FORM OF
CUSTODY AGREEMENT
THIS AGREEMENT made the ___ day of April, 1998, 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 Xxxxxxxxxxxx
Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 ("Custodian"), and Pax World Money Market
Fund, Inc., a Maryland corporation, having its principal office and place of
business at 000 Xxxxx 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.
2. REPRESENTATIONS AND WARRANTIES.
A. Fund hereby represents, warrants and acknowledges to
Custodian:
1. That it is a corporation or trust (as specified
above) duly organized and existing and in good
standing under the laws of its state of organization,
and that it is registered under the Investment
Company Act of 1940 (the "1940 Act"); and
2. That it has the requisite power and authority under
applicable law, its articles of incorporation and
its bylaws to enter into this Agreement; that it
has taken all requisite action necessary to appoint
Custodian as custodian for the Fund; that this
Agreement has been duly executed and delivered by
Fund; and that this Agreement constitutes a legal,
valid and binding obligation of Fund, enforceable
in accordance with its terms.
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B. Custodian hereby represents, warrants and acknowledges to
Fund:
1. That it is a trust company duly organized and
existing and in good standing under the laws of the
State of Missouri; and
2. That it has the requisite power and authority under
applicable law, its charter and its bylaws to enter
into and perform this Agreement; that this Agreement
has been duly executed and delivered by Custodian;
and that this Agreement constitutes a legal, valid
and binding obligation of Custodian, enforceable in
accordance with its terms.
3. DUTIES AND RESPONSIBILITIES OF CUSTODIAN.
A. Delivery Of Assets
Except as permitted by the 1940 Act, 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 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.
B. Delivery of Accounts and Records
Fund shall turn over or cause to be turned over to Custodian
all of the Fund's relevant accounts and records previously
maintained. Custodian shall be entitled to rely conclusively
on the completeness and correctness of the accounts and
records turned over to it, and Fund shall indemnify and hold
Custodian harmless of and from any and all expenses, damages
and losses whatsoever arising out of or in connection with any
error, omission, inaccuracy or other deficiency of such
accounts and records or in the failure of Fund to provide, or
to provide in a timely manner, any accounts, records or
information needed by the Custodian to perform its functions
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, and if Fund is
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comprised of more than one portfolio of investment securities
(each a "Portfolio") Custodian shall keep the assets of each
Portfolio 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 been delivered to the
subcustodian as belonging to the Fund, by Portfolio if
applicable. The Custodian is responsible for the safekeeping
of 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 subcustodians appointed under Section
3.S. of this Agreement, for which Custodian remains
responsible to the extent provided in Section 3.S. hereof.
Custodian may participate directly or indirectly through a
subcustodian in the Depository Trust Company (DTC),
Treasury/Federal Reserve Book Entry System (Fed System),
Participant Trust Company (PTC) or other depository approved
by the Fund (as such entities are defined at 17 CFR Section
270.17f-4(b)) (each a "Depository" and collectively, the
"Depositories").
D. Registration of Securities
The Custodian shall at all times hold registered securities of
the Fund in the name of the Custodian, the Fund, or a nominee
of either of them, unless specifically directed by
instructions to hold such registered securities in so-called
"street name," provided that, in any event, all such
securities and other assets shall be held in an account of the
Custodian containing only assets of the Fund, or only assets
held by the Custodian as a fiduciary or custodian for
customers, and provided further, that the records of the
Custodian at all times shall indicate the Fund or other
customer for which such securities and other assets are held
in such account and the respective interests therein. If,
however, the Fund directs the Custodian to maintain securities
in "street name", notwithstanding anything contained herein to
the contrary, the Custodian shall be obligated only to utilize
its best efforts to timely collect income due the Fund on such
securities and to notify the Fund of relevant corporate
actions including, without limitation, pendency of calls,
maturities, tender or
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exchange offers. All securities, and the ownership thereof by
Fund, which are held by Custodian hereunder, however, shall at
all times be identifiable on the records of the Custodian. The
Fund agrees to hold Custodian and its nominee harmless for any
liability as a shareholder of record of securities held in
custody.
