EX.99.(g)(2)
CUSTODY AGREEMENT
THIS AGREEMENT made the 17th day of March 1992, by and between
INVESTORS FIDUCIARY TRUST COMPANY, a trust company chartered under the laws of
the state of Missouri, having its trust office located at 000 Xxxx 00xx Xxxxxx,
Xxxxxx Xxxx, Xxxxxxxx 00000 ("Custodian"), and EMPIRE BUILDER TAX FREE BOND
FUND, a Massachusetts business trust, having its principal office and place of
business at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Fund").
WITNESSETH:
WHEREAS, Fund desires to appoint Investors Fiduciary Trust Company as
Custodian of the securities and monies of Fund's investment portfolio; and
WHEREAS, Investors Fiduciary Trust Company is willing to accept such
appointment;
NOW THEREFORE, for and in consideration of the mutual promises
contained herein, the parties hereto, intending to be legally bound, mutually
covenant and agree as follows:
1. APPOINTMENT OF CUSTODIAN. Fund hereby constitutes and appoints
Custodian as custodian of the securities and monies at any time owned
by the Fund and delivered to the Custodian.
2. DELIVERY OF CORPORATE DOCUMENTS. Fund has delivered or will deliver to
Custodian prior to the effective date of this Agreement, copies of the
following documents and all amendments or supplements thereto, properly
certified or authenticated:
A. Resolutions of the governing Board of Fund appointing
Custodian as custodian hereunder and approving the form of
this Agreement; and
B. Resolutions of the governing Board of Fund designating certain
persons to give instructions on behalf of Fund to Custodian
and authorizing Custodian to rely upon written instructions
over his/her/their signatures.
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3. DUTIES AND RESPONSIBILITIES OF CUSTODIAN.
A. Delivery of Assets
Fund will deliver or cause to be delivered to Custodian on the
effective date of this Agreement, or as soon thereafter as
practicable, and from time to time thereafter, all portfolio
securities acquired by it and monies then owned by it except
as permitted by the Investment Company Act of 1940 or from
time to time coming into its possession during the time this
Agreement shall continue in effect. Custodian shall have no
responsibility or liability whatsoever for or on account of
securities or monies not so delivered. All securities so
delivered to Custodian (other than bearer securities) shall be
registered in the name of Fund or its nominee, or of a nominee
of Custodian, or shall be properly endorsed and in form for
transfer satisfactory to Custodian.
B. Delivery of Accounts and Records
Fund shall turn over to Custodian all of the Fund's relevant
accounts and records previously maintained by it. Custodian
shall be entitled to rely conclusively on the completeness and
correctness of the accounts and records turned over to it by
Fund, and Fund shall indemnify and hold Custodian harmless of
and from any and all expenses, damages and losses whatsoever
arising out of or in connection with any error, omission,
inaccuracy or other deficiency of such accounts and records or
the failure of Fund to provide any portion of such or to
provide any information needed by the Custodian knowledgeably
to perform its function hereunder.
C. Delivery of Assets to Third Parties
Custodian will receive delivery of and keep safely the assets
of Fund delivered to it from time to time segregated in a
separate account. Custodian will not deliver, assign, pledge
or hypothecate any such assets to any person except as
permitted by the provisions of this Agreement or any agreement
executed by it according to the terms of section 3.S. of this
Agreement. Upon delivery of any such assets to a subcustodian
pursuant to Section 3.S. of this agreement, Custodian will
create and maintain records identifying those assets which
have
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been delivered to the subcustodian as belonging to Fund. The
Custodian is responsible for the securities and monies of Fund
only until they have been transmitted to and received by other
persons as permitted under the terms of this Agreement, except
for securities and monies transmitted to United Missouri Bank
of Kansas City, N.A. (UMBKC) and United Missouri Trust Company
of New York (UMBNY) for which Custodian remains responsible as
defined in Section 5 of this Agreement. Custodian shall be
responsible for the monies and securities of Fund held by
eligible foreign custodians under this Agreement to the extent
the domestic subcustodian with which the Custodian contracts
is responsible to Custodian. Custodian may participate
directly or indirectly through a subcustodian in the
Depository Trust Company, Treasury/Federal Reserve Book Entry
System or Participant Trust Company (PTC) (as such entities
are defined at 17 CFR Section 270.17f-4(b)) or other
depository approved by the Fund and with which Custodian has a
satisfactory direct or indirect contractual relationship.
D. Registration of Securities
Custodian will hold stocks and other registerable portfolio
securities of Fund registered in the name of Fund or in the
name of any nominee of Custodian for whose fidelity and
liability Custodian will be fully responsible, or in street
certificate form, so-called, with or without any indication of
fiduciary capacity. Unless otherwise instructed, Custodian
will register all such portfolio securities in the name of its
authorized nominee. All securities, and the ownership thereof
by Fund, which are held by Custodian hereunder, however, shall
at all times be identifiable on the records of the Custodian.
