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EXHIBIT 8
CUSTODY AGREEMENT
THIS AGREEMENT made effective the 15th day of August, 1997, 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 x00 Xxxx 00xx
Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 ("Custodian"), and THE BRADFORD FUNDS, INC.,
a Maryland corporation, having its principal office and place of business at 000
0xx 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 The Bradford Money Fund; 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 the state of its
incorporation, 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.
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
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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 which Fund intends to be
held in the custody of Custodian. 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 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").
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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 time 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 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;
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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;
8. The name of the person from whom or the broker or
dealer through whom the purchase was made; and
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;
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;
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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:
1. If applicable, the name of the Portfolio making such
purchase or sale;
2. In the case of 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;
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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. In the case of 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. In the case of 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. In the case of 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
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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 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
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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.
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 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 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 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 canceled
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 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,
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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 and state
regulatory agencies, Custodian will instruct any subcustodian
to permit such persons as are authorized by Fund, including
Fund's independent public 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. 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 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
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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 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 subcustodians 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 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.
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V. Advances. In the event Custodian or any subcustodian shall, in
its sole discretion, advance cash or securities for any
purpose (including but not limited to securities settlements,
purchase or sale of foreign exchange or foreign exchange
contracts and assumed settlement) for the benefit of any
Portfolio, the advance shall be payable by the Fund to
Custodian upon demand. Any such cash advance shall be subject
to an overdraft charge at the rate set forth in the
then-current Fee Schedule from the date advanced until the
date repaid. Fund hereby grants Custodian and such
subcustodian a lien on and security interest in all property
at any time held for the account of the applicable Portfolio,
including without limitation all assets acquired with the
amount advanced. Should the Fund fail to promptly repay the
advance, the Custodian and such subcustodian shall be entitled
to utilize available cash and to dispose of such Portfolio's
assets pursuant to applicable law to the extent necessary to
obtain reimbursement of the amount advanced and any 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.
4. 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 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.
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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 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.
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.
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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;
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 limitation: 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
14
15
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.
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 (i)
Custodian's cash disbursements and reasonable out-of-pocket costs and
expenses incurred by Custodian in connection with the performance of
services hereunder and (ii) the amount of any loss, damage, liability,
advance, overdraft or expense for which it shall be entitled to
reimbursement from Fund. 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. In connection with any fees or other amounts due
to Custodian as described above, Custodian shall submit its request for
payment in writing to Xxxxx & Xxxx Asset Management L.P. as the Fund's
administrator (the "Administrator"). If within 30 days after such
request is submitted, Custodian shall not have received such fees or
other amounts as are due to it hereunder from the Administrator and the
Administrator has not contested in good faith such fees or other
amounts, then Custodian shall submit its request for payment in writing
directly to the Fund. If within 30 days after such request is
submitted, Custodian has not received such fees or other amounts as are
due to it hereunder and the Fund has not contested in good faith such
fees or other amounts, then Custodian may charge such fees and amounts
due, including reasonable attorneys fees incurred in connection with
the collection of fees, against monies held by it for the account of
Fund.
7. TERM AND TERMINATION. The initial term of this Agreement shall be for a
period of one (1) year. 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
15
16
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 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 Xxxxx & Tang, 000 Xxxxx Xxx., Xxx Xxxx Xxxx, Xxx Xxxx 00000,
c/o X.X. Xxxx, 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, 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.
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17
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.
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.
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18
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.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective duly authorized officers.
INVESTORS FIDUCIARY TRUST THE BRADFORD FUNDS, INC.
