CUSTODY AGREEMENT
THIS AGREEMENT is made and entered into as of this 20th day of July, 2001,
by and between The Wall Street Fund, Inc., a Company organized under the laws of
the State of Maryland, (the "Company"), and Firstar Bank, N.A., a national
banking association (the "Custodian").
W I T N E S S E T H:
WHEREAS, the Company is a open-end management investment company registered
under the Investment Company Act of 1940, as amended (the"1940 Act"); and
WHEREAS, the Company desires to retain Firstar Bank, N.A. to act as
Custodian; and
WHEREAS, the Company desires that the Fund's Securities and cash be held
and administered by the Custodian pursuant to this Agreement; and
WHEREAS, the Custodian represents that it is a bank having the
qualifications prescribed in Section 26(a)(1) of the 1940 Act;
NOW, THEREFORE, in consideration of the mutual agreements herein made, the
Company and the Custodian hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
1.1 "Authorized Person" means any Officer or other person duly authorized
by resolution of the Board of Directors to give Oral Instructions and
Written Instructions on behalf of the Fund and named in Exhibit A
hereto or in such resolutions of the Board of Directors, certified by
an Officer, as may be received by the Custodian from time to time.
1.2 "Board of Directors" shall mean the Directors from time to time
serving under the Company's Articles of Incorporation, as from time to
time amended.
1.3 "Book-Entry System" shall mean a federal book-entry system as provided
in Subpart O of Treasury Circular Xx. 000, 00 XXX 306, in Subpart B of
31 CFR Part 350, or in such book-entry regulations of federal agencies
as are substantially in the form of such Subpart O.
1.4 "Business Day" shall mean any day recognized as a settlement day by
The New York Stock Exchange, Inc. and any other day for which the
Company computes the net asset value of Shares of the Fund.
1.5 "Fund Custody Account" shall mean any of the accounts in the name of
the Company, which is provided for in Section 3.2 below.
1.6 "NASD" shall mean The National Association of Securities Dealers, Inc.
1.7 "Officer" shall mean the Chairman, President, any Vice President, any
Assistant Vice President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer of the Company.
1.8 "Oral Instructions" shall mean instructions orally transmitted to and
accepted by the Custodian because such instructions are: (i)
reasonably believed by the Custodian to have been given by an
Authorized Person, (ii) recorded and kept among the records of the
Custodian made in the ordinary course of business and (iii) orally
confirmed by the Custodian. The Company shall cause all Oral
Instructions to be confirmed by Written Instructions prior to the end
of the next Business Day. If such Written Instructions confirming Oral
Instructions are not received by the Custodian prior to a transaction,
it shall in no way affect the validity of the transaction or the
authorization thereof by the Company. If Oral Instructions vary from
the Written Instructions which purport to confirm them, the Custodian
shall notify the Company of such variance but such Oral Instructions
will govern unless the Custodian has not yet acted.
1.9 "Proper Instructions" shall mean Oral Instructions or Written
Instructions. Proper Instructions may be continuing Written
Instructions when deemed appropriate by both parties.
1.10 "Securities Depository" shall mean The Depository Trust Company and
(provided that Custodian shall have received a copy of a resolution of
the Board of Directors, certified by an Officer, specifically
approving the use of such clearing agency as a depository for the
Fund) any other clearing agency registered with the Securities and
Exchange Commission under Section 17A of the Securities and Exchange
Act of 1934 as amended (the "1934 Act"), which acts as a system for
the central handling of Securities where all Securities of any
particular class or series of an issuer deposited within the system
are treated as fungible and may be transferred or pledged by
bookkeeping entry without physical delivery of the Securities.
1.11 "Securities" shall include, without limitation, common and preferred
stocks, bonds, call options, put options, debentures, notes, bank
certificates of deposit, bankers' acceptances, mortgage-backed
securities or other obligations, and any certificates, receipts,
warrants or other instruments or documents representing rights to
receive, purchase or subscribe for the same, or evidencing or
representing any other rights or interests therein, or any similar
property or assets that the Custodian has the facilities to clear and
to service.
1.12 "Shares" shall mean, with respect to a Fund, the units of beneficial
interest issued by the Company on account of the Fund.
1.13 "Sub-Custodian" shall mean and include (i) any branch of a "U.S.
Bank," as that term is defined in Rule 17f-5 under the 1940 Act, (ii)
any "Eligible Foreign Custodian," as that term is defined in Rule
17f-5 under the 1940 Act, having a contract with the Custodian which
the Custodian has determined will provide reasonable care of assets of
the Fund based on the standards specified in Section 3.3 below. Such
contract shall include provisions that provide: (i) for
indemnification or insurance arrangements (or any combination of the
foregoing) such that the Fund will be adequately protected against the
risk of loss of assets held in accordance with such contract; (ii)
that the Fund's assets will not be subject to any right, charge,
security interest, lien or claim of any kind in favor of the
Sub-Custodian or its creditors except a claim of payment for their
safe custody or administration, in the case of cash deposits, liens or
rights in favor of creditors of the Sub-Custodian arising under
bankruptcy, insolvency, or similar laws; (iii) that beneficial
ownership for the Fund's assets will be freely transferable without
the payment of money or value other than for safe custody or
administration; (iv) that adequate records will be maintained
identifying the assets as belonging to the Fund or as being held by a
third party for the benefit of the Fund; (v) that the Fund's
independent public accountants will be given access to those records
or confirmation of the contents of those records; and (vi) that the
Fund will receive periodic reports with respect to the safekeeping of
the Fund's assets, including, but not limited to, notification of any
transfer to or from a Fund's account or a third party account
containing assets held for the benefit of the Fund. Such contract may
contain, in lieu of any or all of the provisions specified above, such
other provisions that the Custodian determines will provide, in their
entirety, the same or a greater level of care and protection for Fund
assets as the specified provisions, in their entirety.
