A10045
07/10/89
CUSTODIAN AGREEMENT
THIS AGREEMENT is made as of June 19, 1989 by and between DFA INVESTMENT
DIMENSIONS GROUP INC., a Maryland corporation (the "Fund"), and PROVIDENT
NATIONAL BANK, a national banking association ("Provident").
W I T N E S S E T H :
WHEREAS, the Fund is registered as an open-end, diversified management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Fund desires to retain Provident to serve as the Fund's
custodian and Provident is willing to serve as the Fund's custodian;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Fund hereby appoints Provident to act as custodian
of the portfolio securities, cash and other property belonging to the following
classes of shares: The U.S. 9-10 Small Company Portfolio, The DFA One-Year Fixed
Income Portfolio, The DFA Five-Year Fixed Income Portfolio and The DFA Five Year
Government Portfolio (hereinafter the "Covered Portfolios") of the Fund for the
period and on the terms set forth in this Agreement. Provident accepts such
appointment and agrees to furnish the services herein set forth in return for
the compensation as provided in Paragraph 21 of this Agreement.. The Fund may
from time to time issue additional portfolios and, in such event, the provisions
of this Agreement shall apply to such portfolios as may be mutually agreed by
the Fund and Provident. Provident shall identify to each Covered Portfolio the
property and liabilities belonging to such Portfolio and in such actions,
records, reports, confirmations, accounts and notices to the Fund called for
under this Agreement shall identify the portfolio to which such actions, record,
account, report, confirmation or notice pertains.
2. DELIVERY OF DOCUMENTS. The Fund has furnished Provident with copies
properly certified or authenticated of each of the following:
(a) Resolutions of the Fund's Board of Directors authorizing the
appointment of Provident as custodian of the portfolio securities, cash and
other property belonging to the Fund as provided herein and approving this
Agreement;
(b) Appendix A identifying and containing the signatures of the
Fund's officers and/or other persons authorized to issue Oral Instructions
and to sign Written Instructions, as hereinafter defined, on behalf of the
Fund;
(c) The Fund's Articles of Incorporation filed with the Department
of Assessments and Taxation of the State of Maryland on June 15, 1981 and all
amendments thereto (such Articles of Incorporation, as presently-in effect
and as they shall from time to time be amended' are herein called the
"Charter");
(d) The Fund's By-Laws and all amendments thereto (such By-Laws, as
presently in effect and as they shall from time to time be amended, are herein
called the "By-Laws");
(e) The current Investment Advisory Agreements between Dimensional
Fund Advisors Inc. (the "Advisor") and the Fund (the "Advisory Agreement");
(f) The Distribution Agreement between the Fund and DFA Securities
Inc. (the "Distribution Agreement");
(g) The Transfer Agency Agreement between Provident Financial
Processing Corporation (the "Transfer Agent") and the Fund dated as of June 19,
1989 (the "Transfer Agency Agreement");
(h) The Administration and Accounting Services Agreement between
Provident Financial Processing Corporation and the Fund dated as of June 19,
1989 (the "Accounting Services Agreement");
(i) The current Sub-Advisory Agreements with Dimensional Asset
Management Ltd. and The Nomura Securities Investment Trust Management Co. Ltd.
(the "Sub-Advisory Agreements");
(j) The Fund's most recent Registration Statement on Form N-1A under
the Securities Act of 1933, as amended ("xxx 0000 Xxx") (File No. 2-73948) and
under the 1940 Act as filed with the SEC on February 1, 1989 relating to shares
of the Fund's Common Stock, $.01 par value ("Shares"), and all amendments
thereto; and
(k) The Fund's most recent prospectus or prospectuses and Statements
of Additional Information relating to Shares (such prospectus or prospectuses
and Statements of Additional Information, as presently in effect and all
amendments and supplements thereto are herein called the "Prospectus"). The
Fund will furnish Provident from time to time with copies, properly certified
or authenticated, of all amendments of or supplements to the foregoing, if any.
3. DEFINITIONS.
(a) "AUTHORIZED PERSON". As used in this Agreement, the term
"Authorized Person" means any of the officers of the Fund and any other person,
whether or not any such person is an officer or employee of the Fund, duly
authorized by the Board of Directors of the Fund to give Oral and Written
Instructions on behalf of the Fund and listed on the Certificate annexed hereto
as Appendix A or any amendment thereto as may be received by Provident from time
to time.
(b) "BOOK-ENTRY SYSTEM". As used in this Agreement, the term "Book-
Entry System" means the Federal Reserve Treasury book-entry system for United
States and federal agency securities, its successor or successors and its
nominee or nominees and any book-entry system maintained by a clearing agency
registered with the SEC under Section 17A of the Securities Exchange Act of 1934
(the "1934 Act").