The Fund agrees to hold Custodian and its nominee harmless for
any liability arising solely from Custodian or its nominee
acting as a record holder of securities held in custody.
E. Exchange of Securities
Upon receipt of instructions as defined herein in Section 4.A.
Custodian will exchange, or cause to be exchanged, portfolio
securities held by it for the
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account of Fund for other Securities or cash issued or paid in
connection with any reorganization, recapitalization, merger,
consolidation, split-up of shares, change of par value,
conversion or otherwise, and will deposit any such securities
in accordance with the terms of any reorganization or
protective plan. Without instructions, Custodian is authorized
to exchange securities held by it in temporary form for
securities in definitive form, to effect an exchange of shares
when the par value of the stock is changed, and upon receiving
payment therefor, to surrender bonds or other securities held
by it at maturity or when advised of earlier call for
redemption, except that Custodian shall receive instructions
prior to surrendering any convertible security.
F. Purchases of Investments of the Fund
Fund will, on each business day on which a purchase of
securities shall be made by it, deliver to Custodian
instructions which shall specify with respect to each such
purchase:
1. The name of the portfolio of the Fund making such
purchase;
2. The name of the issuer and description of the
security;
3. The number of shares or the principal amount
purchased, and accrued interest, if any;
4. The trade date;
5. The settlement date;
6. The purchase price per unit and the brokerage
commission, taxes and other expenses payable in
connection with the purchase;
7. The total amount payable upon such purchase; and
8. The name of the person from whom or the broker or
dealer through whom the purchase was made.
In accordance with such instructions, Custodian will pay for
out of monies held for the account of Fund, but only insofar
as monies are available therein for such purpose, and receive
the portfolio securities so purchased by or for the account of
Fund except that Custodian may in its sole discretion advance
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funds to the Fund which may result in an overdraft because the
monies held by the Custodian on behalf of the Fund are
insufficient to pay the total amount payable upon such
purchase. Such payment will be made only upon receipt by
Custodian of the securities so purchased in form for transfer
satisfactory to Custodian.
G. Sales and Deliveries of Investments of the Fund - Other than
Options and Futures Fund will, on each business day on which a
sale of investment securities of Fund has been made, deliver
to Custodian instructions specifying with respect to each such
sale:
1. The name of the portfolio of the Fund making such
sale;
2. The name of the issuer and description of the
securities;
3. The number of shares or principal amount sold, and
accrued interest, if any;
4. The date on which the securities sold were purchased
or other information identifying the securities sold
and to be delivered;
5. The trade date;
6. The settlement date;
7. The sale price per unit and the brokerage commission,
taxes or other expenses payable in connection with
such sale;
8. The total amount to be received by Fund upon such
sale; and
9. The name and address of the broker or dealer through
whom or person to whom the sale was made.
In accordance with such instructions, Custodian will deliver
or cause to be delivered the securities thus designated as
sold for the account of Fund to the broker or other person
specified in the instructions relating to such sale, such
delivery to be made only upon receipt of payment therefor in
such form as is satisfactory to Custodian, with the
understanding that Custodian may deliver or cause to be
delivered securities for payment in accordance with the
customs prevailing among dealers in securities.
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H. Purchases or Sales of Security Options, Options on Indices and
Security Index Futures Contracts
Fund will, on each business day on which a purchase or sale of
the following options and/or futures shall he made by it,
deliver to Custodian instructions which shall specify with
respect to each such purchase or sale:
1. The name of the portfolio of the Fund making such
purchase or sale;
2. Security Options
a. The underlying security;
b. The price at which purchased or sold;
c. The expiration date;
d. The number of contracts;
e. The exercise price;
f. Whether the transaction is an opening, exercising,
expiring or closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased;
i. Market on which option traded;
j. Name and address of the broker or dealer through
whom the sale or purchase was made.
3. Options on Indices
a. The index;
b. The price at which purchased or sold;
c. The exercise price;
d. The premium;
e. The multiple;
f. The expiration date;
g. Whether the transaction is an opening, exercising,
expiring or closing transaction;
h. Whether the transaction involves a put or call;
i. Whether the option is written or purchased;
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j. The name and address of the broker or dealer
through whom the sale or purchase was made, or
other applicable settlement instructions.
4. Security Index Futures Contracts
a. The last trading date specified in the contract
and, when available, the closing level, thereof;
b. The index level on the date the contract is
entered into;
c. The multiple;
d. Any margin requirements;
e. The need for a segregated margin account (in
addition to instructions, and if not already in
the possession of Custodian, Fund shall deliver a
substantially complete and executed custodial
safekeeping account and procedural agreement which
shall be incorporated by reference into this
Custody Agreement); and
f. The name and address of the futures commission
merchant through whom the sale or purchase was
made, or other applicable settlement instructions.
