FORM OF CUSTODY AGREEMENT
This agreement (the "Agreement") is entered into as of the 10th day of
March, 1998, by and between The Millennium XXXX Funds, Inc. (the "Corporation")
and Star Bank, National Association (the "Custodian"), a national banking
association having its principal office at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx,
00000.
WHEREAS, the Corporation and the Custodian desire to enter into this
Agreement to provide for the custody and safekeeping of the assets of the
Corporation as required by the Act (as hereafter defined).
THEREFORE, in consideration of the mutual promises hereinafter set
forth, the Corporation and the Custodian agree as follows:
ARTICLE I
Definitions
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The following words and phrases, when used in this Agreement, unless
the context otherwise requires, shall have the following meanings:
Act - the Investment Company Act of 1940, as amended.
1934 Act - the Securities and Exchange Act of 1934, as amended.
Authorized Person - any (i) Officer of the Corporation or (ii) any
other person, whether or not any such person is an officer or employee of the
Corporation, who is duly authorized by the Board of Directors of the Corporation
to give Oral Instructions and Written Instructions on behalf of the Corporation
or any Fund, and named in Appendix A attached hereto and as amended from time to
time by resolution of the Board of Directors, certified by an Officer, and
received by the Custodian.
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Board of Directors - the Directors from time to time serving under the
Corporation's Articles of Incorporation, as from time to time amended.
Book-Entry System - a federal book-entry system as provided in Subpart
O of Treasury Circular Xx. 000, 00 XXX 306, in Subpart B of 31 CFT Part 350, or
in such book-entry regulations of federal agencies as are substantially in the
form of Subpart O.
Business Day - any day recognized as a settlement day by The New York
Stock Exchange, Inc. and any other day for which the Corporation computes the
net asset value of Shares of any fund.
Depository - The Depository Trust Company ("DTC"), a limited purpose
trust company, its successor(s) and its nominee(s). Depository shall include any
other clearing agency registered with the SEC under Section 17A of the 1934 Act
which acts as a system for the central handling of Securities where all
Securities of any particular class or series of an issuer deposited within the
system are treated as fungible and may be transferred or pledged by bookkeeping
entry without physical delivery of the Securities provided that the Custodian
shall have received a copy of a resolution of the Board Of Directors, certified
by an Officer, specifically approving the use of such clearing agency as a
depository for the Funds.
Dividend and Transfer Agent - the dividend and transfer agent
appointed, from time to time, pursuant to a written agreement between the
dividend and transfer agent and the Corporation.
Foreign Securities - a) securities issued and sold primarily outside
of the United States by a foreign government, a national of any foreign country,
or a trust or other organization incorporated or organized under the laws of any
foreign country or b) securities issued or guaranteed by the government of the
United States, by any state, by any political subdivision or agency thereof, or
by
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any entity organized under the laws of the United States or of any state
thereof, which have been issued and sold primarily outside of the United States.
Fund - each series of the Corporation listed in Appendix B and any
additional series added pursuant to Proper Industries. A series is individually
referred to as a "Fund" and collectively referred to as the "Funds."
Money Market Security - debt obligations issued or guaranteed as to
principal and/or interest by the government of the United States or agencies or
instrumentalities thereof, commercial paper, obligations (including certificates
of deposit, bankers' acceptances, repurchase agreements and reverse repurchase
agreements with respect to the same), and time deposits of domestic banks and
thrift institutions whose deposits are insured by the Federal Deposit Insurance
Corporation, and short-term corporate obligations where the purchase and sale of
such securities normally require settlement in federal funds or their equivalent
on the same day as such purchase and sale, all of which mature in not more than
thirteen (13) months.
NASD - the National Association of Securities Dealers, Inc.
Officer - the Chairman, President, Secretary, Treasurer, any Vice
President, Assistant Secretary or Assistant Treasurer of the Corporation.
Oral Instructions - instructions orally transmitted to and received by
the Custodian from an Authorized Person (or from a person that the Custodian
reasonably believes in good faith to be an Authorized Person) and confirmed by
Written Instructions in such a manner that such Written Instructions are
received by the Custodian on the Business Day immediately following receipt of
such Oral Instructions.
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Proper Instructions - Oral Instructions or Written Instructions.
Proper Instructions may be continuing Written Instructions when deemed
appropriate by both parties.
Prospectus - the Corporation's then currently effective prospectus and
Statement of Additional Information, as filed with and declared effective from
time to time by the Securities and Exchange Commission.
Security or Securities - Money Market Securities, common stock,
preferred stock, options, financial futures, bonds, notes, debentures, corporate
debt securities, mortgages, bank certificates of deposit, bankers' acceptances,
mortgage-backed securities or other obligations and any certificates, receipts,
warrants, or other instruments or documents representing rights to receive,
purchase, or subscribe for the same or evidencing or representing any other
rights or interest therein, or any similar property or assets that the Custodian
has the facilities to clear and to service.
SEC - the Securities and Exchange Commission of the United States of
America.
Shares - with respect to a Fund, the shares of common stock
issued by the Corporation on account of such Fund.