(c) "ORAL INSTRUCTIONS". As used in this Agreement, the term "Oral
Instructions" means oral instructions actually received by Provident from an
Authorized Person or from a person reasonably believed by Provident to be an
Authorized Person. The Fund agrees to deliver to Provident, at the time and in
the manner specified in Paragraph 8(b) of this Agreement, Written Instructions
confirming Oral Instructions.
(d) "PROPERTY". The term "Property", as used in this Agreement,
means:
(i) any and all securities, forward currency contracts,
exchange listed financial futures contracts and other property which the Fund
may from time to time deposit, or cause to be deposited, with Provident or which
Provident may from time to time hold for the Fund;
(ii) all income in respect of any of such securities, forward
currency contracts, exchange listed financial futures contracts or other
property;
(iii) all proceeds of the sale of any of such securities, forward
currency contracts, exchange listed financial futures contracts or other
property; and
(iv) all proceeds of the sale of securities issued by the Fund,
which are received by Provident from time to time from or on behalf of the Fund.
(e) PFPC. As used in this Agreement, "PFPC" means Provident
Financial Processing Corporation.
(f) "WRITTEN INSTRUCTIONS". As used in this Agreement, the term
"Written Instructions" means written instructions delivered by hand, mail,
tested telegram, cable, telex or facsimile sending device, and received by
Provident and signed by an Authorized Person. Written Instructions include
electronic transmissions properly originated and confirmed by the Fund.
(g) AFFILIATE. As used herein, "Affiliate" means any company that
controls, is controlled by or is under common control with Provident.
4. DELIVERY AND REGISTRATION OF THE PROPERTY. The Fund will deliver or
cause to be delivered to Provident all securities and all moneys owned by the
Covered Portfolios, including cash or securities received for the issuance of
their Shares, at any time during the period of this Agreement. Provident will
not be responsible for such securities and such moneys until actually received
by it. All securities delivered to Provident (other than in bearer form) shall
be registered in the name of the Fund or in the name of a nominee of the Fund or
in the name of any nominee of Provident (with or without indication of fiduciary
status), or in the name of any sub-custodian or any nominee of any such sub-
custodian appointed pursuant to Paragraph 6 hereof or shall be properly endorsed
and in form for transfer satisfactory to Provident.
5. RECEIPT AND DISBURSEMENT OF MONEY.
(a) Provident shall open and maintain a separate custodial account or
accounts in the name of each Covered Portfolio subject only to draft or order by
Provident acting pursuant to the terms of this Agreement, and shall hold in such
account or accounts, subject to the provisions hereof, all cash received by it
from or for the account of such Portfolios. Provident shall make payments of
cash to, or for the account of, such Portfolios from such cash only (i) for the
purchase of securities as provided in Paragraph 13 hereof; (ii) upon receipt of
Written Instructions, for the payment of interest, dividends, distributions,
taxes, administration, accounting, advisory or management fees or expenses which
are to be borne by such Portfolios under the terms of this Agreement, the
Advisory Agreements, the Administration and Accounting Services Agreement, and
the Transfer Agency Agreement; (iii) upon receipt of Written Instructions, for
payments in connection with the conversion, exchange or surrender of securities
owned or subscribed to by such Portfolios and held by or to be delivered to
Provident; (iv) to a sub-custodian pursuant to Paragraph 6 hereof; (v) for the
redemption of such Portfolios' Shares pursuant to the procedures set forth in
the Fund's prospectus dated April 1, 1989 or Written Instructions amending such
procedures; (vi) for payment of the amount of dividends received in respect of
securities sold short; or (vii) upon receipt of Written Instructions, for other
Fund purposes. No payment pursuant to (i) above shall be made unless Provident
has received a copy of the broker's or dealer's confirmation or the payee's
invoice, as appropriate, and as provided in Paragraph 13 hereof.
(b) Provident is hereby authorized to endorse and collect all checks,
drafts or other orders for the payment of money received as custodian for the
account of the Covered Portfolios.
6. RECEIPT OF SECURITIES.
(a) Except as provided by Paragraph 7 hereof, Provident shall hold
and physically segregate in a separate account, identifiable at all times from
those of any other persons, firms, or corporations, all securities and other
property received by it for the account of the Covered Portfolios. All such
securities and other property shall be held or disposed of by Provident for the
Fund pursuant to the terms of this Agreement. In the absence of Written
Instructions accompanied by a certified resolution of the Fund's Board of
Directors authorizing the transaction, Provident shall have no power or
authority to withdraw, deliver, assign, hypothecate, pledge or otherwise dispose
of any such securities and investments except in accordance with the express
terms provided for in this Agreement. In no case may any Director, officer,
employee or agent of the Fund withdraw any securities upon their mere receipt.