5. Option on Index Future Contracts
a. The underlying index future contract;
b. The premium;
c. The expiration date;
d. The number of options;
e. The exercise price;
f. Whether the transaction involves an opening,
exercising, expiring or closing transaction;
g. Whether the transaction involves a put or call;
h. Whether the option is written or purchased; and
i. The market on which the option is traded.
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I. Securities Pledged or Loaned
If specifically allowed for in the prospectus of Fund:
1. Upon receipt of instructions, Custodian will release
or cause to be released securities held in custody to
the pledgee designated in such instructions by way of
pledge or hypothecation to secure any loan incurred
by Fund; provided, however, that the securities shall
be released only upon payment to Custodian of the
monies borrowed, except that in cases where
additional collateral is required to secure a
borrowing already made, further securities may be
released or caused to be released for that purpose
upon receipt of instructions. Upon receipt of
instructions, Custodian will pay, but only from funds
available for such purpose, any such loan upon
redelivery to it of the securities pledged or
hypothecated therefor and upon surrender of the note
or notes evidencing such loan.
2. Upon receipt of instructions, Custodian will release
securities held in custody to the borrower designated
in such instructions; provided, however, that the
securities will be released only upon deposit with
Custodian of full cash collateral as specified in
such instructions, and that Fund will retain the
right to any dividends, interest or distribution on
such loaned securities. Upon receipt of instructions
and the loaned securities, Custodian will release the
cash collateral to the borrower.
J. Routine Matters
Custodian will, in general, attend to all routine and
mechanical matters in connection with the sale, exchange,
substitution, purchase, transfer, or other dealings with
securities or other property of Fund except as may be
otherwise provided in this Agreement or directed from time to
time by the governing Board of the Fund.
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K. Deposit Account
Custodian will open and maintain a special purpose deposit
account or accounts in the name of Custodian ("Account"),
subject only to draft or order by Custodian upon receipt of
instructions. All monies received by Custodian from or for the
account of a portfolio shall be deposited in said Account.
Barring events not in the control of the Custodian such as
strikes, lockouts or labor disputes, riots, war or equipment
or transmission failure or damage, fire, flood, earthquake or
other natural disaster, action or inaction of governmental
authority or other causes beyond its control, at 9:00 a.m.,
Kansas City time, on the second business day after deposit of
any check into Fund's Account, Custodian agrees to make Fed
Funds available to the Fund in the amount of the check.
Deposits made by Federal Reserve wire will be available to the
Fund immediately and ACH wires will be available to the Fund
on the next business day. Income earned on the portfolio
securities will he credited to the applicable portfolio of the
Fund based on the schedule attached as Exhibit A. All
collected funds received on behalf of a Fund shall be
deposited, according to Custodian's usual practices, into a
Custody account on behalf of that Fund. The Custodian will be
entitled to reverse any credited amounts where credits have
been made and monies are not finally collected. If monies are
collected after such reversal, the Custodian will credit the
applicable portfolio in that amount. Custodian may open and
maintain an Account in such other banks or trust companies as
may be designated by it and by properly authorized resolution
of the governing Board of the Fund, such Account, however, to
be in the name of Custodian and subject only to its draft or
order.
L. Income and other Payments to Fund
Custodian will:
1. Collect, claim and receive and deposit for the
Account of Fund all income and other payments which
become due and payable on or after the effective date
of this Agreement with respect to the securities
deposited under this Agreement, and credit the
account of Fund in
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accordance with the schedule attached hereto as
Exhibit A. If for any reason, the Fund is credited
with income that is not subsequently collected,
Custodian may reverse that credited amount;
2. Execute ownership and other certificates and
affidavits for all federal, state and local tax
purposes in connection with the collection of bond
and note coupons; and
3. Take such other action as may be necessary or proper
in connection with:
a. the collection, receipt and deposit of such
income and other payments, including but not
limited to the presentation for payment of:
1. all coupons and other income items
requiring presentation; and
2. all other securities which may mature or
be called, redeemed, retired or otherwise
become payable and regarding which the
Custodian has actual knowledge, or notice
of which is contained in publications of
the type to which it normally subscribes
for such purpose; and
b. the endorsement for collection, in the name
of Fund, of all checks, drafts or other
negotiable instruments.
Custodian, however, will not be required to institute suit or
take other extraordinary action to enforce collection except
upon receipt of instructions and upon being indemnified to its
satisfaction against the costs and expenses of such suit or
other actions. Custodian will receive, claim and collect all
stock dividends, rights and other similar items and will deal
with the same pursuant to instructions. Unless prior
instructions have been received to the contrary, Custodian
will, without further instructions, sell any rights held for
the account of Fund on the last trade date prior to the date
of expiration of such rights.
