MASTER CUSTODIAN AGREEMENT
This agreement ("Agreement") dated as of the 22nd day of June 2001 by and
between The Nottingham Management Company (the "Administrator"), a North
Carolina corporation, on behalf of those business companies and trusts listed on
Exhibit A, attached hereto and made a part hereof (individually, a "Trust" and
collectively the "Trusts") and First Union National Bank (the "Bank"), a
federally chartered banking corporation.
WITNESSETH:
WHEREAS, the Administrator serves as the administrator for the Trusts;
WHEREAS, the Administrator in its capacity as administrator desires to
appoint the Bank to act as Custodian for each individual Trust and such Trust's
portfolio securities, cash and other property from time to time deposited with
or collected by the Bank for such Trust; and
WHEREAS, the Bank is qualified and authorized to act as Custodian for
each Trust and the separate series thereof (each a Fund and collectively, the
Funds), and is willing to act in such capacity upon the terms and conditions
herein set forth.
NOW THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto, intending to be legally bound,
do hereby agree as follows:
SECTION 1. The terms as defined in this Section wherever used in this
Agreement, or in any amendment or supplement hereto, shall have meanings herein
specified unless the context otherwise requires.
CUSTODIAN: The term Custodian shall mean the Bank in its capacity as Custodian
under this Agreement.
SECURITIES: The term Securities means stocks, bonds, rights, warrants and all
other negotiable or non-negotiable paper issued in certificated or book-entry
form commonly known as Securities in banking custom or practice.
SECTION 2. The Administrator on behalf of each Trust hereby appoints the
Custodian as Custodian of each said Trust's cash, securities and other property,
to be held by the Custodian as provided in this Agreement. For purposes of this
Agreement, the Trusts comprise of those companies or trusts listed on Exhibit A,
as such exhibit may be amended from time to time by mutual agreement between the
Administrator and the Bank. The Custodian hereby accepts such appointment
subject to the terms and conditions hereinafter provided. The Bank shall, upon
receipt of Proper Instructions, establish and maintain a segregated custodial
account or accounts for and on behalf of each individual Trust on the books and
records of the Bank to hold the Securities of the Trust deposited with,
transferred to or collected by the Bank for the account of each Fund of such
Trust, and a separate cash account to which the Bank shall credit monies
received by the Bank for the account of or from each Fund of such Trust. Such
cash shall be segregated from the assets of others and shall be and remain the
sole property of the appropriate Trust.
SECTION 3. The Custodian's compensation shall be as set forth in Exhibit B,
attached hereto and made a part hereof. The Administrator will pay, or cause the
appropriate Trust to pay, to the Bank the monthly fees as outlined in Exhibit B.
In addition, the Administrator will use reasonable commercial efforts to cause
the appropriate Trust to pay to the Bank reasonable out-of pocket expenses,
including but not limited to all costs associated with the conversion of the
Trust's securities hereunder and the transfer of Securities and records kept in
connection with this Agreement, all expenses and taxes payable with respect to
the Securities in the account of such Trust including, without limitation,
commission charges on purchases and sales and the amount of any loss or
liability for stockholders assessments or otherwise, claimed or asserted against
the bank or against the Bank's nominee by reason of any registration hereunder;
and expenses of third parties providing services to the Fund, including services
of legal counsel and independent accountants, appraisers, and brokers.
SECTION 4. The Administrator shall use reasonable commercial efforts to cause
each Trust to execute an individual custodian agreement ("Individual Custodian
Agreement") in substantially the same form as set forth as Exhibit C, attached
hereto and made a part hereof. It is the intent of the Administrator and the
Bank that each Individual Custodian Agreement, when properly executed, shall
become a part of this Agreement as it relates to the particular Trust.
SECTION 5. In connection with its functions under this Agreement, the Custodian
shall perform those services set forth in the Individual Custodian Agreements
SECTION 6. In connection with its obligations under this Agreement, the
Administrator shall perform the following: those services as may be agreed upon,
from time to time, in writing between the Administrator and the Custodian.
