CUSTODY AGREEMENT
THIS AGREEMENT is made and entered into as of this __ day of March, 2008,
by and between THE RAM FUNDS, an Ohio business trust (the "Trust"), and U.S.
BANK NATIONAL ASSOCIATION, a national banking association organized and existing
under the laws of the United States of America with its principal place of
business at Cincinnati, Ohio (the "Custodian").
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as an open-end management investment company, and
is authorized to issue shares of beneficial interest in separate series, with
each such series representing interests in a separate portfolio of securities
and other assets;
WHEREAS, the Custodian is a bank having the qualifications prescribed in
Section 26(a)(1) of the 1940 Act;
WHEREAS, the Trust desires to retain the Custodian to act as custodian of
the cash and securities of each series of the Trust listed on EXHIBIT C hereto
(as amended from time to time) (each a "Fund" and collectively, the "Funds");
and
WHEREAS, the Board of Trustees of the Trust has delegated to the Custodian
the responsibilities set forth in Rule 17f-5(c) under the 1940 Act and the
Custodian is willing to undertake the responsibilities and serve as the foreign
custody manager for the Trust.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto, intending to be legally bound,
do hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Whenever used in this Agreement, the following words and phrases shall have the
meanings set forth below unless the context otherwise requires:
1.01 "AUTHORIZED PERSON" means any Officer or other person duly authorized by
resolution of the Board of Trustees 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 Trustees, certified by an Officer, as may be
received by the Custodian from time to time.
1.02 "BOARD OF TRUSTEES" shall mean the trustees from time to time serving
under the Trust's declaration of trust, as amended from time to time.
1.03 "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.
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1.04 "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 Trust computes
the net asset value of Shares of the Fund.
1.05 "ELIGIBLE FOREIGN CUSTODIAN" has the meaning set forth in Rule
17f-5(a)(1), including a majority-owned or indirect subsidiary of a U.S. Bank
(as defined in Rule 17f-5), a bank holding company meeting the requirements of
an Eligible Foreign Custodian (as set forth in Rule 17f-5 or by other
appropriate action of the SEC), or a foreign branch of a Bank (as defined in
Section 2(a)(5) of the 0000 Xxx) meeting the requirements of a custodian under
Section 17(f) of the 1940 Act; the term does not include any Eligible Securities
Depository.
1.06 "ELIGIBLE SECURITIES DEPOSITORY" shall mean a system for the central
handling of securities as that term is defined in Rule 17f-4 and 17f-7 under the
0000 Xxx.
1.07 "FOREIGN SECURITIES" means any of the [Trust's/Fund's] investments
(including foreign currencies) for which the primary market is outside the
United States and such cash and cash equivalents as are reasonably necessary to
effect the [Trust/Fund's] transactions in such investments.
1.08 "FUND CUSTODY ACCOUNT" shall mean any of the accounts in the name of the
Trust, which is provided for in Section 3.2 below.
1.09 "IRS" shall mean the Internal Revenue Service.
1.10 "FINRA" shall mean The Financial Industry Regulatory Authority.
1.11 "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 Trust.
1.12 "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 any two Authorized Persons, (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 Trust 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
Trust. If Oral Instructions vary from the Written Instructions that purport to
confirm them, the Custodian shall notify the Trust of such variance but such
Oral Instructions will govern unless the Custodian has not yet acted.
1.13 "PROPER INSTRUCTIONS" shall mean Oral Instructions or Written
Instructions.
1.14 "SEC" shall mean the Securities and Exchange Commission.
1.15 "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
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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 or its agents have the facilities
to clear and service.
1.16 "SECURITIES DEPOSITORY" shall mean The Depository Trust Company and any
other clearing agency registered with the SEC under Section 17A of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), which acts as a
system for the central handling of Securities where all Securities of any
particular class or series of an issuer deposited within the system are treated
as fungible and may be transferred or pledged by bookkeeping entry without
physical delivery of the Securities.
1.17 "SHARES" shall mean, with respect to a Fund, the units of beneficial
interest issued by the Trust on account of the Fund.
1.18 "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, and (ii) any "Eligible
Foreign Custodian" 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 be in writing and
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 Foreign Securities 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 Foreign Securities 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 in (i)-(vi) 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.
1.19 "WRITTEN INSTRUCTIONS" shall mean (i) written communications actually
received by the Custodian and signed by any two Authorized Persons, (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 Trustees, a copy of which, certified by
an Officer, shall have been delivered to the Custodian.
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ARTICLE II.
APPOINTMENT OF CUSTODIAN
2.01 APPOINTMENT. The Trust hereby 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, on the terms and conditions set forth in this
Agreement, and the Custodian hereby accepts such appointment and agrees to
perform the services and duties set forth in this Agreement. The Trust hereby
delegates to the Custodian, subject to Rule 17f-5(b), the responsibilities with
respect to the Fund's Foreign Securities, and the Custodian hereby accepts such
delegation as foreign custody manager with respect to the Fund. The services and
duties of the Custodian shall be confined to those matters expressly set forth
herein, and no implied duties are assumed by or may be asserted against the
Custodian hereunder.
2.02 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 Trust:
(a) A copy of the Trust's declaration of trust, certified by the
Secretary;
(b) A copy of the Trust's bylaws, certified by the Secretary;
(c) A copy of the resolution of the Board of Trustees of the Trust
appointing the Custodian, certified by the Secretary;
(d) A copy of the current prospectus of the Fund (the "Prospectus");
(e) A certification of the Chairman or the President and the Secretary
of the Trust setting forth the names and signatures of the current
Officers of the Trust and other Authorized Persons; and
(f) An executed authorization required by the Shareholder Communications
Act of 1985, attached hereto as EXHIBIT E.