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M. Payment of Dividends and other Distributions
On the declaration of any dividend or other distribution on
the shares of the Fund ("Fund Shares") by the governing Board
of the Fund, Fund shall deliver to Custodian instructions with
respect thereto, including a copy of the Resolution of said
governing Board certified by the Secretary or an Assistant
Secretary of Fund wherein there shall be set forth the record
date as of which shareholders entitled to receive such
dividend or other distribution shall be determined, the date
of payment of such dividend or distribution, and the amount
payable per share on such dividend or distribution. Except if
the ex-dividend date and the reinvestment date of any dividend
are the same, in which case funds shall remain in the Custody
Account, on the date specified in such Resolution for the
payment of such dividend or other distribution, Custodian will
pay out of the monies held for the account of Fund, insofar as
the same shall be available for such purposes, and credit to
the account of the Dividend Disbursing Agent for Fund, such
amount as may be necessary to pay the amount per share payable
in cash on Fund Shares issued and outstanding on the record
date established by such Resolution.
N. Shares of Fund Purchased by Fund
Whenever any Fund Shares are repurchased or redeemed by Fund,
Fund or its agent shall advise Custodian of the aggregate
dollar amount to be paid for such shares and shall confirm
such advice in writing. Upon receipt of such advice, Custodian
shall charge such aggregate dollar amount to the Account of
Fund and either deposit the same in the account maintained for
the purpose of paying for the repurchase or redemption of Fund
Shares or deliver the same in accordance with such advice.
Custodian shall not have any duty or responsibility to
determine that Fund Shares have been removed from the proper
shareholder account or accounts or that the proper number of
such shares have been cancelled and removed from the
shareholder records.
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O. Shares of Fund Purchased from Fund
Whenever Fund Shares are purchased from Fund, Fund will
deposit or cause to be deposited with Custodian the amount
received for such shares. Custodian shall not have any duty or
responsibility to determine that Fund Shares purchased from
Fund have been added to the proper shareholder account or
accounts or that the proper number of such spaces have been
added to the shareholder records.
P. Proxies and Notices
Custodian will promptly deliver or mail or have delivered or
mailed to Fund all proxies properly signed, all notices of
meetings, all proxy statements and other notices, requests or
announcements affecting or relating to securities held by
Custodian for Fund and will, upon receipt of instructions,
execute and deliver or cause its nominee to execute and
deliver or mail or have delivered or mailed such proxies or
other authorizations as may be required. Except as provided by
this Agreement or pursuant to instructions hereafter received
by Custodian, neither it nor its nominee will exercise any
power inherent in any such securities, including any power to
vote the same, or execute any proxy, power of attorney, or
other similar instrument voting any of such securities, or
give any consent, approval or waiver with respect thereto, or
take any other similar action.
Q. Disbursements
Custodian will pay or cause to be paid insofar as funds are
available for the purpose, bills, statements and other
obligations of Fund (including but not limited to obligations
in connection with the conversion, exchange or surrender of
securities owned by Fund, interest charges, dividend
disbursements, taxes, management fees, custodian fees, legal
fees, auditors' fees, transfer agents' fees, brokerage
commissions, compensation to personnel, and other operating
expenses of Fund) pursuant to instructions of Fund setting
forth the name of the person to whom payment is to be made,
the amount of the payment, and the purpose of the payment.
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R. Daily Statement of Accounts
Custodian will, within a reasonable time, render to Fund as of
the close of business on each day, a detailed statement of the
amounts received or paid and of securities received or
delivered for the account of Fund during said day. Custodian
will, from time to time, upon request by Fund, render a
detailed statement of the securities and monies held for Fund
under this Agreement, and Custodian will maintain such books
and records as are necessary to enable it to do so and will
permit such persons as are authorized by Fund including Fund's
independent public accountants, access to such records or
confirmation of the contents of such records; and if demanded,
will permit federal and state regulatory agencies to examine
the securities, books and records. Upon the written
instructions of Fund or as demanded by federal or state
regulatory agencies, Custodian will instruct any subcustodian
to give such persons as are authorized by Fund including
Fund's independent public accountants, access to such records
or confirmation of the contents of such records; and if
demanded, to permit federal and state regulatory agencies to
examine the books, records and securities held by subcustodian
which relate to Fund.
S. Appointment of Subcustodians
1. Notwithstanding any other provisions of this
Agreement, all or any of the monies or securities of
Fund may be held in Custodian's own custody or in the
custody of one or more other banks or trust companies
selected by Custodian. Any such subcustodian must
have the qualifications required for custodian under
the Investment Company Act of 1940, as amended. The
subcustodian may participate directly or indirectly
in the Depository Trust Company, Treasury/Federal
Reserve Book Entry System, Participant Trust Company
(as such entities are defined at 17 CFR Sec.
