CUSTODY AGREEMENT
THIS AGREEMENT made the 2nd day of February, 1993, by and
between INVESTORS FIDUCIARY TRUST COMPANY ("Custodian"), a trust company
chartered under the laws of the state of Missouri, having its trust office
located at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000, and PIPER
INSTITUTIONAL FUNDS INC., a Minnesota corporation having its principal office
and place of business at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx
00000 ("Fund").
WITNESSETH:
WHEREAS, Fund desires to appoint Investors Fiduciary Trust Company
as Custodian of the securities and monies of Fund's investment portfolio; 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. Fund hereby constitutes and appoints
Custodian as custodian of the Fund which is to include:
A. Appointment as custodian of the securities and
monies at any time owned by the Fund; and
B. Appointment as agent to perform certain accounting and
recordkeeping functions required of a duly registered
investment company in compliance with applicable provisions of
federal, state and local laws, rules and regulations
including, as may be required:
1. Providing information necessary for Fund to file required
financial reports; maintaining and preserving required
books, accounts and records as the basis for such
reports; and performing certain daily functions in
connection with such accounts and records.
2. Calculating daily net asset value of the Fund, and
3. Acting as liaison with independent auditors.
2. DELIVERY OF CORPORATE DOCUMENTS. Fund has delivered or will deliver
to Custodian prior to the effective date of this Agreement, copies
of the following documents and all amendments or supplements thereto,
properly certified or authenticated:
A. Resolutions of the Board of Directors of Fund appointing
Custodian as custodian hereunder and approving the form of this
Agreement; and
B. Resolutions of the Board of Directors of Fund designating
certain persons to give instructions on behalf of Fund to
Custodian and authorizing Custodian to rely upon written
instructions over their signatures.
3. DUTIES AND RESPONSIBILITIES OF CUSTODIAN.
A. DELIVERY OF ASSETS
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 except
as permitted by the Investment Company Act of 1940 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. All securities
so delivered to Custodian (other than bearer securities) shall be
registered in the name of Fund or its nominee, or of a nominee
of Custodian, or shall be properly endorsed and in form
for transfer satisfactory to Custodian.
B. DELIVERY OF ACCOUNTS AND RECORDS
Fund shall turn over to Custodian all of the Fund's relevant
accounts and records previously maintained by it, if any.
Custodian shall be entitled to rely conclusively on the
completeness and correctness of the accounts and records
turned over to it by Fund, and 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
accounts and records or in the failure of Fund to provide any
portion of such or to provide any information needed by the
Custodian knowledgeably to perform its function hereunder.
C. DELIVERY OF ASSETS TO THIRD PARTIES
Custodian will receive delivery of and keep safely the assets
of Fund delivered to it from time to time 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.2 of this agreement, Custodian will
create and maintain records identifying those assets which
have been delivered to the subcustodian as belonging to Fund.
The Custodian is responsible for the securities and monies of
Fund 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 United
Missouri Bank of Kansas City, N.A. (UMBKC) and United Missouri
Trust Company of New York (UMBNY) as provided for by Section
3.S., for which Custodian remains responsible. Custodian
shall be responsible only for the monies and securities of
Fund held by it or its nominees or UMBKC under this Agreement.
Custodian may participate directly or indirectly through a
subcustodian in the Depository Trust Company, Treasury/Federal
Reserve Book Entry System, or Participant Trust Company (as
such entities are defined at 17 CFR Section 270.17f-4(b))
provided that (i) the securities of the Fund held at such an
entity shall not include any assets of the Custodian other
than assets held as a fiduciary, custodian or otherwise for
customers; (ii) the records of the Custodian with respect to
securities of the Fund which are maintained in such an entity
shall identify by book-entry those securities belonging to the
Fund; (iii) the Custodian shall pay for securities purchased
for the account of the Fund upon (a) receipt of advice
from such entity that the Fund's securities have been transferred
to the Custodian's account, and (b) the making of an entry on
the records of the Custodian to reflect such payment and
transfer for the account of the Fund; the Custodian shall
transfer securities sold for the account of the Fund upon (a)
receipt of advice
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from such entity that payment for the Fund's securities
has been transferred to the Custodians's account,
and (b) the making of an entry on the records of the
Custodian to reflect such transfer and payment for the account
of the Fund; (v) copies of all advices from such entity(ies)
of transfers of securities for the account of the Fund shall
be maintained for the Fund by the Custodian and the Custodian
shall furnish the Fund with confirmation of each transfer to
or from the account of the Fund; (vi) the Custodian shall
provide the Fund with any report obtained by the Custodian on
the entity(ies) accounting system, internal accounting control
and procedures for safeguarding securities deposited with such
entity.
