Exhibit 8
THE BENCHMARK FUNDS
CUSTODIAN AGREEMENT
Agreement dated this 8th day of June, 1992 between The Benchmark Funds, a
Massachusetts business trust (the "Trust"), and The Northern Trust Company, an
Illinois state bank ("Northern").
1. Appointment of Custodian. The Trust hereby appoints Northern custodian
of all securities (including repurchase agreements) and cash now owned or
hereafter acquired by the Trust, and Northern hereby accepts such appointment,
upon the terms and conditions set forth in this Agreement. The Trust agrees
promptly to deliver and pay, or cause to be delivered and paid, to Northern, as
custodian, all securities and cash now owned or hereafter acquired by the Trust.
It is understood that (a) the Trust is an open-end, management investment
company registered under the Investment Company Act of 1940 ("1940 Act") as a
series company with six portfolios but with the ability to create additional
portfolios (the initial portfolios and each such additional portfolio being
referred to herein as a "Portfolio"), and all such portfolios being collectively
referred to herein as the "Portfolios"), and (b) pursuant to section 18(f)(2) of
the 1940 Act each series of the Trust's Units [as defined in Trust's Agreement
and Declaration of Trust (the "Trust Agreement")], representing the interest in
a Portfolio, is preferred over all other series in respect of the assets
specifically allocated to such Portfolio.
2. Custody of Cash; Separate Accounts.
(a) Accounts. Northern will hold all cash of each Portfolio, in a
separate account or accounts in the name of such Portfolio,
subject only to draft or order by Northern in accordance with the
terms of this Agreement. If and when authored by proper
instructions of the Trustees or Officers of the Trust in
accordance with a vote of the majority of the Trustees of the
Trust, Northern may open and maintain an additional account or
accounts in such other banks or trust companies as may be
designated by such instructions, provided that such account or
accounts shall be in the name of Northern in its capacity as
custodian and subject only to its draft or order in accordance
with the terms of this Agreement.
(b) Proceeds of Sale of Units of Trust. Upon receipt of funds for the
purchase of Units of
any Portfolio, Northern shall promptly deposit the purchase price
in the account or accounts maintained pursuant to Section 2A
hereof.
(c) Collections. Unless otherwise directed by proper instructions
from the Trustees or Officers of the Trust, Northern shall
collect, receive and deposit in the account or accounts
maintained pursuant to Section 2A hereof all income, principal
and other payments in respect of the securities held by it under
this Agreement and, subject to the other provisions of this
Agreement, do all other things necessary or proper in connection
with the collection of such income, principal and other payments.
Without limiting the generality of the foregoing, Northern shall:
(i) present for payment by the date of payment all coupons and
other income items requiring presentation;
(ii) present for payment all securities which may mature or be
called, redeemed, retired or otherwise become payable by
the date such securities become payable;
(iii) endorse and deposit for collection, on behalf of the
Trust, checks, drafts or other negotiable instruments no
later than the next business day as received;
(iv) execute ownership and other certificates and affidavits
for all Federal and State tax purposes in connection with
the collection of income; and
(v) notify the Trust as soon as reasonably practicable
whenever income, principal or other payments due on
securities are not collected in due course.
In any case in which Northern does not receive any such due and unpaid
income, principal or other payment within a reasonable time after it has made
proper demands for the same, it shall so notify the Trust in writing, including
copies of all demand letters, any written responses thereto, and memoranda of
telephonic demands and oral responses to written and telephonic demands, and
await proper instructions from the Trustees or Officers of the Trust. Northern
shall not be obliged to take legal action for collection unless and until
reasonably indemnified to its satisfaction.
-2-
3. Custody of Securities.
(a) Receipt of Securities. Northern will hold in a separate account,
and physically segregated at all times from those of any other
persons, firms, corporations or other Portfolios, pursuant to the
provisions hereof, all securities received by it for or for the
account of a Portfolio, subject to Sections 3D, 8A and 8B hereof.