2.03 NOTICE OF APPOINTMENT OF TRANSFER AGENT. The Trust agrees to notify the
Custodian in writing of the appointment, termination or change in appointment of
any transfer agent of the Fund.
ARTICLE III.
CUSTODY OF CASH AND SECURITIES
3.01 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, Eligible 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 Trust, if applicable) and shall be identified as subject
to this Agreement.
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3.02 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 Trust
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.
3.03 Appointment of Agents.
(a) In its discretion, the Custodian may appoint one or more
Sub-Custodians to establish and maintain arrangements with (i)
Eligible Securities Depositories or (ii) Eligible Foreign Custodians
who are members of the Sub-Custodian's network 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. The Custodian shall be liable for the actions of any
Sub-Custodians (regardless of whether assets are maintained in the
custody of a Sub-Custodian, a member of its network or an Eligible
Securities Depository) appointed by it as if such actions had been
done by the Custodian.
(b) If, after the initial appointment of Sub-Custodians by the Board of
Trustees in connection with this Agreement, the Custodian wishes to
appoint other Sub-Custodians to hold property of the Fund, it will
so notify the Trust and make the necessary determinations as to any
such new Sub-Custodian's eligibility under Rule 17f-5 under the 1940
Act.
(c) In performing its delegated responsibilities as foreign custody
manager to place or maintain the Fund's assets with a Sub-Custodian,
the Custodian will determine that the Fund's assets will be subject
to reasonable care, based on the standards applicable to custodians
in the country in which the Fund's assets will be held by that
Sub-Custodian, after considering all factors relevant to safekeeping
of such assets, including, without limitation the factors specified
in Rule 17f-5(c)(1).
(d) The agreement between the Custodian and each Sub-Custodian acting
hereunder shall contain the required provisions set forth in Rule
17f-5(c)(2) under the 1940 Act.
(e) At the end of each calendar quarter, the Custodian shall provide
written reports notifying the Board of Trustees of the withdrawal or
placement of the Securities and cash of the Fund with a
Sub-Custodian and of any material changes in the Fund's
arrangements. Such reports shall include an analysis of the custody
risks associated with maintaining assets with any Eligible
Securities Depositories. The Custodian shall promptly take such
steps as may be required to withdraw assets of the Fund from any
Sub-Custodian arrangement that has ceased to meet the requirements
of Rule 17f-5 or Rule 17f-7 under the 1940 Act, as applicable.
(f) With respect to its responsibilities under this Section 3.3, the
Custodian hereby warrants to the Trust 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 the Fund's assets will be subject to
reasonable care if maintained with a 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
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certificated securities (if applicable), its method of keeping
custodial records, and its 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.
(g) The Custodian shall establish a system or ensure that its
Sub-Custodian has established a system to monitor on a continuing
basis (i) the appropriateness of maintaining the Fund's assets with
a Sub-Custodian or Eligible Foreign Custodians who are members of a
Sub-Custodian's network; (ii) the performance of the contract
governing the Fund's arrangements with such Sub-Custodian or
Eligible Foreign Custodian's members of a Sub-Custodian's network;
and (iii) the custody risks of maintaining assets with an Eligible
Securities Depository. The Custodian must promptly notify the Fund
or its investment adviser of any material change in these risks.
(h) The Custodian shall use reasonable commercial efforts to collect all
income and other payments with respect to Foreign Securities to
which the Fund shall be entitled and shall credit such income, as
collected, to the Trust. In the event that extraordinary measures
are required to collect such income, the Trust and Custodian shall
consult as to the measurers and as to the compensation and expenses
of the Custodian relating to such measures.
3.04 DELIVERY OF ASSETS TO CUSTODIAN. The Trust shall deliver, or cause to be
delivered, to the Custodian all of the Fund's Securities, cash and other
investment assets, including (i) 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 (ii) all cash received by the Fund for the issuance of Shares.
The Custodian shall not be responsible for such Securities, cash or other assets
until actually received by it.
3.05 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) The Custodian, on an on-going basis, shall deposit in a Securities
Depository or Book-Entry System all Securities eligible for deposit
therein and shall 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.
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(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 Trust 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) Notwithstanding anything to the contrary in this Agreement, the
Custodian shall be liable to the Trust for any loss or damage to the
Fund resulting from (i) the use of a Book-Entry System or Securities
Depository by reason of any negligence or willful misconduct on the
part of the Custodian or any Sub-Custodian, or (ii) failure of the
Custodian or any Sub-Custodian to enforce effectively such rights as
it may have against a Book-Entry System or Securities Depository. At
its election, the Trust 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.
(g) With respect to its responsibilities under this Section 3.5 and
pursuant to Rule 17f-4 under the 1940 Act, the Custodian hereby
warrants to the Trust that it agrees to (i) exercise due care in
accordance with reasonable commercial standards in discharging its
duty as a securities intermediary to obtain and thereafter maintain
such assets, (ii) provide, promptly upon request by the Trust, such
reports as are available concerning the Custodian's internal
accounting controls and financial strength, and (iii) require any
Sub-Custodian to exercise due care in accordance with reasonable
commercial standards in discharging its duty as a securities
intermediary to obtain and thereafter maintain assets corresponding
to the security entitlements of its entitlement holders.
