action.
3.21 Additional Series. In the event that the Trust
establishes one or more additional series and desires to have the
Custodian render services as custodian to such series under the
terms set forth in this Agreement, it shall so notify the
Custodian in writing, and if the Custodian shall agree in writing
to provide such services, such series shall become a Portfolio
hereunder, subject to such fees as the parties may agree upon in
writing.
ARTICLE IV
PURCHASE AND SALE OF PORTFOLIO INVESTMENTS
4.1 Purchase of Securities. Promptly upon each purchase of
securities for a Portfolio, Proper Instructions shall be
delivered to the Custodian, specifying (i) the Portfolio for
which the purchase was made, (ii) the name of the issuer or
writer of such securities, and the title or other description
thereof, (iii) the number of shares, principal amount (and
accrued interest, if any) or other units purchased, (iv) the date
of purchase and settlement, (v) the purchase price per unit, (vi)
the total amount payable upon such purchase, and (vii) the name
of the person to whom such amount is payable. The Custodian
shall, upon receipt of such securities purchased by a Portfolio,
pay out of the moneys held in the Custody Account of such
Portfolio the total amount specified in such Proper Instructions
to the person named therein. The Custodian shall not be under
any obligation to pay out moneys to cover the cost of a purchase
of securities for a Portfolio, if there is insufficient cash
available in the Custody Account of the Portfolio for which such
purchase was made.
4.2 Liability for Payment in Advance of Receipt of
Securities Purchased. Except as provided in this Agreement, in
any and every case where payment for the purchase of securities
for a Portfolio is made by the Custodian in advance of receipt of
the securities purchased but in the absence of Proper
Instructions so to pay in advance, the Custodian shall be liable
to the Portfolio for such securities to the same extent as if the
securities had been received by the Custodian.
4.3 Sale of Securities. Promptly upon each sale of
securities by a Portfolio, Proper Instructions shall be delivered
to the Custodian, specifying (i) the Portfolio for which the sale
was made, (ii) the name of the issuer or writer of such
securities, and the title or other description thereof, (iii) the
number of shares, principal amount (and accrued interest, if any)
or other units sold, (iv) the date of sale and settlement, (v)
the sale price per unit, (vi) the total amount payable upon such
sale, and (vii) the person to whom such securities are to be
delivered. Upon receipt of the total amount payable to the
Portfolio as specified in such Proper Instructions, the Custodian
shall deliver such securities to the person specified in such
Proper 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.
4.4 Payment for Securities Sold. In its sole discretion
and from time to time, the Custodian may credit the Custody
Account of a Portfolio, prior to actual receipt of final payment
thereof, with (i) proceeds from the sale of securities which it
has been instructed to deliver against payment, (ii) proceeds
from the redemption of securities or other assets of the
Portfolio, and (iii) income from cash, securities or other assets
of the Portfolio. Any such credit shall be conditional upon
actual receipt by the Custodian of final payment and may be
reversed if final payment is not actually received in full. The
Custodian may, in its sole discretion and from time to time,
permit a Portfolio to use funds so credited to its Custody
Account in anticipation of actual receipt of final payment. Any
such funds shall be repayable immediately upon demand made by the
Custodian at any time prior to the actual receipt of all final
payments in anticipation of which funds were credited to the
Custody Account.
4.5 Advances by Custodian for Settlement. The Custodian
may, in its sole discretion and from time to time, advance funds
to a Portfolio to facilitate the settlement of transactions in
its Custody Account. Any such advance shall be repayable
immediately upon demand by the Custodian.
ARTICLE V
REDEMPTION OF PORTFOLIO SHARES
5.1 Transfer of Funds. From such funds as may be available
for the purpose in the Custody Account of a Portfolio, and upon
receipt of Proper Instructions specifying that the funds are
required to redeem Shares of the Portfolio, the Custodian shall
wire each amount specified in such Proper Instructions to or
through such bank as may be designated with respect to such
amount in such Proper Instructions.
5.2 No Duty Regarding Paying Banks. The Custodian shall
not be under any obligation to effect payment or distribution by
any bank designated in Proper Instructions given pursuant to
Section 5.1 of any amount paid by the Custodian to such bank in
accordance with such Proper Instructions.