All such securities shall be held or disposed of by Northern for
the Trust pursuant to the terms of this Agreement. Northern shall
have no power or authority to assign, hypothecate, pledge or
otherwise dispose of any such securities, except pursuant to
proper instructions and only for the account of the Trust as set
forth in Section 5 hereof. Any securities delivered to Northern
other than in bearer form shall be properly endorsed and in form
for transfer or shall be in the name of Northern, the Trust or a
nominee of Northern or the Trust, subject to Xxxxxxxx 0X, 0X xxx
0X xxxxxx.
(x) Registered Name: Nominees. Northern shall register securities of
the Trust held by it under this Agreement, other than those in
bearer form, in the name of the Trust or Northern or a nominee of
the Trust or Northern. Securities of the Trust held by an agent
appointed pursuant to Section 8A hereof or a sub custodian
appointed pursuant to Section 8B hereof may be registered in the
name of such agent or custodian or a nominee of such agent or
sub-custodian.
(c) Record Keeping and Inventory. Northern shall maintain records of
all receipts, deliveries and locations of securities held by it
under this Agreement, together with a current inventory thereof.
Without limiting the generality of the foregoing, Northern shall
comply with such proper instructions from the Trustees or
Officers of the Trust as may be issued from time to time in this
regard. With respect to securities held by any agent appointed
pursuant to Section 8A hereof or any sub-custodian appointed
pursuant to Section 8B hereof, Northern may rely upon
certificates of the agent or sub-custodian as to its holdings, it
being understood that such reliance in no
-3-
way relieves Northern of its responsibilities under this
Agreement. Northern will promptly report to the Trust the results
of such inspections, indicating any shortages or discrepancies
uncovered thereby, and will take appropriate action to remedy any
such shortages or discrepancies.
(d) Use of Securities Depositories. Northern, each agent appointed
pursuant to Section 8A hereof and each sub-custodian appointed
pursuant to Section 88 hereof may deposit all or any part of the
securities held by it hereunder and eligible therefor in the book
entry systems ("Depository Systems") covered by Rule 1 7f-4(b)
under the 1940 Act; provided, however, that (a) Northern, each
such agent and each such sub-custodian shall comply in all
respects with clauses (d) (1) through (d) (4) of Rule 1 7f under
the 1940 Act, (b) all books and records maintained by Northern
and each such agent and sub-custodian which relate to the Trust's
participation in such Depository Systems will at all times during
regular business hours be open to inspection by the Trust's duly
authorized officers, employees, agents and auditors, and the
Trust will be furnished with all the information in respect of
the services rendered to it as it may require, (c) in connection
with the use of such Depository Systems, Northern will cooperate
with the Trust in enforcing such rights as may exist against such
Depository Systems with respect to transactions or securities of
the Trust, (d) payment for securities purchased for the account
of any Portfolio shall be made only upon (i) receipt of advice
from the Depository System that such securities have been
transferred to the account (the "Account") contemplated by clause
(d) (2) of Rule 1 7f-4 under the 1940 Act and (ii) the making of
an entry on the records of Northern or such agent or custodian,
as the case may be, to reflect such payment and transfer for the
Account of such Portfolio, and (e) transfer of securities sold
for the Account of any Portfolio shall be made only upon (iii)
receipt of advice from the Depository System that payment for
such securities has been transferred to the Account, and (iv) the
making of an entry on the records of Northern or such agent or
sub-
-4-
custodian, as the case may be, to reflect such transfer and
payment for the Account of such Portfolio. Northern, each agent
appointed pursuant to Section 8A hereof and each sub-custodian
appointed pursuant to Section 8B hereof may deposit all or any
part of the securities held by it hereunder and eligible therefor
in a clearing agency covered by Rule l7f-4(b) under the 1940 Act;
provided, however, that no such deposit may be made prior to the
express written approval by the Trust of such clearing agency
which approval may be subject to such conditions as the Trust may
from time to time determine.
(e) Distributions. Rights. Etc. Northern shall receive and collect
all distributions, rights and other items of like nature in
respect of securities held by it under this Agreement and deal
with the same in accordance with this Agreement and its other
obligations to the Trust.
(f) Proxies. Notices. Voting. Etc. Northern shall arrange for the
receipt by it of all forms of proxies and all notices of
meetings, calls, maturities, tender offers, exchange offers and
expirations of rights and any other notices, consents, or
announcements affecting or relating to securities held by
Northern, its agents appointed pursuant to Section 8A hereof and
all sub-custodians appointed pursuant to Section 88 hereof, and
upon issuance of proper instructions, Northern shall execute and
deliver or cause its nominee to execute and deliver such proxies
or other authorizations as may be necessary or appropriate.
