FORM OF
CUSTODY AND INVESTMENT ACCOUNTING AGREEMENT
THIS AGREEMENT made the 25th day of April, 1997, by and between
INVESTORS FIDUCIARY TRUST COMPANY, a trust company chartered under the
laws of the state of Missouri, having its trust office located at x00
Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 ("Custodian"), and each
registered investment company listed on Exhibit A hereto, as it may be
amended from time to time, each a having its principal office and place
of business at 00 Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000 (each a "Fund" and
collectively the "Funds").
WITNESSETH:
WHEREAS, each Fund desires to appoint Investors Fiduciary Trust
Company as custodian of the securities and monies of such Fund's
investment portfolio and as its agent to perform certain investment
accounting and recordkeeping functions; and
WHEREAS, Investors Fiduciary Trust Company is willing to accept
such appointment;
NOW THEREFORE, for and in consideration of the mutual promises
contained herein, the parties hereto, intending to be legally bound,
mutually covenant and agree as follows:
1. APPOINTMENT OF CUSTODIAN. Each Fund hereby constitutes and
appoints Custodian as:
A. Custodian of the securities and monies at any time
owned by the Fund; and
B. Agent to perform certain accounting and recordkeeping
functions relating to portfolio transactions required
of a duly registered investment company under Rule 31a
of the Investment Company Act of 1940 (the "1940 Act")
and to calculate the net asset value of the Fund.
2. REPRESENTATIONS AND WARRANTIES.
A. Each Fund hereby represents, warrants and acknowledges to
Custodian:
1. That it is a corporation duly organized and
existing and in good standing under the laws
of its state of organization, and that it is
registered under the 1940 Act; and
2. That it has the requisite power and authority
under applicable law, its articles of
incorporation and its bylaws to enter into
this Agreement; that it has taken all
requisite action necessary to appoint
Custodian as custodian and investment
accounting and recordkeeping agent for the
Fund; that this Agreement has been duly
executed and delivered by Fund; and that this
Agreement constitutes a legal, valid and
binding obligation of Fund, enforceable in
accordance with its terms.
B. Custodian hereby represents, warrants and acknowledges
to the Funds:
1. That it is a trust company duly organized and
existing and in good standing under the laws
of the State of Missouri; and
2. That it has the requisite power and authority
under applicable law, its charter and its
bylaws to enter into and perform this
Agreement; that this Agreement has been duly
executed and delivered by Custodian; and that
this Agreement constitutes a legal, valid and
binding obligation of Custodian, enforceable
in accordance with its terms.
3. DUTIES AND RESPONSIBILITIES OF CUSTODIAN.
A. Delivery of Assets
Except as permitted by the 1940 Act, each Fund will
deliver or cause to be delivered to Custodian on the
effective date of this Agreement, or as soon thereafter
as practicable, and from time to time thereafter, all
portfolio securities acquired by it and monies then
owned by it or from time to time coming into its
possession during the time this Agreement shall
continue in effect. Custodian shall have no
responsibility or liability whatsoever for or on
account of securities or monies not so delivered.
B. Delivery of Accounts and Records
Each Fund shall turn over or cause to be turned over to
Custodian all of the Fund's relevant accounts and
records previously maintained. Custodian shall be
entitled to rely conclusively on the completeness and
correctness of the accounts and records turned over to
it, and each Fund shall indemnify and hold Custodian
harmless of and from any and all expenses, damages and
losses whatsoever arising out of or in connection with
any error, omission, inaccuracy or other deficiency of
such Fund's accounts and records or in the failure of
such Fund to provide, or to provide in a timely manner,
any accounts, records or information needed by the
Custodian to perform its functions hereunder.
C. Delivery of Assets to Third Parties
Custodian will receive delivery of and keep safely the
assets of each Fund delivered to it from time to time
segregated in a separate account, and if any Fund is
comprised of more than one portfolio of investment
securities (each a "Portfolio") Custodian shall keep
the assets of each Portfolio segregated in a separate
account. Custodian will not deliver, assign, pledge or
hypothecate any such assets to any person except as
permitted by the provisions of this Agreement or any
agreement executed by it according to the terms of
Section 3.S. of this Agreement. Upon delivery of any
such assets to a subcustodian pursuant to Section 3.S.
of this Agreement, Custodian will create and maintain
records identifying those assets which have been
delivered to the subcustodian as belonging to the
applicable Fund, by Portfolio if applicable. The
Custodian is responsible for the safekeeping of the
securities and monies of the Funds only until they have
been transmitted to and received by other persons as
permitted under the terms of this Agreement, except for
securities and monies transmitted to subcustodians
appointed under Section 3.S. of this Agreement, for
which Custodian remains responsible to the extent
provided in Section 3.S. hereof. Custodian may
participate directly or indirectly through a
subcustodian in the Depository Trust Company (DTC),
Treasury/Federal Reserve Book Entry System (Fed
System), Participant Trust Company (PTC) or other
depository approved by the Funds (as such entities are
defined at 17 CFR Section 270.17f-4(b)) (each a
"Depository" and collectively, the "Depositories").
D. Registration of Securities
The Custodian shall at all times hold registered
securities of the Funds in the name of the Custodian,
the applicable Fund, or a nominee of either of them,
unless specifically directed by instructions to hold
such registered securities in so-called "street name,"
provided that, in any event, all such securities and
other assets shall be held in an account of the
Custodian containing only assets of the applicable
Fund, or only assets held by the Custodian as a
fiduciary or custodian for customers, and provided
further, that the records of the Custodian at all times
shall indicate the Fund or other customer for which
such securities and other assets are held in such
account and the respective interests therein. If,
however, any Fund directs the Custodian to maintain
securities in "street name", notwithstanding anything
contained herein to the contrary, the Custodian shall
be obligated only to utilize its best efforts to timely
collect income due the Fund on such securities and to
notify the Fund of relevant corporate actions
including, without limitation, pendency of calls,
maturities, tender or exchange offers. All securities,
and the ownership thereof by the applicable Fund, which
are held by Custodian hereunder, however, shall at all
times be identifiable on the records of the Custodian.