SECTION 7. The Administrator represents and warrants that: (i) it has the legal
right, power and authority to execute, deliver and perform this Agreement and to
carry out all of the transactions contemplated hereby; (ii) it has obtained all
necessary authorizations; (iii) the execution, delivery and performance of this
Agreement and the carrying out of any of the transactions contemplated hereby
will not be in conflict with, result in a breach of or constitute a default
under any agreement or other instrument to which the Administrator is a party or
which is otherwise known to the Administrator; (iv) to the best of its knowledge
and belief, it does not require the consent or approval of any governmental
agency or instrumentality, except any such consents and approvals which the
Administrator has obtained; (v) to the best of its knowledge and belief, the
execution and delivery of this Agreement by the Administrator will not violate
any law, regulation, charter, by-law, order of any court or governmental agency
or judgment applicable to the Administrator; and (vi) all persons executing this
Agreement on behalf of the Administrator and carrying out the transactions
contemplated hereby on behalf of the Administrator are duly authorized to do so.
In the event any of the foregoing representations should become untrue,
incorrect or misleading, the Administrator agrees to notify the Bank immediately
in writing thereof.
SECTION 8. The Bank represents and warrants that: (i) it has the legal right,
power and authority to execute, deliver and perform this Agreement and to carry
out all of the transactions contemplated hereby; (ii) it has obtained all
necessary authorizations; (iii) the execution, delivery and performance of this
Agreement and the carrying out of any of the transactions contemplated hereby
will not be in conflict with, result in a breach of or constitute a default
under any agreement or other instrument to which the Bank is a party or which is
otherwise known to the Bank; (iv) it does not require the consent or approval of
any governmental agency or instrumentality, except any such consents and
approvals which the Bank has obtained; (v) the execution and delivery of this
Agreement by the Bank will not violate any law, regulation, charter, by-law,
order of any court or governmental agency or judgment applicable to the Bank;
and (vi) all persons executing this Agreement on behalf of the Bank and carrying
out the transactions contemplated hereby on behalf of the Bank are duly
authorized to do so. In the event that any of the foregoing representations
should become untrue, incorrect or misleading, the Bank agrees to notify the
Administrator immediately in writing thereof.
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SECTION 9. All cash and Securities held by the Bank hereunder shall be kept
with the care exercised as to the Bank's own similar property.
SECTION 10. This Agreement may be amended from time to time by a supplemental
agreement executed by the Administrator and the Bank and amending and
supplementing this Agreement in the manner mutually agreed.
SECTION 11. Either the Administrator or the Custodian may give ninety (90) days
written notice to the other of the termination of this Agreement in whole or as
to any Trust and such Trust's corresponding Individual Custodian Agreement, such
termination to take effect at the time specified in the notice. In case such
notice of termination is given either by the Administrator or by the Custodian,
the Administrator shall use reasonable commercial efforts to cause the Trustees
of the applicable Trust(s) to promptly appoint a successor Custodian (the
Successor Custodian) which Successor Custodian shall be a bank, trust company,
or a bank and trust company in good standing, with legal capacity to accept
custody of the cash and Securities of a mutual fund. Upon receipt of written
notice from the Administrator or the applicable Trust(s) of the appointment of
such Successor Custodian and upon receipt of Proper Instructions, the Custodian
shall deliver such cash and Securities as it may then be holding hereunder
directly and only to the Successor Custodian. Unless or until a Successor
Custodian has been appointed as above provided, the Custodian then acting shall
continue to act as Custodian under this Agreement.
Every Successor Custodian appointed hereunder shall execute and deliver an
appropriate written acceptance of its appointment and shall thereupon become
vested with the rights, powers, obligations and custody of its predecessor
Custodian. The Custodian ceasing to act shall nevertheless, upon request of the
applicable Trust and the Successor Custodian and upon payment of its charges and
disbursements, execute and instrument in form approved by its counsel
transferring to the Successor Custodian all the predecessor Custodian's rights,
duties, obligations and custody.