(g) Nondiscretionarv Details. In general, Northern shall attend to
all nondiscretionary details in connection with the sale,
exchange, substitution, purchase, transfer or other dealing with
securities or property of the Trust except as otherwise from time
to time directed by proper instructions from the Trustees or
Officers of the Trust.
4. Disbursements of Cash. Upon the issuance of proper instructions,
Northern shall make payments or disbursements of cash of each Portfolio held by
it or subject to its draft or order under this Agreement, insofar as such cash
is available, only for the following purposes:
-5-
(a) Purchases Generally. To pay for and receive securities purchased
for the Account of such Portfolio, payment to be made only (a)
upon receipt of the securities by Northern (or any bank, banking
firm, responsible commercial agent or trust company doing
business in the United States and/or any foreign country and
appointed by Northern pursuant to Section 8A hereof as Northern's
agent for this purpose or appointed as sub-custodian pursuant to
Section 8B hereof), registered as provided in Section 3B hereof
or in form for transfer satisfactory to Northern, (b) in the case
of a purchase effected through a Depository System, in accordance
with the conditions set forth in Section 3D hereof, or (c) in the
case of repurchase agreements, against delivery of the securities
which are the subject of such repurchase agreement in certificate
form or receipt of advice from a Depository System that such
securities have been transferred to the Account [except that in
the case of a repurchase agreement Northern may transfer funds to
the Account of the other party to the repurchase agreement (i.e,
the seller of the securities) prior to the receipt of written
evidence that the securities subject to such repurchase agreement
have been transferred by book-entry into the Account, provided
that Northern shall be responsible to the Trust in the event that
such securities are not so transferred by book-entry], the making
of an entry on the records of Northern reflecting such transfer,
and receipt of written evidence of the agreement by such person
to repurchase such securities from such Portfolio. All securities
accepted by Northern either shall be accompanied by payment of,
or a "due xxxx" for, any dividends, interest or other
distributions of the issuer, due the purchaser or Northern shall
take such action as may be necessary to obtain the same. In any
and every case of a purchase of securities for the Account of
such Portfolio where payment is made by Northern in advance of
receipt of the securities purchased, Northern shall be absolutely
liable to the Trust for such securities to the same extent as if
the securities had been received by Northern.
(b) Dividends and Distributions. To release or
-6-
otherwise apply cash for the payment of dividends or other
distributions to Unitholders of such Portfolio which are payable
in cash.
(c) Disbursements and liabilities. To make or cause to be made
disbursements for the payment on behalf of the Trust with respect
to such Portfolio of interest, taxes, investment advisory,
agency, professional, custodial and administration fees and all
other operating expenses, including registration and
qualification costs and other expenses of issuing and selling
Units of such Portfolio or changing its capital structure,
whether or not such expenses shall be in whole or in part
capitalized or treated as deferred expenses.
(d) Redemptions of Trust Units. Subject to the Trust Agreement, the
Trust's then current Prospectus and applicable resolutions of the
Trust's Trustees, to make funds available for payment to
Unitholders who have duly requested redemption of their Units by
the Trust pursuant to such Prospectus.
(e) Other Purposes. To make or cause to be made disbursements for any
other purpose which is declared in such instructions to be a
proper trust purpose; provided, however, that before making any
such disbursement Northern shall have received a copy of a
resolution of the Trustees certified by the Secretary of the
Trust specifying the amount of such disbursement, setting forth
the purpose for which such disbursement is to be made, declaring
such purpose to be a proper trust purpose and naming the
person(s) to whom the disbursement is to be made.
5. Release and Delivery of Securities. Northern shall have sole power to
release or deliver any securities of a Portfolio held by it pursuant to this
Agreement. Upon issuance of proper instructions, Northern will transfer,
exchange, or deliver securities held by it hereunder only for the following
purposes:
(a) Sales. Upon receipt of payment therefor, to deliver securities
which have been sold for the Account of such Portfolio.