E. Exchange of Securities
Upon receipt of instructions as defined herein in Section 4.A,
Custodian will exchange, or cause to be exchanged, portfolio
securities held by it for the account of Fund for other
securities or cash issued or paid in connection with any
reorganization, recapitalization, merger, consolidation,
split-up of shares, change of par value, conversion or
otherwise, and will deposit any such securities in accordance
with the terms of any reorganization or protective plan.
Without instructions, Custodian is authorized to exchange
securities held by it in temporary form for securities in
definitive form, to effect an exchange of shares when the par
value of the stock is changed, and, upon receiving payment
therefor, to surrender bonds or other securities held by it at
maturity or when advised of earlier call for redemption,
except that Custodian shall receive instructions prior to
surrendering any convertible security.
F. Purchases of Investments of the Fund
Fund will, on each business day on which a purchase of
securities shall be made by it, deliver to Custodian
instructions which shall specify with respect to each such
purchase:
1. If applicable, the name of the Portfolio making
such purchase;
2. The name of the issuer and description of the
security;
3. The number of shares and 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;
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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.
9. Whether the security is to be received in
certificated form or via a specified Depository.
In accordance with such instructions, Custodian will pay for out of monies held
for the account of Fund, but only insofar as such monies are available 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 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. Except as otherwise instructed by Fund, such payment shall be made by
the Custodian only upon receipt of securities: (a) by the Custodian; (b) by a
clearing corporation of a national exchange of which the Custodian is a member;
or (c) by a Depository. Notwithstanding the foregoing, (i) in the case of a
repurchase agreement, the Custodian may release funds to a Depository prior to
the receipt of advice from the Depository that the securities underlying such
repurchase agreement have been transferred by book-entry into the account
maintained with such Depository by the Custodian, on behalf of its customers,
provided that the Custodian's instructions to the Depository require that the
Depository make payment of such funds only upon transfer by book-entry of the
securities underlying the repurchase agreement in such account; (ii) in the case
of time deposits, call account deposits, currency deposits and other deposits,
foreign exchange transactions, futures contracts or options, the Custodian may
make payment therefor before receipt of an advice or confirmation evidencing
said deposit or entry into such transaction; and (iii) in the case of the
purchase of securities, the settlement of which occurs outside of the United
States of America, the Custodian may make, or cause a subcustodian appointed
pursuant to Section 3.S.2. of this Agreement to make, payment therefor in
accordance with generally accepted local custom and market practice.
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 (other than options and futures) of Fund has been
made, deliver to Custodian instructions specifying with
respect to each such sale:
1. If applicable, the name of the Portfolio making
such sale;
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2. The name of the issuer and description of the
securities;
3. The number of shares and 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. Except as otherwise instructed by Fund, such
delivery shall be made upon receipt of payment therefor: (a) in such
form as is satisfactory to the Custodian; (b) credit to the account of
the Custodian with a clearing corporation of a national securities
exchange of which the Custodian is a member; or (c) credit to the
account of the Custodian, on behalf of its customers, with a
Depository. Notwithstanding the foregoing: (i) in the case of
securities held in physical form, such securities shall be delivered in
accordance with "street delivery custom" to a broker or its clearing
agent; or (ii) in the case of the sale of securities, the settlement of
which occurs outside of the United States of America, the Custodian may
make, or cause a subcustodian appointed pursuant to Section 3.S.2. of
this Agreement to make, payment therefor in accordance with generally
accepted local custom and market practice.
H. Purchases or Sales of Options and Futures
Fund will, on each business day on which a purchase or sale of
the following options and/or futures shall be made by it,
deliver to Custodian instructions which shall specify with
respect to each such purchase or sale:
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1. If applicable, the name of the Portfolio 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; and
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;
and
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
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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. Options 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.
I. Securities Pledged or Loaned
If specifically allowed for in the prospectus of Fund, and
subject to such additional terms and conditions as Custodian
may require:
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
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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 Fund in writing.
K. Deposit Accounts
Custodian will open and maintain one or more special purpose
deposit accounts in the name of Custodian ("Accounts"),
subject only to draft or order by Custodian upon receipt of
instructions. All monies received by Custodian from or for the
account of Fund shall be deposited in said Accounts. 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 an 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 be credited to the Fund based on the schedule attached as
Exhibit A. 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 Fund in that amount.