270.17f-4(b)), or other depository approved by the
Fund and with which Custodian has a satisfactory
direct or indirect contractual relationship.
Custodian
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will appoint UMBKC and UMBNY as subcustodians and
Custodian shall be responsible for UMBKC and UMBNY to
the same extent it is responsible to the Fund under
Section 5 of this Agreement. Custodian is not
responsible for DTC, the Treasury/Federal Reserve
Book Entry System, and PTC except to the extent such
entities are responsible to Custodian. Upon
instruction of the Fund, Custodian shall be willing
to contract with such entities as Bank of New York
(BONY), Xxxxxx Guaranty and Trust Company (MGTC),
Chemical Bank (CB), and Bankers Trust Company (BT)
for variable rate securities and Custodian will be
responsible to the Fund to the same extent those
entities are responsible to Custodian. The Fund shall
be entitled to review Custodian's contracts with
BONY, MGTC, CB, and BT.
2. Notwithstanding any other provisions of this
Agreement, Fund's foreign Securities (as defined in
Rule 17f-5(c)(1) under the Investment Company Act of
1940) and Fund's cash or cash equivalents in amounts
reasonably necessary to effect Fund's foreign
securities transactions, may be held in the custody
of one or more banks or trust companies acting as
subcustodians, according to Section 3.S.1; and
thereafter, pursuant to a written contract or
contracts as approved by Fund's governing Board, may
be transferred to an account maintained by such
subcustodian with an eligible foreign custodian, as
defined in Rule 17f-5(c)(2), provided that any such
arrangement involving a foreign custodian shall be in
accordance with the provisions of Rule 17f-5 under
the Investment Company Act of 1940 as that Rule may
be amended from time to time. The Fund shall be
provided the contract with the domestic subcustodian
who shall contract with the eligible foreign
subcustodians. The Custodian shall be responsible for
the monies and securities of Fund held by eligible
foreign subcustodians to the extent the domestic
subcustodian with which the Custodian
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contracts is responsible to Custodian.
T. Adoption of Procedures
Custodian and Fund may from time to time adopt procedures as
they agree upon, and Custodian may conclusively assume that no
procedure approved by Fund, or directed by Fund, conflicts
with or violates any requirements of its prospectus, or
governing documents such as Articles of Incorporation,
Declaration of Trust, Bylaws, or any rule or regulation of any
regulatory body or governmental agency. Fund will be
responsible to notify Custodian of any changes in statutes,
regulations, rules or Fund policies not specifically governing
custodians or banks which might necessitate changes in
Custodian's responsibilities or procedures.
U. Overdrafts
If Custodian shall in its sole discretion advance funds to the
account of the Fund which results in an overdraft because the
monies held by Custodian on behalf of the Fund are
insufficient to pay the total amount payable upon a purchase
of securities as specified in Fund's instructions or for some
other reason, the amount of the overdraft shall be payable by
the Fund to Custodian upon demand and shall bear an interest
rate determined by Custodian from the date advanced until the
date of payment. Custodian shall have a lien on the assets of
the Fund in the amount of any outstanding overdraft.
4. INSTRUCTIONS.
A. The term "instructions" as used herein, means written or oral
instructions to Custodian from a designated representative of
Fund. Certified copies of resolutions of the governing Board
of Fund naming one or more designated representatives to give
instructions in the name and on behalf of Fund, may be
received and accepted from time to time by Custodian as
conclusive evidence of the authority of any designated
representative to act for Fund and may be considered to be in
full force and effect (and Custodian will be fully protected
in acting in reliance thereon) until receipt by Custodian of
notice
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to the contrary. Unless the resolution delegating authority to
any person to give instructions specifically requires that the
approval of anyone else will first have been obtained,
Custodian will be under no obligation to inquire into the
right of the person giving such instructions to do so.
Notwithstanding any of the foregoing provisions of this
Section 4, no authorizations or instructions received by
Custodian from Fund, will be deemed to authorize or permit any
director, trustee, officer, employee, or agent of Fund to
withdraw any of the securities or similar investments of Fund
upon the mere receipt of such authorization or instructions
from such director, trustee, officer, employee or agent.
Notwithstanding any other provision of this Agreement,
Custodian, upon receipt (and acknowledgement if required at
the discretion of Custodian) of the instructions of a
designated representative of Fund will undertake to deliver
for Fund's account monies, (provided such monies are on hand
or available) in connection with Fund's transactions and to
wire transfer such monies to such broker, dealer,
subcustodian, bank or other agent specified in such
instructions by a designated representative of Fund.