Each Fund agrees to hold Custodian and its nominee
harmless for any liability as a shareholder of record
of its securities held in custody.
E. Exchange of Securities
Upon receipt of instructions as defined herein in
Section 4.A, Custodian will exchange, or cause to be
exchanged, portfolio securities held by it for the
account of a Fund for other securities or cash issued
or paid in connection with any reorganization,
recapitalization, merger, consolidation, split-up of
shares, change of par value, conversion or otherwise,
and will deposit any such securities in accordance with
the terms of any reorganization or protective plan.
Without instructions, Custodian is authorized to
exchange securities held by it in temporary form for
securities in definitive form, to effect an exchange of
shares when the par value of the stock is changed, and,
upon receiving payment therefor, to surrender bonds or
other securities held by it at maturity or when advised
of earlier call for redemption, except that Custodian
shall receive instructions prior to surrendering any
convertible security.
F. Purchases of Investments of a Fund - Other Than Options
and Futures
Each Fund will, on each business day on which a
purchase of securities (other than options and futures)
shall be made by it, deliver to Custodian instructions
which shall specify with respect to each such purchase:
1. If applicable, the name of the Portfolio
making such purchase;
2. The name of the issuer and description of the
security;
3. The number of shares and the principal amount
purchased, and accrued interest, if any;
4. The trade date;
5. The settlement date;
6. The purchase price per unit and the brokerage
commission, taxes and other expenses payable
in connection with the purchase;
7. The total amount payable upon such purchase;
8. The name of the person from whom or the broker
or dealer through whom the purchase was made;
and
9. Whether the security is to be received in
certificated form or via a specified
Depository.
In accordance with such instructions, Custodian will
pay for out of monies held for the account of the
applicable Fund, but only insofar as such monies are
available for such purpose, and receive the portfolio
securities so purchased by or for the account of the
applicable Fund, except that Custodian may in its sole
discretion advance funds to the Fund which may result
in an overdraft because the monies held by the
Custodian on behalf of the Fund are insufficient to pay
the total amount payable upon such purchase. Except as
otherwise instructed by the applicable Fund, such
payment shall be made by the Custodian only upon
receipt of securities: (a) by the Custodian; (b) by a
clearing corporation of a national exchange of which
the Custodian is a member; or (c) by a Depository.
Notwithstanding the foregoing, (i) in the case of a
repurchase agreement, the Custodian may release funds
to a Depository prior to the receipt of advice from the
Depository that the securities underlying such
repurchase agreement have been transferred by
book-entry into the account maintained with such
Depository by the Custodian, on behalf of its
customers, provided that the Custodian's instructions
to the Depository require that the Depository make
payment of such funds only upon transfer by book-entry
of the securities underlying the repurchase agreement
in such account; (ii) in the case of time deposits,
call account deposits, currency deposits and other
deposits, foreign exchange transactions, futures
contracts or options, the Custodian may make payment
therefor before receipt of an advice or confirmation
evidencing said deposit or entry into such transaction;
and (iii) in the case of the purchase of securities,
the settlement of which occurs outside of the United
States of America, the Custodian may make, or cause a
subcustodian appointed pursuant to Section 3.S.2. of
this Agreement to make, payment therefor in accordance
with generally accepted local custom and market
practice.
G. Sales and Deliveries of Investments of a Fund - Other
Than Options and Futures
Each Fund will, on each business day on which a sale of
investment securities (other than options and futures)
of such Fund has been made, deliver to Custodian
instructions specifying with respect to each such sale:
1. If applicable, the name of the Portfolio
making such sale;
2. The name of the issuer and description of the
securities;
3. The number of shares and principal amount
sold, and accrued interest, if any;
4. The date on which the securities sold were
purchased or other information identifying the
securities sold and to be delivered;
5. The trade date;
6. The settlement date;
7. The sale price per unit and the brokerage
commission, taxes or other expenses payable in
connection with such sale;
8. The total amount to be received by Fund upon
such sale; and
9. The name and address of the broker or dealer
through whom or person to whom the sale was
made.
In accordance with such instructions, Custodian will
deliver or cause to be delivered the securities thus
designated as sold for the account of the applicable
Fund to the broker or other person specified in the
instructions relating to such sale. Except as otherwise
instructed by the applicable Fund, such delivery shall
be made upon receipt of: (a) payment therefor in such
form as is satisfactory to the Custodian; (b) credit to
the account of the Custodian with a clearing
corporation of a national securities exchange of which
the Custodian is a member; or (c) credit to the account
of the Custodian, on behalf of its customers, with a
Depository. Notwithstanding the foregoing: (i) in the
case of securities held in physical form, such
securities shall be delivered in accordance with
"street delivery custom" to a broker or its clearing
agent; or (ii) in the case of the sale of securities,
the settlement of which occurs outside of the United
States of America, the Custodian may make, or cause a
subcustodian appointed pursuant to Section 3.S.2. of
this Agreement to make, such delivery upon payment
therefor in accordance with generally accepted local
custom and market practice.
H. Purchases or Sales of Options and Futures
Each Fund will, on each business day on which a
purchase or sale of the following options and/or
futures shall be made by it, deliver to Custodian
instructions which shall specify with respect to each
such purchase or sale:
1. If applicable, the name of the Portfolio
making such purchase or sale;
2. Security Options
a. The underlying security;
b. The price at which purchased or sold;
c. The expiration date;
d. The number of contracts;
e. The exercise price;
f. Whether the transaction is an opening,
exercising, expiring or closing transaction;
g. Whether the transaction involves a put or
call;
h. Whether the option is written or
purchased;
i. Market on which option traded; and
j. Name and address of the broker or
dealer through whom the sale or purchase
was made.