Custodian may open and maintain Accounts in its own banking
department, or in such other banks or trust companies as may
be designated by it or by Fund in writing, all such Accounts,
however, to be in the name of Custodian and subject only to
its draft or order. Funds received and held for the account of
different Portfolios shall be maintained in separate Accounts
established for each Portfolio.
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L. Income and other Payments to the 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 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 should
reasonably be expected to have
knowledge; 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
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on the last trade date prior to the date of expiration of
such rights.
M. Payment of Dividends and other Distributions
On the declaration of any dividend or other distribution on
the shares of capital stock of Fund ("Fund Shares") by the
Board of Directors of Fund, Fund shall deliver to Custodian
instructions with respect thereto. On the date specified in
such instructions 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
Fund Shares have been cancelled and removed from the
shareholder records.
O. Shares of Fund Purchased from Fund
Whenever Fund Shares are purchased from Fund, Fund will
deposit or cause to be deposited with Custodian the amount
received for such shares. Custodian shall not have any duty or
responsibility to determine that Fund Shares purchased from
Fund have been added to the proper shareholder account or
accounts or that the proper number of such shares have been
added to the shareholder records.
P. Proxies and Notices
Custodian will promptly deliver or mail or have delivered or
mailed to Fund all proxies properly signed, all notices of
meetings, all proxy statements
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and other notices, requests or announcements affecting or
relating to securities held by Custodian for Fund and will,
upon receipt of instructions, execute and deliver or cause its
nominee to execute and deliver or mail or have delivered or
mailed such proxies or other authorizations as may be
required. Except as provided by this Agreement or pursuant to
instructions hereafter received by Custodian, neither it nor
its nominee will exercise any power inherent in any such
securities, including any power to vote the same, or execute
any proxy, power of attorney, or other similar instrument
voting any of such securities, or give any consent, approval
or waiver with respect thereto, or take any other similar
action.
Q. Disbursements
Custodian will pay or cause to be paid, insofar as funds are
available for the purpose, bills, statements and other
obligations of Fund (including but not limited to obligations
in connection with the conversion, exchange or surrender of
securities owned by Fund, interest charges, dividend
disbursements, taxes, management fees, custodian fees, legal
fees, auditors' fees, transfer agents' fees, brokerage
commissions, compensation to personnel, and other operating
expenses of Fund) pursuant to instructions of Fund setting
forth the name of the person to whom payment is to be made,
the amount of the payment, and the purpose of the payment.
R. Daily Statement of Accounts
Custodian will, within a reasonable time, render to Fund a
detailed statement of the amounts received or paid and of
securities received or delivered for the account of Fund
during each business 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. Custodian will permit such
persons as are authorized by Fund, including Fund's
independent public accountants, reasonable access to such
records or will provide reasonable confirmation of the
contents of such records, and if demanded, Custodian 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 permit
such persons as are authorized by Fund, including Fund's
independent public
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accountants, reasonable access to such records or to provide
reasonable confirmation of the contents of such records, and
to permit such agencies to examine the books, records and
securities held by such 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 acting as subcustodians as may be
selected by Custodian. Any such subcustodian
selected by the Custodian must have the
qualifications required for a custodian under the
1940 Act, as amended. It is understood that
Custodian initially intends to appoint United
Missouri Bank, N.A. (UMB) and United Missouri
Trust Company of New York (UMTCNY) as
subcustodians. Custodian shall be responsible to
the Fund for any loss, damage or expense suffered
or incurred by the Fund resulting from the actions
or omissions of UMB, UMTCNY and any other
subcustodians selected and appointed by Custodian
(except subcustodians appointed at the request of
Fund and as provided in Subsection 2 below) to the
same extent Custodian would be responsible to the
Fund under Section 5. of this Agreement if it
committed the act or omission itself. Upon
request of the Fund, Custodian shall be willing to
contract with other subcustodians reasonably
acceptable to the Custodian for purposes of (i)
effecting third-party repurchase transactions with
banks, brokers, dealers, or other entities through
the use of a common custodian or subcustodian, or
(ii) providing depository and clearing agency
services with respect to certain variable rate
demand note securities, or (iii) for other
reasonable purposes specified by Fund; provided,
however, that the Custodian shall be responsible
to the Fund for any loss, damage or expense
suffered or incurred by the Fund resulting from
the actions or omissions of any such subcustodian
only to the same extent such subcustodian is
responsible to the Custodian. The Fund shall be
entitled to review the Custodian's contracts with
any such subcustodians appointed at the request of
Fund. Custodian shall be responsible to the Fund
for any loss, damage or expense suffered or
incurred by the Fund resulting from the actions or
omissions of any Depository only to the same
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extent such Depository is responsible to
Custodian.