In connection with its customary and normal ties under this Paragraph 6,
Provident may, at its own expense, enter into sub-custodian agreements with
other banks or trust companies for the receipt of certain securities and cash to
be held by Provident for the account of the Covered Portfolio's pursuant to this
Agreement; provided that each such bank or trust company has an aggregate
capital, surplus and undivided profits, as shown by its last published report,
of not less than one million dollars ($1,000,000) for a Provident subsidiary or
affiliate, or of not less than twenty million dollars ($20,000,000) if such bank
or trust company is not a Provident subsidiary or affiliate and that in either
case such bank or trust company agrees with Provident to comply with all
relevant provisions of the 1940 Act and applicable rules and regulations
thereunder. Provident shall remain responsible for the performance of all of
its duties under this Agreement and shall indemnify and hold the Fund harmless
from the acts and omissions, under the standard of care provided for herein, of
any bank or trust company that it might choose pursuant to this Paragraph 6.
Provident shall notify the Fund in the event that it appoints a sub-custodian
hereunder and shall provide the Fund with such information in respect thereof as
the Fund may reasonably request.
(b) Where securities are transferred to or from an account of a
Covered Portfolio established pursuant to Paragraph 7 hereof, Provident shall
promptly after the close of business each day, by book-entry or otherwise,
identify on its own records as belonging to such Portfolio the quantity of
securities in a fungible bulk of securities registered in the name of 'Provident
(or its nominee) and deposited in Provident's account on the books of the Book-
Entry System. On the following business day, Provident shall furnish PFPC with
confirmations and a summary on a per portfolio basis, of all transfers to or
from the account of the Covered Portfolios. At least monthly and from time to
time, Provident shall furnish the Fund and PFPC with a detailed statement of the
Property held for the Covered Portfolios under this Agreement.
7. USE OF BOOK-ENTRY SYSTEM. The Fund shall deliver to Provident
certified resolutions of the Board of Directors of the Fund approving,
authorizing and instructing Provident on a continuous and on-going basis until
instructed to the contrary by Oral or Written Instructions actually received by
Provident (a) to deposit in the Book-Entry System all securities belonging to
the Covered Portfolios eligible for deposit therein and (b) to utilize the Book-
Entry System to the extent possible in connection with settlements of purchases
and sales of securities by the Covered Portfolios, and deliveries and returns of
securities loaned, subject to repurchase agreements or used as collateral in
connection with borrowings. Without limiting the generality of such use, it is
agreed that the following provisions shall apply thereto:
(a) Securities and any cash of the Covered Portfolios deposited in
the Book-Entry System will at all times be segregated from any assets and
cash controlled by Provident in other than a fiduciary or custodian capacity
but may be commingled with other assets held in such capacities. Provident
and its sub-custodian, if any, will pay out money only upon receipt of
securities and will deliver securities only upon the receipt of money.
(b) All books and records maintained by Provident which relate to the
Fund's participation in the Book-Entry System will at all times during
Provident's regular business hours be open to the inspection of the Fund's duly
authorized employees, designees and agents, and the Fund will be furnished with
all information in respect of the services rendered to it as it may require.
(c) Provident will provide the Fund with copies of any report
obtained by Provident on the system of internal accounting control of the Book-
Entry System promptly after receipt of such a report by Provident. Provident
will also provide the Fund with such reports on its own system of internal
control as the Fund may reasonably request from time to time.
(d) In the event that any securities transaction for a Covered
Portfolio fails to settle in accordance with Instructions received by Provident,
Provident shall promptly so notify PFPC and Provident shall use its best efforts
to settle or cause to be settled 8uch transactions in accordance with such
Instructions.
8. INSTRUCTIONS CONSISTENT WITH CHARTER ETC.
(a) Unless otherwise provided in this Agreement, Provident shall act
only upon Oral and Written Instructions. Although Provident may know of the
provisions of the Charter and By-Laws of the Fund, Provident may assume that any
Oral or Written Instructions received hereunder are not in any way inconsistent
with any provisions of such Charter or By-Laws or any vote, resolution or
proceeding of the Shareholders, or of the Board of Directors, or of any
committee thereof.
(b) Provident shall be entitled to rely upon any Oral Instructions
and any Written Instructions actually received by Provident pursuant to this
Agreement. The Fund agrees to forward or request PFPC to forward to Provident
Written Instructions confirming Oral Instructions in such manner that t Written
Instructions are received by Provident by the close of business of the same day
that such Oral Instructions are giver Provident. The Fund agrees that the fact
that such confirming Written Instructions are not received by Provident shall in
1 way affect the validity of the transactions or enforceability the transactions
authorized by the Fund by giving Oral Instructions. The Fund agrees that
Provident shall incur r liability to the Fund in acting in good faith upon Oral
Instructions given to Provident hereunder concerning such transactions provided
such instructions reasonably appear been received from an Authorized Person,
provided, however, Provident shall not be so protected if such Oral or Written
Instructions were received from an Affiliate who has acted negligently, unless
such an Affiliate has received and transmitted erroneous instructions received
from an Authorized Person who is not an Affiliate.
9. TRANSACTIONS NOT REQUIRING INSTRUCTIONS. In the absence of contrary
Written Instructions, Provident is authorized to, and shall take, as necessary,
the following actions:
(a) COLLECTION OF INCOME AND OTHER PAYMENTS.