ARTICLE VI
SEGREGATED ACCOUNTS
Upon receipt of Proper Instructions, the Custodian shall
establish and maintain a segregated account or accounts for and
on behalf of a Portfolio, into which account or accounts may be
transferred cash and/or securities, including securities
maintained in a Depository Account:
(a) In accordance with the provisions of any agreement
among the Trust on behalf of the Portfolio, the
Custodian and a broker-dealer registered under the 1934
Act and a member of the NASD (or any futures commission
merchant registered under the Commodity Exchange Act),
relating to compliance with the rules of the OCC and of
any registered national securities exchange (or the
CFTC or any registered contract market), or of any
similar organization or organizations, regarding escrow
or other arrangements in connection with transactions
by the Portfolio;
(b) For purposes of segregating cash or securities in
connection with options purchased, sold or written by
the Portfolio, or in connection with futures contracts
(or options thereon) purchased or sold by the
Portfolio;
(c) Which constitute collateral for loans of securities
made by the Portfolio;
(d) For purposes of compliance by the Trust with
requirements under the 1940 Act for the maintenance of
segregated accounts by registered investment companies
in connection with reverse repurchase agreements, and
when-issued, delayed delivery and firm commitment
transactions, and other similar transactions; and
(e) For any other proper purpose, but only upon receipt of,
in addition to Proper Instructions, a certified copy of
a resolution of the Board of Trustees, certified by an
officer of the Trust, specifying the purpose of such
segregated account and declaring such purpose to be a
proper corporate purpose.
Each segregated account established under this Article VI
shall be established and maintained for a single Portfolio only.
All Proper Instructions relating to a segregated account shall
specify the Portfolio involved.
ARTICLE VII
CONCERNING THE CUSTODIAN
7.1 Standard of Care. The Custodian shall be held to a
standard of reasonable care in carrying out the provisions of
this Agreement. The Custodian shall be entitled to rely on and
may act upon advice of counsel (who may be counsel for the Trust)
on all matters, and shall be without liability for any action
reasonably taken or omitted pursuant to such advice. Subject to
the limitations set forth in this Agreement, the Custodian shall
be kept indemnified by and shall be without liability to the
Trust for any action taken or omitted by it in good faith without
negligence.
7.2 No Responsibility for Title. So long as and to the
extent that it is in the exercise of reasonable care, the
Custodian shall not be responsible for the title, validity or
genuineness of any property or evidence of title thereto received
or delivered by it pursuant to this Agreement.
7.3 Reliance Upon Documents and Instructions. The
Custodian shall be entitled to rely upon any certificate, notice
or other instrument in writing received by it and reasonably
believed by it to be genuine. The Custodian shall be entitled to
rely upon any Proper Instructions actually received by it
pursuant to this Agreement.
7.4 Express Duties Only. The Custodian shall have no
duties or obligations whatsoever except such duties and
obligations as are specifically set forth in this Agreement, and
no covenant or obligation shall be implied in this Agreement
against the Custodian.
7.5 Cooperation. The Custodian shall cooperate with and
supply necessary information, by Portfolio, to the entity or
entities appointed by the Trust to keep the books of account of
the Portfolios and/or compute the net asset value of the
Portfolios. The Custodian shall take all such reasonable actions
as the Trust may from time to time request to enable the Trust to
obtain, from year to year, favorable opinions from the Trust's
independent accountants with respect to the Custodian's
activities hereunder in connection with (i) the preparation of
amendments to the Trust's registration statement on Form N-1A and
of the Trust's reports on Form N-SAR and any other reports
required by the SEC, and (ii) the fulfillment by the Trust of any
other requirements of the SEC.
7.6 Force Majeure. The Custodian shall not be responsible
or liable for any failure or delay in the performance of its
obligations under this Agreement arising out of or caused,
directly or indirectly, by circumstances beyond its reasonable
control, including without limitation, acts of God, earthquakes,
fires, floods, wars, civil or military disturbances, sabotage,
epidemics, riots, loss or malfunctions of utilities,
transportation, computer (hardware or software) or communications
service, labor disputes, acts of civil or military authority,
governmental, judicial or regulatory actions or inability to
obtain labor, material, equipment or transportation.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification. The Trust shall indemnify and hold
harmless the Custodian and its duly appointed sub-custodians and
agents, and any nominee thereof, from and against any loss,
damage, cost, expense (including attorneys' fees and
disbursements), liability (including, without limitation,
liability arising under the Securities Act of 1933, as amended,
the 1934 Act, the 1940 Act, and any state securities or banking
laws) or claim arising, directly or indirectly, (i) from any
action or inaction pursuant to Proper Instructions or otherwise
taken at the request or direction of or in reliance on the advice
of the Trust, or (ii) from the fact that securities are
registered in the name of any such nominee, or (iii) generally,
from the performance of its or their obligations under this
Agreement or any sub-custody agreement; provided, however, that
neither the Custodian nor any sub-custodian or agent shall be
indemnified and held harmless from and against any such loss,
damage, cost, expense, liability or claim arising from the
failure to act in accordance with the standard of reasonable care
set forth in Section 7.1.