COMPANY
By: /s/ Xxxxx X. Strain By: /s/ Xxxx Xxxxxx
-------------------------------- --------------------------------
Title: Executive Vice President Title: Vice President
----------------------------- -----------------------------
18
19
EXHIBIT A
INVESTORS FIDUCIARY TRUST COMPANY
AVAILABILITY SCHEDULE BY TRANSACTION TYPE
===============================================================================================================================
TRANSACTION DTC PHYSICAL FED
----------- --- -------- ---
-------------------------------------------------------------------------------------------------------------------------------
TYPE CREDIT DATE FUNDS TYPE CREDIT DATE FUNDS TYPE CREDIT DATE FUNDS 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 Rate Int. Paydate C Paydate C N/A
-------------------------------------------------------------------------------------------------------------------------------
Floating Rate Int. N/A As Rate Received C N/A
(No Rate)
-------------------------------------------------------------------------------------------------------------------------------
Mtg. Backed P&I Paydate C Paydate + 1 Bus. C Paydate F
Day
-------------------------------------------------------------------------------------------------------------------------------
Fixed Rate Int. Paydate C Paydate C Paydate F
-------------------------------------------------------------------------------------------------------------------------------
Euroclear N/A C Paydate C
===============================================================================================================================
Legend
C = Clearinghouse Funds
F = Fed Funds
N/A = Not Applicable
Availability based on how received.
19
20
EXHIBIT B -- FUNDS TRANSFER OPERATING GUIDELINES
1. OBLIGATION OF THE SENDER: Custodian ("IFTC") is authorized to promptly debit
Fund's ("Client's") account(s) upon the receipt of a payment order in
compliance with any of the Security Procedures chosen by the Client, from those
offered on the attached selection form (and any updated selection forms
hereafter executed by the Client), for funds transfers and in the amount of
money that IFTC has been instructed to transfer. IFTC is hereby instructed to
accept funds transfer instructions only via the delivery methods and Security
Procedures indicated on the attached selection form (and any updated executed
by the Client). The Client agrees that the Security Procedures are reasonable
and adequate for its wire transfer transactions and agrees to be bound by any
payment orders, amendments and cancellations, whether or not authorized, issued
in its name and accepted by IFTC after being confirmed by any of the selected
Security Procedures. The Client also agrees to be bound by any other valid and
authorized payment order accepted by IFTC. IFTC shall execute payment orders in
compliance with the selected Security Procedures and with the
Client's/Investment Manager's instructions on the execution date provided that
such payment order is received by the customary deadline for processing such a
request, unless the payment order specifies a later time. IFTC will use
reasonable efforts to execute on the execution date payment orders received
after the customary deadline, but if it is unable to execute any such payment
order on the execution date, such payment order will be deemed to have been
received on the next business day.
2. SECURITY PROCEDURES: The Client acknowledges that the selected Security
Procedures were selected by the Client from Security Procedures offered by
IFTC. The Client shall restrict access to confidential information relating to
the Security Procedures to authorized persons as communicated in writing to
IFTC. The Client must notify IFTC immediately if it has reason to believe
unauthorized persons may have obtained access to such information or of any
change in the Client's authorized personnel. IFTC shall verify the authenticity
of all instructions according to the selected Security Procedures.
3. ACCOUNT NUMBERS: IFTC shall process all payment orders on the basis of the
account number contained in the payment order. In the event of a discrepancy
between any name indicated on the payment order and the account number, the
account number shall take precedence and govern. Financial institutions that
receive payment orders initiated by IFTC at the instruction of the Client may
also process payment orders on the basis of account numbers, regardless of any
name included in the payment order. IFTC will also rely on any financial
institution identification numbers included in any payment order, regardless of
any financial institution name included in the payment order.
4. REJECTION: IFTC reserves the right to decline to process or delay the
processing of a payment order which (a) is in excess of the collected balance
in the account to be charged at the time of IFTC's receipt of such payment
order; (b) if initiating such payment order would cause IFTC, in IFTC's sole
judgment, to exceed any applicable volume, aggregate dollar, network, time,
credit or similar limits upon wire transfer; or (c) if IFTC, in good faith, is
unable to satisfy itself that the transaction has been properly authorized.
21
5. CANCELLATION OR AMENDMENT: IFTC shall use reasonable efforts to act on all
authorized requests to cancel or amend payment orders received in compliance
with the selected Security Procedures provided that such requests are received
in sufficient time to afford IFTC a reasonable opportunity to act prior to
executing the payment order. However, IFTC assumes no liability if the request
for amendment or cancellation cannot be satisfied by IFTC's reasonable efforts.