3.06 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
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contracts), against the delivery to the Custodian (or any
Sub-Custodian) 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 any 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 any
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 Trust and a bank which is a member of the Federal Reserve System
or between the Trust 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 Trust, the Custodian and a broker-dealer registered under
the 1934 Act and a member of FINRA, 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 provisions of any agreement
among the Trust, 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
Trustees, 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.
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3.07 DELIVERY OF SECURITIES FROM FUND CUSTODY ACCOUNT. Upon receipt of Proper
Instructions, the Custodian shall release and deliver, or cause the
Sub-Custodian to 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, or any nominee or
nominees of any of the foregoing, or (ii) for exchange for a
different number of certificates or other evidence representing the
same aggregate face amount or number of units; provided that, in any
such case, the new Securities are to be delivered to the Custodian;
(e) To the broker selling the Securities, for examination in accordance
with the "street delivery" custom;
(f) For exchange or conversion pursuant to any plan of 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 Trust 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 Trust, 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 Trust;
(l) For delivery in accordance with the provisions of any agreement
among the Trust, the Custodian and a broker-dealer registered under
the 1934 Act and a member of FINRA, relating to compliance with the
rules of the Options Clearing Corporation and of any
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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 Trust, 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;
(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 Trustees, 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; or
(o) To brokers, clearing banks or other clearing agents for examination
or trade execution in accordance with market custom; provided that
in any such case the Custodian shall have no responsibility or
liability for any loss arising from the delivery of such securities
prior to receiving payment for such securities except as may arise
from the Custodian's own negligence or willful misconduct.
3.08 ACTIONS NOT REQUIRING PROPER INSTRUCTIONS. Unless otherwise instructed by
the Trust, the Custodian shall with respect to all Securities held for the Fund:
(a) Subject to Section 9.4 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 9.4 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 IRS and the Trust 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 other assets of the Fund.
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3.09 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, a Sub-Custodian or any
nominee thereof, or in the name of a Book-Entry System, Securities Depository or
any nominee of either thereof. The records of the Custodian with respect to
foreign securities of the Fund that are maintained with a Sub-Custodian in an
account that is identified as belonging to the Custodian for the benefit of its
customers shall identify those securities as belonging to the Fund. The Trust
shall furnish to the Custodian appropriate instruments to enable the Custodian
to hold or deliver in proper form for transfer, or to register in the name of
any of the nominees referred to above 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 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; (iii) canceled checks and bank records related
thereto; and (iv) all records relating to its activities and
obligations under this Agreement. The Custodian shall keep such
other books and records of the Fund as the Trust 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 Trust and in compliance with
the rules and regulations of the SEC, (ii) be the property of the
Trust 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 Trust and employees
or agents of the SEC, and (iii) if required to be maintained by Rule
31a-1 under the 1940 Act, be preserved for the periods prescribed in
Rules 31a-1 and 31a-2 under the 1940 Act.
3.11 FUND REPORTS BY CUSTODIAN. The Custodian shall furnish the Trust 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, the
Custodian shall furnish the Trust 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. As the Trust may reasonably request from time
to time, the Custodian shall provide the Trust with reports on the internal
accounting controls and procedures for safeguarding Securities which are
employed by the Custodian or any Sub-Custodian.
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
11
such Securities, without indication of the manner in which such proxies are to
be voted, and shall promptly deliver to the Trust such proxies, all proxy
soliciting materials and all notices relating to such Securities. With respect
to the foreign Securities, the Custodian will use reasonable commercial efforts
to facilitate the exercise of voting and other shareholder rights, subject to
the laws, regulations and practical constraints that may exist in the country
where such securities are issued. The Trust acknowledges that local conditions,
including lack of regulation, onerous procedural obligations, lack of notice and
other factors may have the effect of severely limiting the ability of the Trust
to exercise shareholder rights.
3.14 INFORMATION ON CORPORATE ACTIONS. The Custodian shall promptly deliver to
the Trust 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 Trust desires to take
action with respect to any tender offer, exchange offer or other similar
transaction, the Trust shall notify the Custodian at least three Business Days
prior to the date on which the Custodian is to take such action. The Trust will
provide or cause to be provided to the Custodian all relevant information for
any Security which has unique put/option provisions at least three Business Days
prior to the beginning date of the tender period.
ARTICLE IV.
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
4.01 PURCHASE OF SECURITIES. Promptly upon each purchase of Securities for the
Fund, Written Instructions shall be delivered to the Custodian, specifying (i)
the name of the issuer or writer of such Securities, and the title or other
description thereof, (ii) the number of shares, principal amount (and accrued
interest, if any) or other units purchased, (iii) the date of purchase and
settlement, (iv) the purchase price per unit, (v) the total amount payable upon
such purchase, and (vi) 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.
4.02 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 and in
the absence of specified Written Instructions to so pay in advance, the
Custodian shall be liable to the Fund for such payment.
4.03 SALE OF SECURITIES. Promptly upon each sale of Securities by the Fund,
Written Instructions shall be delivered to the Custodian, specifying (i) the
name of the issuer or writer of such Securities, and the title or other
description thereof, (ii) the number of shares, principal amount (and accrued
interest, if any), or other units sold, (iii) the date of sale and settlement,
(iv) the sale price per unit, (v) the total amount payable upon such sale, and
(vi) 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
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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.
4.04 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.
4.05 PAYMENT FOR SECURITIES SOLD. 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.
4.06 ADVANCES BY CUSTODIAN FOR SETTLEMENT. The Custodian may, in its sole
discretion and from time to time, advance funds to the Trust 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
5.01 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 or broker-dealer as the Trust may designate.