D. REGISTRATION OF SECURITIES
Custodian will hold stocks and other registerable portfolio
securities of Fund registered in the name of Fund or in the
name of any nominee of Custodian for whose fidelity and
liability Custodian will be fully responsible, or in street
certificate form, so-called, with or without any indication of
fiduciary capacity. Unless otherwise instructed, Custodian
will register all such portfolio securities in the name of its
authorized nominee. All securities, and the ownership thereof
by Fund, which are held by Custodian hereunder, however, shall
at all times be identifiable on the records of the Custodian.
The Fund agrees to hold Custodian and its nominee harmless for
any liability as a record holder of 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 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 THE FUND
Fund will, on each business day on which a purchase of
securities shall be made by it, deliver to Custodian
instructions which shall specify with respect to each such
purchase:
1. The name of the issuer and description of the security;
2. The number of shares or the principal amount purchased,
and accrued interest, if any;
3. The trade date;
4. The settlement date;
5. The purchase price per unit and the brokerage commission,
taxes and other expenses payable in connection with the
purchase;
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6. The total amount payable upon such purchase; and
7. The name of the person from whom or the broker or dealer
through whom the purchase was made.
In accordance with such instructions, Custodian will pay for
out of monies held for the account of Fund, but only insofar
as monies are available therein for such purpose, and receive
the portfolio securities so purchased by or for the account of
Fund. Such payment will be made only upon receipt by
Custodian of the securities so purchased in form for transfer
satisfactory to Custodian.
G. SALES AND DELIVERIES OF INVESTMENTS OF THE
FUND - OTHER THAN OPTIONS AND FUTURES
Fund will, on each business day on which a sale of investment
securities of Fund has been made, deliver to Custodian
instructions specifying with respect to each such sale:
1. The name of the issuer and description of the securities;
2. The number of shares or principal amount sold, and accrued
interest, if any;
3. The date on which the securities sold were purchased or
other information identifying the securities sold and to
be delivered;
4. The trade date;
5. The settlement date;
6. The sale price per unit and the brokerage commission, taxes
or other expenses payable in connection with such sale;
7. The total amount to be received by Fund upon such sale; and
8. 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 Fund to the broker or other person
specified in the instructions relating to such sale, such
delivery to be made only upon receipt of payment therefor in
such form as is satisfactory to Custodian, with the
understanding that Custodian may deliver or cause to be
delivered securities for payment in accordance with the
customs prevailing among dealers in securities.
H. PURCHASES OR SALES OF SECURITY OPTIONS, OPTIONS ON INDICES
AND SECURITY INDEX FUTURES CONTRACTS
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. 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;
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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;
j. Name and address of the broker or dealer through
whom the sale or purchase was made.
2. 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;
j. The name and address of the broker or dealer through
whom the sale or purchase was made, or other
applicable settlement instructions.
3. 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.
4. Option on Index Future Contracts
a. The underlying index futures contract;
b. The premium;
c. The expiration date;
d. The number of options;
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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 Fund:
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 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
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 Fund except as may be
otherwise provided in this Agreement or directed from time to
time by the Board of Directors of Fund.
K. DEPOSIT ACCOUNT
Custodian will open and maintain a special purpose deposit
accounts in the name of Custodian ("Account"), subject only to
draft or order by Custodian upon receipt of instructions. All
monies received by Custodian from or for the account of a
portfolio shall be deposited in said Account, 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 Fund's Account. Custodian may open and maintain an
Account in such other banks or trust companies as may be
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designated by it or by properly authorized resolution of the
Board of Directors of Fund, such Account, however, to be in
the name of custodian and subject only to its draft or order.
L. INCOME AND OTHER PAYMENTS TO FUND
Custodian will:
1. Collect, claim and receive and deposit for the Account of
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 Fund with such
income on the date received;
2. Execute ownership and other certificates and affidavits
for all foreign, 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 notice of which is
contained in publications of the type to which
it normally subscribes for such purpose; and
b. the endorsement for collection, in the name of 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. Unless prior
instructions have been received to the contrary, Custodian
will, without further instructions, sell any rights held for
the account of Fund on the last trade date prior to the date
of expiration of such rights.