6. ERRORS: IFTC shall assume no responsibility for failure to detect any
erroneous payment order provided that IFTC complies with the payment order
instructions as received and IFTC complies with the selected Security
Procedures. The Security Procedures are established for the purpose of
authenticating payment orders only and not for the detection of errors in
payment orders.
7. INTEREST AND LIABILITY LIMITS: IFTC shall assume no responsibility for lost
interest with respect to the refundable amount of any unauthorized payment
order, unless IFTC is notified of the unauthorized payment order within thirty
(30) days of notification by IFTC of the acceptance of such payment order. In
no event (including but not limited to failure to execute a payment order)
shall IFTC be liable for special, indirect or consequential damages, even if
advised of the possibility of such damages.
8. AUTOMATED CLEARING HOUSE ("ACH") CREDIT ENTRIES/PROVISIONAL PAYMENTS: When
the Client initiates or receives ACH credit and debit entries pursuant to
these Guidelines and the rules of the National Automated Clearing House
Association and the Mid-America Payment Exchange or other similar body, IFTC or
its agent will act as an Originating Depository Financial Institution and/or
Receiving Depository Financial Institution, as the case may be, with respect to
such entries. Credits given with respect to an ACH credit entry are
provisional until final settlement for such entry is received from the Federal
Reserve Bank. If such final settlement is not received, the Client agrees to
promptly refund the amount credited to the Client in connection with such
entry, and the party making payment to the Client via such entry shall not be
deemed to have paid the amount of the entry.
9. CONFIRMATIONS: Confirmation of IFTC's execution of payment orders shall
ordinarily be provided within 24 hours. Notice may be delivered through IFTC's
account statements, advices, information systems, or by facsimile or callback.
The Client must report any objections to the execution of a payment order
within 30 days.
10. MISCELLANEOUS: IFTC may use the Federal Reserve System Fedwire to execute
payment orders, and any payment order carried in whole or in part through
Fedwire will be subject to applicable Federal Reserve Board rules and
regulations. IFTC and the Client agree to cooperate to attempt to recover any
funds erroneously paid to wrong parties, regardless of any fault of IFTC or the
Client, but the party responsible for the erroneous payment shall bear all costs
and expenses incurred in trying to effect such recover. These Guidelines may
not be amended except by written agreement signed by the parties.
22
SECURITY PROCEDURES SELECTION FORM
Please select one or more of the funds transfer security procedures indicated
below.
[ ] SWIFT SWIFT (Society for Worldwide Interbank Financial
Telecommunication) is a cooperative society owned and operated by member
financial institutions that provides telecommunication services for its
membership. Participation is limited to securities brokers and dealers,
clearing and depository institutions, recognized exchanges for securities,
and investment management institutions. SWIFT provides a number of
security features through encryption and authentication to protect against
unauthorized access, loss or wrong delivery of messages, transmission
errors, loss of confidentiality and fraudulent changes to messages.
Selection of this security procedure would be most appropriate for
existing SWIFT members.
[ ] REMOTE BATCH TRANSMISSION Wire transfer instructions are delivered via
Computer-to-Computer (CPU-CPU) data communications between the Client
and/or its agent and IFTC and/or its agent. Security procedures include
encryption and/or the use of a test key by those individuals authorized as
Automated Batch Verifiers or a callback procedure to those individuals.
Clients selecting this option should have an existing facility for
completing CPU-CPU transmissions. This delivery mechanism is typically
used for high-volume business such as shareholder redemptions and dividend
payments.
[X] TELEPHONE CONFIRMATION (CALL BACK) This procedure requires Clients to
designate individuals as authorized initiators and authorized verifiers.
IFTC will verify that the instruction contains the signature of an
authorized person and prior to execution of the payment order, will
contact someone other than the originator at the Client's location to
authenticate the instruction. Non-repetitive wire transfers with the
original signatures of 2 authorized persons are acceptable and do not
require a call back. Selection of this alternative is appropriate for
Clients who do not have the capability to use other security procedures.