Subject to the provisions of Section 17 hereof, in case the Custodian shall
consolidate with or merge into any other corporation, the corporation remaining
after or resulting from such consolidation or merger shall ipso facto without
the execution of filing of any papers or other documents, succeed to and be
substituted for the Custodian with like effect as though originally named as
such, provided, however, in every case that said Successor corporation maintains
the qualifications set out in Section 17(f) of the Investment Company Act of
1940, as amended.
In addition to the termination rights set forth above, each individual Trust
shall have the right to terminate this Agreement as it relates to such Trust as
provided in such Trust's Individual Custodian Agreement.
SECTION 12. This Agreement shall take effect with respect to each individual
Trust upon the execution of the Individual Custodian Agreements and when assets
of such Trusts are first delivered to the Custodian.
SECTION 13. This Agreement may be executed in two or more counterparts, each of
which when so executed shall be deemed to be an original, but such counterparts
shall together constitute but one and the same instrument.
SECTION 14. Notwithstanding anything to the contrary in this Agreement, the
Administrator shall not be liable to the Bank for any obligations of the Trusts
under the Individual Custodian Agreements. In addition, the Administrator shall
only be liable to the Bank for compensation and expenses due the Bank under
Section 3 of this Agreement to the extent that the Administrator actually
receives said amounts from the appropriate Trust. Notice is hereby given that
this Agreement is not binding upon any of the Trustees, officers or Shareholders
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of the Trusts individually, but binding only upon the assets and property of the
applicable Trust under the terms of its Individual Custodian Agreement. No Fund
of any Trust shall be liable for the obligations of any other Fund of that Trust
or any other Trust.
SECTION 15. Any sub-custodian appointed hereunder shall be qualified under
Section 17(f) of the 1940 Act and will perform its duties in accordance with the
requirements of this Agreement.
SECTION 16. Nothing contained in this Agreement is intended to or shall require
the Custodian in any capacity hereunder to perform any functions or duties on
any holiday or other day of special observance on which the Custodian is closed.
Functions or duties normally scheduled to be performed on such days shall be
performed on, and as of, the next business day the Custodian is open.
SECTION 17. 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 Administrator without the
written consent of the Custodian, or by the Custodian without the written
consent of the Administrator.
SECTION 18. All communications (other than Proper Instructions) which are to be
furnished hereunder to either party, or under any amendment hereto, shall be
sent by mail to the address listed below, provided that in the event that the
Bank, in its sole discretion, shall determine that an emergency exists, the Bank
may use such other means of communications as the Bank deems advisable.
To the Administrator:
The Nottingham Management Company
000 X. Xxxxxxxx Xxxxxx
Post Office Xxx 00
Xxxxx Xxxxx, XX 00000
Attn: Xxxxx Xxxxxx
President
To the Bank:
First Union National Bank
Institutional Custody Group-PA4942
000 X. Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
SECTION 19. This Agreement, and any amendments hereto, shall be governed,
construed and interpreted in accordance with the laws of The Commonwealth of
Pennsylvania applicable to agreements made and to be performed entirely within
such Commonwealth.
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IN WITNESS WHEREOF, the Administrator and the Custodian have caused this
Agreement to be duly signed by their respective officers as of the day and year
first above written.
THE NOTTINGHAM MANAGEMENT COMPANY
By: /s/ Xxxxx X. Xxxxxxx III
Print Name: Xxxxx X. Xxxxxxx III
Title: Chief Executive Officer
FIRST UNION NATIONAL BANK
By: /s/ Xxxxx X. Xxxxxx
Print Name: Xxxxx X. Xxxxxx
Title: Vice President
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EXHIBIT A
Mutual Fund Companies and Trusts
1. Capital Management Investment Trust
2. Xxxxxxx Xxxxx Investment Trust
3. Xxxxxxx Capital Management Investment Trust
4. New Providence Investment Trust
5. Nottingham Investment Trust II (except XXXXXXX Partners Fixed Income Trust)
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EXHIBIT B
Custodian's Compensation
DOMESTIC CUSTODY FEE SCHEDULE
(For all domestic funds)
Custody Administration Fees:
.70 basis point on market value
Transaction Fees:
$4.00 Book Entry DTC Transactions (self affirmed trades)
$7.50 Book Entry DTC Transactions (First Union affirms trades)
$10.00 Book Entry Federal Reserve Transactions
$30.00 Physical Securities Transactions
$15.00 Options
$8.00 Futures Contracts
$4.00 Paydowns on Mortgage Backed Securities.