M. PAYMENT OF DIVIDENDS AND OTHER DISTRIBUTIONS
On the declaration of any dividend or other distribution on
the shares of Capital Stock of Fund ("Fund Shares") by the
Board of Directors of Fund, Fund shall deliver to Custodian
instructions with respect thereto wherein there shall be set
forth the record date as of which shareholders entitled to
receive such dividend or other distribution shall be
determined, the date of payment of such dividend or
distribution, and the amount payable per share on such
dividend or distribution. Except if the ex-dividend date and
the reinvestment date of any dividend are the same, in which
case funds shall remain in the Custody Account, on the date
specified in such Resolution for the payment of such dividend
or other distribution, Custodian will pay out of the monies
held for the account of Fund, insofar as the same shall be
available for such purposes, and credit to the account of the
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Dividend Disbursing Agent for Fund, such amount as may be
necessary to pay the amount per share payable in cash on Fund
Shares issued and outstanding on the record date established
by such Resolution.
N. SHARES OF FUND PURCHASED BY FUND
Whenever any Fund Shares are repurchased or redeemed by Fund,
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 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 such shares have been cancelled and removed
from the shareholder records.
O. SHARES OF FUND PURCHASED FROM FUND
Whenever Fund Shares are purchased from Fund, 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 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 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 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 Fund (including but not limited to obligations
in connection with the conversion, exchange or surrender of
securities owned by 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 Fund) pursuant to instructions of 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
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Custodian will, within a reasonable time, render to Fund as of
the close of business on each day, a detailed statement of the
amounts received or paid and of securities received or
delivered for the account of Fund during said day in
compliance with 31a-1(b)(1) of the Investment Company Act of
1940, as amended. Custodian will, from time to time, upon
request by Fund, render a detailed statement of the securities
and monies held for Fund under this Agreement, and Custodian
will maintain such books and records as are necessary to
enable it to do so and will permit such persons as are
authorized by Fund including Fund's independent public
accountants, access to such records or confirmation of the
contents of such records; and if demanded, will permit federal
and state regulatory agencies to examine the securities, books
and records. Upon the written instructions of Fund or as
demanded by federal or state regulatory agencies, Custodian
will instruct any subcustodian to give such persons as are
authorized by Fund including Fund's independent public
accountants, access to such records or confirmation of the
contents of such records; and if demanded, to permit federal
and state regulatory agencies to examine the books, records
and securities held by subcustodian which relate to Fund.
S. APPOINTMENT OF SUBCUSTODIANS
1. Notwithstanding any other provisions of this Agreement,
all or any of the monies or securities of Fund may be
held in Custodian's own custody or in the custody of one
or more other banks or trust companies selected by
Custodian or as directed by the Fund. Any such
subcustodian must have the qualifications required for
custodian under the Investment Company Act of 1940, as
amended. The Custodian or subcustodian may participate
directly or indirectly in the Depository Trust Company,
Treasury/Federal Reserve Book Entry System, or
Participant Trust Company (as such entities are defined
at 17 CFR Sec. 270.17f-4(b)), or other depository
approved by the Fund. Custodian will appoint UMBKC and
UMBNY as subcustodians and Custodian shall be responsible
for UMBKC and UMBNY to the same extent it is responsible
to the Fund under Section 5 of this Agreement. Custodian
is not responsible for DTC, the Federal Reserve Book
Entry System, and PTC except to the extent such entities
are responsible to Custodian. Upon instruction of the
Fund, the Custodian shall be willing to contract with
such entities as Bank of New York (BONY), Xxxxxx Guaranty
and Trust Company (MGTC), Chemical Bank (CB), and Bankers
Trust Company (BT) for variable rate securities and
Custodian will be responsible to the Fund to the same
extent those entities are responsible to Custodian. The
Fund shall be entitled to review Custodian's contracts
with BONY, MGTC, CB, and BT.
2. Notwithstanding any other provisions of this Agreement,
Fund's foreign securities (as defined in Rule 17f-5(c)(1)
under the Investment Company Act of 1940) and Fund's cash
or cash equivalents, in amounts reasonably necessary to
effect Fund's foreign securities transactions, may be
held in the custody of one or more banks or trust
companies acting
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as subcustodians, according to Section 3.S.1; and
thereafter, pursuant to a written contract or contracts
as approved by Fund's Board of Directors, may be
transferred to an account maintained by such
subcustodian with an eligible foreign custodian, as
defined in Rule 17f-5(c)(2), provided that any such
arrangement involving a foreign custodian shall be in
accordance with the provisions of Rule 17f-5 under the
Investment Company Act of 1940 as that Rule may be
amended from time to time.