2. Notwithstanding any other provisions of this
Agreement, Fund's foreign securities (as defined
in Rule 17f-5(c)(1) under the 0000 Xxx) and Fund's
cash or cash equivalents, in amounts deemed by the
Fund to be 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, and thereafter,
pursuant to a written contract or contracts as
approved by Fund's Board of Directors, may be
transferred to accounts maintained by any such
subcustodian with eligible foreign custodians, as
defined in Rule 17f-5(c)(2). Custodian shall be
responsible to the Fund for any loss, damage or
expense suffered or incurred by the Fund resulting
from the actions or omissions of any foreign
subcustodians or a domestic subcustodian
contracting with such foreign subcustodians only
to the same extent such domestic subcustodian is
responsible to the Custodian.
T. Accounts and Records Property of Fund
Custodian acknowledges that all of the accounts and records
maintained by Custodian pursuant to this Agreement are the
property of Fund, and will be made available to Fund for
inspection or reproduction within a reasonable period of time,
upon demand. Custodian will assist Fund's independent
auditors, or upon approval of Fund, or upon demand, any
regulatory body, in any requested review of Fund's accounts
and records but shall be reimbursed by Fund for all expenses
and employee time invested in any such review outside of
routine and normal periodic reviews. Upon receipt from Fund of
the necessary information or instructions, Custodian will
supply information from the books and records it maintains for
Fund that Fund needs for tax returns, questionnaires, periodic
reports to shareholders and such other reports and information
requests as Fund and Custodian shall agree upon from time to
time.
U. 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 or directed by Fund or its accountants or
other advisors conflicts with or violates any requirements of
its
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prospectus, articles of incorporation, bylaws, any applicable
law, rule or regulation, or any order, decree or agreement by
which Fund may be bound. Fund will be responsible to notify
Custodian of any changes in statutes, regulations, rules,
requirements or policies which might necessitate changes in
Custodian's responsibilities or procedures.
V. Overdrafts
If Custodian shall in its sole discretion advance funds to the
account of the Fund which results in an overdraft in any
Account because the monies held therein 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 together with the overdraft charge set forth on the
then-current Fee Schedule from the date advanced until the
date of payment. Fund hereby grants Custodian a lien on and
security interest in the assets of the Fund to secure the full
amount of any outstanding overdraft and related overdraft
charges.
W. Exercise of Rights; Tender Offers
Upon receipt of instructions, the Custodian shall: (a) deliver
warrants, puts, calls, rights or similar securities to the
issuer or trustee thereof, or to the agent of such issuer or
trustee, for the purpose of exercise or sale, provided that
the new securities, cash or other assets, if any, are to be
delivered to the Custodian; and (b) deposit securities upon
invitations for tenders thereof, provided that the
consideration for such securities is to be paid or delivered
to the Custodian or the tendered securities are to be returned
to the Custodian.
INSTRUCTIONS.
A. The term "instructions", as used herein, means written
(including telecopied or telexed) or oral instructions which
Custodian reasonably believes were given by a designated
representative of Fund. Fund shall deliver to Custodian,
prior to delivery of any assets to Custodian and thereafter
from time to time as changes therein are necessary, written
instructions naming one or more designated representatives
to give instructions in the name and on behalf of Fund,
which instructions may be received and accepted by Custodian
as conclusive evidence of the authority of any designated
representative to act for Fund and may be considered to be
698902.1
15
in full force and effect (and Custodian will be fully protected in
acting in reliance thereon) until receipt by Custodian of notice to the
contrary. Unless such written instructions delegating authority to any
person to give instructions specifically limit such authority to
specific matters or require that the approval of anyone else will first
have been obtained, Custodian will be under no obligation to inquire
into the right of such person, acting alone, to give any instructions
whatsoever which Custodian may receive from such person. If Fund fails
to provide Custodian any such instructions naming designated
representatives, any instructions received by Custodian from a person
reasonably believed to be an appropriate representative of Fund shall
constitute valid and proper instructions hereunder.