$5.50 Fed Wire Charge on Repo Collateral in / out.
$6.50 Cash Wire Transfers
Minimum Annual Fee: $4,800 per fund ($400 per month)
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GLOBAL CUSTODY FEE SCHEDULE
(For all international funds)
========================= ========================= =========================
Holding Fee Transaction
Country Basis Points Fee
(per annum) $USD
------------------------- ------------------------- -------------------------
Argentina 44.00 $137.50
------------------------- ------------------------- -------------------------
Australia 7.70 $66.00
------------------------- ------------------------- -------------------------
Austria 7.70 $55.00
------------------------- ------------------------- -------------------------
Bangladesh 66.00 $220.00
------------------------- ------------------------- -------------------------
Belgium 7.70 $66.00
------------------------- ------------------------- -------------------------
Botswana 66.00 $220.00
------------------------- ------------------------- -------------------------
Brazil 27.50 $55.00
------------------------- ------------------------- -------------------------
Canada 3.30 $33.00
------------------------- ------------------------- -------------------------
Cedel 3.30 $16.50
------------------------- ------------------------- -------------------------
Chile 55.00 $99.00
------------------------- ------------------------- -------------------------
China 55.00 $220.00
------------------------- ------------------------- -------------------------
Colombia 55.00 $121.00
------------------------- ------------------------- -------------------------
Cote d'Ivore 66.00 $220.00
------------------------- ------------------------- -------------------------
Cyprus 66.00 $165.00
------------------------- ------------------------- -------------------------
Czech Republic 55.00 $137.50
------------------------- ------------------------- -------------------------
Denmark 7.70 $55.00
------------------------- ------------------------- -------------------------
ECU 9.90 $55.00
------------------------- ------------------------- -------------------------
Ecuador 66.00 $110.00
------------------------- ------------------------- -------------------------
Egypt 66.00 $192.50
------------------------- ------------------------- -------------------------
Euroclear 2.75 $27.50
------------------------- ------------------------- -------------------------
Euro CD 1.80 $17.00
------------------------- ------------------------- -------------------------
Finland 7.70 $55.00
------------------------- ------------------------- -------------------------
France 6.60 $66.00
------------------------- ------------------------- -------------------------
Germany 5.50 $44.00
------------------------- ------------------------- -------------------------
Ghana 66.00 $220.00
------------------------- ------------------------- -------------------------
Greece 88.00 $220.00
------------------------- ------------------------- -------------------------
Hong Kong 8.80 $88.00
------------------------- ------------------------- -------------------------
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------------------------- ------------------------- -------------------------
Hungary 66.00 $220.00
------------------------- ------------------------- -------------------------
India 66.00 $220.00
------------------------- ------------------------- -------------------------
Indonesia 22.00 $99.00
------------------------- ------------------------- -------------------------
Ireland 7.70 $66.00
------------------------- ------------------------- -------------------------
Israel 44.00 $82.50
------------------------- ------------------------- -------------------------
Italy 7.70 $66.00
------------------------- ------------------------- -------------------------
Japan 3.85 $22.00
------------------------- ------------------------- -------------------------
Jordan 49.50 $220.00
------------------------- ------------------------- -------------------------
Kenya 66.00 $220.00
------------------------- ------------------------- -------------------------
Malaysia 11.00 $88.00
------------------------- ------------------------- -------------------------
Mauritius 66.00 $192.50
------------------------- ------------------------- -------------------------
Mexico 13.20 $66.00
------------------------- ------------------------- -------------------------
Morocco 55.00 $110.00
------------------------- ------------------------- -------------------------
Netherlands 6.60 $66.00
------------------------- ------------------------- -------------------------
New Zealand 8.80 $88.00
------------------------- ------------------------- -------------------------
Norway 7.70 $66.00
------------------------- ------------------------- -------------------------
Pakistan 27.50 $165.00