1.14 "Written Instructions" shall mean (i) written communications actually
received by the Custodian and signed by an Authorized Person, or (ii)
communications by telex or any other such system from one or more
persons reasonably believed by the Custodian to be Authorized Persons,
or (iii) communications between electro-mechanical or electronic
devices provided that the use of such devices and the procedures for
the use thereof shall have been approved by resolutions of the Board
of Directors, a copy of which, certified by an Officer, shall have
been delivered to the Custodian.
ARTICLE II
APPOINTMENT OF CUSTODIAN
2.1 Appointment. The Company hereby constitutes and appoints the Custodian
as custodian of all Securities and cash owned by or in the possession
of the Fund at any time during the period of this Agreement.
2.2 Acceptance. The Custodian hereby accepts appointment as such custodian
and agrees to perform the duties thereof as hereinafter set forth.
2.3 Documents to be Furnished. The following documents, including any
amendments thereto, will be provided contemporaneously with the
execution of the Agreement to the Custodian by the Company:
a. A copy of the Articles of Incorporation certified by the
Secretary;
b. A copy of the Bylaws of the Company certified by the Secretary;
c. A copy of the resolution of the Board of Directors of the Company
appointing the Custodian, certified by the Secretary;
d. A copy of the then current Prospectus of the Fund; and
e. A certification of the Chairman and Secretary of the Company
setting forth the names and signatures of the current Officers of
the Company and other Authorized Persons.
2.4 Notice of Appointment of Dividend and Transfer Agent. The Company
agrees to notify the Custodian in writing of the appointment,
termination or change in appointment of any Dividend and Transfer
Agent of the Fund.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
3.1 Segregation. All Securities and non-cash property held by the
Custodian for the account of the Fund (other than Securities
maintained in a Securities Depository or Book-Entry System) shall be
physically segregated from other Securities and non-cash property in
the possession of the Custodian (including the Securities and non-cash
property of the other series of the Company) and shall be identified
as subject to this Agreement.
3.2 Fund Custody Accounts. As to each Fund, the Custodian shall open and
maintain in its trust department a custody account in the name of the
Company coupled with the name of the Fund, subject only to draft or
order of the Custodian, in which the Custodian shall enter and carry
all Securities, cash and other assets of such Fund which are delivered
to it.
3.3 Appointment of Agents. (a) In its discretion, the Custodian may
appoint one or more Sub-Custodians to act as Securities Depositories
or as sub-custodians to hold Securities and cash of the Fund and to
carry out such other provisions of this Agreement as it may determine,
provided, however, that the appointment of any such agents and
maintenance of any Securities and cash of the Fund shall be at the
Custodian's expense and shall not relieve the Custodian of any of its
obligations or liabilities under this Agreement.
(b) If, after the initial approval of Sub-Custodians by the Board of
Directors in connection with this Agreement, the Custodian wishes
to appoint other Sub-Custodians to hold property of the Fund, it
will so notify the Company and provide it with information
reasonably necessary to determine any such new Sub-Custodian's
eligibility under Rule 17f-5 under the 1940 Act, including a copy
of the proposed agreement with such Sub-Custodian. The Company
shall at the meeting of the Board of Directors next following
receipt of such notice and information give a written approval or
disapproval of the proposed action.
(c) The Agreement between the Custodian and each Sub-Custodian acting
hereunder shall contain the required provisions set forth in Rule
17f-5(a)(1)(iii).
(d) At the end of each calendar quarter, the Custodian shall provide
written reports notifying the Board of Directors of the placement
of the Securities and cash of the Fund with a particular
Sub-Custodian and of any material changes in the Fund's
arrangements. The Custodian shall promptly take such steps as may
be required to withdraw assets of the Fund from any Sub-Custodian
that has ceased to meet the requirements of Rule 17f-5 under the
1940 Act.
(e) With respect to its responsibilities under this Section 3.3, the
Custodian hereby warrants to the Company that it agrees to
exercise reasonable care, prudence and diligence such as a person
having responsibility for the safekeeping of property of the
Fund. The Custodian further warrants that a Fund's assets will be
subject to reasonable care, based on the standards applicable to
custodians in the relevant market, if maintained with each
Sub-Custodian, after considering all factors relevant to the
safekeeping of such assets, including, without limitation: (i)
the Sub-Custodian's practices, procedures, and internal controls,
for certificated securities (if applicable), the method of
keeping custodial records, and the security and data protection
practices; (ii) whether the Sub-Custodian has the requisite
financial strength to provide reasonable care for Fund assets;
(iii) the Sub-Custodian's general reputation and standing and, in
the case of a Securities Depository, the Securities Depository's
operating history and number of participants; and (iv) whether
the Fund will have jurisdiction over and be able to enforce
judgments against the Sub-Custodian, such as by virtue of the
existence of any offices of the Sub-Custodian in the United
States or the Sub-Custodian's consent to service of process in
the United States.
(f) The Custodian shall establish a system to monitor the
appropriateness of maintaining the Fund's assets with a
particular Sub-Custodian and the contract governing the Fund's
arrangements with such Sub-Custodian.