8.2 Indemnity to be Provided. If the Trust requests the
Custodian to take any action with respect to securities, which
action involves the payment of money or which action may, in the
opinion of the Custodian, result in the Custodian or its nominee
becoming liable for the payment of money or incurring liability
of some other form, the Custodian shall not be required to take
such action until the Trust shall have provided indemnity
therefor to the Custodian in an amount and form satisfactory to
the Custodian.
8.3 Security. If the Custodian advances cash or securities
to a Portfolio for any purpose, either at the Trust's request or
as otherwise contemplated in this Agreement, or in the event that
the Custodian or its nominee incurs, in connection with its
performance under this Agreement, any loss, damage, cost, expense
(including attorneys' fees and disbursements), liability or claim
(except such as may arise from its or its nominee's negligence or
willful misconduct), then, in such event, any property at any
time held for the account of such Portfolio shall be security
therefor, and should such Portfolio fail promptly to repay or
indemnify the Custodian, the Custodian shall be entitled to
utilize available cash of such Portfolio and to dispose of other
assets of such Portfolio to the extent necessary to obtain
reimbursement or indemnification.
ARTICLE IX
EFFECTIVE PERIOD; TERMINATION
9.1 Effective Period. This Agreement shall become
effective as of its execution and shall continue in full force
and effect until terminated as hereinafter provided.
9.2 Termination. Either party hereto may terminate this
Agreement, with respect to one or more Portfolios, by giving to
the other party a notice in writing specifying the date of such
termination, which shall be not less than sixty (60) days after
the date of the giving of such notice. The notice shall specify
the Portfolios to which the termination relates (the "Terminated
Portfolios"). The Trust may at any time immediately terminate
this Agreement in the event of the appointment of a conservator
or receiver for the Custodian by regulatory authorities or upon
the happening of a like event at the direction of an appropriate
regulatory agency or court of competent jurisdiction.
9.3 Successor Custodian. If a successor custodian for one
or more Terminated Portfolios shall have been appointed by the
Board of Trustees, the Custodian shall, upon receipt of a notice
of acceptance by the successor custodian, on such specified date
of termination (i) deliver directly to the successor custodian
all securities (other than securities held in a Securities
System) and cash then owned by the benefit of the Terminated
Portfolios and held by the Custodian as custodian, and (ii)
transfer any securities held in a Securities System to an account
of or for the Terminated Portfolios at the successor custodian,
provided that the Trust on behalf of the Terminated Portfolios
shall have paid to the Custodian all fees, expenses and other
amounts to the payment or reimbursement of which it shall then be
entitled. Upon such delivery and transfer, the Custodian shall
be relieved of all obligations under this Agreement with respect
to the Terminated Portfolios. If a successor custodian is not
designated by the Trust on or before the date of termination
specified pursuant to Section 9.2, then the Custodian shall have
the right to deliver to a bank or trust company of its own
selection, which (i) is a "bank" as defined in the 1940 Act, (ii)
has aggregate capital, surplus and undivided profits as shown on
its then most recent public report of not less than $25 million,
and (iii) is doing business in New York, New York, all
securities, cash and other property held by the Custodian under
this Agreement and to transfer to an account of or for the
benefit of the Terminated Portfolios at such bank or trust
company all securities of the Terminated Portfolios held in a
Securities System. Upon such delivery and transfer, such bank or
trust company shall be the successor custodian for the Terminated
Portfolios under this Agreement and the Custodian shall be
relieved of all obligations with respect to the Terminated
Portfolios under this Agreement. If, after reasonable inquiry,
the Custodian cannot find a successor custodian as contemplated
in this Section 9.3, then the Custodian shall have the right to
deliver to the Trust all securities and cash of the Terminated
Portfolios and to transfer any securities held in a Securities
System to an account of or for the benefit of the Trust.