Provident shall:
(i) collect and receive for the account of the Covered
Portfolios, all income and other payments and distributions, including (without
limitation) stock dividends, rights, bond coupons, option premiums and similar
items, included or to be included in the Property, and promptly advise the Fund
and PFPC of such receipt and shall credit such income, as collected, to the
Fund's custodian account;
(ii) endorse and deposit for collection, in the name of the
Fund, checks, drafts, or other orders for the payment of money on the same day
as received;
(iii) receive and hold for the account of the Covered Portfolios
all securities received as a distribution on such Portfolios' securities as a
result of a stock dividend, share split-up or reorganization, recapitalization,
readjustment or other rearrangement or distribution of rights or similar
securities issued with respect to any portfolio securities belonging to the
Covered Portfolios held by Provident hereunder;
(iv) present for payment and collect the amount payable upon all
securities which may mature or be called, redeemed, or retired, or otherwise
become payable on the date such securities become payable; and
(v) take any action which may be necessary and proper in
connection with the collection and receipt of such income and other payments and
the endorsement for collection of checks, drafts, and other negotiable
instruments as described in Paragraph 24 of this Agreement.
(b) MISCELLANEOUS TRANSACTIONS. Provident IS authorized to deliver
or cause to be delivered Property against payment or other consideration or
written receipt therefor in the following cases:
(i) for examination by a broker selling for the account of the
Fund in accordance with street delivery custom;
(ii) for the exchange of interim receipts or temporary
securities for definitive securities; and
(iii) for transfer of securities into the name of the Fund or
Provident or nominee of either, or for exchange of securities for a different
number of bonds, certificates, or other evidence, representing the same
aggregate face amount or number of units bearing the same interest rate,
maturity date and call provisions, if any; provided that, in any such case, the
new securities are to be delivered to Provident.
10. TRANSACTIONS. Upon receipt of Oral or Written Instructions and not
otherwise, Provident, directly or through the use of the Book-Entry System,
shall:
(a) execute and deliver to such persons as may be designated in, and
in accordance with, such Oral or Written Instructions, proxies, consents,
authorizations, and any other instruments whereby the authority of the Fund as
owner of any securities may be exercised;
(b) deliver any securities held for the Covered Portfolios against
receipt of other securities or cash issued or paid in connection with the
liquidation, reorganization, refinancing, tender offer, merger, consolidation or
recapitalization of any corporation, or the exercise of any conversion
privilege;
(c) deliver any securities held for the Covered Portfolios to any
protective committee, reorganization committee or other person in connection
with the reorganization, refinancing, merger, consolidation, recapitalization or
sale of assets of any corporation, and receive and hold under the terms of this
Agreement such
certificates of deposit, interim receipts or other instruments or documents as
may be issued to it to evidence such delivery;
(d) make such transfers or exchanges of the assets of the Covered
Portfolios and take such other steps as shall be stated in said Oral or Written
Instructions to, be for the purpose of effectuating any duly authorized plan of
liquidation, reorganization, merger, consolidation or recapitalization of the
Fund;
(e) release securities belonging to the Covered Portfolios to any
bank or trust company for the purpose of pledge or hypothecation to secure any
loan incurred by the Covered Portfolios; provided, however, that securities
shall be released only upon payment to Provident of the monies borrowed, except
that in cases where additional collateral is required to secure a borrowing
already made, subject to proper prior authorization, further securities may be
released for that purpose; and repay such loan upon redelivery to it of the
securities pledged or hypothecated therefor and upon surrender of the note or
notes evidencing the loan;
(f) release and deliver securities owned by the Covered Portfolios in
connection with any repurchase agreement entered into on behalf of the Fund, but
only on receipt of payment therefor; and pay out moneys of the Fund in
connection with such repurchase agreements, but only upon the delivery of the
securities; and
(g) otherwise receive, transfer, exchange (including exchanges of
Shares of the Covered Portfolios for securities and redemption of Shares of the
Covered Portfolios in securities owned by the Covered Portfolios), lend or
deliver securities in accordance with Oral or Written Instructions.
11. SEGREGATED ACCOUNTS.
(a) In the event that the Covered Portfolios engage in transactions
involving forward currency contracts, exchange listed financial futures
contracts or options thereon, or buy, sell or write options on securities,
Provident shall, upon receipt of Written or Oral Instructions, establish and
maintain a segregated account or accounts on its records for and on behalf of
such Covered Portfolios, into which account or accounts may be transferred cash
and/or securities, including securities in the Book-Entry System (i) for the
purposes of compliance BY the Fund with the procedures required BY A securities
or options exchange or futures commissions merchant and (ii) shall establish
other segregated accounts for other proper purposes hereunder in accordance with
Written or Oral Instructions.