B. No later than the next business day immediately following each
oral instruction, Fund will send Custodian written
confirmation of such oral instruction. At Custodian's sole
discretion, Custodian may record on tape, or otherwise, any
oral instruction whether given in person or via telephone,
each such recording identifying the parties, the date and the
time of the beginning and ending of such oral instruction.
5. LIMITATION OF LIABILITY OF CUSTODIAN.
A. Custodian shall hold harmless and indemnify Fund from and
against any loss or liability arising out of Custodian's
negligence, willful misconduct, or bad faith. Custodian shall
not be liable for consequential special or punitive damages.
Custodian may request and obtain the advice and opinion of
counsel for Fund, or of its own counsel with respect to
questions or matters of law, and it shall be without liability
to Fund for any action taken or omitted
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by it in good faith in conformity with such advice or
opinion. If Custodian reasonably believes that it could not
prudently act according to the instructions of the Fund or the
Fund's counsel, it may in its discretion, with notice to the
Fund, not act according to such instructions.
B. Custodian may rely upon the advice of Fund and upon statements
of Fund's accountants and other persons believed by, it in
good faith, to be expert in matters upon which they are
consulted, and Custodian shall not be liable for any actions
taken, in good faith, upon such statements.
C. If Fund requires Custodian in any capacity to take, with
respect to any securities, any action which involves the
payment of money by it, or which in Custodian's opinion might
make it or its nominee liable for payment of monies or in any
other way, Custodian, upon notice to Fund given prior to such
actions, shall be and be kept indemnified by Fund in an amount
and form satisfactory to Custodian against any liability on
account of such action.
D. Custodian shall be entitled to receive, and Fund agrees to pay
to Custodian, on demand, reimbursement for such cash
disbursements, costs and expenses as may be agreed upon from
time to time by Custodian and Fund.
E. Custodian shall be protected in acting as custodian hereunder
upon any instructions, advice, notice, request, consent,
certificate or other instrument or paper reasonably appearing
to it to be genuine and to have been properly executed and
shall, unless otherwise specifically provided herein, be
entitled to receive as conclusive proof of any fact or matter
required to be ascertained from Fund hereunder, a certificate
signed by the Fund's President, or other officer specifically
authorized for such purpose.
F. Without limiting the generality of the foregoing, Custodian
shall be under no duty or obligation to inquire into, and
shall not be liable for:
1. The validity of the issue of any securities purchased
by or for Fund, the legality of the purchase thereof
or evidence of ownership required by Fund to be
received by Custodian, or the propriety of the
decision to purchase or amount paid therefor:
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2. The legality of the sale of any securities by or for
Fund, or the propriety of the amount for which the
same are sold;
3. The legality of the issue or sale of any shares of
the Capital Stock of Fund, or the sufficiency of the
amount to be received therefor;
4. The legality of the repurchase or redemption of any
Fund Shares, or the propriety of the amount to be
paid therefor; or
5. The legality of the declaration of any dividend by
Fund, or the legality of the issue of any Fund Shares
in payment of any stock dividend.
G. Custodian shall not be liable for, or considered to be
Custodian of, any money represented by any check, draft, wire
transfer, clearing house funds, uncollected funds, or
instrument for the payment of money received by it on behalf
of Fund, until Custodian actually receives such money,
provided only that it shall advise Fund promptly if it fails
to receive any such money in the ordinary course of business,
and use its best efforts and cooperate with Fund toward the
end that such money shall be received.
H. Except for any subcustodians or eligible foreign custodians
appointed under section 3.S., Custodian shall not be
responsible for loss occasioned by the acts, neglects,
defaults or insolvency of any broker, bank, trust company, or
any other person with whom Custodian may deal in the absence
of negligence, or bad faith on the part of Custodian.
I. Notwithstanding anything herein to the contrary, Custodian
may, and with respect to any foreign subcustodian appointed
under Section 3.S.2 must, provide Fund for its approval,
agreements with banks or trust companies which will act as
subcustodians for Fund pursuant to Section 3.S of this
Agreement.
6. COMPENSATION. Fund will pay to Custodian such compensation as is stated
in the Fee Schedule attached hereto as Exhibit B which may be changed
from time to time as agreed to in writing by Custodian and Fund.
Custodian may charge such compensation against monies held by it for
the account of Fund. Custodian will also be entitled, notwithstanding
the provisions of Sections 5.C. or 5.D. hereof, to charge
18
against any monies held by it for the account of Fund the amount of any
loss, damage, liability, advance, or expense for which it shall be
entitled to reimbursement under the provisions of this Agreement
including fees or expenses due to Custodian for other services provided
to the Fund by the Custodian. Custodian will not be entitled to
reimbursement by Fund for any loss or expenses of any subcustodian.