(b) Securities Loans. Upon receipt of the collateral required by the
Trust's then
-7-
current Prospectus, to deliver securities which have been lent
for the Account of such Portfolio.
(c) Redemption or Maturity. To deliver securities owned for the
Account of such Portfolio to the issuer thereof or its agent when
such securities are called, redeemed, retired or otherwise become
payable; provided, that in any such case, the cash or other
consideration payable in respect thereof is to be delivered to
Northern.
(d) Changes of Name and Denomination. To deliver securities owned for
the Account of such Portfolio to the issuer thereof or its agent
for transfer into the name of the Trust or Northern or a nominee
of either or a permitted sub-custodian or agent or a nominee of
such sub-custodian or agent, or for exchange for a different
number of bonds, certificates, or other evidence representing the
same aggregate face amount or number of units bearing the same
interest rate, maturity dates and call/put provisions, if any;
provided, that in any such case, the new securities are to be
delivered to Northern.
(e) Street Delivery. To deliver securities owned for the Account of
such Portfolio to the broker or dealer selling the same for
examination in accordance with the then current "street delivery"
custom.
(f) Securities as Collateral. To deliver securities owned for the
Account of such Portfolio for the purpose of pledge or
hypothecation to secure any loan (including a reverse repurchase
agreement) incurred by the Trust; provided that securities shall
be released only upon payment to Northern of the monies borrowed,
except that in cases where additional collateral is required to
secure a borrowing already made, subject to proper prior
authorization, further securities may be delivered for that
purpose. Upon issuance of proper instructions, Northern shall pay
such loan upon redelivery to it of the securities pledged or
hypothecated therefor and upon surrender of the note or notes, if
any, evidencing the loan.
-8-
(g) Exchanges. Deposits, Tenders, Etc. To exchange securities or
interim receipts or temporary securities held by it or by any
agent appointed pursuant to Section 8A hereof or any sub-
custodian appointed pursuant to Section 8B hereof for the Account
of such Portfolio for other securities alone or for other
securities and cash, and to expend cash, insofar as cash is
available, in connection with any merger, consolidation,
reorganization, recapitalization, conversion or in connection
with the exercise of subscription or purchase rights, or
otherwise; to deposit any such securities and cash in accordance
with the terms of any reorganization or protective plan or
otherwise, and to deliver securities and Related Documents to the
designated depository or other receiving agent in response to
tender offers or similar offers to purchase received in writing.
(h) Other Purposes. To release or deliver any securities held by it
for the Account of such Portfolio for any other purpose which
such instructions declare to be a proper trust purpose; provided,
however, that before making any such release or delivery Northern
shall have received a copy of the resolution of the Trustees
certified by the Secretary of the Trust specifying the securities
to be delivered, setting forth the purpose for which such release
or delivery is to be made, declaring such purpose to be a proper
trust purpose and naming the person(s) to whom such release or
delivery is to be made.
6. Records; Accounts and Reporting.
(a) Records. Northern shall create, maintain and retain all records
relating to its activities and obligations under this Agreement
in such manner as will enable the Trust and Northern to meet
their respective obligations under: (i) the 1940 Act,
particularly Sections 30 and 31 thereof, and the rules and
regulations thereunder, including the preparation and filing of
all required periodic and other reports, (ii) applicable Federal
and State tax laws, and (iii) any other law or administrative
rule or procedure which may be applicable to the Trust or
Northern. All records maintained by Northern in connection
-9-
with the performance of its duties under this Agreement will
remain the property of the Trust, shall be returned to the Trust
promptly upon request and, in the event of termination of this
Agreement, will be delivered in accordance with Section 14
hereof.
(b) Accounts and Reporting. Northern shall keep the books of account
for the Trust and each of its Portfolios, including all books
necessary to permit prompt determinations of the Federal and
State tax status and origin of the Trust, each such Portfolio and
the dividends and other distributions declared and/or paid
thereby as and to the extent provided in or contemplated by the
Trust's Current Prospectus as in effect from time to time (such
determination being collectively referred to herein as "Tax
Determinations"). Northern shall render statements or copies
thereof and shall make Tax Determinations from time to time as
contemplated by proper instructions from the Trustees or Officers
of the Trust.