3.4 Delivery of Assets to Custodian. The Company shall deliver, or cause
to be delivered, to the Custodian all of the Fund's Securities, cash
and other assets, including (a) all payments of income, payments of
principal and capital distributions received by the Fund with respect
to such Securities, cash or other assets owned by the Fund at any time
during the period of this Agreement, and (b) all cash received by the
Fund for the issuance, at any time during such period, of Shares. The
Custodian shall not be responsible for such Securities, cash or other
assets until actually received by it.
3.5 Securities Depositories and Book-Entry Systems. The Custodian may
deposit and/or maintain Securities of the Fund in a Securities
Depository or in a Book-Entry System, subject to the following
provisions:
(a) Prior to a deposit of Securities of the Fund in any Securities
Depository or Book-Entry System, the Company shall deliver to the
Custodian a resolution of the Board of Directors, certified by an
Officer, authorizing and instructing the Custodian on an on-going
basis to deposit in such Securities Depository or Book-Entry
System all Securities eligible for deposit therein and to make
use of such Securities Depository or Book-Entry System to the
extent possible and practical in connection with its performance
hereunder, including, without limitation, in connection with
settlements of purchases and sales of Securities, loans of
Securities, and deliveries and returns of collateral consisting
of Securities.
(b) Securities of the Fund kept in a Book-Entry System or Securities
Depository shall be kept in an account ("Depository Account") of
the Custodian in such Book-Entry System or Securities Depository
which includes only assets held by the Custodian as a fiduciary,
custodian or otherwise for customers.
(c) The records of the Custodian with respect to Securities of the
Fund maintained in a Book-Entry System or Securities Depository
shall, by book-entry, identify such Securities as belonging to
the Fund.
(d) If Securities purchased by the Fund are to be held in a
Book-Entry System or Securities Depository, the Custodian shall
pay for such Securities upon (i) receipt of advice from the
Book-Entry System or Securities Depository that such Securities
have been transferred to the Depository Account, and (ii) the
making of an entry on the records of the Custodian to reflect
such payment and transfer for the account of the Fund. If
Securities sold by the Fund are held in a Book-Entry System or
Securities Depository, the Custodian shall transfer such
Securities upon (i) receipt of advice from the Book-Entry System
or Securities Depository that payment for such Securities has
been transferred to the Depository Account, and (ii) the making
of an entry on the records of the Custodian to reflect such
transfer and payment for the account of the Fund.
(e) The Custodian shall provide the Company with copies of any report
(obtained by the Custodian from a Book-Entry System or Securities
Depository in which Securities of the Fund are kept) on the
internal accounting controls and procedures for safeguarding
Securities deposited in such Book-Entry System or Securities
Depository.
(f) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Company for any loss or damage
to the Fund resulting (i) from the use of a Book-Entry System or
Securities Depository by reason of any negligence or willful
misconduct on the part of Custodian or any Sub-Custodian
appointed pursuant to Section 3.3 above or any of its or their
employees, or (ii) from failure of Custodian or any such
Sub-Custodian to enforce effectively such rights as it may have
against a Book-Entry System or Securities Depository. At its
election, the Company shall be subrogated to the rights of the
Custodian with respect to any claim against a Book-Entry System
or Securities Depository or any other person from any loss or
damage to the Fund arising from the use of such Book-Entry System
or Securities Depository, if and to the extent that the Fund has
not been made whole for any such loss or damage.
3.6 Disbursement of Moneys from Fund Custody Account. Upon receipt of
Proper Instructions, the Custodian shall disburse moneys from the Fund
Custody Account but only in the following cases:
(a) For the purchase of Securities for the Fund but only in
accordance with Section 4.1 of this Agreement and only (i) in the
case of Securities (other than options on Securities, futures
contracts and options on futures contracts), against the delivery
to the Custodian (or any Sub-Custodian appointed pursuant to
Section 3.3 above) of such Securities registered as provided in
Section 3.9 below or in proper form for transfer, or if the
purchase of such Securities is effected through a Book-Entry
System or Securities Depository, in accordance with the
conditions set forth in Section 3.5 above; (ii) in the case of
options on Securities, against delivery to the Custodian (or such
Sub-Custodian) of such receipts as are required by the customs
prevailing among dealers in such options; (iii) in the case of
futures contracts and options on futures contracts, against
delivery to the Custodian (or such Sub-Custodian) of evidence of
title thereto in favor of the Fund or any nominee referred to in
Section 3.9 below; and (iv) in the case of repurchase or reverse
repurchase agreements entered into between the Company and a bank
which is a member of the Federal Reserve System or between the
Company and a primary dealer in U.S. Government securities,
against delivery of the purchased Securities either in
certificate form or through an entry crediting the Custodian's
account at a Book-Entry System or Securities Depository with such
Securities;
(b) In connection with the conversion, exchange or surrender, as set
forth in Section 3.7(f) below, of Securities owned by the Fund;
(c) For the payment of any dividends or capital gain distributions
declared by the Fund;
(d) In payment of the redemption price of Shares as provided in
Section 5.1 below;
(e) For the payment of any expense or liability incurred by the Fund,
including but not limited to the following payments for the
account of the Fund: interest; taxes; administration, investment
advisory, accounting, auditing, transfer agent, custodian,
director and legal fees; and other operating expenses of the
Fund; in all cases, whether or not such expenses are to be in
whole or in part capitalized or treated as deferred expenses;
(f) For transfer in accordance with the provisions of any agreement
among the Company, the Custodian and a broker-dealer registered
under the 1934 Act and a member of the NASD, relating to
compliance with rules of The Options Clearing Corporation and of
any registered national securities exchange (or of any similar
organization or organizations) regarding escrow or other
arrangements in connection with transactions by the Fund;
(g) For transfer in accordance with the provision of any agreement
among the Company, the Custodian, and a futures commission
merchant registered under the Commodity Exchange Act, relating to
compliance with the rules of the Commodity Futures Trading
Commission and/or any contract market (or any similar
organization or organizations) regarding account deposits in
connection with transactions by the Fund;
(h) For the funding of any uncertificated time deposit or other
interest-bearing account with any banking institution (including
the Custodian), which deposit or account has a term of one year
or less; and
(i) For any other proper purpose, but only upon receipt, in addition
to Proper Instructions, of a copy of a resolution of the Board of
Directors, certified by an Officer, specifying the amount and
purpose of such payment, declaring such purpose to be a proper
corporate purpose, and naming the person or persons to whom such
payment is to be made.