Written Instructions - communications in writing actually received by
the Custodian from an Authorized Person. A communication in writing includes a
communication by facsimile, telex or between electro-mechanical or electronic
devices (where the use of such devices have been approved by resolution of the
Board of Directors and the resolution is certified by an Officer and delivered
to the Custodian). All written communications shall be directed to the
Custodian, attention: Mutual Fund Custody Department.
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ARTICLE II
Appointment; Acceptance; and Furnishing of Documents
----------------------------------------------------
A. Appointment of Custodian. The Corporation hereby constitutes and
appoints the Custodian as custodian of all Securities and cash owned by the
Corporation at any time during the term of this Agreement.
B. Acceptance of Custodian. The Custodian hereby accepts appointment
as such custodian and agrees to perform the duties thereof as hereinafter set
forth.
C. Documents to be Furnished. The following documents, including any
amendments thereto, will be provided contemporaneously with the execution of the
Agreement, to the Custodian by the Corporation:
1. A copy of the Articles of Incorporation of the Corporation
certified by the Secretary.
2. A copy of the By-Laws of the Corporation certified by the
Secretary.
3. A copy of the resolution of the Board Of Directors of the
Corporation appointing the Custodian, certified by the
Secretary.
4. A copy of the then current Prospectus.
5. A Certificate of the President and Secretary of the
Corporation setting forth the names and signatures of the
current Officers of the Corporation and other Authorized
Persons.
D. Notice of Appointment of Dividend and Transfer Agent. The
Corporation agrees to notify the Custodian in writing of the appointment,
termination or change in appointment of any Dividend and Transfer Agent.
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ARTICLE III
Receipt of Corporation Assets
-----------------------------
A. Delivery of Moneys. During the term of this Agreement, the
Corporation will deliver or cause to be delivered to the Custodian all moneys to
be held by the Custodian for the account of any Fund. Subject to Article V,
Section A, the Custodian shall be entitled to reverse any deposits made on any
Fund's behalf where such deposits have been entered and moneys are not finally
collected within 30 days of the making of such entry.
B. Delivery of Securities. During the term of this Agreement, the
Corporation will deliver or cause to be delivered to the Custodian all
Securities to be held by the Custodian for the account of any Fund. The
Custodian will not have any duties or responsibilities with respect to such
Securities until actually received by the Custodian.
C. Payments for Shares. As and when received, the Custodian shall
deposit to the account(s) of a Fund any and all payments for Shares of that Fund
issued or sold from time to time as they are received from the Corporation's
distributor or Dividend and Transfer Agent or from the Corporation itself.
D. Duties Upon Receipt. The Custodian shall, acting on behalf of each
Fund, deposit any Fund assets in the Book-Entry System or a Depository. The
Custodian shall not be responsible for any Securities, moneys or other assets of
any Fund until actually received by it. The Custodian shall always be
accountable to the Corporation for Fund assets deposited by the Custodian.
E. Validity of Title. The Custodian shall not be responsible for the
title, validity or genuineness of any property or evidence of title thereto
received or delivered by it pursuant to this Agreement.
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ARTICLE IV
Disbursement of Corporation Assets
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A. Declaration of Dividends by Corporation. The Corporation shall
furnish to the Custodian a copy of the resolution of the Board of Directors of
the Corporation, certified by the Corporation's Secretary, either (i) setting
forth the date of the declaration of any dividend or distribution in respect of
Shares of any Fund of the Corporation, the date of payment thereof, the record
date as of which the Fund shareholders entitled to payment shall be determined,
the amount payable per share to Fund shareholders of record as of that date, and
the total amount to be paid by the Dividend and Transfer Agent on the payment
date, or (ii) authorizing the declaration of dividends and distributions in
respect of Shares of a Fund on a daily basis and authorizing the Custodian to
rely on Written Instructions setting forth the date of the declaration of any
such dividend or distribution, the date of payment thereof, the record date as
of which the Fund shareholders entitled to payment shall be determined, the
amount payable per share to Fund shareholders of record as of that date, and the
total amount to be paid by the Dividend and Transfer Agent on the payment date.
On the payment date specified in the resolution or Written
Instructions described above, the Custodian shall segregate such amounts from
moneys held for the account of the Fund so that they are available for such
payment.
B. Segregation of Redemption Proceeds. Upon receipt of Proper
Instructions so directing it, the Custodian shall segregate amounts necessary
for the payment of redemption proceeds to be made by the Dividend and Transfer
Agent from moneys held for the account of the Fund so that they are available
for such payment.
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C. Disbursements of Custodian. Upon receipt of a Certificate directing
payment and setting forth the name and address of the person to whom such
payment is to be made, the amount of such payment, the name of the Fund from
which payment is to be made, and the purpose for which payment is to be made,
the Custodian shall disburse amounts as and when directed from the assets of
that Fund. The Custodian is authorized to rely on any Written Instructions that
it reasonably believes to have been issued by an Authorized Person.
D. Payment of Custodian Fees. Upon receipt of Written Instructions
directing payment, the Custodian shall disburse moneys from the assets of the
Corporation in payment of the Custodian's fees and expenses as provided in
Article VIII hereof.