3. Options on Indices
a. The index;
b. The price at which purchased or sold;
c. The exercise price;
d. The premium;
e. The multiple;
f. The expiration date;
g. Whether the transaction is an opening,
exercising, expiring or closing transaction;
h. Whether the transaction involves a put or call;
i. Whether the option is written or purchased; and
j. The name and address of the broker or dealer
through whom the sale or purchase was made, or
other applicable settlement instructions.
4. Security Index Futures Contracts
a. The last trading date specified in the
contract and, when available, the closing
level, thereof;
b. The index level on the date the contract is
entered into;
c. The multiple;
d. Any margin requirements;
e. The need for a segregated margin account
(in addition to instructions, and if not
already in the possession of Custodian,
Fund shall deliver a substantially complete
and executed custodial safekeeping account
and procedural agreement which shall be
incorporated by reference into this Custody
Agreement); and
f. The name and address of the futures
commission merchant through whom the sale
or purchase was made, or other applicable
settlement instructions.
5. Options on Index Future Contracts
a. The underlying index future contract;
b. The premium;
c. The expiration date;
d. The number of options;
e. The exercise price;
f. Whether the transaction involves an opening,
exercising, expiring or closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased; and
i. The market on which the option is traded.
I. Securities Pledged or Loaned
If specifically allowed for in the prospectus of the
applicable Fund, and subject to such additional terms
and conditions as Custodian may require:
1. Upon receipt of instructions, Custodian will
release or cause to be released securities
held in custody to the pledgee designated in
such instructions by way of pledge or
hypothecation to secure any loan incurred by
such Fund; provided, however, that the
securities shall be released only upon payment
to Custodian of the monies borrowed, except
that in cases where additional collateral is
required to secure a borrowing already made,
further securities may be released or caused
to be released for that purpose upon receipt
of instructions. Upon receipt of instructions,
Custodian will pay, but only from funds
available for such purpose, any such loan upon
redelivery to it of the securities pledged or
hypothecated therefor and upon surrender of
the note or notes evidencing such loan.
2. Upon receipt of instructions, Custodian will
release securities held in custody to the
borrower designated in such instructions;
provided, however, that the securities will be
released only upon deposit with Custodian of
full cash collateral as specified in such
instructions, and that such Fund will retain
the right to any dividends, interest or
distribution on such loaned securities. Upon
receipt of instructions and the loaned
securities, Custodian will release the cash
collateral to the borrower.
J. Routine Matters
Custodian will, in general, attend to all routine and
mechanical matters in connection with the sale,
exchange, substitution, purchase, transfer, or other
dealings with securities or other property of the Funds
except as may be otherwise provided in this Agreement
or directed from time to time by the applicable Fund in
writing.
K. Deposit Accounts
Custodian will open and maintain one or more special
purpose deposit accounts for each Fund in the name of
Custodian ("Accounts"), subject only to draft or order
by Custodian upon receipt of instructions. All monies
received by Custodian from or for the account of any
Fund shall be deposited in the appropriate Accounts.
Barring events not in the control of the Custodian such
as strikes, lockouts or labor disputes, riots, war or
equipment or transmission failure or damage, fire,
flood, earthquake or other natural disaster, action or
inaction of governmental authority or other causes
beyond its control, at 9:00 a.m., Kansas City time, on
the second business day after deposit of any check into
an Account, Custodian agrees to make Fed Funds
available to the applicable Fund in the amount of the
check. Deposits made by Federal Reserve wire will be
available to the Fund immediately and ACH wires will be
available to the Fund on the next business day. Income
earned on the portfolio securities will be credited to
the Fund based on the schedule attached as Exhibit A.
The Custodian will be entitled to reverse any credited
amounts where credits have been made and monies are not
finally collected. If monies are collected after such
reversal, the Custodian will credit the Fund in that
amount. Custodian may open and maintain Accounts in
such banks or trust companies as may be designated by
it or by the applicable Fund in writing, all such
Accounts, however, to be in the name of Custodian and
subject only to its draft or order. Funds received and
held for the account of different Portfolios shall be
maintained in separate Accounts established for each
Portfolio.
L. Income and Other Payments to the Funds Custodian will:
1. Collect, claim and receive and deposit for the
account of the applicable Fund all income and
other payments which become due and payable on
or after the effective date of this Agreement
with respect to the securities deposited under
this Agreement, and credit the account of such
Fund in accordance with the schedule attached
hereto as Exhibit A. If, for any reason, the
Fund is credited with income that is not
subsequently collected, Custodian may reverse
that credited amount.
2. Execute ownership and other certificates and
affidavits for all federal, state and local
tax purposes in connection with the collection
of bond and note coupons; and
3. Take such other action as may be necessary or
proper in connection with:
a. the collection, receipt and deposit of such
income and other payments, including but not
limited to the presentation for payment of:
1. all coupons and other income items
requiring presentation; and
2. all other securities which may mature or
be called, redeemed, retired or otherwise
become payable and regarding which the
Custodian has actual knowledge, or should
reasonably be expected to have knowledge;
and
b. the endorsement for collection, in the name
of the applicable Fund, of all checks, drafts
or other negotiable instruments.
Custodian, however, will not be required to institute
suit or take other extraordinary action to enforce
collection except upon receipt of instructions and upon
being indemnified to its satisfaction against the costs
and expenses of such suit or other actions. Custodian
will receive, claim and collect all stock dividends,
rights and other similar items and will deal with the
same pursuant to instructions.
M. Payment of Dividends and Other Distributions
On the declaration of any dividend or other
distribution on the shares of capital stock of any Fund
("Fund Shares") by the Board of Directors of such Fund,
such Fund shall deliver to Custodian instructions with
respect thereto. On the date specified in such
instructions for the payment of such dividend or other
distribution, Custodian will pay out of the monies held
for the account of such Fund, insofar as the same shall
be available for such purposes, and credit to the
account of the Dividend Disbursing Agent for such Fund,
such amount as may be specified in such instructions.