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.
LIMITATION OF LIABILITY OF CUSTODIAN.
A. Custodian shall at all times use reasonable care and due
diligence and act in good faith in performing its duties
under this Agreement. Custodian shall not be responsible
for, and the Fund shall indemnify and hold Custodian
harmless from and against, any and all losses, damages,
costs, charges, counsel fees, payments, expenses and
liability which may be asserted against Custodian, incurred
by Custodian or for which Custodian may be held to be
liable, arising out of or attributable to:
1. All actions taken by Custodian pursuant to this Agreement or
any instructions provided to it hereunder, provided that
Custodian has acted in good faith and with due diligence and
reasonable care; and
2. The Fund's refusal or failure to comply with the terms
of this Agreement (including without limitation the
Fund's failure to pay or reimburse Custodian under this
indemnification provision), the Fund's negligence or
willful misconduct, or the failure of any
representation or warranty of the Fund hereunder to be
and remain true and correct in all respects at all
times.
698902.1
16
B. Custodian may request and obtain at the expense of Fund the
advice and opinion of counsel for Fund or of its own counsel
with respect to questions or matters of law, and it shall be
without liability to Fund for any action taken or omitted by
it in good faith, in conformity with such advice or opinion.
If Custodian reasonably believes that it could not prudently
act according to the instructions of the Fund or the Fund's
accountants or counsel, it may in its discretion, with
notice to the Fund, not act according to such instructions.
C. Custodian may rely upon the advice and statements of Fund, Fund's
accountants and officers or other authorized individuals, 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 advice and statements.
D. If Fund requests Custodian in any capacity to take any
action which involves the payment of money by Custodian, or
which might make it or its nominee liable for payment of
monies or in any other way, Custodian shall be indemnified
and held harmless by Fund against any liability on account
of such action; provided, however, that nothing herein shall
obligate Custodian to take any such action except in its
sole discretion.
E. Custodian shall be protected in acting as custodian
hereunder upon any instructions, advice, notice, request,
consent, certificate or other instrument or paper appearing
to it to be genuine and to have been properly executed and
shall be entitled to receive upon request as conclusive
proof of any fact or matter required to be ascertained from
Fund hereunder a certificate signed by an officer or
designated representative of Fund.
F. 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 of any securities or
foreign currency positions or evidence of ownership required
by Fund to be received by Custodian, or the propriety of the
decision to purchase or amount paid therefor;
2. The legality of the sale of any securities or foreign currency
positions 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 Fund Shares, or the
sufficiency of the amount to be received therefor;
698902.1
17
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, clearinghouse funds, uncollected funds, or
instrument for the payment of money to be received by it on
behalf of Fund until Custodian actually receives such money;
provided, however, that it shall advise Fund promptly if it
fails to receive any such money in the ordinary course of
business and shall cooperate with Fund toward the end that
such money shall be received.
H. Except as provided in 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.
I. Custodian shall not be responsible or liable for the failure
or delay in performance of its obligations under this
Agreement, or those of any entity for which it is
responsible hereunder, arising out of or caused, directly or
indirectly, by circumstances beyond the affected entity's
reasonable control, including, without limitations: any
interruption, loss or malfunction of any utility,
transportation, computer (hardware or software) or
communication service; inability to obtain labor, material,
equipment or transportation, or a delay in mails;
governmental or exchange action, statute, ordinance,
rulings, regulations or direction; war, strike, riot,
emergency, civil disturbance, terrorism, vandalism,
explosions, labor disputes, freezes, floods, fires,
tornados, acts of God or public enemy, revolutions, or
insurrection.