(b)(i) Promptly after each loan of securities specifically allocated
to a Covered Portfolio held by Provident hereunder, the Fund shall deliver or
cause to be delivered Provident Written Instructions specifying with respect to
such loan: (a) the Covered Portfolio to which the loaned securities are
specifically allocated; (b) the name of the issuer and the title of the
securities, (c) the number of shares principal amount loaned, (d) the date of
the loan and delivery, (e) the total amount to be delivered to Provident against
the loan of the securities, including the amount of cash collateral and the
premium, if any, separately identified, and (f) the name of the broker, dealer,
or financial institution to which the loan was made. Provident shall deliver
the securities thus designated to the broker, dealer or financial institution to
which the loan was made upon receipt of the total amount designated as to be
delivered against the loan of securities. Provident may accept payment in
connection with a delivery otherwise than through the Book-Entry System only in
the form of a certified or bank cashier's check payable to the order of the Fund
or
Provident drawn on New York Clearing House funds and may deliver securities in
accordance with the customs prevailing among dealers in securities.
(ii) Promptly after each termination of the loan of
securities by the Fund, the Fund shall deliver or cause to be delivered to
Provident Written Instructions specifying with respect to each such loan
termination and return of securities; (a) the Covered Portfolio to which the
loaned securities are specifically allocated; (b) the name of the issuer and the
title of the securities to be returned, (c) the number of shares or the
principal amount to be returned, (d) the date of termination, (e) the total
amount to be delivered by Provident (including the cash collateral for such
securities minus any offsetting credits as described in said Written
Instructions), and (f) the name of the broker, dealer, or financial institution
from which the securities will be returned. Provident shall receive all
securities returned from the broker, dealer, or financial institution to which
such securities were loaned and upon receipt thereof shall pay, out of the
moneys held for the account of the Fund, the total amount payable upon such
return of securities as set forth in the Written Instructions.
12. DIVIDENDS AND DISTRIBUTIONS. The Fund itself or through PFPC shall
furnish Provident with appropriate evidence of action by the Fund's Board of
Directors declaring and authorizing the payment of any dividends and
distributions in respect of the Covered Portfolios. Upon receipt by Provident
of Written Instructions with respect to dividends and distributions declared by
the Fund's Board of Directors and payable to Shareholders who have elected in
the proper manner to receive their distributions or dividends in cash, and in
conformance with procedures mutually agreed upon by Provident, the Fund, and
PFPC, Provident shall pay to PFPC, an amount equal to the amount indicated in
said Written Instructions as payable by the Fund to such Shareholders for
distribution in cash by PFPC to such Shareholders. In lieu of remitting to PFPC
cash dividends and distributions, Provident may arrange for the direct payment
of cash dividends and distributions to Shareholders by Provident in accordance
with such procedures and controls as are mutually agreed upon from time to time
by and among the Fund, Provident and PFPC.
In accordance with the Prospectus, the Internal Revenue Code and
regulations promulgated thereunder, and with such procedures and controls as are
mutually agreed upon from time to time by and among the Fund, Provident and
PFPC, Provident shall arrange for the establishment of XXX custodian accounts
for such Shareholders holding Shares through XXX accounts.
13. PURCHASES OF SECURITIES. Promptly after each purchase of securities
by the Advisor for a Covered Portfolio, the Fund, through PFPC, shall deliver to
Provident Oral or Written Instructions specifying with respect to each such
purchase: (a) the name of the issuer and the title of the securities including
CUSIP number, if applicable, (b) the number of shares or the principal Amount
purchased and accrued interest, if any, (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 from whom or the broker through whom the purchase
was made. Provident shall pay out of the moneys held for the account of such
Portfolio the total amount payable to the person from whom or the broker
through whom the purchase was made, provided that the same conforms to the total
amount payable as set forth in such Oral or Written Instructions. In the event
that such a transaction fails to settle in accordance with such Oral or Written
Instructions, Provident shall promptly so notify the Advisor or PFPC and shall
use its best efforts to settle or cause to be settled such transactions in
accordance with such Instructions.
14. SALES OF SECURITIES. Promptly after each sale of securities by the
Advisor for a Covered Portfolio or exercise of an option written by such a
Portfolio, the Fund, through PFPC, shall deliver to Provident Oral Instructions,
specifying with respect to each such sale: (a) the name of the issuer and the
title of the security including CUSIP number, if applicable, (b) the number of
shares or principal amount sold, and accrue( interest, if any, (c) the date of
sale, (d) the sale price per unit, (e) the total amount payable to the Covered
Portfolio upon such sale, (f) the name of the broker through whom or the person
to whom the sale was made, and (g) the location to which the security must be
delivered. Provident shall deliver the securities upon such sale, provided that
the same conforms to the total amount payable as set forth in such Oral
Instructions. Subject to the foregoing, Provident 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.
If any such transaction fails to settle in accordance with such Instructions,
Provident shall promptly so notify the Advisor and shall use its best efforts to
settle or cause to be settled such transactions in accordance with such
Instructions.