T. ACCOUNTS AND RECORDS
Custodian, with the direction and as interpreted by the Fund,
Fund's accountants and/or other tax advisors, will prepare and
maintain as complete, accurate and current all accounts and
records required to be maintained by Fund under the Internal
Revenue Code of 1986 ("Code") as amended and under the general
Rules and Regulations under the Investment Company Act of 1940
("Rules") as amended with particular attention to Rules 31a-1.
and 31a-2., and as agreed upon between the parties and will
preserve said records in the manner and for the periods
prescribed in said Code and Rules, or for such longer period
as is agreed upon by the parties.
Custodian relies upon Fund to furnish, in writing, accurate
and timely information to complete Fund's records and perform
daily calculation of the Fund's net asset value, as provided
in Section 3.W. below.
Custodian shall incur no liability and Fund shall indemnify
and hold harmless Custodian from and against any liability
arising from any failure of Fund to furnish such information
in a timely and accurate manner, even if Fund subsequently
provides accurate but untimely information. It shall be the
responsibility of 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 FUND
Custodian acknowledges that all of the accounts and records
maintained by Custodian pursuant to this Agreement are the
property of Fund, and will be made available to Fund for
inspection or reproduction within a reasonable period of time,
upon demand. Custodian will assist Fund's independent
auditors, or upon approval of Fund, or upon demand, any
regulatory body, in any requested review of Fund's accounts
and records but shall be reimbursed for all expenses and
employee time invested in any such review outside of routine
and normal periodic reviews. Upon receipt from Fund of the
necessary information, Custodian will supply necessary data
for Fund's completion of any necessary tax returns,
questionnaires, periodic reports to Shareholders and such
other reports and information requests as Fund and Custodian
shall agree upon from time to time.
V. ADOPTION OF PROCEDURES
Custodian and Fund may from time to time adopt procedures as
they agree upon, and Custodian may conclusively assume that no
procedure approved by Fund, or directed by Fund, conflicts with
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or violates any requirements of its prospectus, "Articles
of Incorporation", Bylaws, or any rule or regulation of any
regulatory body or governmental agency. Fund will be
responsible to notify Custodian of any changes in statutes,
regulations, rules or policies which might necessitate changes
in Custodian's responsibilities or procedures.
W. CALCULATION OF NET ASSET VALUE
Custodian will calculate Fund's net asset value, in accordance
with Fund's prospectus, once daily. Custodian will prepare and
maintain a daily evaluation of securities for which market
quotations are available by the use of outside services
normally used and contracted for this purpose; all other
securities will be evaluated in accordance with 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 Fund or upon instructions.
X. OVERDRAFTS
If Custodian shall in its sole discretion advance funds to the
account of the Fund which results in an overdraft because the
monies held by Custodian on behalf of the Fund are
insufficient to pay the total amount payable upon a purchase
of securities as specified in Fund's instructions or for some
other reason, the amount of the overdraft shall be payable by
the Fund to Custodian upon demand and shall bear an interest
rate determined by Custodian from the date advanced until the
date of payment.
4. INSTRUCTIONS.
A. The term "instructions", as used herein, means written or
oral instructions to Custodian from a designated
representative of Fund. Certified copies of resolutions of
the Board of Directors of Fund naming one or more designated
representatives to give instructions in the name and on behalf
of Fund, may be received and accepted from time to time by
Custodian as conclusive evidence of the authority of any
designated representative to act for 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 the
resolution delegating authority to any person to give
instructions specifically requires that the approval of anyone
else will first have been obtained, Custodian will be under no
obligation to inquire into the right of the person giving such
instructions to do so. Notwithstanding any of the foregoing
provisions of this Section 4. no authorizations or
instructions received by Custodian from Fund, will be deemed
to authorize or permit any Trustee, officer, employee, or
agent of Fund to withdraw any of the securities or similar
investments of Fund upon the mere receipt of such
authorization or instructions from such director, officer,
employee or agent.