N. Shares of a Fund Purchased by Such Fund
Whenever any Fund Shares are repurchased or redeemed by
a Fund, such Fund or its agent shall advise Custodian
of the aggregate dollar amount to be paid for such
shares and shall confirm such advice in writing. Upon
receipt of such advice, Custodian shall charge such
aggregate dollar amount to the account of such Fund and
either deposit the same in the account maintained for
the purpose of paying for the repurchase or redemption
of Fund Shares or deliver the same in accordance with
such advice. Custodian shall not have any duty or
responsibility to determine that Fund Shares have been
removed from the proper shareholder account or accounts
or that the proper number of Fund Shares have been
cancelled and removed from the shareholder records.
O. Shares of a Fund Purchased from Such Fund
Whenever Fund Shares are purchased from any Fund, such
Fund will deposit or cause to be deposited with
Custodian the amount received for such shares.
Custodian shall not have any duty or responsibility to
determine that Fund Shares purchased from any Fund have
been added to the proper shareholder account or
accounts or that the proper number of such shares have
been added to the shareholder records.
P. Proxies and Notices
Custodian will promptly deliver or mail or have
delivered or mailed to the applicable Fund all proxies
properly signed, all notices of meetings, all proxy
statements and other notices, requests or announcements
affecting or relating to securities held by Custodian
for such Fund and will, upon receipt of instructions,
execute and deliver or cause its nominee to execute and
deliver or mail or have delivered or mailed such
proxies or other authorizations as may be required.
Except as provided by this Agreement or pursuant to
instructions hereafter received by Custodian, neither
it nor its nominee will exercise any power inherent in
any such securities, including any power to vote the
same, or execute any proxy, power of attorney, or other
similar instrument voting any of such securities, or
give any consent, approval or waiver with respect
thereto, or take any other similar action.
Q. Disbursements
Custodian will pay or cause to be paid, insofar as
funds are available for the purpose, bills, statements
and other obligations of each Fund (including but not
limited to obligations in connection with the
conversion, exchange or surrender of securities owned
by such Fund, interest charges, dividend disbursements,
taxes, management fees, custodian fees, legal fees,
auditors' fees, transfer agents' fees, brokerage
commissions, compensation to personnel, and other
operating expenses of such Fund) pursuant to
instructions of such Fund setting forth the name of the
person to whom payment is to be made, the amount of the
payment, and the purpose of the payment.
R. Daily Statement of Accounts
Custodian will, within a reasonable time, render to
each Fund a detailed statement of the amounts received
or paid and of securities received or delivered for the
account of the Fund during each business day. Custodian
will, from time to time, upon request by any Fund,
render a detailed statement of the securities and
monies held for such Fund under this Agreement, and
Custodian will maintain such books and records as are
necessary to enable it to do so. Custodian will permit
such persons as are authorized by any Fund, including
such Fund's independent public accountants, reasonable
access to such records or will provide reasonable
confirmation of the contents of such records, and if
demanded, Custodian will permit federal and state
regulatory agencies to examine the securities, books
and records. Upon the written instructions of any Fund
or as demanded by federal or state regulatory agencies,
Custodian will instruct any subcustodian to permit such
persons as are authorized by such Fund, including such
Fund's independent public accountants, reasonable
access to such records or to provide reasonable
confirmation of the contents of such records, and to
permit such agencies to examine the books, records and
securities held by such subcustodian which relate to
such Fund.
S. Appointment of Subcustodians
1. Notwithstanding any other provisions of this
Agreement, all or any of the monies or
securities of the Funds may be held in
Custodian's own custody or in the custody of
one or more other banks or trust companies
acting as subcustodians as may be selected by
Custodian. Any such subcustodian selected by
the Custodian must have the qualifications
required for a custodian under the 1940 Act,
as amended. Custodian shall be responsible to
the applicable Fund for any loss, damage or
expense suffered or incurred by the Fund
resulting from the actions or omissions of any
subcustodians selected and appointed by
Custodian (except subcustodians appointed at
the request of the Fund and as provided in
Subsection 2 below) to the same extent
Custodian would be responsible to the Fund
under Section 5. of this Agreement if it
committed the act or omission itself. Upon
request of any Fund, Custodian shall be
willing to contract with other subcustodians
reasonably acceptable to the Custodian for
purposes of (i) effecting third-party
repurchase transactions with banks, brokers,
dealers, or other entities through the use of
a common custodian or subcustodian, or (ii)
providing depository and clearing agency
services with respect to certain variable rate
demand note securities, or (iii) for other
reasonable purposes specified by such Fund;
provided, however, that the Custodian shall be
responsible to the Fund for any loss, damage
or expense suffered or incurred by the Fund
resulting from the actions or omissions of any
such subcustodian only to the same extent such
subcustodian is responsible to the Custodian.
The Fund shall be entitled to review the
Custodian's contracts with any such
subcustodians appointed at its request.
Custodian shall be responsible to the
applicable Fund for any loss, damage or
expense suffered or incurred by the Fund
resulting from the actions or omissions of any
Depository only to the same extent such
Depository is responsible to Custodian.
2. Notwithstanding any other provisions of this
Agreement, each Fund's foreign securities (as
defined in Rule 17f-5(c)(1) under the 0000
Xxx) and each Fund's cash or cash equivalents,
in amounts deemed by the Fund to be reasonably
necessary to effect Fund's foreign securities
transactions, may be held in the custody of
one or more banks or trust companies acting as
subcustodians, and thereafter, pursuant to a
written contract or contracts as approved by
such Fund's Board of Directors, may be
transferred to accounts maintained by any such
subcustodian with eligible foreign custodians,
as defined in Rule 17f-5(c)(2). Custodian
shall be responsible to the Fund for any loss,
damage or expense suffered or incurred by the
Fund resulting from the actions or omissions
of any foreign subcustodian only to the same
extent the foreign subcustodian is liable to
the domestic subcustodian with which the
Custodian contracts for foreign subcustody
purposes.