3.7 Delivery of Securities from Fund Custody Account. Upon receipt of Proper
Instructions, the Custodian shall release and deliver Securities from the
Fund Custody Account but only in the following cases:
(a) Upon the sale of Securities for the account of the Fund but only
against receipt of payment therefor in cash, by certified or cashiers
check or bank credit;
(b) In the case of a sale effected through a Book-Entry System or
Securities Depository, in accordance with the provisions of Section
3.5 above;
(c) To an offeror's depository agent in connection with tender or other
similar offers for Securities of the Fund; provided that, in any such
case, the cash or other consideration is to be delivered to the
Custodian;
(d) To the issuer thereof or its agent (i) for transfer into the name of
the Fund, the Custodian or any Sub-Custodian appointed pursuant to
Section 3.3 above, or of any nominee or nominees of any of the
foregoing, or (ii) for exchange for a different number of certificates
or other evidence representing the same aggregate face amount or
number of units; provided that, in any such case, the new Securities
are to be delivered to the Custodian;
(e) To the broker selling Securities, for examination in accordance with
the "street delivery" custom;
(f) For exchange or conversion pursuant to any plan or merger,
consolidation, recapitalization, reorganization or readjustment of the
issuer of such Securities, or pursuant to provisions for conversion
contained in such Securities, or pursuant to any deposit agreement,
including surrender or receipt of underlying Securities in connection
with the issuance or cancellation of depository receipts; provided
that, in any such case, the new Securities and cash, if any, are to be
delivered to the Custodian;
(g) Upon receipt of payment therefor pursuant to any repurchase or reverse
repurchase agreement entered into by the Fund;
(h) In the case of warrants, rights or similar Securities, upon the
exercise thereof, provided that, in any such case, the new Securities
and cash, if any, are to be delivered to the Custodian;
(i) For delivery in connection with any loans of Securities of the Fund,
but only against receipt of such collateral as the Company shall have
specified to the Custodian in Proper Instructions;
(j) For delivery as security in connection with any borrowings by the Fund
requiring a pledge of assets by the Company, but only against receipt
by the Custodian of the amounts borrowed;
(k) Pursuant to any authorized plan of liquidation, reorganization,
merger, consolidation or recapitalization of the Company;
(l) For delivery in accordance with the provisions of any agreement among
the Company, the Custodian and a broker-dealer registered under the
1934 Act and a member of the NASD, relating to compliance with the
rules of The Options Clearing Company and of any registered national
securities exchange (or of any similar organization or organizations)
regarding escrow or other arrangements in connection with transactions
by the Fund;
(m) For delivery in accordance with the provisions of any agreement among
the Company, the Custodian, and a futures commission merchant
registered under the Commodity Exchange Act, relating to compliance
with the rules of the Commodity Futures Trading Commission and/or any
contract market (or any similar organization or organizations)
regarding account deposits in connection with transactions by the
Fund; or
(n) For any other proper corporate purpose, but only upon receipt, in
addition to Proper Instructions, of a copy of a resolution of the
Board of Directors, certified by an Officer, specifying the Securities
to be delivered, setting forth the purpose for which such delivery is
to be made, declaring such purpose to be a proper corporate purpose,
and naming the person or persons to whom delivery of such Securities
shall be made.
3.8 Actions Not Requiring Proper Instructions. Unless otherwise instructed by
the Company, the Custodian shall with respect to all Securities held for
the Fund:
(a) Subject to Section 7.4 below, collect on a timely basis all income and
other payments to which the Fund is entitled either by law or pursuant
to custom in the securities business;
(b) Present for payment and, subject to Section 7.4 below, collect on a
timely basis the amount payable upon all Securities which may mature
or be called, redeemed, or retired, or otherwise become payable;
(c) Endorse for collection, in the name of the Fund, checks, drafts and
other negotiable instruments;
(d) Surrender interim receipts or Securities in temporary form for
Securities in definitive form;
(e) Execute, as custodian, any necessary declarations or certificates of
ownership under the federal income tax laws or the laws or regulations
of any other taxing authority now or hereafter in effect, and prepare
and submit reports to the Internal Revenue Service ("IRS") and to the
Company at such time, in such manner and containing such information
as is prescribed by the IRS;
(f) Hold for the Fund, either directly or, with respect to Securities held
therein, through a Book-Entry System or Securities Depository, all
rights and similar securities issued with respect to Securities of the
Fund; and
(g) In general, and except as otherwise directed in Proper Instructions,
attend to all non-discretionary details in connection with the sale,
exchange, substitution, purchase, transfer and other dealings with
Securities and assets of the Fund.