7. TERMINATION. Either party to this Agreement may terminate the same by
notice in writing, delivered or mailed, postage prepaid, to the other
party hereto and received not less than sixty (60) days prior to the
date upon which such termination will take effect. Upon termination of
this Agreement, Fund will pay to Custodian such compensation for its
reimbursable disbursements, costs and expenses paid or incurred to such
date and Fund will use its best efforts to obtain a successor
custodian. Unless the holders of a majority of the outstanding shares
of Fund vote to have the securities, funds and other properties held
under this Agreement delivered and paid over to some other person, firm
or corporation specified in the vote, having not less the Two Million
Dollars ($2,000,000) aggregate capital, surplus and undivided profits,
as shown by its last published report, and meeting such other
qualifications for custodian as set forth in the governing documents of
the Fund, the governing Board of Fund will, forthwith upon giving or
receiving notice of termination of this Agreement, appoint as successor
custodian a bank or trust company having such qualifications. Custodian
will, upon termination of this Agreement, deliver to the successor
custodian so specified or appointed, at Custodian's office, all
securities then held by Custodian hereunder, duly endorsed and in form
for transfer, all funds and other properties of Fund deposited with or
held by Custodian hereunder, or will cooperate in effecting changes in
book-entries at the Depository Trust Company or in the Treasury/Federal
Reserve Book-Entry System, DTC, or other depository. In the event no
such vote has been adopted by the shareholders of Fund and no written
order designating a successor custodian has been delivered to Custodian
on or before the date when such termination becomes effective, then
Custodian will deliver the securities, funds and properties of Fund to
a bank or trust company at the selection of Custodian and meeting the
qualifications
19
for custodian, if any, set forth in the governing documents of the Fund
and having not less that Two Million Dollars ($2,000,000) aggregate
capital, surplus and undivided profits, as shown by its last published
report. Upon either such delivery to a successor custodian, Custodian
will have no further obligations or liabilities under this Agreement.
Thereafter such bank or trust company will be the successor custodian
under this Agreement and will be entitled to reasonable compensation
for its services. In the event that no such successor custodian can be
found, Fund will submit to its shareholders, before permitting delivery
of the cash and securities owned by Fund to anyone other than a
successor custodian, the question of whether Fund will be liquidated or
function without a custodian. Notwithstanding the foregoing requirement
as to delivery upon termination of this Agreement, Custodian may make
any other delivery of the securities, funds and property of Fund which
is permitted by the Investment Company Act of 1940, Fund's governing
documents then in effect or apply to a court of competent jurisdiction
for the appointment of a successor custodian.
8. NOTICES. Notices, requests, instructions and other writings received by
Fund at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such other
address as Fund may have designated to Custodian in writing, will be
deemed to have been properly given to Fund hereunder; and notices,
requests, instructions and other writings received by Custodian at its
offices at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000, or to
such other address as it may have designated to Fund in writing, will
be deemed to have been properly given to Custodian hereunder.
9. MISCELLANEOUS.
A. This Agreement is executed and delivered in the State of
Missouri and shall be governed by the laws of said state.
B. All the terms and provisions of this Agreement shall be
binding upon, inure to the benefit of, and be enforceable by
the respective successor and assigns of the parties hereto.
C. No provisions of the Agreement may be amended or modified, in
any manner except by a written agreement properly authorized
and executed by both
20
parties hereto.
D. The captions in this Agreement are included for convenience of
reference only, and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or
effect.
E. This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original but all
of which together will constitute one and the same instrument.
F. If any part, term or provision of this Agreement is by the
courts held to be illegal, in conflict with any law or
otherwise invalid, the remaining portion or portions shall be
considered severable and not be affected, and the rights and
obligations of the parties shall be construed and enforced as
if the Agreement did not contain the particular part, term or
provision held to be illegal or invalid.
G. Custodian will not release the identity of Fund to an issuer
which requests such information pursuant to the Shareholder
Communications Act of 1985 for the specific purpose of direct
communications between such issuer and Fund unless the Fund
directs the Custodian otherwise.
H. This Agreement may not be assigned by either party without
prior written consent of the other party.
I. If any provision of the Agreement, either in its present form
or as amended from time to time, limits, qualifies, or
conflicts with the Investment Company Act of 1940 and the
rules and regulations promulgated thereunder, such statues,
rules and regulations shall be deemed to control and supersede
such provision without nullifying or terminating the remainder
of the provisions of this Agreement.
J. If the Fund is organized as a Massachusetts business trust, a
copy of the Declaration of Trust of the Fund is on file with
the Secretary of the Commonwealth of Massachusetts and notice
is hereby given that the Agreement has been executed on
behalf of Fund by the undersigned officer of Fund in his/her
capacity as an officer of Fund. The obligations of this
21
Agreement shall only be binding upon the assets and property
of Fund and shall not be binding upon any Trustee, officer or
shareholder of Fund individually.