5.02 NO DUTY REGARDING PAYING BANKS. Once the Custodian has wired amounts to a
bank or broker-dealer pursuant to Section 5.1 above, the Custodian shall not be
under any obligation to effect any further payment or distribution by such bank
or broker-dealer.
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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 Trust,
the Custodian and a broker-dealer registered under the 1934 Act and
a member of FINRA (or any futures commission merchant registered
under the Commodity Exchange Act), relating to compliance with the
rules of the Options Clearing Corporation 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 Trustees, 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.
COMPENSATION OF CUSTODIAN
7.01 COMPENSATION. The Custodian shall be compensated for providing the
services set forth in this Agreement in accordance with the fee schedule set
forth on EXHIBIT D hereto (as amended from time to time). The Custodian shall
also be compensated for such out-of-pocket expenses (e.g., telecommunication
charges, postage and delivery charges, and reproduction charges) as are
reasonably incurred by the Custodian in performing its duties hereunder. The
Trust shall pay all such fees and reimbursable expenses within 30 calendar days
following receipt of the billing notice, except for any fee or expense subject
to a good faith dispute. The Trust shall notify the Custodian in writing within
30 calendar days following receipt of each invoice if the Trust is disputing any
amounts in good faith. The Trust shall pay such disputed amounts within 10
calendar days of the
14
day on which the parties agree to the amount to be paid. With the exception of
any fee or expense the Trust is disputing in good faith as set forth above,
unpaid invoices shall accrue a finance charge of 1 1/2% per month after the due
date. Notwithstanding anything to the contrary, amounts owed by the Trust to the
Custodian shall only be paid out of the assets and property of the particular
Fund involved.
7.02 OVERDRAFTS. The Trust is responsible for maintaining an appropriate level
of short term cash investments to accommodate cash outflows. The Trust may
obtain formal line of credit for potential overdrafts of its custody account. In
the event of an overdraft or in the event the line of credit is insufficient to
cover an overdraft, the overdraft amount or the overdraft amount that exceeds
the line of credit will be charged in accordance with the fee schedule set forth
on Exhibit D hereto (as amended from time to time)
ARTICLE VIII.
REPRESENTATIONS AND WARRANTIES
8.01 REPRESENTATIONS AND WARRANTIES OF THE TRUST. The Trust hereby represents
and warrants to the Custodian, which representations and warranties shall be
deemed to be continuing throughout the term of this Agreement, that:
(a) It is duly organized and existing under the laws of the jurisdiction
of its organization, with full power to carry on its business as now
conducted, to enter into this Agreement and to perform its
obligations hereunder;
(b) This Agreement has been duly authorized, executed and delivered by
the Trust in accordance with all requisite action and constitutes a
valid and legally binding obligation of the Trust, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and secured parties;
and
(c) It is conducting its business in compliance in all material respects
with all applicable laws and regulations, both state and federal,
and has obtained all regulatory approvals necessary to carry on its
business as now conducted; there is no statute, rule, regulation,
order or judgment binding on it and no provision of its charter,
bylaws or any contract binding it or affecting its property which
would prohibit its execution or performance of this Agreement.
8.02 REPRESENTATIONS AND WARRANTIES OF THE CUSTODIAN. The Custodian hereby
represents and warrants to the Trust, which representations and warranties shall
be deemed to be continuing throughout the term of this Agreement, that:
(a) It is duly organized and existing under the laws of the jurisdiction
of its organization, with full power to carry on its business as now
conducted, to enter into this Agreement and to perform its
obligations hereunder;
(b) It is a U.S. Bank as defined in section (a)(7) of Rule 17f-5.
15
(c) This Agreement has been duly authorized, executed and delivered by
the Custodian in accordance with all requisite action and
constitutes a valid and legally binding obligation of the Custodian,
enforceable in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting the rights and remedies of creditors and
secured parties; and
(d) It is conducting its business in compliance in all material respects
with all applicable laws and regulations, both state and federal,
and has obtained all regulatory approvals necessary to carry on its
business as now conducted; there is no statute, rule, regulation,
order or judgment binding on it and no provision of its charter,
bylaws or any contract binding it or affecting its property which
would prohibit its execution or performance of this Agreement.
ARTICLE IX.
CONCERNING THE CUSTODIAN
9.01 STANDARD OF CARE. The Custodian shall exercise reasonable care in the
performance of its duties under this Agreement. The Custodian shall not be
liable for any error of judgment or mistake of law or for any loss suffered by
the Trust in connection with its duties under this Agreement, except a loss
arising out of or relating to the Custodian's (or a Sub-Custodian's) refusal or
failure to comply with the terms of this Agreement (or any sub-custody
agreement) or from its (or a Sub-Custodian's) bad faith, negligence or willful
misconduct in the performance of its duties under this Agreement (or any
sub-custody agreement). 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 Trust of any action taken or omitted by the Custodian
pursuant to advice of counsel.
9.02 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.
9.03 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.
9.04 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.
9.05 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.
9.06 COOPERATION. The Custodian shall cooperate with and supply necessary
information to the entity or entities appointed by the Trust to keep the books
of account of the Fund and/or
16
compute the value of the assets of the Fund. The Custodian shall take all such
reasonable actions as the Trust may from time to time request to enable the
Trust to obtain, from year to year, favorable opinions from the Trust's
independent accountants with respect to the Custodian's activities hereunder in
connection with (i) the preparation of the Trust's reports on Form N-1A and Form
N-SAR and any other reports required by the SEC, and (ii) the fulfillment by the
Trust of any other requirements of the SEC.
ARTICLE X.