3.9 Registration and Transfer of Securities. All Securities held for the Fund
that are issued or issuable only in bearer form shall be held by the
Custodian in that form, provided that any such Securities shall be held in
a Book-Entry System if eligible therefor. All other Securities held for the
Fund may be registered in the name of the Fund, the Custodian, or any
Sub-Custodian appointed pursuant to Section 3.3 above, or in the name of
any nominee of any of them, or in the name of a Book-Entry System,
Securities Depository or any nominee of either thereof. The Company shall
furnish to the Custodian appropriate instruments to enable the Custodian to
hold or deliver in proper form for transfer, or to register in the name of
any of the nominees hereinabove referred to or in the name of a Book-Entry
System or Securities Depository, any Securities registered in the name of
the Fund.
3.10 Records.
(a) The Custodian shall maintain, for the Fund, complete and accurate
records with respect to Securities, cash or other property held for
the Fund, including (i) journals or other records of original entry
containing an itemized daily record in detail of all receipts and
deliveries of Securities and all receipts and disbursements of cash;
(ii) ledgers (or other records) reflecting (A) Securities in transfer,
(B) Securities in physical possession, (C) monies and Securities
borrowed and monies and Securities loaned (together with a record of
the collateral therefor and substitutions of such collateral), (D)
dividends and interest received, and (E) dividends receivable and
interest receivable; and (iii) canceled checks and bank records
related thereto. The Custodian shall keep such other books and records
of the Fund as the Company shall reasonably request, or as may be
required by the 1940 Act, including, but not limited to, Section 31 of
the 1940 Act and Rule 31a-2 promulgated thereunder.
(b) All such books and records maintained by the Custodian shall (i) be
maintained in a form acceptable to the Company and in compliance with
rules and regulations of the Securities and Exchange Commission, (ii)
be the property of the Company and at all times during the regular
business hours of the Custodian be made available upon request for
inspection by duly authorized officers, employees or agents of the
Company and employees or agents of the Securities and Exchange
Commission, and (iii) if required to be maintained by Rule 31a-1 under
the 1940 Act, be preserved for the periods prescribed in Rule 31a-2
under the 0000 Xxx.
3.11 Fund Reports by Custodian. The Custodian shall furnish the Company with a
daily activity statement and a summary of all transfers to or from each
Fund Custody Account on the day following such transfers. At least monthly
and from time to time, the Custodian shall furnish the Company with a
detailed statement of the Securities and moneys held by the Custodian and
the Sub-Custodians for the Fund under this Agreement.
3.12 Other Reports by Custodian. The Custodian shall provide the Company with
such reports, as the Company may reasonably request from time to time, on
the internal accounting controls and procedures for safeguarding
Securities, which are employed by the Custodian or any Sub-Custodian
appointed pursuant to Section 3.3 above.
3.13 Proxies and Other Materials. The Custodian shall cause all proxies relating
to Securities which are not registered in the name of the Fund, to be
promptly executed by the registered holder of such Securities, without
indication of the manner in which such proxies are to be voted, and shall
promptly deliver to the Company such proxies, all proxy soliciting
materials and all notices relating to such Securities.
3.14 Information on Corporate Actions. The Custodian shall promptly deliver to
the Company all information received by the Custodian and pertaining to
Securities being held by the Fund with respect to optional tender or
exchange offers, calls for redemption or purchase, or expiration of rights
as described in the Standards of Service Guide attached as Exhibit B. If
the Company desires to take action with respect to any tender offer,
exchange offer or other similar transaction, the Company shall notify the
Custodian at least five Business Days prior to the date on which the
Custodian is to take such action. The Company will provide or cause to be
provided to the Custodian all relevant information for any Security which
has unique put/option provisions at least five Business Days prior to the
beginning date of the tender period.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
4.1 Purchase of Securities. Promptly upon each purchase of Securities for the
Fund, Written Instructions shall be delivered to the Custodian, specifying
(a) the name of the issuer or writer of such Securities, and the title or
other description thereof, (b) the number of shares, principal amount (and
accrued interest, if any) or other units purchased, (c) the date of
purchase and settlement, (d) the purchase price per unit, (e) the total
amount payable upon such purchase, and (f) the name of the person to whom
such amount is payable. The Custodian shall upon receipt of such Securities
purchased by the Fund pay out of the moneys held for the account of the
Fund the total amount specified in such Written Instructions to the person
named therein. The Custodian shall not be under any obligation to pay out
moneys to cover the cost of a purchase of Securities for the Fund, if in
the Fund Custody Account there is insufficient cash available to the Fund
for which such purchase was made.
4.2 Liability for Payment in Advance of Receipt of Securities Purchased. In any
and every case where payment for the purchase of Securities for the Fund is
made by the Custodian in advance of receipt of the Securities purchased but
in the absence of specified Written Instructions to so pay in advance, the
Custodian shall be liable to the Fund for such Securities to the same
extent as if the Securities had been received by the Custodian.
4.3 Sale of Securities. Promptly upon each sale of Securities by the Fund,
Written Instructions shall be delivered to the Custodian, specifying (a)
the name of the issuer or writer of such Securities, and the title or other
description thereof, (b) the number of shares, principal amount (and
accrued interest, if any), or other units sold, (c) the date of sale and
settlement, (d) the sale price per unit, (e) the total amount payable upon
such sale, and (f) the person to whom such Securities are to be delivered.