Thereafter, the Trust shall be deemed to be its own custodian
with respect to the securities, cash and other assets of the
Terminated Portfolios and the Custodian shall be relieved of all
obligations with respect to the Terminated Portfolios under this
Agreement.
9.4 Continuing Obligations. Nothing contained in this
Article IX shall be construed to excuse the Trust from payment of
all charges due and payable to the Custodian. The provisions of
Section 13.2, "References to Custodian", Article VII, "Concerning
the Custodian" and Article VIII, "Indemnification" shall survive
the termination or expiration of this Agreement for any reason.
ARTICLE X
COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to compensation as agreed
upon from time to time by the Trust and the Custodian. The fees
and other charges in effect on the date hereof and applicable to
the Portfolios are set forth in Exhibit C hereto.
ARTICLE XI
LIMITATION OF LIABILITY
It is expressly agreed that the obligations of the Trust
hereunder shall not be binding upon any of the trustees,
shareholders, nominees, officers, agents or employees of the
Trust personally, but shall bind only the trust property of the
Trust as provided in the Trust's Agreement and Declaration of
Trust, dated March 19, 1993, as from time to time amended. The
execution and delivery of this Agreement have been authorized by
the trustees of the Trust, and this Agreement has been signed and
delivered by an authorized officer of the Trust, acting as such,
and neither such authorization by the trustees 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 trust property of the
Trust as provided in the above-mentioned Agreement and
Declaration of Trust.
ARTICLE XII
NOTICES
Unless otherwise specified herein, all demands, notices,
instructions and other communications to be given hereunder shall
be in writing and shall be sent or delivered to the recipient at
the address set forth after its name herein below:
If to the Trust:
ARK Funds
00 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Secretary
If to the Custodian:
The First National Bank of Maryland
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or at such other address as either party shall have provided to
the other by notice given in accordance with this Article XII.
Writing shall include transmission by or through teletype,
facsimile, central processing unit connection, on-line terminal
and magnetic tape.
ARTICLE XIII
MISCELLANEOUS
13.1 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland.
13.2 References to Custodian. The Trust shall not circulate
any printed matter which contains any reference to the Custodian
without the prior written approval of the Custodian, excepting
printed matter contained in any prospectus or statement of
additional information for the Portfolios and such other printed
matter as merely identifies the Custodian as custodian for the
Portfolios. The Trust shall submit printed matter requiring
approval to the Custodian in draft form, allowing sufficient time
for review by the Custodian and its counsel prior to any deadline
for printing.
13.3 No Waiver. No failure by either party hereto to
exercise, and no delay by such party in exercising, any right
hereunder shall operate as a waiver thereof. The exercise by
either party hereto of any right hereunder shall not preclude the
exercise of any other right, and the remedies provided herein are
cumulative and not exclusive of any remedies provided at law or
in equity.
13.4 Amendments. This Agreement cannot be changed orally
and no amendment to this Agreement shall be effective unless
evidenced by an instrument in writing executed by the parties
hereto.
13.5 Counterparts. This Agreement may be executed in one or
more counterparts, and by the parties hereto on separate
counterparts, each of which shall be deemed an original but all
of which together shall constitute but one and the same
instrument.
13.6 Severability. If any provision of this Agreement shall
be invalid, illegal or unenforceable in any respect under any
applicable law, the validity, legality and enforceability of the
remaining provisions shall not be affected or impaired thereby.
13.7 Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto
and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable by either party
without the written consent of the other.
13.8 Headings. The headings of sections in this Agreement
are for convenience of reference only and shall not affect the
meaning or construction of any provision of this Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused
this Agreement to be executed and delivered in its name and on
its behalf by its representatives thereunto duly authorized, all
as of the day and year first above written.
ATTEST: ARK FUNDS
/s/ By: /s/
Xxxxxx X. Xxxxx Xxxxx X. Xxxxxx
Secretary President
ATTEST: THE FIRST NATIONAL BANK OF MARYLAND
/s/ By: /s/
Jan J. Sagrett Xxxxx X. Xxxxxxx
Vice President Senior Vice President
Exhibit A
to the
Custody Agreement
The Trust is retaining the Custodian to serve as custodian
for the following series of the Trust:
U.S. Treasury Money Market Portfolio
U.S. Government Money Market Portfolio
Money Market Portfolio
Tax-Free Money Market Portfolio
Maryland Tax-Free Portfolio
Income Portfolio
Growth and Income Portfolio
Capital Growth Portfolio
Special Equity Portfolio
Dated: September 28, 1995
_________ initials
_________ initials
Exhibit B
to the
Custody Agreement
The undersigned, an Officer of The First National Bank of
Maryland, hereby requests that the following individuals be
authorized to give proper instructions to the Custodian.