T. Accounts and Records
Custodian will prepare and maintain, with the direction
and as interpreted by each Fund, its accountants and/or
other advisors, in complete, accurate and current form
all accounts and records (i) required to be maintained
by such Fund with respect to portfolio transactions
under Rule 31a of the 1940 Act, (ii) required to be
maintained as a basis for calculation of such Fund's
net asset value, and (iii) as otherwise agreed upon
between the parties. Custodian will preserve said
records in the manner and for the periods prescribed in
the 1940 Act or for such longer period as is agreed
upon by the parties. Custodian relies upon each Fund to
furnish, in writing or its electronic or digital
equivalent, accurate and timely information needed by
Custodian to complete such Fund's records and perform
daily calculation of such Fund's net asset value.
Custodian shall incur no liability and each Fund shall
indemnify and hold harmless Custodian from and against
any liability arising from any failure of such Fund to
furnish such information in a timely and accurate
manner, even if such Fund subsequently provides
accurate but untimely information. It shall be the
responsibility of each Fund to furnish Custodian with
the declaration, record and payment dates and amounts
of any dividends or income and any other special
actions required concerning each of its securities when
such information is not readily available from
generally accepted securities industry services or
publications.
U. Accounts and Records Property of the Funds
Custodian acknowledges that all of the accounts and
records maintained by Custodian pursuant to this
Agreement are the property of the applicable Fund, and
will be made available to such Fund for inspection or
reproduction within a reasonable period of time, upon
demand. Custodian will assist any Fund's independent
auditors, or upon approval of the Fund, or upon demand,
any regulatory body, in any requested review of the
Fund's accounts and records but shall be reimbursed by
the Fund for all expenses and employee time invested in
any such review outside of routine and normal periodic
reviews. Upon receipt from any Fund of the necessary
information or instructions, Custodian will supply
information from the books and records it maintains for
such Fund that the Fund needs for tax returns,
questionnaires, periodic reports to shareholders and
such other reports and information requests as such
Fund and Custodian shall agree upon from time to time.
V. Adoption of Procedures
Custodian and each Fund may from time to time adopt
procedures as they agree upon, and Custodian may
conclusively assume that no procedure approved or
directed by a Fund or its accountants or other advisors
conflicts with or violates any requirements of its
prospectus, articles of incorporation, bylaws, any
applicable law, rule or regulation, or any order,
decree or agreement by which such Fund may be bound.
Each Fund will be responsible to notify Custodian of
any changes in statutes, regulations, rules,
requirements or policies which might necessitate
changes in Custodian's responsibilities or procedures.
W. Calculation of Net Asset Value
Custodian will calculate each Fund's net asset value,
in accordance with such Fund's prospectus. Custodian
will price the securities and foreign currency holdings
of each Fund for which market quotations are available
by the use of outside services designated by such Fund
which are normally used and contracted with for this
purpose; all other securities and foreign currency
holdings will be priced in accordance with such Fund's
instructions. Custodian will have no responsibility for
the accuracy of the prices quoted by these outside
services or for the information supplied by any Fund or
for acting upon such instructions.
X. Advances
In the event Custodian or any subcustodian shall, in
its sole discretion, advance cash or securities for any
purpose (including but not limited to securities
settlements, purchase or sale of foreign exchange or
foreign exchange contracts and assumed settlement) for
the benefit of any Fund or Portfolio thereof, the
advance shall be payable by the applicable Fund or
Portfolio on demand. Any such cash advance shall be
subject to an overdraft charge at the rate set forth in
the then-current fee schedule from the date advanced
until the date repaid. As security for each such
advance, each Fund hereby grants Custodian and such
subcustodian a lien on and security interest in all
property at any time held for the account of the Fund
or applicable Portfolio, including without limitation
all assets acquired with the amount advanced. Should
the Fund fail to promptly repay the advance, the
Custodian and such subcustodian shall be entitled to
utilize available cash and to dispose of such Fund's or
Portfolio's assets pursuant to applicable law to the
extent necessary to obtain reimbursement of the amount
advanced and any related overdraft charges.
Y. Exercise of Rights; Tender Offers
Upon receipt of instructions, the Custodian shall: (a)
deliver warrants, puts, calls, rights or similar
securities to the issuer or trustee thereof, or to the
agent of such issuer or trustee, for the purpose of
exercise or sale, provided that the new securities,
cash or other assets, if any, are to be delivered to
the Custodian; and (b) deposit securities upon
invitations for tenders thereof, provided that the
consideration for such securities is to be paid or
delivered to the Custodian or the tendered securities
are to be returned to the Custodian.
4. INSTRUCTIONS.
A. The term "instructions", as used herein, means written
(including telecopied or telexed) or oral instructions
which Custodian reasonably believes were given by a
designated representative of any Fund. Each Fund shall
deliver to Custodian, prior to delivery of any assets
to Custodian and thereafter from time to time as
changes therein are necessary, written instructions
naming one or more designated representatives to give
instructions in the name and on behalf of such Fund,
which instructions may be received and accepted by
Custodian as conclusive evidence of the authority of
any designated representative to act for such Fund and
may be considered to be in full force and effect (and
Custodian will be fully protected in acting in reliance
thereon) until receipt by Custodian of notice to the
contrary. Unless such written instructions delegating
authority to any person to give instructions
specifically limit such authority to specific matters
or require that the approval of anyone else will first
have been obtained, Custodian will be under no
obligation to inquire into the right of such person,
acting alone, to give any instructions whatsoever which
Custodian may receive from such person. If any Fund
fails to provide Custodian any such instructions naming
designated representatives, any instructions received
by Custodian from a person reasonably believed to be an
appropriate representative of such Fund shall
constitute valid and proper instructions hereunder.
"Designated representatives" of a Fund may include its
employees and agents, including investment managers and
their employees.