ARTICLE V
Custody of Corporation Assets
-----------------------------
A. Separate Accounts for Each Fund. As to each Fund, the Custodian
shall open and maintain a separate bank account or accounts in the United States
in the name of the Corporation coupled with the name of such Fund, subject only
to draft or order by the Custodian acting pursuant to the terms of this
Agreement, and shall hold all cash received by it from or for the account of the
Fund, other than cash maintained by the Fund in a bank account established and
used by the Fund in accordance with Rule 17f-3 under the Act. Moneys held by the
Custodian on behalf of a Fund may be deposited by the Custodian to its credit as
Custodian in the banking department of the Custodian. Such moneys shall be
deposited by the Custodian in its capacity as such, and shall be withdrawable by
the Custodian only in such capacity.
B. Segregation of Non-Cash Assets. All Securities and non-cash
property held by the Custodian for the account of a Fund (other than Securities
maintained in a Depository or Book-entry
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System) shall be physically segregated from other Securities and non-cash
property in the possession of the Custodian (including the Securities and
non-cash property of the other Funds) and shall be identified as subject to this
Agreement.
C. Securities in Bearer and Registered Form. All Securities held which
are issued or issuable only in bearer form shall be held by the Custodian in
that form; all other Securities held for the Fund may be registered in the name
of the Custodian, any sub-custodian appointed in accordance with this Agreement,
or the nominee of any of them. The Corporation agrees to furnish to the
Custodian appropriate instruments to enable the Custodian to hold, or deliver in
proper form for transfer, any Securities that it may hold for the account of any
Fund and which may, from time to time, be registered in the name of a Fund.
D. Duties of Custodian As to Securities. Unless otherwise instructed
by the Corporation, with respect to all Securities held for the Corporation, the
Custodian shall on a timely basis (concerning items 1 and 2 below, as defined in
the Custodian's Standards of Service Guide, as amended from time to time,
annexed hereto as Appendix D):
1. Collect all income due and payable with respect to such
Securities;
2. Present for payment and collect amounts payable upon all
Securities which may mature or be called, redeemed, or
retired, or otherwise become payable;
3. Surrender interim receipts or Securities in temporary form
for Securities in definitive form; and
4. Execute, as Custodian, any necessary declarations or
certificates of ownership under the Federal income tax laws
or the laws or regulations of any other
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taxing authority, including any foreign taxing authority,
now or hereafter in effect.
E. Certain Actions Upon Written Instructions. Upon receipt of a
Written Instructions and not otherwise, the Custodian shall:
1. Execute and deliver to such persons as may be designated in
such Written Instructions proxies, consents, authorizations,
and any other instruments whereby the authority of the
Corporation as beneficial owner of any Securities may be
exercised;
2. Deliver any Securities in exchange for other Securities or
cash issued or paid in connection with the liquidation,
reorganization, refinancing, merger, consolidation, or
recapitalization of any corporation, or the exercise of any
conversion privilege;
3. Deliver any Securities to any protective committee,
reorganization committee, or other person in connection with
the reorganization, refinancing, merger, consolidation,
recapitalization, or sale of assets of any corporation, and
receive and hold under the terms of this Agreement such
certificates of deposit, interim receipts or other
instruments or documents as may be issued to it to evidence
such delivery;
4. Make such transfers or exchanges of the assets of any Fund
and take such other steps as shall be stated in the Written
Instructions to be for the purpose of effectuating any duly
authorized plan of liquidation, reorganization, merger,
consolidation or recapitalization of the Corporation; and
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5. Deliver any Securities held for any Fund to the depository
agent for tender or other similar offers.
F. Custodian to Deliver Proxy Materials. The Custodian shall promptly
deliver to the Corporation all notices, proxy material and executed but unvoted
proxies pertaining to shareholder meetings of Securities held by any Fund. The
Custodian shall not vote or authorize the voting of any Securities or give any
consent, waiver or approval with respect thereto unless so directed by Written
Instructions.
G. Custodian to Deliver Tender Offer Information. The Custodian shall
promptly deliver to the Corporation all information received by the Custodian
and pertaining to Securities held by any Fund with respect to tender or exchange
offers, calls for redemption or purchase, or expiration of rights. If the
Corporation desires to take action with respect to any tender offer, exchange
offer or other similar transaction, the Corporation shall notify the Custodian
at least five Business Days prior to the date on which the Custodian is to take
such action. The Corporation will provide or cause to be provided to the
Custodian all relevant information for any Security which has unique put/option
provisions at least five Business Days prior to the beginning date of the tender
period.
ARTICLE VI
Purchase and Sale of Securities
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A. Purchase of Securities. Promptly after each purchase of Securities
by the Corporation, the Corporation shall deliver to the Custodian (i) with
respect to each purchase of Securities which are not Money Market Securities,
Written Instructions, and (ii) with respect to each purchase of Money Market
Securities, Proper Instructions, specifying with respect to each such purchase
the:
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1. name of the issuer and the title of the Securities,
2. the number of shares, principal amount purchased (and
accrued interest, if any) or other units purchased,
3. date of purchase and settlement,
4. purchase price per unit,
5. total amount payable,
6. name of the person from whom, or the broker through which,
the purchase was made,
7. the name of the person to whom such amount is payable, and
8. the Fund for which the purchase was made.