Notwithstanding any other provision of this Agreement,
Custodian, upon receipt (and acknowledgement if required at
the discretion of Custodian) of the instructions of a
designated representative of Fund will undertake to deliver
for Fund's account monies, (provided such monies are on hand
or available) in connection with Fund's transactions and to
wire transfer such monies
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to such broker, dealer, subcustodian, bank or other agent
specified in such instructions by a designated representative
of Fund.
B. No later than the next business day immediately following each
oral instruction, 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 parties, the date and the
time of the beginning and ending of such oral instruction.
5. LIMITATION OF LIABILITY OF CUSTODIAN.
A. Custodian shall hold harmless and indemnify Fund from and
against any loss or liability arising out of
Custodian's failure to comply with the terms of this Agreement
or arising out of Custodian's negligence, willful misconduct,
or bad faith. Custodian shall not be liable for
consequential, special or punitive damages. Custodian may
reasonably request and obtain the advice and opinion of
counsel for Fund, or of its own counsel with respect to
questions or matters of law, and it shall be without liability
to Fund for any action taken or omitted by it in good faith,
in conformity with such advice or opinion.
B. Custodian may rely upon the advice of Fund and upon statements of
Fund's accountants 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 without negligence upon such statements.
C. If Fund requires Custodian in any capacity to take, with respect
to any securities, any action which involves the payment of
money by it, or which in Custodian's opinion might make it or
its nominee liable for payment of monies or in any other way,
Custodian, upon notice to Fund given prior to such actions,
shall be and be kept indemnified by Fund in an amount and form
satisfactory to Custodian against any liability on account of
such action.
D. Custodian shall be entitled to receive, and Fund agrees to pay to
Custodian, on demand, reimbursement for such cash
disbursements, costs and expenses as may be agreed upon from
time to time by Custodian and Fund.
E. Custodian shall be protected in acting as custodian hereunder
upon any instructions, advice, notice, request, consent,
certificate or other instrument or paper reasonably appearing
to it to be genuine and to have been properly executed and
shall, unless otherwise specifically provided herein, be
entitled to receive as conclusive proof of any fact or matter
required to be ascertained from Fund hereunder, a certificate
signed by the Fund's President, or other officer specifically
authorized for such purpose.
F. Without limiting the generality of the foregoing, Custodian shall
be under no duty or obligation to inquire into, and shall not be
liable for:
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1. The validity of the issue of any securities purchased by or
for Fund, the legality of the purchase thereof or evidence
of ownership required by 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 by or for Fund,
or the propriety of the amount for which the same are sold;
3. The legality of the issue or sale of any shares of the
Capital Stock of Fund, or the sufficiency of the amount
to be received therefor;
4. The legality of the repurchase or redemption of any shares
of Fund Shares, or the propriety of the amount to be paid
therefor; or
5. The legality of the declaration of any dividend by 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,
clearing house funds, uncollected funds, or instrument for the
payment of money received by it on behalf of Fund, until
Custodian actually receives such money, provided only that it
shall advise Fund promptly if it fails to receive any such
money in the ordinary course of business, and use its best
efforts and cooperate with Fund toward the end that such money
shall be received.
H. Except for any subcustodians appointed under 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 in the absence of negligence, or bad faith on the part of
Custodian.
I. Notwithstanding anything herein to the contrary, Custodian may,
and with respect to any foreign subcustodian appointed under
Section 3.S.2. must, provide Fund for its approval, agreements
with banks or trust companies which will act as subcustodians
for Fund pursuant to Section 3.S of this Agreement.
6. COMPENSATION. Fund will pay to Custodian such compensation as is
stated in the Fee Schedule attached hereto as Exhibit A which
may be changed from time to time as agreed to in writing by
Custodian and Fund. Custodian may charge such compensation
against monies held by it for the account of Fund. Custodian
will also be entitled, notwithstanding the provisions of
Sections 5.C. or 5.D. hereof, to charge against any monies
held by it for the account of Fund or to place a lien upon the
securities or monies of the Fund the amount of any loss,
damage, liability, or expense for which it shall be entitled
to reimbursement under the provisions of this Agreement
including fees or expenses due to Custodian for other services
provided to the Fund by the Custodian or advance and interest
due to IFTC under Section 3.X. Custodian will not be entitled
to reimbursement by Fund for any loss or expenses of any
subcustodian.