Upon receipt of the total amount payable to the Fund as specified in such
Written Instructions, the Custodian shall deliver such Securities to the
person specified in such Written Instructions. Subject to the foregoing,
the Custodian may accept payment in such form as shall be satisfactory to
it, and may deliver Securities and arrange for payment in accordance with
the customs prevailing among dealers in Securities.
4.4 Delivery of Securities Sold. Notwithstanding Section 4.3 above or any other
provision of this Agreement, the Custodian, when instructed to deliver
Securities against payment, shall be entitled, if in accordance with
generally accepted market practice, to deliver such Securities prior to
actual receipt of final payment therefor. In any such case, the Fund shall
bear the risk that final payment for such Securities may not be made or
that such Securities may be returned or otherwise held or disposed of by or
through the person to whom they were delivered, and the Custodian shall
have no liability for any for the foregoing.
4.5 Payment for Securities Sold, etc. In its sole discretion and from time to
time, the Custodian may credit the Fund Custody Account, prior to actual
receipt of final payment thereof, with (i) proceeds from the sale of
Securities which it has been instructed to deliver against payment, (ii)
proceeds from the redemption of Securities or other assets of the Fund, and
(iii) income from cash, Securities or other assets of the Fund. Any such
credit shall be conditional upon actual receipt by Custodian of final
payment and may be reversed if final payment is not actually received in
full. The Custodian may, in its sole discretion and from time to time,
permit the Fund to use funds so credited to the Fund Custody Account in
anticipation of actual receipt of final payment. Any such funds shall be
repayable immediately upon demand made by the Custodian at any time prior
to the actual receipt of all final payments in anticipation of which funds
were credited to the Fund Custody Account.
4.6 Advances by Custodian for Settlement. The Custodian may, in its sole
discretion and from time to time, advance funds to the Company to
facilitate the settlement of a Fund's transactions in the Fund Custody
Account. Any such advance shall be repayable immediately upon demand made
by Custodian.
ARTICLE V
REDEMPTION OF FUND SHARES
5.1 Transfer of Funds. From such funds as may be available for the purpose in
the relevant Fund Custody Account, and upon receipt of Proper Instructions
specifying that the funds are required to redeem Shares of the Fund, the
Custodian shall wire each amount specified in such Proper Instructions to
or through such bank as the Company may designate with respect to such
amount in such Proper Instructions.
5.2 No Duty Regarding Paying Banks. The Custodian shall not be under any
obligation to effect payment or distribution by any bank designated in
Proper Instructions given pursuant to Section 5.1 above of any amount paid
by the Custodian to such bank in accordance with such Proper Instructions.
ARTICLE VI
SEGREGATED ACCOUNTS
Upon receipt of Proper Instructions, the Custodian shall establish and
maintain a segregated account or accounts for and on behalf of the Fund, into
which account or accounts may be transferred cash and/or Securities, including
Securities maintained in a Depository Account,
(a) in accordance with the provisions of any agreement among the Company,
the Custodian and a broker-dealer registered under the 1934 Act and a
member of the NASD (or any futures commission merchant registered
under the Commodity Exchange Act), relating to compliance with the
rules of The Options Clearing Company and of any registered national
securities exchange (or the Commodity Futures Trading Commission or
any registered contract market), or of any similar organization or
organizations, regarding escrow or other arrangements in connection
with transactions by the Fund,
(b) for purposes of segregating cash or Securities in connection with
securities options purchased or written by the Fund or in connection
with financial futures contracts (or options thereon) purchased or
sold by the Fund,
(c) which constitute collateral for loans of Securities made by the Fund,
(d) for purposes of compliance by the Fund with requirements under the
1940 Act for the maintenance of segregated accounts by registered
investment companies in connection with reverse repurchase agreements
and when-issued, delayed delivery and firm commitment transactions,
and
(e) for other proper corporate purposes, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a resolution of
the Board of Directors, certified by an Officer, setting forth the
purpose or purposes of such segregated account and declaring such
purposes to be proper corporate purposes.
Each segregated account established under this Article VI shall be
established and maintained for the Fund only. All Proper Instructions relating
to a segregated account shall specify the Fund.
ARTICLE VII
CONCERNING THE CUSTODIAN
7.1 Standard of Care. The Custodian shall be held to the exercise of reasonable
care in carrying out its obligations under this Agreement, and shall be
without liability to the Company or any Fund for any loss, damage, cost,
expense (including attorneys' fees and disbursements), liability or claim
unless such loss, damage, cost, expense, liability or claim arises from
negligence, bad faith or willful misconduct on its part or on the part of
any Sub-Custodian appointed pursuant to Section 3.3 above. The Custodian
shall be entitled to rely on and may act upon advice of counsel on all
matters, and shall be without liability for any action reasonably taken or
omitted pursuant to such advice. The Custodian shall promptly notify the
Company of any action taken or omitted by the Custodian pursuant to advice
of counsel. The Custodian shall not be under any obligation at any time to
ascertain whether the Company or the Fund is in compliance with the 1940
Act, the regulations thereunder, the provisions of the Company's charter
documents or by-laws, or its investment objectives and policies as then in
effect.
7.2 Actual Collection Required. The Custodian shall not be liable for, or
considered to be the custodian of, any cash belonging to the Fund or any
money represented by a check, draft or other instrument for the payment of
money, until the Custodian or its agents actually receive such cash or
collect on such instrument.
7.3 No Responsibility for Title, etc. So long as and to the extent that it is
in the exercise of reasonable care, the Custodian shall not be responsible
for the title, validity or genuineness of any property or evidence of title
thereto received or delivered by it pursuant to this Agreement.