(c) Access to Records. Without limiting Section 3D hereof, subject to
security requirements of Northern applicable to its own employees
having access to similar records within Northern and such
regulations as to the conduct of such matters as may be
reasonably imposed by Northern after prior consultation with an
officer of the Trust or its Administrator, the books and records
of Northern pertaining to its actions under this Agreement shall
be open to inspection and audit at reasonable times by those
persons or classes of persons designated in proper instructions
from the Trustees or Officers of the Trust.
(d) Cooperation with the Trust and its Auditors. Northern shall
cooperate with the Trust and the Trust's independent public
accountants in connection with: (i) the preparation of reports to
Unitholders of the Trust, to the Securities and Exchange
Commission (including all required periodic and other reports),
to State securities commissioners, and to others, (ii) annual and
other audits of the books and records of the Trust (including,
without limitation, such procedures as may be designated in
proper instructions from the
-10-
Trustees or Officers of the Trust), and (iii) other matters
of a like nature.
7. Additional Duties of Northern.
(a) Valuations; Net Income Computation. Unless otherwise
directed by proper instructions from the Trustees or Officers
of the Trust, Northern shall compute and determine on the
days and at the times specified in the Trust's then Current
Prospectus, the net asset value of a Unit of each Portfolio,
such computation and determination to be made in accordance
with the Trust's then Current Prospectus, and shall promptly
notify the Administrator of the result of such computation
and determination.
Unless advised otherwise by proper instructions from the
Trustees or Officers of the Trust, Northern shall also
calculate at the times specified in the Trust's then Current
Prospectus the net income of each Portfolio and shall
promptly advise the Administrator of the results of such
calculation. Such calculation shall be made in accordance
with the Trust's then Current Prospectus.
8. Appointment of Agents and Sub-Custodians.
(a) Appointment of Agents. Northern, as custodian, may at any
time or times appoint (and may at any time remove) in
accordance with the 1940 Act any other bank, trust company or
responsible commercial agent as its agent to carry out such
of the provisions of this Agreement as Northern may from time
to time direct, provided that the appointment of such agent
shall not relieve Northern of any of its responsibilities
under this Agreement.
(b) Appointment of Sub-Custodian. Northern, as custodian, may
from time to time employ one or more sub-custodians, but only
in accordance with the terms and conditions set forth in a
resolution of the Trustees of the Trust authorizing the
appointment of each particular sub-custodian, it being
understood and agreed that: (i) Northern shall have no more
responsibility or liability to the Trust on account of any
actions or omissions of any sub-custodian so employed that
such sub-
-11-
custodian has to Northern; and (ii) the responsibility or
liability of the sub-custodian to Northern shall conform to
the resolution of the Trustees of the Trust authorizing the
appointment of the particular sub-custodian.
9. Proper Instructions.
(a) Proper Instructions Generally. Proper instructions shall be
deemed to have been issued upon issuance of written
instructions signed by not less than one officer and one
responsible employee of Northern which in the case of each
such officer and employee Northern's Board of Directors shall
have from time to time authorized to give the particular
class of instructions in question. Different persons may be
authorized to give instructions for different purposes.
(b) Proper Instructions from the Trustees or Officers of the
Trust. Proper instructions from the Trustees or Officers of
the Trust shall be deemed to have been issued upon receipt by
Northern of written instructions (including receipt of
facsimile) signed by a majority of the Trustees of the Trust
or by not less than two of the Officers of the Trust
designated from time to time by resolution of the Trustees.
Such instructions shall be deemed proper instructions as that
term is used in this Agreement in addition to also being
deemed proper instructions from the Trustees or Officers of
the Trust. A certificate executed by the Secretary or
Assistant Secretary of the Trust as to the persons serving as
Trustees and/or who are Officers of the Trust designated as
set forth above may be received and accepted by Northern as
conclusive evidence of those persons who are such Trustees
and/or Officers and may be considered to be accurate until
receipt of written notice (or oral notice followed by written
confirmation within seven days) to the contrary. In the case
of conflict between Instructions under Section 9A and under
this Section 9B, those given pursuant to this Section 9B
shall prevail upon receipt by Northern.
10. Compensation: Reimbursement. The Trust shall pay to
-12-
Northern, as custodian, the compensation and expense reimbursement set forth in
Exhibit A hereto.