[ ] TEST KEY Test Key confirmation will be used to verify all
non-repetitive funds transfer instructions received via facsimile or
phone. IFTC will provide test keys if this option is chosen. IFTC will
verify that the instruction contains the signature of an authorized person
and prior to execution of the payment order, will authenticate the test
key provided with the corresponding test key at IFTC. Non-repetitive wire
transfers with the original signatures of 2 authorized persons are
acceptable and do not require a test key. Selection of this alternative is
appropriate for Clients who do not have the capability to use other
security procedures.
[X] REPETITIVE WIRES For situations where funds are transferred periodically
from an existing authorized account to the same payee (destination bank
and account number) and only the date and currency amount are variable, a
repetitive wire may be implemented. Repetitive wires will be subject to a
$10 million limit. If the payment order exceeds the $10 million limit, the
instruction will be confirmed by telephone or test key prior to execution.
Repetitive wire instructions must be reconfirmed annually. Clients may
establish Repetitive Wires by following the agreed upon security
procedures for Non-Repetitive Wire Transfers as described by Telephone
Confirmation (Call Back) or Test Key. This alternative is recommended
whenever funds are frequently transferred between the same two accounts.
23
[X] STANDING INSTRUCTIONS Funds are transferred by IFTC to a counter party
on the Client's established list of authorized counter parties. Only
the date and the dollar amount are variable. Clients may establish
Standby Instructions by following the agreed upon security procedures
for Non-Repetitive Wire Transfers as described by Telephone
Confirmation (Call Back) or Test Key. This option is used for
transactions that include but are not limited to Foreign Exchange
Contracts, Time Deposits and Tri-Party Repurchase Agreements.
[ ] AUTOMATED CLEARING HOUSE (ACH) IFTC or its agent receives an automated
transmission from a Client for the initiation of payment (credit) or
collection (debit) transactions through the ACH network. The
transactions contained on each transmission or tape must be
authenticated by the Client. The transmission is sent from the Client's
or its agent's system to IFTC's or its agent's system with encryption.
KEY CONTACT INFORMATION
Whom shall we contact to implement your selection(s)?
CLIENT OPERATIONS CONTACT ALTERNATE CONTACT
---------------------------------- ----------------------------------
Name Name
---------------------------------- ----------------------------------
Address Address
---------------------------------- ----------------------------------
City/State/Zip Code City/State/Zip Code
---------------------------------- ----------------------------------
Telephone Number Telephone Number
----------------------------------
Facsimile Number
----------------------------------
SWIFT Number
THE BRADFORD FUNDS, INC.
By: /s/ Xxxx Xxxxxx
-------------------------------
Title: Vice President
----------------------------
Date: August 15, 1997
-----------------------------
24
INVESTORS FIDUCIARY TRUST COMPANY
XXXXX & TANG FUNDS
FEE SCHEDULE
I. INVESTMENT ACCOUNTING & CUSTODY
A. Asset Based Fee (Based on the aggregate assets of all funds in the
Xxxxx & Xxxx complex included under the terms of this agreement. An
allocable portion of the asset based fee is to be apportioned to the
Fund in accordance with the methodology agreed to between the Fund and
Xxxxx & Tang Asset Management L.P.).
2.55/100 of 1% (2.55 basis points) on the first $5 billion in assets
1/100 of 1% (1 basis point) on all assets over $5 billion
(Note: Investment accounting assets will be used to determine all
charges.)
B. Transaction Fee, per transaction
Physical Delivery - $19.00
Fed Book Entry - $9.00
Fed Book Entry - Repo's - $7.00
DTC - $7.00
PTC - $12.00
GNMA Paydown - $10.00
Euroclear/CEDEL/First Chicago Clearing - $32.00
Emerging Markets - $90 - $120
C. Sweep Account Deposits
$5.00 per deposit
D. Foreign Custody Fees
16/100 of 1% (16 basis points) on all assets held in foreign securities
6/100 of 1% (6 basis points) on all assets held in
Euroclear/CEDEL/First Chicago Clearing (Excluding Daily Dollar
International which will be charged 2 basis points)
40/100 of 1% (40 basis points) on all assets held in emerging markets
(Excluding Mexico which is 22 basis points)
June 26, 1997 Page 1 of 3
25
Xxxxx & Xxxx Funds
Fee Schedule (continued)
E. Federal Funds Wire
See Cash Management Services Fee Schedule
F. Balance Credits
IFTC will offset fees with balance credits calculated at 75%
of the bank credit rate (see below) 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 and portfolio accounting fees. Any credits in excess
of fees will be carried forward from month to month through
the end of the calendar year. For calculation purposes, IFTC
uses an actual/actual basis.