7.4 Limitation on Duty to Collect. Custodian shall not be required to enforce
collection, by legal means or otherwise, of any money or property due and
payable with respect to Securities held for the Fund if such Securities are
in default or payment is not made after due demand or presentation.
7.5 Reliance Upon Documents and Instructions. The Custodian shall be entitled
to rely upon any certificate, notice or other instrument in writing
received by it and reasonably believed by it to be genuine. The Custodian
shall be entitled to rely upon any Oral Instructions and any Written
Instructions actually received by it pursuant to this Agreement.
7.6 Express Duties Only. The Custodian shall have no duties or obligations
whatsoever except such duties and obligations as are specifically set forth
in this Agreement, and no covenant or obligation shall be implied in this
Agreement against the Custodian.
7.7 Co-operation. The Custodian shall cooperate with and supply necessary
information to the entity or entities appointed by the Company to keep the
books of account of the Fund and/or compute the value of the assets of the
Fund. The Custodian shall take all such reasonable actions as the Company
may from time to time request to enable the Company to obtain, from year to
year, favorable opinions from the Company's independent accountants with
respect to the Custodian's activities hereunder in connection with (a) the
preparation of the Company's reports on Form N-1A and Form N-SAR and any
other reports required by the Securities and Exchange Commission, and (b)
the fulfillment by the Company of any other requirements of the Securities
and Exchange Commission.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification by Company. The Company shall indemnify and hold harmless
the Custodian and any Sub-Custodian appointed pursuant to Section 3.3
above, and any nominee of the Custodian or of such Sub-Custodian, from and
against any loss, damage, cost, expense (including attorneys' fees and
disbursements), liability (including, without limitation, liability arising
under the Securities Act of 1933, the 1934 Act, the 1940 Act, and any state
or foreign securities and/or banking laws) or claim arising directly or
indirectly (a) from the fact that Securities are registered in the name of
any such nominee, or (b) from any action or inaction by the Custodian or
such Sub-Custodian (i) at the request or direction of or in reliance on the
advice of the Company, or (ii) upon Proper Instructions, or (c) generally,
from the performance of its obligations under this Agreement or any
sub-custody agreement with a Sub-Custodian appointed pursuant to Section
3.3 above, provided that neither the Custodian nor any such Sub-Custodian
shall be indemnified and held harmless from and against any such loss,
damage, cost, expense, liability or claim arising from the Custodian's or
such Sub-Custodian's negligence, bad faith or willful misconduct.
8.2 Indemnification by Custodian. The Custodian shall indemnify and hold
harmless the Company from and against any loss, damage, cost, expense
(including attorneys' fees and disbursements), liability (including without
limitation, liability arising under the Securities Act of 1933, the 1934
Act, the 1940 Act, and any state or foreign securities and/or banking laws)
or claim arising from the negligence, bad faith or willful misconduct of
the Custodian or any Sub-Custodian appointed pursuant to Section 3.3 above,
or any nominee of the Custodian or of such Sub-Custodian.
8.3 Indemnity to be Provided. If the Company requests the Custodian to take any
action with respect to Securities, which may, in the opinion of the
Custodian, result in the Custodian or its nominee becoming liable for the
payment of money or incurring liability of some other form, the Custodian
shall not be required to take such action until the Company shall have
provided indemnity therefor to the Custodian in an amount and form
satisfactory to the Custodian.
8.4 Security. If the Custodian advances cash or Securities to the Fund for any
purpose, either at the Company's request or as otherwise contemplated in
this Agreement, or in the event that the Custodian or its nominee incurs,
in connection with its performance under this Agreement, any loss, damage,
cost, expense (including attorneys' fees and disbursements), liability or
claim (except such as may arise from its or its nominee's negligence, bad
faith or willful misconduct), then, in any such event, any property at any
time held for the account of the Fund shall be security therefor, and
should the Fund fail promptly to repay or indemnify the Custodian, the
Custodian shall be entitled to utilize available cash of such Fund and to
dispose of other assets of such Fund to the extent necessary to obtain
reimbursement or indemnification.
ARTICLE IX
FORCE MAJEURE
Neither the Custodian nor the Company shall be liable for any failure or
delay in performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable control,
including, without limitation, acts of God; earthquakes; fires; floods; wars;
civil or military disturbances; sabotage; strikes; epidemics; riots; power
failures; computer failure and any such circumstances beyond its reasonable
control as may cause interruption, loss or malfunction of utility,
transportation, computer (hardware or software) or telephone communication
service; accidents; labor disputes; acts of civil or military authority;
governmental actions; or inability to obtain labor, material, equipment or
transportation; provided, however, that the Custodian in the event of a failure
or delay (i) shall not discriminate against the Fund in favor of any other
customer of the Custodian in making computer time and personnel available to
input or process the transactions contemplated by this Agreement and (ii) shall
use its best efforts to ameliorate the effects of any such failure or delay.
ARTICLE X
EFFECTIVE PERIOD; TERMINATION
10.1 Effective Period. This Agreement shall become effective as of its execution
and shall continue in full force and effect for a period of three (3)
years. Subsequent to the initial three (3) year term, this Agreement may be
terminated according to the following provision.