The Custodian shall, against receipt of Securities purchased by or for the
Corporation, pay out of the moneys held for the account of such Fund the total
amount specified in the Written Instructions, or Oral Instructions, if
applicable, to the person named therein. The Custodian shall not be under any
obligation to pay out moneys to cover the cost of a purchase of Securities for a
Fund, if in the relevant Fund custody account there is insufficient cash
available to the Fund for which such purchase was made.
B. Sale of Securities. Promptly after each sale of Securities by a
Fund, the Corporation shall deliver to the Custodian (i) with respect to each
sale of Securities which are not Money Market Securities, Written Instructions,
and (ii) with respect to each sale of Money Market Securities, Proper
Instructions, specifying with respect to each such sale the:
1. name of the issuer and the title of the Securities,
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2. number of shares, principal amount sold (and accrued
interest, if any) or other units sold,
3. date of sale and settlement,
4. sale price per unit,
5. total amount receivable,
6. name of the person to whom, or the broker through which, the
sale was made,
7. name of the person to whom such Securities are to be
delivered, and
8. Fund for which the sale was made.
The Custodian shall deliver the Securities against receipt of the total amount
specified in the Written Instructions, or Oral Instructions, if applicable.
Notwithstanding any other provision of this Agreement, the Custodian, when
properly instructed as provided herein to deliver Securities against payment,
shall be entitled, if in accordance with generally accepted market practice, to
deliver such Securities prior to actual receipt of final payment therefor. In
any such case, the Fund for which the Securities were delivered shall bear the
risk that final payment for the Securities may not be made or that the
Securities may be returned or otherwise held or disposed of by or through the
person to whom they were delivered, and the Custodian shall have no liability
for any of the foregoing.
C. Options. Promptly after the time as of which the Corporation, on
behalf of a Fund, either:
1. writes an option on securities,
2. notifies the Custodian that its obligations in respect of
any put or call option, as described in the Corporation's
Prospectus, require that the Fund deposit
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Securities or additional Securities with the Custodian,
specifying the type and value of Securities required to be
so deposited,
the Custodian will cause to be segregated or identified as deposited, pursuant
to the Fund's obligations as set forth in the Prospectus, Securities of such
kinds and having such aggregate values as are required to meet the Fund's
obligations in respect thereof. The Corporation will provide to the Custodian,
as of the end of each trading day, the market value of the Fund's option
liability and the market value of its portfolio of common stocks.
D. Payment on Settlement Date. On contractual settlement date, the
account of the Fund will be charged for all purchased Securities settling on
that day, regardless of whether or not delivery is made. Likewise, on
contractual settlement date, proceeds from the sale of Securities settling that
day will be credited to the account of the Fund, irrespective of delivery. Any
such credit shall be conditioned upon actual receipt by Custodian of final
payment and may be reversed if final payment is not actually received in full.
E. Credit of Moneys Prior to Receipt. With respect to any credit given
prior to actual receipt of final payment, the Custodian may, in its sole
discretion and from time to time, permit a Fund to use funds so credited to its
Fund custody account in anticipation of actual receipt of final payment. Any
such funds shall be deemed a loan from the Custodian to the Corporation payable
on demand and bearing interest accruing from the date such loan is made up to
but not including the date on which such loan is repaid at the rate per annum
customarily charged by the Custodian on similar loans.
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F. Segregated Accounts. The Custodian shall, upon receipt of Proper
Instructions so directing it, establish and maintain a segregated account or
accounts for and on behalf of a Fund. Cash and/or Securities may be transferred
into such account or accounts for specific purposes, to-wit:
1. in accordance with the provision of any agreement among the
Corporation, the Custodian, and a broker-dealer registered
under the 1934 Act, and also a member of the NASD (or any
futures commission merchant registered under the Commodity
Exchange Act), relating to compliance with the rules of the
Options Clearing Corporation and of any registered national
securities exchange, the Commodity Futures Trading
Commission, any registered contract market, or any similar
organization or organizations requiring escrow or other
similar arrangements in connection with transactions by the
Fund;
2. for purposes of segregating cash or Securities in connection
with options purchased, sold, or written by the Fund or
commodity futures contracts or options thereon purchased or
sold by the Fund;
3. for the purpose of compliance by the Fund with the
procedures required for reverse repurchase agreements, firm
commitment agreements, standby commitment agreements, and
short sales by Act Release No. 10666, or any subsequent
release or releases or rule of the SEC relating to the
maintenance of segregated accounts by registered investment
companies;
4. for the purpose of segregating collateral for loans of
Securities made by the Fund; and
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5. for other proper corporate purposes, but only upon receipt
of, in addition to Proper Instructions, a copy of a
resolution of the Board Of Directors, certified by an
Officer, setting forth the purposes of such segregated
account.