15. RECORDS. Provident shall prepare and maintain, on a per portfolio
basis, written records of all cash and Property and income and disbursements of
the Covered Portfolios hereunder. The books and records pertaining to the Fund
and the Covered Portfolios which are in the possessions of Provident shall be
the property of the Fund. Such books and records shall be prepared and
maintained as required by the 1940 Act and rules thereunder and other applicable
laws and regulations and shall be provided by Provident to the Fund or its
designee upon request. The Fund and the Fund's authorized representatives and
designees, access to such books and records at all times d, normal business
hours. Upon the request of the Fund any such books and records shall be
provided Fund or the Fund's authorized representative Fund's expense.
16. REPORTS AND OTHER INFORMATION.
(a) Provident shall furnish the Fund the following reports:
(1) such periodic and special reports as the Fund may
reasonably request;
(2) a monthly statement summarizing all transactions and
entries for the account of the Fund, listing the portfolio securities belonging
to the Fund with the average cost of each issue at the end of such month, and
stating the cash account of the Fund including disbursements;
(3) the reports to be furnished to the Fund pursuant to Rule
17f-4; and
(4) such other information as may be agreed upon from time to
time between the Fund and Provident.
(b) Provident shall transmit promptly to the Fund any proxy
statement, proxy materials, notice of a call, tender offer or conversion,
redemption, reorganization and similar communications received by it as
custodian of the Property.
(c) In addition to its obligations under paragraph 16(b) herein,
Provident shall use its best efforts to communicate to the Fund such material
information concerning the securities held by the Covered Portfolios as shall
come into Provident's possession via electronic services or user notification,
but Provident shall have no obligation to monitor any publication, newspapers or
similar periodicals for such information and shall not be liable to the Fund in
respect of the activity covered by this paragrpah 16(c).
17. COOPERATION WITH ACCOUNTANTS. Provident shall cooperate with the
Fund's independent public accountants and shall take all reasonable action in
the performance of its obligations under this Agreement to assure that the
necessary information is made available to such accountants for the
expression of their opinion, as such may be required from time to time by the
Fund.
18. CONFIDENTIALITY. Provident agrees on behalf of itself and its
employees to treat confidentially all records and other information relative
to the Fund and its prior, present, or potential Shareholders, except, after
prior notification to and approval in writing by the Fund, which approval may
not be withheld where Provident reasonably believes that it may be exposed to
civil or criminal contempt proceedings for failure to comply, when requested
to divulge such information by duly constituted authorities, or when so
requested by the Fund.
19. RIGHT TO RECEIVE ADVICE. Provident shall be protected in any action
or inaction that Provident takes in reliance on advice of Provident's counsel.
PFPC shall notify the Fund of the receipt of such advice within a reasonable
time.
20. COMPLIANCE WITH GOVERNMENTAL RULES AND REGULATIONS. Provident agrees
to perform its duties hereunder in accordance with applicable law, however;
Provident assumes no responsibility for ensuring that the Fund complies with the
requirements of the 1933 Act, the 1934 Act, the 1940 Act, the CEA, and any laws,
rules and regulations of governmental authorities having jurisdiction.
21. COMPENSATION. As compensation for the services rendered by Provident
during the term of this Agreement, the Fund will pay to Provident fees that
shall be agreed upon from time to time in writing by Provident and the Fund.
22. INDEMNIFICATION. (a) The Fund, as sole owner the Property, agrees to
indemnify and hold harmless Provident and its nominees hereunder from all taxes,
charges, expense expenses that are inherent to its duties hereunder),
assessments, claims and liabilities (including, without limitation, liabilities
arising under the 1933 Act, the 1934 Act, the l940 Act, the CEA, and any state
and foreign securities and blue sky laws, all as or may be amended from time to
time) including (without limitation) reasonable attorneys' fees and
disbursements, arising directly or indirectly (a) solely from fact that
securities included in the Property are registered in the name of any such
nominee or (b) from any action or thing which Provident takes or does or omits
to take or do (i) at
request or on the direction of or in reliance on the advice of the Fund or the
Fund's counsel on behalf of the Fund or (ii) upon Oral or Written Instructions,
provided that Oral or Written Instructions were not received from an Affiliate
who has acted negligently (unless such an Affiliate has received and transmitted
erroneous Instructions received from an Authorized Person that is not an
Affiliate) provided further, that neither Provident nor any of its nominees
shall be indemnified against any liability (or any expenses incident to such
liability) arising out of Provident's or such nominee's own misfeasance, bad
faith, negligence or disregard of its duties or responsibilities described in
this Agreement. In the event of any advance of cash for any purpose made by
Provident pursuant to Oral or Written Instructions of the Fund, or in the event
that Provident or its nominee shall incur or be assessed any such taxes,
charges, expenses, assessments, claims or liabilities described in the previous
sentence of this Paragraph 22(a), except such as may arise from its or its
nominee's own negligent action, negligent failure to act, disregard of its
duties hereunder or misconduct, any Property at any time held for the account of
the Covered Portfolios shall be security therefor.