Note: The bank credit rate is the equivalent to the lesser of:
- The average 91-day Treasury Xxxx discount rate for the
month
or
- The average Federal Funds rate for the month less
50 basis points.
G. Overdraft Charges
Overdrafts will be calculated at the Fed Fund rate (as
published in the Wall Street Journal) and charged on a daily
basis.
H. Multi-Class Fees
There will be a $350 per month base fee for each additional
class that is added to each fund.
June 26, 1997 Page 2 of 3
26
II. NOTES TO THE ABOVE FEE SCHEDULE
A. Asset based fees will be billed monthly at 1/12th of the
annual stated rate based on monthly average net assets, except
for the foreign securities premium which will be billed on
month-end market value at 1/12th of the annual stated rate.
B. The above schedule does not include out-of-pocket expenses
that would be incurred by IFTC on the client's behalf.
Examples of out-of-pocket expenses include but are not limited
to forms, postage, magnetic tapes, printing, proxy processing,
microfilm, microfiche, back-up recovery, pricing services,
overnight mailing services, FDIC insurance, foreign
registration and script fees, etc. IFTC bills out-of-pocket
expenses separately from service fees.
C. The fees stated above are exclusive of terminal equipment
required in the client's location(s) and communication line
costs.
D. 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.
E. The above fee schedule is applicable for selections made and
communicated within 90 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 not prior to their effective date.
F. The Foreign Custody Fee will be charged on all securities
that are held by a sub-custodian or depository outside of the
United States.
June 26, 1997 Page 3 of 3
27
INVESTORS FIDUCIARY TRUST COMPANY
XXXXX & XXXX FUNDS
CASH MANAGEMENT SERVICES FEE SCHEDULE
JUNE 26, 1997
ITEM CHARGE
---------------------------------------------------
Account Maintenance $50.00 per account/month (Capped at 7,500 per year)
Checks Cleared $0.15 per check
Deposits $0.35 per transaction
Deposited Items*
Pre-encoded
First 20,000 $0.035 per item/month
Next 20,000 $0.03 per item/month
Unencoded $0.075 per item
Internal Transfers $0.35 per transfer
Microfilming Checks $0.01 per check
Return Items $0.95 per item
Check Copies $2.50 per check
NSCC Settlement $200.00 per month
ACH Item Fee $0.07 per item
ACH File Fee $10.00 per file
Wires In/Out $4.50 per wire
Wires-Remote Input $2.00 per wire
Stop Payments $5.00 per check
Signature Verification $0.25 per check
Returning Checks to Shareholders** $0.04 per check
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28
FDIC Insurance *** 23 basis points on cash balances
Overdraft Charges Prime rate per Wall Street Journal
Moneynet System Charges Line charges approx. $1,700 per month
(The Moneynet System line charges are
assessed once, on a complex-wide basis.
Xxxxx & Tang Asset Management L.P. will
allocate a portion of the charge to the
funds in the complex in a manner agreed to
between the funds and Xxxxx & Xxxx Asset
Management L.P.)
IFTC will offset fees with balance credits calculated at 75% of the bank credit
rate (see below) applied to average collected cash balances for the month.
Balance credits will be applied on a fund by fund basis and can be used to
offset fees. Any credits in excess of fees will be carried forward from month
to month through the end of the calendar year. For calculation purposes, IFTC
uses an actual/actual basis.
Note: The bank credit rate is the equivalent to the lesser of:
- The average 91-day Treasury Xxxx discount rate for the month OR
- The average Federal Funds rate for the month less 50 basis points.
* Additional per item fees will normally be imposed for clearing through
the Federal Reserve System or a direct send to a commercial bank, and
for transportation.
** Plus Postage
*** Fluctuates based on assessment from FDIC.
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