Each segregated account established hereunder shall be established and
maintained for a single Fund only. All Proper Instructions relating to a
segregated account shall specify the Fund involved.
G. Advances for Settlement. Except as otherwise may be agreed upon by
the parties hereto, the Custodian shall not be required to comply with any
Written Instructions to settle the purchase of any Securities on behalf of a
Fund unless there is sufficient cash in the account(s) pertaining to such Fund
at the time or to settle the sale of any Securities from such an account(s)
unless such Securities are in deliverable form. Notwithstanding the foregoing,
if the purchase price of such Securities exceeds the amount of cash in the
account(s) at the time of such purchase, the Custodian may, in its sole
discretion, advance the amount of the difference in order to settle the purchase
of such Securities. The amount of any such advance shall be deemed a loan from
the Custodian to the Corporation payable on demand and bearing interest accruing
from the date such loan is made up to but not including the date such loan is
repaid at the rate per annum customarily charged by the Custodian on similar
loans.
ARTICLE VII
Corporation Indebtedness
------------------------
In connection with any borrowings by the Corporation, the Corporation
will cause to be delivered to the Custodian by a bank or broker requiring
Securities as collateral for such borrowings (including the Custodian if the
borrowing is from the Custodian), a notice or undertaking in the form
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currently employed by such bank or broker setting forth the amount of
collateral. The Corporation shall promptly deliver to the Custodian Written
Instructions specifying with respect to each such borrowing: (a) the name of the
bank or broker, (b) the amount and terms of the borrowing, which may be set
forth by incorporating by reference an attached promissory note duly endorsed by
the Corporation, or a loan agreement, (c) the date, and time if known, on which
the loan is to be entered into, (d) the date on which the loan becomes due and
payable, (e) the total amount payable to the Corporation on the borrowing date,
and (f) the description of the Securities securing the loan, including the name
of the issuer, the title and the number of shares or other units or the
principal amount. The Custodian shall deliver on the borrowing date specified in
the Written Instructions the required collateral against the lender's delivery
of the total loan amount then payable, provided that the same conforms to that
which is described in the Written Instructions. The Custodian shall deliver, in
the manner directed by the Corporation, such Securities as additional
collateral, as may be specified in Written Instructions, to secure further any
transaction described in this Article VII. The Corporation shall cause all
Securities released from collateral status to be returned directly to the
Custodian and the Custodian shall receive from time to time such return of
collateral as may be tendered to it.
The Custodian may, at the option of the lender, keep such collateral
in its possession, subject to all rights therein given to the lender because of
the loan. The Custodian may require such reasonable conditions regarding such
collateral and its dealings with third-party lenders as it may deem appropriate.
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ARTICLE VIII
Concerning the Custodian
------------------------
A. Limitations on Liability of Custodian. Except as otherwise provided
herein, the Custodian shall not be liable for any loss or damage resulting from
its action or omission to act or otherwise, except for any such loss or damage
arising out of its own gross negligence or willful misconduct, or reckless
disregard of its duties under this Agreement. The Corporation shall defend,
indemnify and hold harmless the Custodian and its directors, officers, employees
and agents with respect to any loss, claim, liability or cost (including
reasonable attorneys' fees) arising or alleged to arise from or relating to the
Corporation's duties hereunder or any other action or inaction of the
Corporation or its Directors, officers, employees or agents, except such as may
arise from the grossly negligent action or omission, willful misconduct,
reckless disregard, or breach of this Agreement by the Custodian. The Custodian
shall indemnify, defend and hold harmless the Corporation and its Directors,
officers, employees or agents with respect to any loss, claim, liability or cost
(including reasonable attorneys' fees) arising or alleged to arise from or
relating to the Custodian's duties with respect to the Corporation hereunder or
any other action or inaction of the Custodian or its directors, officers,
employees, agents, nominees or Sub-Custodians as to a Fund, except such as may
arise from the grossly negligent action or omission, willful misconduct,
reckless disregard of breach of this Agreement by the Corporation, its
directors, officers, employees or agents. The Custodian shall be entitled to
rely on and may act upon the advice and opinion of counsel on all matters, at
the expense of the Corporation, and shall be without liability for any action
reasonably taken or omitted pursuant to such advice or opinion of counsel. The
provisions under this paragraph shall survive the termination of this Agreement.
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B. Actions Not Required By Custodian. Without limiting the generality
of the foregoing, the Custodian, acting in the capacity of Custodian hereunder,
shall be under no obligation to inquire into, and shall not be liable for:
1. The validity of the issue of any Securities purchased by or
for the account of any Fund, the legality of the purchase
thereof, or the propriety of the amount paid therefor;
2. The legality of the sale of any Securities by or for the
account of any Fund, or the propriety of the amount for
which the same are sold;
3. The legality of the issue or sale of any Shares of any Fund,
or the sufficiency of the amount to be received therefor;
4. The legality of the redemption of any Shares of any Fund, or
the propriety of the amount to be paid therefor;
5. The legality of the declaration or payment of any dividend
by the Corporation in respect of Shares of any Fund;
6. The legality of any borrowing by the Corporation on behalf
of the Corporation or any Fund, using Securities as
collateral;
7. Whether the Corporation or a Fund is in compliance with the
1940 Act, the regulations thereunder, the provisions of the
Corporation's charter documents or by-laws, or its
investment objectives and policies as then in effect.