/s/
Xxxxxxxx X. Xxxxxxx
Chief Investment Officer
Name, Title: Signature:
Trust Officers:
Xxxxx X. Xxxxxx, President /s/_________________________________
Xxxxxx X. Xxxxx, Secretary /s/_________________________________
Xxxx X. Xxxxxxxx, Treasurer /s/_________________________________
Access Persons:
Xxxxxx Xxxxxx /s/_________________________________
Xxxxxxx Xxxxxx /s/_________________________________
Trading Officers:
U.S. Treasury Money Market Portfolio
U.S. Government Money Market Portfolio
Money Market Portfolio
Tax-Free Money Market Portfolio
Income Portfolio
Maryland Tax-Free Portfolio
Xxxxxx X. Xxxxx /s/--------------------------------
Xxxxx X. Xxxxxxxx /s_________________________________
Xxxxx X. Xxxxxx /s/________________________________
Growth and Income Portfolio
X. Xxxxx Xxxxxx /s/_________________________________
Xxxxxxxx X. Xxxxxxx /s/---------------------------------
Xxxxxxx X. Xxxxxxx, III /s/_________________________________
Capital Growth Portfolio
X. Xxxxx Knight /s/_______________________________
Xxxxx X. Xxxxxxx /s/_______________________________
Xxxxxxxxxxx Xxxxx /s/_______________________________
Special Equity Portfolio
X. Xxxxx Xxxxxx /s/_______________________________
Xxxxxxxxxxx Xxxxxxx /s/_______________________________
Authorized Persons For Paying Fund Expenses:
Xxxx Xxxxxxxx, Treasurer _______________________________
Xxxx Xxxxxxxxxx
Fidelity Fund Treasurer's Office_______________________________
Xxxxxxx Xxxxxxxx,
Fidelity Fund Treasurer's Office_______________________________
Amendment No. 1 to Exhibit B
to the
Custody Agreement
The undersigned, Vice President and Secretary of ARK Funds (the "Fund"),
does hereby certify that the persons listed below have resigned as officers
and agents of the Fund and are no longer Authorized Persons under the Custody
Agreement:
Xxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxx
Xxxx Xxxxxxxxx
Xxxxxx Xxxxxxxx
The undersigned further certifies that the following persons have been
duly authorized by resolution of the Board of Trustees of the Fund to give
Proper Instructions on behalf of the Fund to the Custodian:
NAME, TITLE: SIGNATURE:
New Trust Officers:
Xxxxxxx X. Xxxxx, Vice President & Secretary /s/
Xxxxxxx X. Xxxxx, Treasurer, Controller &
Chief Financial Officer /s/
Xxxxx X. Xxxxxx, Vice President & Secretary /s/
Xxxxxxx X. Xxxxxxx, Vice President & Assistant Secretary /s/
Xxxxxx X. Xxxxx, Vice President & Assistant Secretary /s/
Xxxxxx X. Xxxxxxx, Vice President & Assistant Secretary /s/
Xxxx Xxxxxxxxx, Vice President & Assistant Secretary /s/
Xxxxxx X. Xxxxx, Vice President & Assistant Secretary /s/
Xxxxxxx X. Xxxxxxxx, Assistant Secretary /s/
Xxxxxxxxx Xxxxxxxx, Assistant Secretary /s/
Other Persons Authorized to Give Proper Instructions
Xxxxx X. Xxx /s/
Xxxx Xxxxxxxxx /s/
Xxxxxxx Xxxxx /s/
Xxxxx Xxxxxx /s/
Xxxxxx XxxxxXxxxx /s/
Xxxxx X. Xxxxxxxx /s/
Xxxxxx Xxxxxxx /s/
Xxxxx Xxxxxxx /s/
Xxxxx XxXxxxxxx /s/
Xxxxxx X. Xxxxxx /s/
ARK FUNDS
By: /s/
Xxxxxxx X. Xxxxx, Vice President
and Secretary
Dated: November 1, 1995
Exhibit C
to the
Custody Agreement
Annual Fee
For the services to be provided to the Trust pursuant to the
Custody Agreement, the Trust shall pay the Custodian a fee at the
annual rate of 1.5 basis points of the market value of the assets
of the Portfolios. Such fee shall be computed and paid monthly
at one-twelfth of the annual rate.