INDEMNIFICATION
10.01 INDEMNIFICATION BY TRUST. The Trust shall indemnify and hold harmless the
Custodian, any Sub-Custodian and any nominee thereof (each, an "Indemnified
Party" and collectively, the "Indemnified Parties") from and against any and all
claims, demands, losses, expenses and liabilities of any and every nature
(including reasonable attorneys' fees) that an Indemnified Party may sustain or
incur or that may be asserted against an Indemnified Party by any person arising
directly or indirectly (i) from the fact that Securities are registered in the
name of any such nominee, (ii) from any action taken or omitted to be taken by
the Custodian or such Sub-Custodian (a) at the request or direction of or in
reliance on the advice of the Trust, or (b) upon Proper Instructions, or (iii)
from the performance of its obligations under this Agreement or any sub-custody
agreement, provided that neither the Custodian nor any such Sub-Custodian shall
be indemnified and held harmless from and against any such claim, demand, loss,
expense or liability arising out of or relating to its refusal or failure to
comply with the terms of this Agreement (or any sub-custody agreement), or from
its bad faith, negligence or willful misconduct in the performance of its duties
under this Agreement (or any sub-custody agreement). This indemnity shall be a
continuing obligation of the Trust, its successors and assigns, notwithstanding
the termination of this Agreement. As used in this paragraph, the terms
"Custodian" and "Sub-Custodian" shall include their respective directors,
officers and employees.
10.02 INDEMNIFICATION BY CUSTODIAN. The Custodian shall indemnify and hold
harmless the Trust from and against any and all claims, demands, losses,
expenses, and liabilities of any and every nature (including reasonable
attorneys' fees) that the Trust may sustain or incur or that may be asserted
against the Trust by any person arising directly or indirectly out of any action
taken or omitted to be taken by an Indemnified Party as a result of the
Indemnified Party's refusal or failure to comply with the terms of this
Agreement (or any sub-custody agreement), or from its bad faith, negligence or
willful misconduct in the performance of its duties under this Agreement (or any
sub-custody agreement). This indemnity shall be a continuing obligation of the
Custodian, its successors and assigns, notwithstanding the termination of this
Agreement. As used in this paragraph, the term "Trust" shall include the Trust's
directors, officers and employees.
10.03 SECURITY. If the Custodian advances cash or Securities to the Fund for any
purpose, either at the Trust's request or as otherwise contemplated in this
Agreement, or in the event that the Custodian or its nominee incurs, in
connection with its performance under this Agreement, any claim, demand, loss,
expense or liability (including reasonable attorneys' fees) (except such as may
arise from its or its nominee's bad faith, negligence 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
17
available cash of such Fund and to dispose of other assets of such Fund to the
extent necessary to obtain reimbursement or indemnification.
10.04 Miscellaneous.
(a) Neither party to this Agreement shall be liable to the other party
for consequential, special or punitive damages under any provision
of this Agreement.
(b) The indemnity provisions of this Article shall indefinitely survive
the termination and/or assignment of this Agreement.
(c) In order that the indemnification provisions contained in this
Article shall apply, it is understood that if in any case the
indemnitor may be asked to indemnify or hold the indemnitee
harmless, the indemnitor shall be fully and promptly advised of all
pertinent facts concerning the situation in question, and it is
further understood that the indemnitee will use all reasonable care
to notify the indemnitor promptly concerning any situation that
presents or appears likely to present the probability of a claim for
indemnification. The indemnitor shall have the option to defend the
indemnitee against any claim that may be the subject of this
indemnification. In the event that the indemnitor so elects, it will
so notify the indemnitee and thereupon the indemnitor shall take
over complete defense of the claim, and the indemnitee shall in such
situation initiate no further legal or other expenses for which it
shall seek indemnification under this section. The indemnitee shall
in no case confess any claim or make any compromise in any case in
which the indemnitor will be asked to indemnify the indemnitee
except with the indemnitor's prior written consent.
ARTICLE XI.
FORCE MAJEURE
Neither the Custodian nor the Trust 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; acts of terrorism; 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 in the event of a failure or delay, the
Custodian (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 XII.
PROPRIETARY AND CONFIDENTIAL INFORMATION
12.01 The Custodian agrees on behalf of itself and its directors, officers, and
employees to treat confidentially and as proprietary information
18
of the Trust, all records and other information relative to the Trust and prior,
present, or potential shareholders of the Trust (and clients of said
shareholders), and not to use such records and information for any purpose other
than the performance of its responsibilities and duties hereunder, except (i)
after prior notification to and approval in writing by the Trust, which approval
shall not be unreasonably withheld and may not be withheld where the Custodian
may be exposed to civil or criminal contempt proceedings for failure to comply,
(ii) when requested to divulge such information by duly constituted authorities,
or (iii) when so requested by the Trust. Records and other information which
have become known to the public through no wrongful act of the Custodian or any
of its employees, agents or representatives, and information that was already in
the possession of the Custodian prior to receipt thereof from the Trust or its
agent, shall not be subject to this paragraph.
12.02 Further, the Custodian will adhere to the privacy policies adopted by the
Trust pursuant to Title V of the Xxxxx-Xxxxx-Xxxxxx Act, as may be modified from
time to time. In this regard, the Custodian shall have in place and maintain
physical, electronic and procedural safeguards reasonably designed to protect
the security, confidentiality and integrity of, and to prevent unauthorized
access to or use of, records and information relating to the Trust and its
shareholders.
ARTICLE XIII.
EFFECTIVE PERIOD; TERMINATION
13.01 EFFECTIVE PERIOD. This Agreement shall become effective as of the date
first written above and will continue in effect for a period of three years.