C. No Duty to Collect Amounts Due From Dividend and Transfer Agent.
The Custodian shall not be under any duty or obligation to take action to effect
collection of any amount due to the Corporation from any Dividend and Transfer
Agent of the Corporation nor to take any action to
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effect payment or distribution by any Dividend and Transfer Agent of the
Corporation of any amount paid by the Custodian to any Dividend and Transfer
Agent of the Corporation in accordance with this Agreement.
D. No Enforcement Actions. Notwithstanding Section D of Article V, the
Custodian shall not be under any duty or obligation to take action, by legal
means or otherwise, to effect collection of any amount, if the Securities upon
which such amount is payable are in default, or if payment is refused after due
demand or presentation, unless and until (i) it shall be directed to take such
action by Written Instructions and (ii) it shall be assured to its satisfaction
(including prepayment thereof) of reimbursement of its costs and expenses in
connection with any such action.
E. Authority to Use Agents and Sub-Custodians. The Corporation
acknowledges and hereby authorizes the Custodian to hold Securities through its
various agents described in Appendix C annexed hereto. The Fund hereby
represents that such authorization has been duly approved by the Board Of
Directors of the Corporation as required by the Act.
In addition, the Corporation acknowledges that the Custodian may
appoint one or more financial institutions, as agent or agents or as
sub-custodian or sub-custodians, including, but not limited to, banking
institutions located in foreign countries, for the purpose of holding Securities
and moneys at any time owned by the Fund. The Custodian shall not be relieved of
any obligation or liability under this Agreement in connection with the
appointment or activities of such agents or sub-custodians. Any such agent or
sub-custodian shall be qualified to serve as such for assets of investment
companies registered under the Act. The Funds shall reimburse the Custodian for
all costs incurred by the Custodian in connection with opening accounts with any
such agents or sub-custodians. Upon request, the Custodian shall promptly
forward to the Corporation any documents
701153.1
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it receives from any agent or sub-custodian appointed hereunder which may assist
trustees of registered investment companies to fulfill their responsibilities
under Rule 17f-5 of the Act.
F. No Duty to Supervise Investments. The Custodian shall not be under
any duty or obligation to ascertain whether any Securities at any time delivered
to or held by it for the account of the Corporation are such as properly may be
held by the Corporation under the provisions of the Articles of Incorporation
and the Corporation's By-Laws.
G. All Records Confidential. The Custodian shall treat all records and
other information relating to the Corporation and the assets of all Funds as
confidential and shall not disclose any such records or information to any other
person unless (i) the Corporation shall have consented thereto in writing or
(ii) such disclosure is required by law.
H. Compensation of Custodian. The Custodian shall be entitled to
receive and the Corporation agrees to pay to the Custodian such compensation as
shall be determined pursuant to Appendix E attached hereto, or as shall be
determined pursuant to amendments to Appendix E. The Custodian shall be entitled
to charge against any money held by it for the account of any Fund, the amount
of any of its fees, any loss, damage, liability or expense, including counsel
fees. The expenses which the Custodian may charge against the account of a Fund
include, but are not limited to, the expenses of agents or sub-custodians
incurred in settling transactions involving the purchase and sale of Securities
of the Fund.
I. Reliance Upon Instructions. The Custodian shall be entitled to rely
upon any Proper Instructions. The Corporation agrees to forward to the Custodian
Written Instructions confirming Oral Instructions in such a manner so that such
Written Instructions are received by the Custodian, whether by hand delivery,
telex, facsimile or otherwise, on the same Business Day on which such
701153.1
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Oral Instructions were given. The Corporation agrees that the failure of the
Custodian to receive such confirming instructions shall in no way affect the
validity of the transactions or enforceability of the transactions hereby
authorized by the Corporation. The Corporation agrees that the Custodian shall
incur no liability to the Corporation for acting upon Oral Instructions given to
the Custodian hereunder concerning such transactions.
J. Books and Records. The Custodian will (i) set up and maintain
proper books of account and complete records of all transactions in the accounts
maintained by the Custodian hereunder in such manner as will meet the
obligations of the Fund under the Act, with particular attention to Section 31
thereof and Rules 3la-1 and 3la-2 thereunder and those records are the property
of the Corporation, and (ii) preserve for the periods prescribed by applicable
Federal statute or regulation all records required to be so preserved. All such
books and records shall be the property of the Corporation, and shall be
available, upon request, for inspection by duly authorized officers, employees
or agents of the Corporation and employees of the SEC.
K. Internal Accounting Control Systems. The Custodian shall send to
the Corporation any report received on the systems of internal accounting
control of the Custodian, or its agents or sub-custodians, as the Corporation
may reasonably request from time to time.