22
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly respective authorized officers.
INVESTORS FIDUCIARY TRUST
COMPANY
By: [illegible]
---------------------------
Title: S.V.P.
------------------------
ATTEST:
[illegible]
------------------------------
Title: Exec. V.P.
------------------------
EMPIRE BUILDER TAX FREE
BOND FUND
By: [illegible]
---------------------------
Title: Asst. Treasurer
------------------------
ATTEST:
[illegible]
------------------------------
Secretary
23
EXHIBIT A
IFTC AVAILABILITY SCHEDULE BY TRANSACTION TYPE
TRANSACTION DTC PHYSICAL FED
----------- --- -------- ---
TYPE CR DATE FDS TYPE CR DATE FDS TYPE CR DATE FDS TYPE
---- ------- -------- ------- -------- ------- --------
Calls Puts As Received C or F* As Received C or F*
Maturities As Received C or F* Mat. Date C or F* Mat. Date F
Tender Reorgs. As Received C As Received C N/A
Dividends Paydate C Paydate C N/A
Floating Paydate C Paydate C N/A
Rate Int.
Floating As Rate C N/A
Rate Int. N/A Received
(No Rate)
Mtg. Backed Paydate C Paydate + 1 C Paydate F
P&I Bus. Day
Fixed Rate Paydate C Paydate C Paydate F
Int.
Euroclear N/A C Paydate C
Legend
------
C = Clearinghouse Funds
F = Fed Funds
N/A = Not Applicable
*Availability based on how received.
EMPIRE MUTUAL FUNDS
FEE SCHEDULE
I. SECURITY CUSTODY
A. Domestic Securities
Asset-Based Fees, per fund group
3/100 of 1% (3 basis points) on the first $100 million in assets
2/100 of 1% (2 basis points) on the next $100 million in assets
1/100 of 1% (1 basis point) on all assets in excess of $200 million
Transaction Fees, per transaction
Physical Delivery - $20.00
Depository Eligible - $10.00
Euro-Clear - $40.00
PTC - $12.00
XXX X&X - x0.00
X&X Other - $10.00
Wires - $5.00
B. Balance Credits
IFTC will offset fees with balance credits calculated at 75%
of the bank credit rate which is equal to the T-xxxx rate
applied to average custody collected cash balances for the
month. Balance credits will be applied on a fund by fund basis
and can be used to offset custody fees. Any credits in excess
of fees will be carried forward from month to month through
the first quarter of the ensuing year. For calculation
purposes, IFTC uses an actual/actual basis.
C. Overdraft Charges
Fund overdrafts will be calculated at the Prime rate (as
published in the Wall Street Journal) and charged on a daily
basis.
II. NOTES TO THE ABOVE FEE SCHEDULE
A. The above schedule does not include out-of-pocket expenses
that would be incurred by IFTC on the fund's behalf. Examples
of out-of-pocket expenses include forms, postage, mailing
services, and FDIC insurance, etc. Out-of-pocket expenses
incurred by IFTC in planning and executing the conversion will
be passed on to the fund. IFTC bills out-of-pocket expenses
separately from service fees.
B. The fees stated above are exclusive of terminal equipment
required in the client's location(s) and communication line
costs.
C. Any fees or out-of-pocket expenses not paid within 30 days of
the date of the original invoice will be charged a late
payment fee of 1% per month until payment of the fees are
received by IFTC.
D. The above fee schedule is predicated on the fact that IFTC be
allowed a minimum of 90 calendar days between notification of
hiring and when the selection is effective, and that IFTC
receive adequate cooperation from the client during the
implementation period.
E. The above fee schedule is applicable for selections made and
communicated within 30 days of the date of this proposal. The
fees are guaranteed for a one year period commencing on the
effective date of the service agreement between IFTC and the
client. All changes to the fee schedule will be communicated
in writing at least 60 days prior to their effective date.
F. The fees and charges set forth hereto shall increase annually
upon each anniversary of this Agreement over the fees and
charges during the prior 12 months in an amount not less than
the annual percentage of change in the Consumer Price Index in
Kansas City, Missouri-Kansas-Standard Metropolitan Statistical
Area as last reported by the U.S. Bureau of Labor Statistics.
In the event that this Agreement was not signed as of the
first day of the month, the fees and charges increase shall be
effective as of the first day of the month immediately
following the month during which the anniversary occurred.
--------------------------------- ---------------------------------
INVESTORS FIDUCIARY TRUST COMPANY EMPIRE MUTUAL FUNDS
--------------------------------- ---------------------------------
DATE DATE
SCHEDULE A
--------------------------------------------------------------------------------
Empire Builder Tax Free Bond Fund