J. IN NO EVENT AND UNDER NO CIRCUMSTANCES SHALL EITHER PARTY TO THIS
AGREEMENT BE LIABLE TO ANYONE, INCLUDING, WITHOUT LIMITATION TO THE
OTHER PARTY, FOR CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES FOR ANY ACT
OR FAILURE TO ACT UNDER ANY PROVISION OF THIS AGREEMENT EVEN IF ADVISED
OF THIS POSSIBILITY THEREOF.
698902.1
18
6. COMPENSATION. In consideration for its services hereunder,
Fund will pay to Custodian such compensation as shall be set
forth in a separate fee schedule to be agreed to by Fund and
Custodian from time to time. A copy of the initial fee
schedule is attached hereto and incorporated herein by
reference. Custodian shall also be entitled to receive, and
Fund agrees to pay to Custodian, on demand, reimbursement
for Custodian's cash disbursements and reasonable out-of-
pocket costs and expenses, including attorney's fees,
incurred by Custodian in connection with the performance of
services hereunder. Custodian may charge such compensation
against monies held by it for the account of Fund.
Custodian will also be entitled to charge against any monies
held by it for the account of Fund the amount of any loss,
damage, liability, advance, overdraft or expense for which
it shall be entitled to reimbursement from Fund, including
but not limited to fees and expenses due to Custodian for
other services provided to the Fund by Custodian. Custodian
will be entitled to reimbursement by the Fund for the
losses, damages, liabilities, advances, overdrafts and
expenses of subcustodians only to the extent that (i)
Custodian would have been entitled to reimbursement
hereunder if it had incurred the same itself directly, and
(ii) Custodian is obligated to reimburse the subcustodian
therefor.
7. TERM AND TERMINATION. The initial term of this Agreement
shall be for a period of __________. Thereafter, either
party to this Agreement may terminate the same by notice in
writing, delivered or mailed, postage prepaid, to the other
party hereto and received not less than ninety (90) days
prior to the date upon which such termination will take
effect. Upon termination of this Agreement, Fund will pay
Custodian its fees and compensation due hereunder and its
reimbursable disbursements, costs and expenses paid or
incurred to such date and Fund shall designate a successor
custodian by notice in writing to Custodian by the
termination date. In the event no written order designating
a successor custodian has been delivered to Custodian on or
before the date when such termination becomes effective,
then Custodian may, at its option, deliver the securities,
funds and properties of Fund to a bank or trust company at
the selection of Custodian, and meeting the qualifications
for custodian set forth in the 1940 Act and having not less
than Two Million Dollars ($2,000,000) aggregate capital,
surplus and undivided profits, as shown by its last
published report, or apply to a court of competent
jurisdiction for the appointment of a successor custodian or
other proper relief, or take any other lawful action under
the circumstances; provided, however, that Fund shall
698902.1
19
reimburse Custodian for its costs and expenses, including reasonable
attorney's fees, incurred in connection therewith. Custodian will, upon
termination of this Agreement and payment of all sums due to Custodian
from Fund hereunder or otherwise, deliver to the successor custodian so
specified or appointed, or as specified by the court, at Custodian's
office, all securities then held by Custodian hereunder, duly endorsed
and in form for transfer, and all funds and other properties of Fund
deposited with or held by Custodian hereunder, and Custodian will
co-operate in effecting changes in book-entries at all Depositories.
Upon delivery to a successor custodian or as specified by the court,
Custodian will have no further obligations or liabilities under this
Agreement. Thereafter such successor will be the successor custodian
under this Agreement and will be entitled to reasonable compensation
for its services. In the event that securities, funds and other
properties remain in the possession of the Custodian after the date of
termination hereof owing to failure of the Fund to appoint a successor
custodian, the Custodian shall be entitled to compensation as provided
in the then-current fee schedule hereunder for its services during such
period as the Custodian retains possession of such securities, funds
and other properties, and the provisions of this Agreement relating to
the duties and obligations of the Custodian shall remain in full force
and effect.