B. No later than the next business day immediately
following each oral instruction, the applicable Fund
will send Custodian written confirmation of such oral
instruction. At Custodian's sole discretion, Custodian
may record on tape, or otherwise, any oral instruction
whether given in person or via telephone, each such
recording identifying the date and the time of the
beginning and ending of such oral instruction.
C. If Custodian shall provide any Fund any direct access
to any computerized recordkeeping and reporting system
used hereunder or if Custodian and any Fund shall agree
to utilize any electronic system of communication, such
Fund shall be fully responsible for any and all
consequences of the use or misuse of the terminal
device, passwords, access instructions and other means
of access to such system(s) which are utilized by,
assigned to or otherwise made available to the Fund.
Each Fund agrees to implement and enforce appropriate
security policies and procedures to prevent
unauthorized or improper access to or use of such
system(s). Custodian shall be fully protected in acting
hereunder upon any instructions, communications, data
or other information received by Custodian by such
means as fully and to the same effect as if delivered
to Custodian by written instrument signed by the
requisite authorized representative(s) of the
applicable Fund. Each Fund shall indemnify and hold
Custodian harmless from and against any and all losses,
damages, costs, charges, counsel fees, payments,
expenses and liability which may be suffered or
incurred by Custodian as a result of the use or misuse,
whether authorized or unauthorized, of any such
system(s) by such Fund or by any person who acquires
access to such system(s) through the terminal device,
passwords, access instructions or other means of access
to such system(s) which are utilized by, assigned to or
otherwise made available to the Fund, except to the
extent attributable to any negligence or willful
misconduct by Custodian.
5. LIMITATION OF LIABILITY OF CUSTODIAN.
A. Custodian shall at all times use reasonable care and
due diligence and act in good faith in performing its
duties under this Agreement. Custodian shall not be
responsible for, and the applicable Fund shall
indemnify and hold Custodian harmless from and against,
any and all losses, damages, costs, charges, counsel
fees, payments, expenses and liability which may be
asserted against Custodian, incurred by Custodian or
for which Custodian may be held to be liable, arising
out of or attributable to:
1. All actions taken by Custodian pursuant to
this Agreement or any instructions provided to
it hereunder, provided that Custodian has
acted in good faith and with due diligence and
reasonable care; and
2. The Fund's refusal or failure to comply with
the terms of this Agreement (including without
limitation the Fund's failure to pay or
reimburse Custodian under this indemnification
provision), the Fund's negligence or willful
misconduct, or the failure of any
representation or warranty of the Fund
hereunder to be and remain true and correct in
all respects at all times.
B. Custodian may request and obtain at the expense of the
applicable Fund the advice and opinion of counsel for
such Fund or of its own counsel with respect to
questions or matters of law, and it shall be without
liability to such Fund for any action taken or omitted
by it in good faith, in conformity with such advice or
opinion. If Custodian reasonably believes that it could
not prudently act according to the instructions of any
Fund or the Fund's accountants or counsel, it may in
its discretion, with notice to the Fund, not act
according to such instructions.
C. Custodian may rely upon the advice and statements of
any Fund, its accountants and officers or other
authorized individuals, and other persons believed by
it in good faith to be expert in matters upon which
they are consulted, and Custodian shall not be liable
for any actions taken, in good faith, upon such advice
and statements.
D. If any Fund requests Custodian in any capacity to take
any action which involves the payment of money by
Custodian, or which might make it or its nominee liable
for payment of monies or in any other way, Custodian
shall be indemnified and held harmless by such Fund
against any liability on account of such action;
provided, however, that nothing herein shall obligate
Custodian to take any such action except in its sole
discretion.
E. Custodian shall be protected in acting as custodian
hereunder upon any instructions, advice, notice,
request, consent, certificate or other instrument or
paper appearing to it to be genuine and to have been
properly executed. Custodian shall be entitled to
receive upon request as conclusive proof of any fact or
matter required to be ascertained from any Fund
hereunder a certificate signed by an officer or
designated representative of the Fund. Each Fund shall
also provide Custodian instructions with respect to any
matter concerning this Agreement requested by
Custodian.
F. Custodian shall be under no duty or obligation to
inquire into, and shall not be liable for:
1. The validity of the issue of any securities
purchased by or for any Fund, the legality of
the purchase of any securities or foreign
currency positions or evidence of ownership
required by any Fund to be received by
Custodian, or the propriety of the decision to
purchase or amount paid therefor;
2. The legality of the sale of any securities or
foreign currency positions by or for any Fund,
or the propriety of the amount for which the
same are sold;
3. The legality of the issue or sale of any Fund
Shares, or the sufficiency of the amount to be
received therefor;
4. The legality of the repurchase or redemption
of any Fund Shares, or the propriety of the
amount to be paid therefor; or
5. The legality of the declaration of any
dividend by any Fund, or the legality of the
issue of any Fund Shares in payment of any
stock dividend.
G. Custodian shall not be liable for, or considered to be
Custodian of, any money represented by any check,
draft, wire transfer, clearinghouse funds, uncollected
funds, or instrument for the payment of money to be
received by it on behalf of the applicable Fund until
Custodian actually receives such money; provided,
however, that it shall advise such Fund promptly if it
fails to receive any such money in the ordinary course
of business and shall cooperate with the Fund toward
the end that such money shall be received.
H. Except as provided in Section 3.S., Custodian shall not
be responsible for loss occasioned by the acts,
neglects, defaults or insolvency of any broker, bank,
trust company, or any other person with whom Custodian
may deal.
I. Custodian shall not be responsible or liable for the
failure or delay in performance of its obligations
under this Agreement, or those of any entity for which
it is responsible hereunder, arising out of or caused,
directly or indirectly, by circumstances beyond the
affected entity's reasonable control, including,
without limitation: any interruption, loss or
malfunction of any utility, transportation, or
communication service or computer (hardware or
software) services of third parties unrelated to
Custodian; inability to obtain labor, material,
equipment or transportation, or a delay in mails;
governmental or exchange action, statute, ordinance,
rulings, regulations or direction; war, strike, riot,
emergency, civil disturbance, terrorism, vandalism,
explosions, labor disputes, freezes, floods, fires,
tornados, acts of God or public enemy, revolutions, or
insurrection.