11. Duration and Termination. Insofar as the holders of Units
representing the interests in the Trust's initial Portfolios are affected by
this Agreement, it shall continue, unless sooner terminated as provided herein,
until April 30, 1993, and, insofar as the holders of Units representing the
interests in each additional Portfolio are affected by this Agreement, it shall
continue until April 30 of the year following the year in which the Portfolio
becomes a Portfolio hereunder, and, for each such Portfolio, thereafter shall
continue automatically for periods of one year so long as each such latter
continuance is approved at least annually (a) by the vote of a majority of the
Trustees of the Trust who are not parties to this Agreement or interested
persons (as defined by the 0000 Xxx) of any such party, cast in person at a
meeting called for the purpose of voting on such approval, and (b) by the
Trustees of the Trust or by a majority of the outstanding Units (as defined with
respect to voting securities in the 1940 Act) representing the interests in such
Portfolio; provided, however, that this Agreement may be terminated by the Trust
at any time, without the payment of any penalty, by vote of a majority of the
Trustees of the Trust or by vote of a majority of the outstanding Units (as so
defined) of the Trust on 60 days' written notice to Northern, or by Northern at
any time, without the payment of any penalty, on 60 days' written notice to the
Trust.
12. Amendment of Agreement. This Agreement may be amended by mutual
consent, but the consent of the Trust must be approved by vote of a majority of
those Trustees of the Trust who are not parties to this Agreement or interested
persons (as defined in the 0000 Xxx) of any such party.
13. Interpretative and Additional Provisions. In connection with the
operation of this Agreement, Northern and the Trust may agree from time to time,
by written instrument signed by both parties, on such provisions interpretative
of or in addition to the provisions of this Agreement as may in their joint
opinion be consistent with the general tenor of this Agreement, provided that no
such interpretative or additional provisions shall contravene any applicable
Federal or State laws or regulations, or any provision of the Trust Agreement or
the Trust's By-laws, as the same may from time to time be amended. No
interpretative or additional provisions made as provided in the preceding
sentence shall be deemed to be an amendment of this Agreement.
14. Successor Custodian.
(a) Appointment of Successor by Trust. If a successor custodian is
appointed by the Trust
-13-
and a certified copy of the related appointing resolutions
are delivered to Northern, Northern shall, upon termination
of this Agreement or substitution of such successor for
Northern, deliver to such successor custodian at the office
of Northern, duly endorsed and in proper form for transfer,
all securities then held by Northern hereunder (or by any
agent or sub-custodian of Northern) and all funds or other
property of the Trust deposited with or held by Northern
hereunder (or by any agent or sub-custodian of Northern).
(b) Delivery Pursuant to Unitholder Resolution. In the event that
this Agreement is to be terminated but no new custodian can
be found by the Trust, the Trust shall, before authorizing
the delivery of such securities, funds and other property to
anyone other than a successor custodian, submit to its
Unitholders the question of whether the Trust shall be
liquidated or shall function without a custodian. Upon
approval by the Unitholders for the Trust to liquidate or
function without a custodian Northern shall, in like manner
at its office, upon receipt of a certified copy of a
resolution of the Unitholders of the Trust deliver such
securities, funds and other property in accordance with such
resolution.
(c) Selection of Successor by Northern. In the event that this
Agreement is terminated and no successor custodian has been
appointed by the Trust or certified copy of a resolution of
the Unitholders has been delivered to Northern on or before
the date when such termination shall become effective, then
Northern shall have the right to deliver to a bank or trust
company of its own selection, having an aggregate capital,
surplus, and undivided profits, as shown by its last
published report, of not less than $50 million, all
securities, funds, property and instruments of the Trust held
by Northern under this Agreement (or any agent or sub-
custodian of Northern) and all instruments held by Northern
(or such agent or sub-custodian) relative thereto.
Thereafter, such bank or trust company shall be the successor
custodian to Northern under this Agreement.
15. Communications. Notices and other writings delivered
-14-
or mailed postage prepaid to the Trust in care of The Benchmark Funds, 0000
Xxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000, Attention: Shareholder Servicing, or to
The Northern Trust Company at 00 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000,
Attention: Fund Accounting, Canal Center, or to such other address as the Trust
or Northern may hereafter specify by written notice to the most recent address
specified by the party to whom such notice is addressed, shall be deemed to have
been properly delivered or given hereunder to the respective addressee.