13.02 TERMINATION. Subsequent to the initial three-year term, this Agreement may
be terminated by either party upon giving 90 days prior written notice to the
other party or such shorter period as is mutually agreed upon by the parties.
Notwithstanding the foregoing, this Agreement may be terminated by any party
upon the breach of the other party of any material term of this Agreement if
such breach is not cured within 15 days of notice of such breach to the
breaching party. In addition, the Trust may, at any time, immediately terminate
this Agreement in the event of the appointment of a conservator or receiver for
the Custodian by regulatory authorities or upon the happening of a like event at
the direction of an appropriate regulatory agency or court of competent
jurisdiction.
13.03 EARLY TERMINATION. In the absence of any material breach of this
agreement, should the Trust elect to terminate this agreement prior to the end
of the term, the trust agrees to pay the following fees:
a) All monthly fees through the life of the contract, including the
rebate of any negotiated discounts;
b) All fees associated with converting services to successor service
provider;
c) All fees associated with any record retention and/or tax reporting
obligations that may not be eliminated due to the conversion to a
successor service provider;
All out-of-pocket costs associated with a-c above
19
13.04 APPOINTMENT OF SUCCESSOR CUSTODIAN. If a successor custodian shall have
been appointed by the Board of Trustees, the Custodian shall, upon receipt of a
notice of acceptance by the successor custodian, on such specified date of
termination (i) deliver directly to the successor custodian all Securities
(other than Securities held in a Book-Entry System or Securities Depository) and
cash then owned by the Fund and held by the Custodian as custodian, and (ii)
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 Trust shall have paid to the Custodian all fees, expenses and
other amounts to the payment or reimbursement of which it shall then be
entitled. In addition, the Custodian shall, at the expense of the Trust,
transfer to such successor all relevant books, records, correspondence, and
other data established or maintained by the Custodian under this Agreement in a
form reasonably acceptable to the Trust (if such form differs from the form in
which the Custodian has maintained the same, the Trust shall pay any expenses
associated with transferring the data to such form), and will cooperate in the
transfer of such duties and responsibilities, including provision for assistance
from the Custodian's personnel in the establishment of books, records, and other
data by such successor. Upon such delivery and transfer, the Custodian shall be
relieved of all obligations under this Agreement.
13.05 FAILURE TO APPOINT SUCCESSOR CUSTODIAN. If a successor custodian is not
designated by the Trust on or before the date of termination of this Agreement,
then the Custodian shall have the right to deliver to a bank or trust company of
its own selection, which bank or trust company (i) is a "bank" as defined in the
1940 Act, and (ii) has aggregate capital, surplus and undivided profits as shown
on its 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. In addition, under these circumstances,
all books, records and other data of the Trust shall be returned to the Trust.
ARTICLE XIV.
MISCELLANEOUS
14.01 COMPLIANCE WITH LAWS. The Trust has and retains primary responsibility for
all compliance matters relating to the Fund, including but not limited to
compliance with the 1940 Act, the Internal Revenue Code of 1986, the
Xxxxxxxx-Xxxxx Act of 2002, the USA Patriot Act of 2002 and the policies and
limitations of the Fund relating to its portfolio investments as set forth in
its Prospectus and statement of additional information. The Custodian's services
hereunder shall not relieve the Trust of its responsibilities for assuring such
compliance or the Board of Trustee's oversight responsibility with respect
thereto.
14.02 AMENDMENT. This Agreement may not be amended or modified in any manner
except by written agreement executed by the Custodian and the Trust, and
authorized or approved by the Board of Trustees.
14.03 ASSIGNMENT. This Agreement shall extend to and be binding upon the parties
hereto and their respective successors and assigns; provided, however, that this
Agreement shall not be
20
assignable by the Trust without the written consent of the Custodian, or by the
Custodian without the written consent of the Trust accompanied by the
authorization or approval of the Board of Trustees.
14.04 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio, without regard to conflicts of
law principles. To the extent that the applicable laws of the State of Ohio, or
any of the provisions herein, conflict with the applicable provisions of the
1940 Act, the latter shall control, and nothing herein shall be construed in a
manner inconsistent with the 1940 Act or any rule or order of the SEC
thereunder.
14.05 NO AGENCY RELATIONSHIP. Nothing herein contained shall be deemed to
authorize or empower either party to act as agent for the other party to this
Agreement, or to conduct business in the name, or for the account, of the other
party to this Agreement.
14.06 SERVICES NOT EXCLUSIVE. Nothing in this Agreement shall limit or restrict
the Custodian from providing services to other parties that are similar or
identical to some or all of the services provided hereunder.
14.07 INVALIDITY. Any provision of this Agreement which may be determined by
competent authority to be prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. In such case, the
parties shall in good faith modify or substitute such provision consistent with
the original intent of the parties.
14.08 NOTICES. Any notice required or permitted to be given by either party to
the other shall be in writing and shall be deemed to have been given on the date
delivered personally or by courier service, or three days after sent by
registered or certified mail, postage prepaid, return receipt requested, or on
the date sent and confirmed received by facsimile transmission to the other
party's address set forth below:
Notice to the Custodian shall be sent to:
U.S Bank, N.A.
0000 X. Xxxxxxxxxxx Xx., XX-XX-X000
Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
and notice to the Trust shall be sent to:
The RAM Funds
c/o Riazzi Asset Management, LLC
0000 Xxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
21
14.09 MULTIPLE ORIGINALS. This Agreement may be executed on two or more
counterparts, each of which when so executed shall be deemed an original, but
such counterparts shall together constitute but one and the same instrument.