(b) Provident shall not pay or settle any claim, demand, expense or
liability in respect of which Provident is entitled to be indemnified pursuant
to paragraph (a) above (an "Indemnifiable Claim") without the express written
consent of the Fund. Provident shall notify the Fund promptly of receipt of
notification of an Indemnifiable Claim. Unless the Fund notifies Provident
within 30 days of receipt of Written Notice of such Indemnifiable Claim that the
Fund does not intend to defend such Indemnifiable Claim, the Fund shall defend
Provident from such Indemnifiable Claim. The Fund shall have the right to
defend any Indemnifiable Claim at its own expense, such defense to be conducted
by counsel selected by the Fund. Further, Provident may join the Fund in such
defense at Provident's own expense, but to the extent that it shall so desire
the Fund shall direct such defense. If the Fund shall fail or refuse to defend,
pay or settle an Indemnifiable Claim, Provident, at the Fund's expense
consistent with limitations concerning attorney's fees expressed in Paragraph
22(a) hereof, may provide its own defense.
23. RESPONSIBILITY OF PROVIDENT. Provident hereby represents that it is
experienced in the provision of the services covered by this Agreement. In the
performance of its duties hereunder, Provident shall be obligated to exercise
due care and diligence and to act in good faith and in a timely manner to assure
the accuracy and completeness of all services performed under this Agreement.
Provident shall be under no duty to take any action on behalf of the Fund except
as specifically set forth herein or as may be specifically agreed to by
Provident in writing. Provident shall be responsible for its own negligent
failure to perform its duties under this Agreement. in assessing negligence for
purposes of this Agreement, the parties agree that the standard of care applied
to Provident's conduct shall be the care that would be exercised by a similarly
situated service provider, supplying substantially the same services under
substantially similar circumstances. Notwithstanding the foregoing, Provident
shall not be responsible for losses beyond its control, provided that Provident
has acted in accordance with the provisions of this Agreement and the standard
of care set forth above; and provided further that Provident shall only be
responsible for that portion of losses or damages suffered by the Fund
attributable to the negligence of Provident.
Losses shall be beyond Provident's control if they result from or occur because
of delays or errors or loss of data provided by a person other than Provident or
its Affiliates, or acts of civil or military authority, national emergencies,
labor difficulties (other than those of Provident or its Affiliates), fire,
failure of equipment caused by failures external to the premises of Provident or
its Affiliates, flood or catastrophe, acts of God, insurrection, war, riots or
failure of the mails, transportation, communication or power supply external to
the premises of Provident or its Affiliates.
Without limiting the generality of the foregoing or of any other provision
of this Agreement, Provident in connection with its duties under this Agreement
shall not be under any duty or obligation to inquire into and shall not be
liable for or in respect of the validity or invalidity or authority or lack
thereof of any Oral or Written Instruction received from the Fund, the Advisor
or a Sub-Advisor or an Affiliate, provided such Affiliate has not acted
negligently (unless such Affiliate has received and transmitted erroneous
instructions received from an Authorized Person that is not an Affiliate),
notice or other instrument which conforms to the applicable requirements of this
Agreement, and which Provident reasonably believes to be genuine.
Provident shall have no liability to the Fund for any losses or damages
the nature of which is or was remote, unforeseen, unforeseeable or beyond the
scope of reasonable anticipation at the time this Agreement was executed.
24. COLLECTIONS. All collections of monies or other property in respect,
or which are to become part, of the Property (but not the safekeeping thereof
upon receipt by Provident) shall be at the sole risk of the Fund. In any case
in which Provident does not receive any payment due the Fund within a reasonable
time after Provident has made proper demands for the same, it shall so notify
the Fund in writing, including copies of all demand letters, any written
responses thereto, and memoranda of all oral responses thereto and to telephonic
demands, and await instructions from the Fund. Provident shall not be obliged
to take legal action for collection unless and until reasonably indemnified to
its satisfaction. Provident shall also notify the Fund as soon as reasonably
practicable whenever income due on securities is not collected in due course.
25. DURATION AND TERMINATION. This Agreement shall continue in effect for
a period of one year from the date hereof. This agreement may be terminated by
either party on or after the first anniverary hereof upon not less than 180 days
prior written notice to the other party. The foregoing provisions
notwithstanding, either party may terminate this Agreement in the event of a
material breach of the terms hereof after written notice to the other party of
such breach and a reasonable time for cure of such breach, unless such breach is
not curable and, in such circumstances, this Agreement shall terminate, at the
option of the injured party, three months after the date such notice is given.