L. No Management of Assets By Custodian. The Custodian performs only
the services of a custodian and shall have no responsibility for the management,
investment or reinvestment of the Securities or other assets from time to time
owned by any Fund. The Custodian is not a selling agent for Shares of any Fund
and performance of its duties as custodian shall not be deemed to be a
recommendation to any Fund's depositors or others of Shares of the Fund as an
investment. The Custodian shall have no duties or obligations whatsoever except
such duties and obligations as are
701153.1
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specifically set forth in this Agreement, and no covenant or obligation shall be
implied in this Agreement against the Custodian.
M. Assistance to Corporation. The Custodian shall take all reasonable
action, that the Corporation may from time to time request, to assist the
Corporation in obtaining favorable opinions from the Corporation's independent
accountants, with respect to the Custodian's activities hereunder, in connection
with the preparation of the Fund's Form N- IA, Form N-SAR, or other annual
reports to the SEC.
X. Xxxxx of Security Interest. The Corporation hereby pledges to and
grants the Custodian a security interest in the assets of any Fund to secure the
payment of any liabilities of the Corporation to the Custodian, whether acting
in its capacity as Custodian or otherwise, or on account of money borrowed from
the Custodian. This pledge is in addition to any other pledge of collateral by
the Corporation to the Custodian.
ARTICLE IX
Initial Term; Termination
-------------------------
A. Initial Term. This Agreement shall become effective as of its
execution and shall continue in full force and effect for a period of two years
(the "Initial Term") and thereafter until terminated as hereinafter provided.
B. Termination. Either party hereto may terminate this Agreement after
the Initial Term for any reason by giving to the other party a notice in writing
specifying the date of such termination, which shall be not less than ninety
(90) days after the date of giving of such notice. If such notice is given by
the Corporation, it shall be accompanied by a copy of a resolution of the Board
of Directors of the Corporation, certified by the Secretary of the Corporation,
electing to terminate this
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Agreement and designating a successor custodian or custodians. In the event such
notice is given by the Custodian, the Corporation shall, on or before the
termination date, deliver to the Custodian a copy of a resolution of the Board
of Directors of the Corporation, certified by the Secretary, designating a
successor custodian or custodians to act on behalf of the Corporation. In the
absence of such designation by the Corporation, the Custodian may designate a
successor custodian which shall be a bank or corporation company having not less
than $100,000,000 aggregate capital, surplus, and undivided profits. Upon the
date set forth in such notice this Agreement shall terminate, and the Custodian,
provided that it has received a notice of acceptance by the successor custodian,
shall deliver, on that date, directly to the successor custodian all Securities
and moneys then owned by the Fund and held by it as Custodian. Upon termination
of this Agreement, the Corporation shall pay to the Custodian on behalf of the
Corporation such compensation as may be due as of the date of such termination.
The Corporation agrees on behalf of the Corporation that the Custodian shall be
reimbursed for its reasonable costs in connection with the termination of this
Agreement.
C. Failure to Designate Successor Trustee. If a successor custodian is
not designated by the Corporation, or by the Custodian in accordance with the
preceding paragraph, or the designated successor cannot or will not serve, the
Corporation shall, upon the delivery by the Custodian to the Corporation of all
Securities (other than Securities held in the Book-Entry System which cannot be
delivered to the Corporation) and moneys then owned by the Corporation, be
deemed to be the custodian for the Corporation, and the Custodian shall thereby
be relieved of all duties and responsibilities pursuant to this Agreement, other
than the duty with respect to Securities held in the Book-Entry System, which
cannot be delivered to the Corporation, which shall be held by the Custodian in
accordance with this Agreement.
701153.1
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ARTICLE X
Force Majeure
-------------
Neither the Custodian nor the Corporation shall be liable for any
failure or delay in performance of its obligations under this Agreement arising
out of or caused, directly or indirectly, by circumstances beyond its reasonable
control, including, without limitation, acts of God; earthquakes; fires; floods;
wars; civil or military disturbances; sabotage; strikes; epidemics; riots; power
failures; computer failure and any such circumstances beyond its reasonable
control as may cause interruption, loss or malfunction of utility,
transportation, computer (hardware or software) or telephone communication
service; accidents; labor disputes; acts of civil or military authority;
governmental actions; or inability to obtain labor, material, equipment or
transportation; provided, however, that the Custodian, in the event of a failure
or delay, shall use its best efforts to ameliorate the effects of any such
failure or delay.
ARTICLE XI
Miscellaneous
-------------
A. Designation of Authorized Persons. Appendix A sets forth the names
and the signatures of all Authorized Persons as of this date, as certified by
the Secretary of the Corporation. The Corporation agrees to furnish to the
Custodian a new Appendix A in form similar to the attached Appendix A, if any
present Authorized Person ceases to be an Authorized Person or if any other or
additional Authorized Persons are elected or appointed. Until such new Appendix
A shall be received, the Custodian shall be fully protected in acting under the
provisions of this Agreement upon Oral Instructions or signatures of the then
current Authorized Persons as set forth in the last delivered Appendix A.