J. EXCEPT FOR VIOLATIONS OF SECTION 9, IN NO EVENT AND
UNDER NO CIRCUMSTANCES SHALL EITHER PARTY TO THIS
AGREEMENT BE LIABLE TO ANYONE, INCLUDING, WITHOUT
LIMITATION TO THE OTHER PARTY, FOR CONSEQUENTIAL,
SPECIAL OR PUNITIVE DAMAGES FOR ANY ACT OR FAILURE TO
ACT UNDER ANY PROVISION OF THIS AGREEMENT EVEN IF
ADVISED OF THIS POSSIBILITY THEREOF.
6. COMPENSATION. In consideration for its services hereunder as
Custodian and investment accounting and recordkeeping agent,
each Fund will pay to Custodian such compensation as shall be
set forth in a separate fee schedule to be agreed to by the
Funds and Custodian from time to time. A copy of the initial fee
schedule is attached hereto and incorporated herein by
reference. Custodian shall also be entitled to receive, and each
Fund agrees to pay to Custodian, on demand, reimbursement for
Custodian's cash disbursements and reasonable out-of-pocket
costs and expenses, including attorney's fees, incurred by
Custodian in connection with the performance of services
hereunder. Custodian may charge such compensation against monies
held by it for the account of the applicable Fund. Custodian
will also be entitled to charge against any monies held by it
for the account of the applicable Fund the amount of any loss,
damage, liability, advance, overdraft or expense for which it
shall be entitled to reimbursement from such Fund, including but
not limited to fees and expenses due to Custodian for other
services provided to the Fund by Custodian. Custodian will be
entitled to reimbursement by the Fund for the losses, damages,
liabilities, advances, overdrafts and expenses of subcustodians
only to the extent that (i) Custodian would have been entitled
to reimbursement hereunder if it had incurred the same itself
directly, and (ii) Custodian is obligated to reimburse the
subcustodian therefor.
7. TERM AND TERMINATION. The initial term of this Agreement shall
be for a period of one year. Thereafter, each Fund and Custodian
may terminate the same by notice in writing, delivered or
mailed, postage prepaid, to the other and received not less than
ninety (90) days prior to the date upon which such termination
will take effect. Upon termination of this Agreement, each
applicable Fund will pay Custodian its fees and compensation due
hereunder and its reimbursable disbursements, costs and expenses
paid or incurred to such date and each applicable Fund shall
designate a successor custodian by notice in writing to
Custodian by the termination date. In the event no written order
designating a successor custodian has been delivered to
Custodian on or before the date when such termination becomes
effective, then Custodian may, at its option, deliver the
securities, funds and properties of the Fund to a bank or trust
company at the selection of Custodian, and meeting the
qualifications for custodian set forth in the 1940 Act and
having not less that Two Million Dollars ($2,000,000) aggregate
capital, surplus and undivided profits, as shown by its last
published report, or apply to a court of competent jurisdiction
for the appointment of a successor custodian or other proper
relief, or take any other lawful action under the circumstances;
provided, however, that the applicable Fund shall reimburse
Custodian for its costs and expenses, including reasonable
attorney's fees, incurred in connection therewith. Custodian
will, upon termination of this Agreement and payment of all sums
due to Custodian from each applicable Fund hereunder or
otherwise, deliver to the successor custodian so specified or
appointed, or as specified by the court, at Custodian's office,
all securities then held by Custodian hereunder, duly endorsed
and in form for transfer, and all funds and other properties of
each applicable Fund deposited with or held by Custodian
hereunder, and Custodian will co-operate in effecting changes in
book-entries at all Depositories. Upon delivery to a successor
custodian or as specified by the court, Custodian will have no
further obligations or liabilities under this Agreement.
Thereafter such successor will be the successor custodian under
this Agreement and will be entitled to reasonable compensation
for its services. In the event that securities, funds and other
properties remain in the possession of the Custodian after the
date of termination hereof owing to failure of any Fund to
appoint a successor custodian, the Custodian shall be entitled
to compensation as provided in the then-current fee schedule
hereunder for its services during such period as the Custodian
retains possession of such securities, funds and other
properties, and the provisions of this Agreement relating to the
duties and obligations of the Custodian shall remain in full
force and effect.
8. NOTICES. Notices, requests, instructions and other writings
addressed to any Fund at 00 Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000,
or at such other address as the Funds may have designated to
Custodian in writing, will be deemed to have been properly given
to such Fund hereunder; and notices, requests, instructions and
other writings addressed to Custodian at its offices at 000 Xxxx
00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000, Attention: Custody
Department, or to such other address as it may have designated
to the Funds in writing, will be deemed to have been properly
given to Custodian hereunder.
9. CONFIDENTIALITY.
A. Each Fund shall preserve the confidentiality of the
computerized investment portfolio and custody
recordkeeping and accounting systems used by Custodian
(the "Systems") and the tapes, books, reference
manuals, instructions, records, programs, documentation
and information of, and other materials relevant to,
the Systems and the business of Custodian
("Confidential Information"). Each Fund agrees that it
will not voluntarily disclose any such Confidential
Information to any other person other than its own
employees who reasonably have a need to know such
information pursuant to this Agreement. Each Fund shall
return all such Confidential Information to Custodian
upon termination or expiration of this Agreement.
B. Each Fund has been informed that the Systems are
licensed for use by Custodian from third parties
("Licensors"), and each Fund acknowledges that
Custodian and the Licensors have proprietary rights in
and to the Systems and all other Custodian or Licensor
programs, code, techniques, know-how, data bases,
supporting documentation, data formats, and procedures,
including without limitation any changes or
modifications made at the request or expense or both of
any Fund (collectively, the "Protected Information").