Upon any termination of this Agreement Provident shall deliver cash, securities,
Property and the records maintained hereunder for the Fund and the Covered
Portfolios hereunder to a successor custodian designated by the Fund, and if no
such successor is designated, Provident may deliver such cash, securities,
Property and records to a bank or trust company of its own selections having an
aggregate capital, surplus and undivided profits, as shown by its last published
report, of not less than twenty million dollars
($20,000,000) as a custodian for the Fund to be held under terms similar to
those of this Agreement, provided, however, that Provident shall not be required
to make any such delivery or payment until full payment shall have been made or
provided for by the Fund of all liabilities constituting a charge on or against
the property of the Covered Portfolios then held by Provident or on or against
Provident and until full payment shall have been made to Provident of all of its
fees, compensation, costs and expenses as provided herein.
26. NOTICES. All notices and other communications, including Written
Instructions (collectively referred to as "Notice" or "Notices" in this
paragraph), hereunder shall be in writing or by confirming telegram, cable,
telex or facsimile sending device. Notices shall be addressed (a) if to
Provident at Provident's address, 00xx xxx Xxxxxxxx Xxxxxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000, marked for the attention of the Custodian Services
Department (or its successor); (b) if to the Fund, at the address of the
Fund; or (c) if to neither of the foregoing, at such other address as shall
have been notified to the sender of any such Notice or other communication.
All postage, cable, telegram, telex and facsimile sending device charges
arising from the sending of a Notice hereunder shall be paid by the sender.
27. FURTHER ACTIONS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
28. AMENDMENTS. This Agreement or any part hereof may be changed or
waived only by an instrument in writing signed by the party against which
enforcement of such change or waiver is sought.
29. DELEGATION. On thirty (30) days prior written notice to the Fund,
Provident may assign its rights and delegate its duties hereunder to any wholly-
owned direct or indirect subsidiary of Provident or PNC Financial Corp, provided
that (i) the delegate agrees with Provident to comply with all relevant
provisions of the 1940 Act and this Agreement; and (ii) Provident and such
delegate shall promptly provide such information as the Fund may request, and
respond to such questions as the Fund may ask, relative to the delegation,
including (without limitation) the capabilities of the delegate. In the event
of such delegation, Provident shall remain liable under this Agreement.
30. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
31. MISCELLANEOUS. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior agreem6hts
and understandings relating to the subject matter hereof, provided that the
parties hereto may embody in one or more separate documents their agreement, if
any, with respect to delegated and/or Oral Instructions. The captions in this
Agreement are included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their construction or
effect. This Agreement shall be deemed to be a contract made in Pennsylvania
and governed by Pennsylvania law. If any provision of this Agreement shall be
held or made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby. This Agreement shall
be binding and shall inure to the benefit of the parties hereto and their
respective successors.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below on the day and year first above
written.
[SEAL] DFA INVESTMENT DIMENSIONS
GROUP INC.
Attest: Xxxxxxx X. Xxxxxx By: Xxxxxx Xxxxxx Xxxxxxxxxxx
----------------- -------------------------
Vice President Executive Vice President
[SEAL] PROVIDENT NATIONAL BANK
Attest: (signature) By: Xxxxxx X. Xxxxx, Senior Vice President
----------------- --------------------------------------
Vice President
INDEX
Paragraph Page
1. Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
2. Delivery of Documents . . . . . . . . . . . . . . . . . . . . . . . .2
3. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
4. Delivery and Registration of the Property . . . . . . . . . . . . . .6
5. Receipt and Disbursement of Money . . . . . . . . . . . . . . . . . .7
6. Receipt of Securities . . . . . . . . . . . . . . . . . . . . . . . .8
7. Use of Book-Entry System. . . . . . . . . . . . . . . . . . . . . . 10
8. Instructions Consistent with Charter
Declaration, etc. . . . . . . . . . . . . . . . . . . . . . . . . 11
9. Transactions Not Requiring Instructions . . . . . . . . . . . . . . 13
10. Transactions Requiring Instruction. . . . . . . . . . . . . . . . . 15
11. Segregated Accounts . . . . . . . . . . . . . . . . . . . . . . . . 17
12. Dividends and Distributions . . . . . . . . . . . . . . . . . . . . 19
13. Purchase of Securities. . . . . . . . . . . . . . . . . . . . . . . 20
14. Sales of Securities . . . . . . . . . . . . . . . . . . . . . . . . 20
15. Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
16. Reports and Other Information . . . . . . . . . . . . . . . . . . . 22
17. Cooperation with Accountants. . . . . . . . . . . . . . . . . . . . 23
18. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . 23
19. Right to Receive Advice . . . . . . . . . . . . . . . . . . . . . . 24
20. Compliance with Governmental Rules and
Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
21. Compensation. . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
22. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . 24
23. Responsibility of Provident . . . . . . . . . . . . . . . . . . . . 26
24. Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
25. Duration and Termination. . . . . . . . . . . . . . . . . . . . . . 28
26. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
27. Further Actions . . . . . . . . . . . . . . . . . . . . . . . . . . 30
28. Amendments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
29. Delegation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
30. Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
31. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