14.10 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.
14.11 REFERENCES TO CUSTODIAN. The Trust 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 Trust 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by a duly authorized officer on one or more counterparts as of the date
first above written.
THE RAM FUNDS U.S. BANK NATIONAL ASSOCIATION
By:________________________________ By:______________________________
Name:______________________________ Name: Xxxxxxx X. XxXxx
Title:______________________________ Title: Vice President
22
EXHIBIT A
---------
AUTHORIZED PERSONS
Set forth below are the names and specimen signatures of the persons
authorized by The RAM Funds to administer the Fund Custody Accounts.
AUTHORIZED PERSONS SPECIMEN SIGNATURES
------------------ -------------------
President: Xxxx X. Xxxxxx ________________________________
Vice President: Xxxxxx X. Xxxxxx ________________________________
Treasurer: Xxxx X. Xxxxx ________________________________
Secretary: Xxxx X. Xxxxxx ________________________________
Assistant Vice President: Xxxxx X. Xxxx ________________________________
Controller: Xxxxx Xxxxx ________________________________
Assistant Treasurer: Xxxxxxx X. Bridge ________________________________
Assistant Secretary: Xxxx X. Xxxxx ________________________________
OTHER:
Xxxxxxx Xxxxxxx ________________________________
Xxxx X. Bridge ________________________________
Xxxx Xxxxxxx ________________________________
23
AUTHORIZED PERSONS SPECIMEN SIGNATURES
------------------ -------------------
Xxxxx Xxxxx ________________________________
Xxxxxx Xxxx ________________________________
Xxxxx Xxxxxxxxxxx ________________________________
Xxxxxx Xxxxxxx ________________________________
Xxx Xxxxx ________________________________
24
EXHIBIT B
---------
U.S. BANK INSTITUTIONAL CUSTODY SERVICES
STANDARDS OF SERVICE GUIDE
U.S. Bank, N.A. ("USBank") is committed to providing superior quality
service to all customers and their agents at all times. We have compiled this
guide as a tool for our clients to determine our standards for the processing of
security settlements, payment collection, and capital change transactions.
Deadlines recited in this guide represent the times required for USBank to
guarantee processing. Failure to meet these deadlines will result in settlement
at our client's risk. In all cases, USBank will make every effort to complete
all processing on a timely basis.
USBank is a direct participant of the Depository Trust Company, a direct
member of the Federal Reserve Bank of Cleveland, and utilizes the Bank of New
York as its agent for ineligible and foreign securities.
For corporate reorganizations, USBank utilizes SEI's Reorg Source,
Financial Information, Inc., XCITEK, DTC Important Notices, Capital Changes
Daily (CCH) and the WALL STREET JOURNAL.
For bond calls and mandatory puts, USBank utilizes SEI's Bond Source,
Xxxxx Information Systems, Standard & Poor's Corporation, XCITEK, and DTC
Important Notices. USBank will not notify clients of optional put opportunities.
Any securities delivered free to USBank or its agents must be received
three (3) business days prior to any payment or settlement in order for the
USBank standards of service to apply.
Should you have any questions regarding the information contained in this
guide, please feel free to contact your account representative.
THE INFORMATION CONTAINED IN THIS STANDARDS OF SERVICE GUIDE IS
SUBJECT TO CHANGE. SHOULD ANY CHANGES BE MADE USBANK WILL PROVIDE
YOU WITH AN UPDATED COPY OF ITS STANDARDS OF SERVICE GUIDE.
25
USBANK SECURITY SETTLEMENT STANDARDS
------------------------------------
TRANSACTION TYPE INSTRUCTIONS DEADLINES* DELIVERY INSTRUCTIONS
---------------- ----------------------- ---------------------
DTC 1:30 P.M. on Settlement Date DTC Participant #0000
Xxxxx Xxxx XX 00000
Institutional #________________
For Account #_____________
Federal Reserve Book Entry 12:30 P.M. on Settlement Date Federal Reserve Bank of Cleveland
for US Bank, N.A. ABA# 000000000
XXXXX/1050
For Account #_____________
Federal Reserve Book Entry (Repurchase 1:00 P.M. on Settlement Date Federal Reserve Bank of Cleveland
Agreement Collateral Only) for US Bank, N.A. ABA# 000000000
XXXXX/1040
For Account #_____________
PTC Securities 12:00 P.M. on Settlement Date PTC For Account BYORK
(GNMA Book Entry) US Bank / 117612
Physical Securities 9:30 A.M. EST on Settlement Date Bank of New York
(for Deliveries, by 4:00 P.M. on Settlement Date Xxx Xxxx Xxxxxx- 0xx Xxxxx - Xxxxxx A
minus 1) Xxx Xxxx, XX 00000
For account of US Bank / Cust #117612
Attn: Xxxxxx Xxxxxx
CEDEL/EURO-CLEAR 11:00 A.M. on Settlement Date minus 2 Cedel a/c 55021
FFC: a/c 387000
US Bank /Global Omnibus
Euroclear a/c 97816
FFC: a/c 387000
US Bank/Global Omnibus
Cash Wire Transfer 3:00 P.M. US Bank, X.X. Xxxxx/Trust
ABA# 000000000
Credit Account #112950027
Account of US Bancorp Trust Services
Further Credit to ___________
Account # _______________
* All times listed are Eastern Standard Time.