8. NOTICES. Notices, requests, instructions and other writings addressed to Fund
at 000 Xxxxx 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 addressed to Custodian at its offices at 000 Xxxx 00xx Xxxxxx, Xxxxxx
Xxxx, Xxxxxxxx 00000, Attention: Custody Department, 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. MULTIPLE PORTFOLIOS. If Fund is comprised of more than one Portfolio:
A. Each Portfolio shall be regarded for all purposes
hereunder as a separate party apart from each
other Portfolio. Unless the context otherwise
requires, with respect to every transaction
covered by this Agreement, every reference herein
to the Fund shall be deemed to relate solely to
the particular Portfolio to which such transaction
relates. Under no circumstances shall the rights,
obligations or remedies with respect to a
particular Portfolio constitute a right,
698902.1
20
obligation or remedy applicable to any other
Portfolio. The use of this single document to
memorialize the separate agreement of each Portfolio
is understood to be for clerical convenience only and
shall not constitute any basis for joining the
Portfolios for any reason.
B. Additional Portfolios may be added to this Agreement,
provided that Custodian consents to such addition.
Rates or charges for each additional Portfolio shall
be as agreed upon by Custodian and Fund in writing.
10. MISCELLANEOUS.
A. This Agreement shall be construed according to, and
the rights and liabilities of the parties hereto
shall be governed by, the laws of the State of
Missouri, without reference to the choice of laws
principles thereof.
B. All terms and provisions of this Agreement shall be
binding upon, inure to the benefit of and be
enforceable by the parties hereto and their
respective successors and permitted assigns.
C. The representations and warranties and the
indemnifications extended hereunder are intended to
and shall continue after and survive the expiration,
termination or cancellation of this Agreement.
D. No provisions of the Agreement may be amended or
modified in any manner except by a written agreement
properly authorized and executed by each party
hereto.
E. The failure of either party to insist upon the
performance of any terms or conditions of this
Agreement or to enforce any rights resulting from
any breach of any of the terms or conditions of
this Agreement, including the payment of damages,
shall not be construed as a continuing or
permanent waiver of any such terms, conditions,
rights or privileges, but the same shall continue
and remain in full force and effect as if no such
forbearance or waiver had occurred. No waiver,
release or discharge of any party's rights
hereunder shall be effective unless contained in a
written instrument signed by the party sought to
be charged.
698902.1
21
F. The captions in the 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.
G. 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.
H. If any part, term or provision of this Agreement
is determined by the courts or any regulatory
authority 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.
I. This Agreement may not be assigned by either party
hereto without the prior written consent of the other
party.
J. Neither the execution nor performance of this
Agreement shall be deemed to create a partnership or
joint venture by and between Custodian and Fund.
K. Except as specifically provided herein, this
Agreement does not in any way affect any other
agreements entered into among the parties hereto and
any actions taken or omitted by either party
hereunder shall not affect any rights or obligations
of the other party hereunder.
698902.1
22
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed by their respective duly authorized
officers.
INVESTORS FIDUCIARY TRUST COMPANY
By:______________________________
Title:___________________________
PAX WORLD MONEY MARKET FUND, INC.
By:______________________________
Title:___________________________
698902.1
23
EXHIBIT A
INVESTORS FIDUCIARY TRUST COMPANY
AVAILABILITY SCHEDULE BY TRANSACTION TYPE
TRANSACTION DTC PHYSICAL
----------- --- --------
TYPE CREDIT DATE FUNDS TYPE CREDIT DATE FUNDS TYPE
------------------------------- --------------------- --------------------- --------------------- ---------------------
Calls Put As Received C or F* As Received C or F*
Maturities As Received C or F* Mat. Date C or F*
Tender Reorgs. As Received C As Received C
Dividends Paydate C Paydate C
Floating Rate Int. Paydate C Paydate C
Floating Rate Int. N/A As Rate C
(No Rate) Received
Mtg. Backed P&I Paydate C Paydate + 1 C
Bus. Day
Fixed Rate Inc. Paydate C Paydate C
Euroclear N/A Paydate C
TRANSACTION FED
----------- ---
TYPE CREDIT DATE FUNDS TYPE
------------------------------- --------------------- ---------------------
Calls Put
Maturities Mat. Date F
Tender Reorgs. N/A
Dividends N/A
Floating Rate Int. N/A
Floating Rate Int. N/A
(No Rate)
Mtg. Backed P&I Paydate F
Fixed Rate Inc. Paydate F
Euroclear
Legend
C = Clearinghouse Funds F = Fed Funds N/A = Not Applicable * Availability based
on how received.
698902.1
24