10.2 Termination. This Agreement shall become effective as of the later of (i)
April 17, 2001 or (ii) the date on which the Fund's advisory contract with
Xxxxxxxx Capital Markets is approved by the Fund's shareholders and shall
continue in effect for a period of one (1) year. Subsequent to the initial
one (1) year term, this Agreement may be terminated by either party upon
giving ninety (90) days prior wriitten notice to the other party or such
shorter period as is mutually agreed upon by the parties. However, this
Agreement may be amended by mutual written consent of the parties. If a
successor custodian shall have been appointed by the Board of Directors,
the Custodian shall, upon receipt of a notice of acceptance by the
successor custodian, on such specified date of termination (a) deliver
directly to the successor custodian all Securities (other than Securities
held in a Book-Entry System or Securities Depository) and cash then owned
by the Fund and held by the Custodian as custodian, and (b) transfer any
Securities held in a Book-Entry System or Securities Depository to an
account of or for the benefit of the Fund at the successor custodian,
provided that the Company shall have paid to the Custodian all fees,
expenses and other amounts to the payment or reimbursement of which it
shall then be entitled. Upon such delivery and transfer, the Custodian
shall be relieved of all obligations under this Agreement. The Company may
at any time immediately terminate this Agreement in the event of the
appointment of a conservator or receiver for the Custodian by regulatory
authorities or upon the happening of a like event at the direction of an
appropriate regulatory agency or court of competent jurisdiction.
10.3 Failure to Appoint Successor Custodian. If a successor custodian is not
designated by the Company on or before the date of termination specified
pursuant to Section 10.1 above, then the Custodian shall have the right to
deliver to a bank or Company company of its own selection, which (a) is a
"bank" as defined in the 1940 Act and (b) has aggregate capital, surplus
and undivided profits as shown on its then most recent published report of
not less than $25 million, all Securities, cash and other property held by
Custodian under this Agreement and to transfer to an account of or for the
Fund at such bank or trust company all Securities of the Fund held in a
Book-Entry System or Securities Depository. Upon such delivery and
transfer, such bank or trust company shall be the successor custodian under
this Agreement and the Custodian shall be relieved of all obligations under
this Agreement.
ARTICLE XI
COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to compensation as agreed upon from time to
time by the Company and the Custodian. The fees and other charges in effect on
the date hereof and applicable to the Fund are set forth in Exhibit C attached
hereto.
ARTICLE XII
LIMITATION OF LIABILITY
It is expressly agreed that the obligations of the Company hereunder shall
not be binding upon any of the Directors, shareholders, nominees, officers,
agents or employees of the Company personally, but shall bind only the property
of the Company as provided in the Company's Articles of Incorporation, as from
time to time amended. The execution and delivery of this Agreement have been
authorized by the Directors, and this Agreement has been signed and delivered by
an authorized officer of the Company, acting as such, and neither such
authorization by the Directors nor such execution and delivery by such officer
shall be deemed to have been made by any of them individually or to impose any
liability on any of them personally, but shall bind only the Company property of
the Company as provided in the above-mentioned Articles of Incorporation.
ARTICLE XIII
NOTICES
Unless otherwise specified herein, all demands, notices, instructions, and
other communications to be given hereunder shall be in writing and shall be sent
or delivered to the recipient at the address set forth after its name
hereinbelow:
To the Company:
Xxxxxx X. Xxxxx
President
Xxxxx, Xxxxxxxx & Company, Inc.
x/x Xxx Xxxx Xxxxxx Fund, Inc.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
000-000-0000
To Custodian:
----------------------------
----------------------------
----------------------------
or at such other address as either party shall have provided to the other by
notice given in accordance with this Article XIII. Writing shall include
transmissions by or through teletype, facsimile, central processing unit
connection, on-line terminal and magnetic tape.
ARTICLE XIV
MISCELLANEOUS
14.1 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
14.2 References to Custodian. The Company shall not circulate any printed matter
which contains any reference to Custodian without the prior written
approval of Custodian, excepting printed matter contained in the prospectus
or statement of additional information for the Fund and such other printed
matter as merely identifies Custodian as custodian for the Fund. The
Company shall submit printed matter requiring approval to Custodian in
draft form, allowing sufficient time for review by Custodian and its
counsel prior to any deadline for printing.
14.3 No Waiver. No failure by either party hereto to exercise, and no delay by
such party in exercising, any right hereunder shall operate as a waiver
thereof. The exercise by either party hereto of any right hereunder shall
not preclude the exercise of any other right, and the remedies provided
herein are cumulative and not exclusive of any remedies provided at law or
in equity.
14.4 Amendments. This Agreement cannot be changed orally and no amendment to
this Agreement shall be effective unless evidenced by an instrument in
writing executed by the parties hereto.
14.5 Counterparts. This Agreement may be executed in one or more counterparts,
and by the parties hereto on separate counterparts, each of which shall be
deemed an original but all of which together shall constitute but one and
the same instrument.
14.6 Severability. If any provision of this Agreement shall be invalid, illegal
or unenforceable in any respect under any applicable law, the validity,
legality and enforceability of the remaining provisions shall not be
affected or impaired thereby.
14.7 Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors
and assigns; provided, however, that this Agreement shall not be assignable
by either party hereto without the written consent of the other party
hereto.
14.8 Headings. The headings of sections in this Agreement are for convenience of
reference only and shall not affect the meaning or construction of any
provision of this Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed and delivered in its name and on its behalf by its representatives
thereunto duly authorized, all as of the day and year first above written.
THE WALL STREET FUND FIRSTAR BANK, N.A.
By:Xxxxxx X. Xxxxx By: Xxxx Rock
Print:Xxxxxx X. Xxxxx Print: Xxxx Rock
Title: President Title: Senior Vice President
Date: August 6, 2001 Date: July 20, 2001
Attest: _________________ Attest: ____________________