701153.1
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B. Limitation of Personal Liability. No recourse under any obligation
of this Agreement or for any claim based thereon shall be had against any
organizer, shareholder, officer, trustee, past, present or future as such, of
the Corporation or of any predecessor or successor, either directly or through
the Corporation or any such predecessor or successor, whether by virtue of any
constitution, statute or rule of law or equity, or by the enforcement of any
assessment or penalty or otherwise; it being expressly agreed and understood
that this Agreement and the obligations thereunder are enforceable solely
against the Corporation, and that no such personal liability whatever shall
attach to, or is or shall be incurred by, the organizers, shareholders,
officers, or directors of the Corporation or of any predecessor or successor, or
any of them as such. To the extent that any such liability exists, it is hereby
expressly waived and released by the Custodian as a condition of, and as a
consideration for, the execution of this Agreement.
C. Authorization By Board. The obligations set forth in this Agreement
as having been made by the Corporation have been made by the Board of Directors,
acting as such Directors for and on behalf of the Corporation, pursuant to the
authority vested in them under the laws of the State of Maryland, the Articles
of Incorporation and the By-Laws of the Corporation. This Agreement has been
executed by Officers of the Corporation as officers, and not individually, and
the obligations contained herein are not binding upon any of the Directors,
Officers, agents or holders of shares, personally, but bind only the
Corporation.
D. Custodian's Consent to Use of Its Name. The Corporation shall
review with the Custodian all provisions of the Prospectus and any other
documents (including advertising material) specifically mentioning the Custodian
(other than merely by name and address) and shall obtain the Custodian's consent
prior to the publication and/or dissemination or distribution thereof.
701153.1
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E. Notices to Custodian. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the Custodian, shall be
sufficiently given if addressed to the Custodian and mailed or delivered to it
at its offices at Star Bank Center, 000 Xxxxxx Xxxxxx, X. X. 0000, Xxxxxxxxxx,
Xxxx 00000, attention Mutual Fund Custody Department, or at such other place as
the Custodian may from time to time designate in writing.
F. Notices to Corporation. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the Corporation shall be
sufficiently given when delivered to the Corporation or on the second Business
Day following the time such notice is deposited in the U.S. mail postage prepaid
and addressed to the Corporation at its office at 000 Xxxx Xxxxxxx Xxxxx,
Xxxxxxx Xxxxxx, Xxxxxxxxxx 00000 or at such other place as the Corporation may
from time to time designate in writing.
G. Amendments In Writing. This Agreement, with the exception of the
Appendices, may not be amended or modified in any manner except by a written
agreement executed by both parties with the same formality as this Agreement,
and authorized and approved by a resolution of the Board of Directors of the
Corporation.
H. Successors and Assigns. This Agreement shall extend to and shall be
binding upon the parties hereto, and their respective successors and assigns;
provided, however, that this Agreement shall not be assignable by the
Corporation or by the Custodian, and no attempted assignment by the Corporation
or the Custodian shall be effective without the written consent of the other
party hereto.
I. Governing Law. This Agreement shall be construed in accordance with
the laws of the State of Ohio.
701153.1
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J. Jurisdiction. Any legal action, suit or proceeding to be instituted
by either party with respect to this Agreement shall be brought by such party
exclusively in the courts of the State of Ohio or in the courts of the United
States for the Southern District of Ohio, and each party, by its execution of
this Agreement, irrevocably (i) submits to such jurisdiction and (ii) consents
to the service of any process or pleadings by first class U.S. mail, postage
prepaid and return receipt requested, or by any other means from time to time
authorized by the laws of such jurisdiction.
K. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but such
counterparts shall, together, constitute only one instrument.
L. Headings. The headings of paragraphs in this Agreement are for
convenience of reference only and shall not affect the meaning or construction
of any provision of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective Officers, thereunto duly authorized as of the
day and year first above written.
ATTEST: THE MILLENNIUM XXXX FUNDS, INC.
By:
------------------------- --------------------------------
Title:
-----------------------------
ATTEST: STAR BANK, N.A.
By:
------------------------- --------------------------------
Xxxxxx X. Xxxxxxx
Title: Senior Vice President
701153.1
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APPENDIX A
Authorized Persons Specimen Signatures
------------------ -------------------
Chairman:
------------------ ------------------
President:
------------------ ------------------
Secretary:
------------------ ------------------
Treasurer:
------------------ ------------------
Senior Vice
President:
------------------ ------------------
Assistant
Secretary:
------------------ ------------------
Assistant
Treasurer:
------------------ ------------------
Adviser Employees:
------------------ ------------------
------------------ -------------------
Transfer Agent/Fund Accountant
Employees:
------------------ ------------------
------------------ -------------------
------------------ -------------------
------------------ -------------------
701153.1
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XXXXXXXX X
Series of the Corporation
The Millennium Growth Fund
The Millennium Growth & Income Fund
701153.1
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APPENDIX C
Agents of the Custodian
The following agents are employed currently by Star Bank, N.A. for
securities processing and control ...
The Depository Trust Company (New York)
0 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
The Federal Reserve Bank
Cincinnati and Cleveland Branches
Bankers Trust Company
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
(For Foreign Securities and certain non-DTC eligible Securities)
701153.1
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