16. Miscellaneous. The Trust's Declaration of Trust as amended to date is
on file with the Secretary of The Commonwealth of Massachusetts. The captions in
this Agreement are included for convenience of reference only and in no way
define or delimit any of the provisions hereof or otherwise affect their
construction or effect. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby. Any provision in this Agreement
requiring compliance with any statute or regulation shall mean such statute or
regulation as amended and in effect from time to time. This Agreement shall be
construed in accordance with the laws of the State of Illinois (except as to
Section 17 hereof which shall be construed in accordance with the laws of The
Commonwealth of Massachusetts) and shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
17. Unitholder Liability. This Agreement is executed by or on behalf of
the Trust and the obligations hereunder are not binding upon any of the
Trustees, Officers or Unitholders of the Trust individually but are binding only
upon the Trust and its assets and property. All obligations of the Trust under
this Agreement shall apply only on a Portfolio by Portfolio basis, and the
assets of one Portfolio shall not be liable for the obligations of another
Portfolio.
ATTEST: THE BENCHMARK FUNDS
By ______________________________ By _________________________
As its __________________________ As its _____________________
ATTEST: THE NORTHERN TRUST COMPANY
By ______________________________ By _________________________
As its __________________________ As its _____________________
-15-
Exhibit A to The Benchmark Funds
Custodian Agreement
-------------------
A. Basic Fee
---------
Each Portfolio Fee
-------------- ---
First $100 million of average
daily net assets $18,000 (flat fee)
Average Daily Net Assets in
excess of $100 million 1/100th of 1% of
average daily net assets
The Basic Fee is an annual fee which will be billed and payable monthly.
B. Transaction Fee for Portfolio Trades
------------------------------------
Transaction Fee
----------- ---
Nonbook Entry $12.00
Book Entry $10.00
C. Wire Fees
---------
Type of Wire Fee
------------ ---
Wire Out $ 3.50
Wire In $ 3.65
D. Out-of-Pocket Expenses Reimbursable by the Trust
------------------------------------------------
The Trust will reimburse Northern monthly for the following outs-pocket
expenses incurred by Northern during such month in the performance of its duties
under the Custodian Agreement: (i) telephone; (ii) postage; (iii) courier fees
of independent courier services; (iv) office supplies used in maintaining the
Trust's records; and (v) duplicating.
E. Adjustment of Certain Fees Based on the Consumer Price Index
------------------------------------------------------------
Effective April 30,1998 and effective each April 30 thereafter during the
term of this Agreement the Transaction Fees for Portfolio Trades and the Wire
Fees shall be adjusted by multiplying each such Fee by a fraction the
denominator of which is the Base Index Number and the numerator of which is the
Corresponding Index Number; provided, however, that (i) in no event shall such
fee be less than stated above in paragraphs B or C, as the case may be, and (ii)
-16-
Northern shall have the right to permanently or temporarily waive all or any
portion of the Ie~ in any such Fee resulting from such adjustment. For purposes
of this
(A) "Index" means the Consumer Price Index for All Urban Consumers, 1967 =
100, published by the Bureau of Labor Statistics of the United States
Department of Labor;
(B) "Base Index Number" means the index number designated in the Index for
"All Items" for the United States City Average for the month of December
1982, which is acknowledged by the parties as being 292.4;
(C) "Corresponding Index Number" with respect to a March 1 adjustment means
the index number designated in the Index for "All Items" for the United
States City Average for the month of December immediately preceding such
March 1; and
(D) If the publication of the index shall be discontinued so that the Fee
applicable to a year commencing March 1 during the term of the Custodian
Agreement cannot be computed in accordance with the foregoing provisions,
then the Fee for such year shall be determined on the basis of comparable
statistics reflecting changes in the urban cost of living in the United
States, as computed and published by an agency of the United States or by a
responsible financial periodical of recognized authority with such
revisions in the method of computation provided for in this paragraph D as
the circumstances may require in order to provide an inflation adjustment
to such fee.
-17-