26
USBANK PAYMENT STANDARDS
SECURITY TYPE INCOME PRINCIPAL
Equities Payable Date
Municipal Bonds* Payable Date Payable Date
Corporate Bonds* Payable Date Payable Date
Federal Reserve Bank Book Entry* Payable Date Payable Date
PTC GNMA's (P&I) Payable Date + 1 Payable Date + 1
CMOs *
DTC Payable Date + 1 Payable Date + 1
Bankers Trust Payable Date + 1 Payable Date + 1
SBA Loan Certificates When Received When Received
Unit Investment Trust Certificates* Payable Date Payable Date
Certificates of Deposit* Payable Date + 1 Payable Date + 1
Limited Partnerships When Received When Received
Foreign Securities When Received When Received
*Variable Rate Securities
Federal Reserve Bank Book Entry Payable Date Payable Date
DTC Payable Date + 1 Payable Date + 1
Bankers Trust Payable Date + 1 Payable Date + 1
NOTE: If a payable date falls on a weekend or bank holiday, payment will be made
on the immediately following business day.
27
USBANK CORPORATE REORGANIZATION STANDARDS
TYPE OF ACTION NOTIFICATION TO CLIENT DEADLINE FOR CLIENT INSTRUCTIONS TRANSACTION
TO USBANK POSTING
Rights, Warrants, Later of 10 business days prior to 5 business days prior to expiration Upon receipt
and Optional Mergers expiration or receipt of notice
Mandatory Puts with Later of 10 business days prior to 5 business days prior to expiration Upon receipt
Option to Retain expiration or receipt of notice
Class Actions 10 business days prior to expiration date 5 business days prior to expiration Upon receipt
Voluntary Tenders, Later of 10 business days prior to 5 business days prior to expiration Upon receipt
Exchanges, expiration or receipt of notice
and Conversions
Mandatory Puts, Defaults, At posting of funds or securities received None Upon receipt
Liquidations, Bankruptcies,
Stock Splits, Mandatory
Exchanges
Full and Partial Calls Later of 10 business days prior to None Upon receipt
expiration or receipt of notice
NOTE: Fractional shares/par amounts resulting from any of the above will be
sold. 1.01
28
EXHIBIT C
---------
TO THE CUSTODY AGREEMENT
FUND NAMES
Separate Series of The RAM Funds
NAME OF SERIES DATE ADDED
-------------- ----------
RAM Capital Appreciation Fund on or after April ___, 2008
RAM Enhanced Income Fund on or after April ___, 2008
29
EXHIBIT D TO THE CUSTODY AGREEMENT
---------
THE RAM FUNDS
DOMESTIC CUSTODY SERVICES
ANNUAL FEE SCHEDULE AT APRIL, 2008
I. MARKET VALUE FEE PER FUND
--------------------------
Based upon an annual rate of:
.000175% (1.75 basis points) on first $50 million
.0001% (1 basis point) on the next $450 million
.000075% (0.75 basis point) on the next $1 billion
.00005 (.50 basis point) on the balance
MONTHLY MINIMUM FEE $500 per month
II. PORTFOLIO TRANSACTION FEES:
---------------------------
$ 7.00 per US Bank repurchase agreement transaction
$ 9.00 per book entry security (depository or Federal Reserve system)
$ 7.50 per book entry security (depository or Federal Reserve system) -
Advisor affirmed
$25.00 per transaction processed through our New York custodian definitive
security (physical)
$ 8.00 per principal paydown $15.00 per option/future contract written,
exercised or expired
$10.00 per Currency transaction
$15.00 per mutual fund trade
$15.00 per Fed wire or margin variation Fed wire
$ 6.00 per short sale
$ 5.00 per expense disbursement
$150.00 per segregated account per year
A transaction is a purchase/sale of a security, free receipt/free delivery
(excludes initial conversion), maturity, tender or exchange.
III. OUT-OF-POCKET EXPENSES
----------------------
Treasury management, shipping fees, transfer fees and other out-of-pocket
charges will be billed monthly.
o OVERDRAFTS - CHARGED TO THE ACCOUNT AT PRIME INTEREST RATE PLUS 2.
o U S BANK RETAINS THE RIGHT TO BE REIMBURSED FOR OUT-OF-POCKET EXPENSES
INCLUDING, BUT NOT LIMITED TO POSTAGE, INSURANCE AND LONG DISTANCE
TELEPHONE CHARGES. OTHER SERVICES ARE AVAILABLE AND PRICES CAN BE SUPPLIED
UPON REQUEST.
o REAL TIME INTERNET ACCESS FOR THE CLIENT WILL BE PROVIDED AT NO ADDITIONAL
CHARGE.
o THIS FEE SCHEDULE IS QUOTED BASED ON EXCLUSIVE UTILIZATION OF THE FIRST
AMERICAN MONEY MARKET FUNDS FOR INVESTMENT OF SHORT-TERM CASH.
30
EXHIBIT E
---------
SHAREHOLDER COMMUNICATIONS ACT AUTHORIZATION
THE RAM FUNDS
The Shareholder Communications Act of 1985 requires banks and trust companies to
make an effort to permit direct communication between a company which issues
securities and the shareholder who votes those securities.
Unless you specifically require us to NOT release your name and address to
requesting companies, we are required by law to disclose your name and address.
Your "yes" or "no" to disclosure will apply to all securities U.S. Bank holds
for you now and in the future, unless you change your mind and notify us in
writing.
______ YES U.S. Bank is authorized to provide the Trust's name,
address and security position to requesting
companies whose stock is owned by the Trust.
______ NO U.S. Bank is NOT authorized to provide the Trust's
name, address and security position to requesting
companies whose stock is owned by the Trust.
THE RAM FUNDS
By: ___________________________________
Title: ________________________________
Date: _________________________________
31