7. TERMINATION. The term of this Agreement shall be continuous for
one year terms unless terminated. Either party to this
Agreement may terminate the same by notice in writing,
delivered or mailed, postage prepaid, to the other party
hereto and received not less than ninety (90) days prior to
the date upon which
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such termination will take effect. Upon termination of this
Agreement, Fund will pay to Custodian such compensation for
its reimbursable disbursements, costs and expenses paid
or incurred to such date and Fund will use its best efforts
to obtain a successor custodian. Unless the holders of a
majority of the outstanding shares of "Capital Stock" of Fund
vote to have the securities, funds and other properties held
under this Agreement delivered and paid over to some other person,
firm or corporation specified in the vote, having not less the
Two Million Dollars ($2,000,000) aggregate capital, surplus
and undivided profits, as shown by its last published report,
and meeting such other qualifications for custodian as set
forth in the Bylaws of Fund, the Board of Directors of Fund
will, forthwith upon giving or receiving notice of termination
of this Agreement, appoint as successor custodian a bank or trust
company having such qualifications. Custodian will, upon termination
of this Agreement, deliver to the successor custodian so specified or
appointed, at Custodian's office, all securities then held by
Custodian hereunder, duly endorsed and in form for transfer,
all funds and other properties of Fund deposited with or held
by Custodian hereunder, or will co-operate in effecting
changes in book-entries at the Depository Trust Company or in
the Treasury/Federal Reserve Book-Entry System pursuant to 31
CFR Sec. 306.118. In the event no such vote has been adopted
by the stockholders of Fund and no written order designating a
successor custodian has been delivered to Custodian on or
before the date when such termination becomes effective, then
Custodian will deliver the securities, funds and properties of
Fund to a bank or trust company at the selection of Custodian
and meeting the qualifications for custodian, if any, set
forth in the Bylaws of Fund and having not less that Two
Million Dollars ($2,000,000) aggregate capital, surplus and
undivided profits, as shown by its last published report.
Upon either such delivery to a successor custodian, Custodian
will have no further obligations or liabilities under this
Agreement. Thereafter such bank or trust company will be the
successor custodian under this Agreement and will be entitled
to reasonable compensation for its services. In the event
that no such successor custodian can be found, Fund will
submit to its shareholders, before permitting delivery of the
cash and securities owned by Fund to anyone other than a
successor custodian, the question of whether Fund will be
liquidated or function without a custodian. Notwithstanding
the foregoing requirement as to delivery upon termination of
this Agreement, Custodian may make any other delivery of the
securities, funds and property of Fund which is permitted by
the Investment Company Act of 1940, Fund's Certificate of
Incorporation and Bylaws then in effect or apply to a court of
competent jurisdiction for the appointment of a successor
custodian.
8. NOTICES. Notices, requests, instructions and other writings
received by Fund at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx
00000 or at such other address as Fund may have designated to
Custodian in writing, will be deemed to have been properly given
to Fund hereunder; and notices, requests, instructions and other
writings received by Custodian at its offices at 000 Xxxx 00xx
Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000, or to such other address as
it may have designated to Fund in writing, will be deemed to have
been properly given to Custodian hereunder.
9. MISCELLANEOUS.
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A. This Agreement is executed and delivered in the State of Missouri
and shall be governed by the laws of said state.
B. All the terms and provisions of this Agreement shall be binding
upon, inure to the benefit of, and be enforceable by the
respective successor and assigns of the parties hereto.
C. No provisions of the Agreement may be amended or modified, in any
manner except by a written agreement properly authorized and
executed by both parties hereto.
D. The captions in this Agreement are included for convenience of
reference only, and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or
effect.
E. This Agreement shall become effective at the close of business
on the _____ day of _____________, 19___.
F. This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original but
all of which together will constitute one and the same
instrument.
G. If any part, term or provision of this Agreement is by the
courts held to be illegal, in conflict with any law or
otherwise invalid, the remaining portion or portions shall
be considered severable and not be affected, and the rights
and obligations of the parties shall be construed and enforced
as if the Agreement did not contain the particular part,
term or provision held to be illegal or invalid.
H. This Agreement may not be assigned by either party without
prior written consent of the other party.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly respective authorized officers.
INVESTORS FIDUCIARY TRUST COMPANY
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------------
Title: Senior Vice President
---------------------------------------------
PIPER INSTITUTIONAL FUNDS INC.
By: /s/ Xxxxxxx Xxxxxx
------------------------------------------------
Title: Senior Vice President
---------------------------------------------
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