Each Fund acknowledges that the Protected Information
constitutes confidential material and trade secrets of
Custodian and the Licensors. Each Fund shall preserve
the confidentiality of the Protected Information, and
each Fund hereby acknowledges that any unauthorized
use, misuse, disclosure or taking of Protected
Information, residing or existing internal or external
to a computer, computer system, or computer network, or
the knowing and unauthorized accessing or causing to be
accessed of any computer, computer system, or computer
network, may be subject to civil liabilities and
criminal penalties under applicable law. Each Fund
shall so inform employees and agents who have access to
the Protected Information or to any computer equipment
capable of accessing the same. The Licensors are
intended to be and shall be third party beneficiaries
of the Funds' obligations and undertakings contained in
this paragraph.
10. MULTIPLE FUNDS AND PORTFOLIOS.
A. Each Fund, and as to any Fund which is comprised of
more than one Portfolio, each Portfolio, shall be
regarded for all purposes hereunder as a separate party
apart from each other. Unless the context otherwise
requires, with respect to every transaction covered by
this Agreement, every reference herein to a Fund shall
be deemed to relate solely to the particular Fund, and,
if applicable, Portfolio thereof to which such
transaction relates. Under no circumstances shall the
rights, obligations or remedies with respect to a
particular Fund or Portfolio constitute a right,
obligation or remedy applicable to any other. The use
of this single document to memorialize the separate
agreement of each Fund is understood to be for clerical
convenience only and shall not constitute any basis for
joining the Funds for any reason.
B. Additional Funds and Portfolios may be added to this
Agreement, provided that Custodian consents to such
addition. Rates or charges for each additional Fund or
Portfolio shall be as agreed upon by Custodian and the
applicable Fund in writing. Additional Funds may be
added hereto by execution of instruments amending
Exhibit A to add such Funds thereto.
11. MISCELLANEOUS.
A. This Agreement shall be construed according to, and the
rights and liabilities of the parties hereto shall be
governed by, the laws of the State of Missouri, without
reference to the choice of laws principles thereof.
B. All terms and provisions of this Agreement shall be
binding upon, inure to the benefit of and be
enforceable by the parties hereto and their respective
successors and permitted assigns.
C. The representations and warranties, the
indemnifications extended hereunder, and the provisions
of Section 9. hereof are intended to and shall continue
after and survive the expiration, termination or
cancellation of this Agreement.
D. No provisions of the Agreement may be amended or
modified in any manner except by a written agreement
properly authorized and executed by each party hereto.
E. The failure of any party to insist upon the performance
of any terms or conditions of this Agreement or to
enforce any rights resulting from any breach of any of
the terms or conditions of this Agreement, including
the payment of damages, shall not be construed as a
continuing or permanent waiver of any such terms,
conditions, rights or privileges, but the same shall
continue and remain in full force and effect as if no
such forbearance or waiver had occurred. No waiver,
release or discharge of any party's rights hereunder
shall be effective unless contained in a written
instrument signed by the party sought to be charged.
F. The captions in the Agreement are included for
convenience of reference only, and in no way define or
limit any of the provisions hereof or otherwise affect
their construction or effect.
G. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original
but all of which together shall constitute one and the
same instrument.
H. If any provision of this Agreement shall be determined
to be invalid or unenforceable, the remaining
provisions of this Agreement shall not be affected
thereby, and every provision of this Agreement shall
remain in full force and effect and shall remain
enforceable to the fullest extent permitted by
applicable law.
I. This Agreement may not be assigned by any Fund or
Custodian without the prior written consent of the
other.
J. Neither the execution nor performance of this Agreement
shall be deemed to create a partnership or joint
venture by and between Custodian and any Fund or Funds.
K. Except as specifically provided herein, this Agreement
does not in any way affect any other agreements entered
into among the parties hereto and any actions taken or
omitted by either party hereunder shall not affect any
rights or obligations of the other party hereunder.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed by their respective duly authorized officers.
INVESTORS FIDUCIARY TRUST COMPANY
By:
Title:
EACH REGISTERED INVESTMENT
COMPANY LISTED ON EXHIBIT A HERETO
By:
Title:
EXHIBIT A
LIST OF FUNDS
Bull & Bear Funds I, Inc.:
Bull & Bear U.S. and Overseas Fund
Bull & Bear Funds II, Inc.:
Bull & Bear Dollar Reserves
Bull & Bear Global Income Fund, Inc.
Bull & Bear U.S. Government Securities Fund, Inc.
Bull & Bear Special Equities Fund, Inc.
Bull & Bear Gold Investors Ltd.
Bull & Bear Municipal Income Fund, Inc.
Midas Fund, Inc.
Rockwood Fund, Inc.
EXHIBIT B
INVESTORS FIDUCIARY TRUST COMPANY
AVAILABILITY SCHEDULE BY TRANSACTION TYPE
TRANSACTION DTC PHYSICAL FED
TYPE CREDIT DATE FUNDS TYPE CREDIT DATE FUNDS TYPE CREDIT DATE FUNDS TYPE
---------- -----------
=======================================================================================================================
Calls Puts As Received C or F* As Received C or F*
Maturities As Received C or F* Mat. Date C or F* Mat. Date F
Tender Reorgs. As Received C As Received C N/A
Dividends Paydate C Paydate C N/A
Floating Rate Paydate C Paydate C N/A
Int.
Floating Rate N/A As Rate C N/A
Int. (No Rate) Received
Mtg. Backed P&I Paydate C Paydate + 1 C Paydate F
Bus. Day
Fixed Rate Int. Paydate C Paydate C Paydate F
Euroclear N/A C Paydate C
======================================================================================================================
Legend
C = Clearinghouse Funds
F = Fed Funds
N/A = Not Applicable
* Availability based on how received.