Transaction Fees
Security transactions initiated by the investment adviser,
including market executions, subscriptions, tenders,
redemptions, maturities, receipts, deliveries, and mortgage-
backed principal pay-downs, shall be computed as follows:
$15 per book-entry security transaction
$25 per physical security transaction
$75 per EuroClear transaction
$5 per principal pay-down
$15 per wire transfer (outgoing wires only)
Expenses
Out-of-pocket expenses including telephone, legal, postage
and insurance, telex, telecopier, supplies, stationery and forms.
Dated: September 28, 1995
_________ initials
_________ initials
TABLE OF CONTENTS
Page
Article I Certain Definitions................................... 1
1.1 Authorized Person................................ 1
1.2 Board of Trustees................................ 1
1.3 Business day..................................... 1
1.4 CFTC............................................. 2
1.5 Custody Account.................................. 2
1.6 DTC.............................................. 2
1.7 NASD............................................. 2
1.8 OCC.............................................. 2
1.9 Officer.......................................... 2
1.10 Proper Instructions.............................. 2
1.11 SEC.............................................. 2
1.12 Securities....................................... 2
1.13 Securities System................................ 3
1.14 Shares........................................... 3
Article II Appointment of Custodian.............................. 3
2.1 Appointment...................................... 3
2.2 Acceptance....................................... 3
Article III Custody of Cash Securities............................ 3
3.1 Segregation...................................... 3
3.2 Custody Accounts................................. 3
3.3 Appointment of Sub-Custodians.................... 4
3.4 Appointment of Agents............................ 4
3.5 Delivery of Assets to Custodian.................. 4
3.6 Securities Systems............................... 4
3.7 Collection of Income............................. 5
3.8 Disbursement of Moneys from Custody Accounts..... 6
3.9 Delivery of Securities from Custody Accounts..... 7
3.10 Bank Accounts.................................... 9
3.11 Payments for Shares.............................. 10
3.12 Availability of Federal Funds.................... 10
3.13 Actions Not Requiring Proper Instructions........ 10
3.14 Ownership Certificates for Tax Purpose........... 10
3.15 Registration and Transfer of Securities.......... 10
3.16 Records.......................................... 11
3.17 Portfolio Reports by Custodian................... 11
3.18 Other Reports by Custodian....................... 11
3.19 Proxies and Other Materials...................... 11
3.20 Information on Corporate Actions................. 12
3.21 Additional Series................................ 12
Article IV Purchase and Sale of Portfolio Investments............ 12
4.1 Purchase of Securities........................... 12
4.2 Liability for Payment in Advance of Receipt
of Securities Purchased.......................... 12
4.3 Sale of Securities............................... 13
4.4 Payment for Securities Sold...................... 13
4.5 Advances by Custodian for Settlement............. 13
Article V Redemption of Portfolio Shares........................ 13
5.1 Transfer of Funds................................ 13
5.2 No Duty Regarding Paying Banks................... 14
Article VI Segregated Accounts................................... 14
Article VII Concerning the Custodian.............................. 15
7.1 Standard of Care................................. 15
7.2 No Responsibility for Title...................... 15
7.3 Reliance Upon Documents and Instructions..... 15
7.4 Express Duties Only.............................. 15
7.5 Cooperation...................................... 15
7.6 Force Majeure.................................... 15
Article VIII Indemnification....................................... 16
8.1 Indemnification.................................. 16
8.2 Indemnity to be Provided......................... 16
8.3 Security......................................... 16
Article IX Effective Period; Termination......................... 16
9.1 Effective Period................................. 16
9.2 Termination...................................... 16
9.3 Successor Custodian.............................. 17
9.4 Continuing Obligations........................... 17
Article X Compensation of Custodian............................. 18
Article XI Limitation of Liability............................... 18
Article XII Notices............................................... 18
Article XIII Miscellaneous......................................... 19
13.1 Governing Law.................................... 19
13.2 References to Custodian.......................... 19
13.3 No Waiver........................................ 19
13.4 Amendments....................................... 19
13.5 Counterparts..................................... 19
13.6 Severability..................................... 20
13.7 Successors and Assigns........................... 20
13.8 Headings......................................... 20
CUSTODY AGREEMENT
between
ARK Funds
and
The First National Bank of Maryland