------------------------- ------------------------- -------------------------
Papua New Guinea 13.20 $110.00
------------------------- ------------------------- -------------------------
Peru 71.50 $165.00
------------------------- ------------------------- -------------------------
Philippines 16.50 $88.00
------------------------- ------------------------- -------------------------
Poland 88.00 $165.00
------------------------- ------------------------- -------------------------
Portugal 22.00 $99.00
------------------------- ------------------------- -------------------------
Russia 88.00 $165.00
------------------------- ------------------------- -------------------------
Singapore 13.20 $88.00
------------------------- ------------------------- -------------------------
Slovak Republic 66.00 $110.00
------------------------- ------------------------- -------------------------
South Africa 11.00 $82.50
------------------------- ------------------------- -------------------------
South Korea 16.50 $88.00
------------------------- ------------------------- -------------------------
Spain 6.60 $66.00
------------------------- ------------------------- -------------------------
Sri Lanka 27.50 $82.50
------------------------- ------------------------- -------------------------
Swaziland 66.00 $220.00
------------------------- ------------------------- -------------------------
Sweden 7.70 $66.00
------------------------- ------------------------- -------------------------
Switzerland 6.60 $66.00
------------------------- ------------------------- -------------------------
Taiwan 16.50 $99.00
------------------------- ------------------------- -------------------------
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------------------------- ------------------------- -------------------------
Thailand 13.20 $82.50
------------------------- ------------------------- -------------------------
Turkey 22.00 $82.50
------------------------- ------------------------- -------------------------
United Kingdom 3.30 $33.00
------------------------- ------------------------- -------------------------
United States 1.65 $16.50
------------------------- ------------------------- -------------------------
Uruguay 66.00 $110.00
------------------------- ------------------------- -------------------------
Venezuela 55.00 $110.00
------------------------- ------------------------- -------------------------
Zambia 66.00 $220.00
------------------------- ------------------------- -------------------------
Zimbabwe 66.00 $220.00
========================= ========================= =========================
Non-First Union Foreign Exchange Contract: $10.00 per F/X contract.
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EXHIBIT C
FORM OF INDIVIDUAL CUSTODIAN AGREEMENT
THIS INDIVIDUAL CUSTODIAN AGREEMENT ("Agreement") dated as of the ___
day of ___ 2001 by and between _____________ (the "Trust"), a business trust
duly organized under the laws of the state of _______ and First Union National
Bank (the "Bank").
WITNESSETH:
WHEREAS, The Nottingham Management Company (the "Administrator") serves
as administrator for the Trust;
WHEREAS, the Administrator in its capacity as administrator, and on
behalf of the Trust, appointed the Bank to act as custodian for the Trust
pursuant to a certain Master Custodian Agreement between the Administrator and
the Bank;
WHEREAS, under the terms of the Master Custodian Agreement, the Trust
and the Bank must execute this Agreement to acknowledge and confirm the terms
and conditions of the Bank acting as Custodian for the Trust; and
WHEREAS, the Bank is qualified and authorized to act as Custodian for
the Trust and the separate series thereof (each a Fund and collectively, the
Funds), and is willing to act in such capacity upon the terms and conditions
herein set forth;
NOW THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto, intending to be legally bound,
do hereby agree as follows:
SECTION 1. The terms as defined in this Section wherever used in this
Agreement, or in any amendment or supplement hereto, shall have meanings herein
specified unless the context otherwise requires.
CUSTODIAN: The term Custodian shall mean the Bank in its capacity as Custodian
under this Agreement.
DEPOSITORY: The term Depository means any depository service 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 by bookkeeping entry without physical
delivery.
MASTER AGREEMENT: The term Master Agreement means that certain Master Custodian
Agreement, dated ________, between the Administrator and the Bank, the terms and
conditions of with are hereby incorporated herein by reference.
PROPER INSTRUCTIONS: For purposes of this Agreement, the Custodian shall be
deemed to have received Proper Instructions upon receipt of written (including
instructions received by means of computer terminals of facsimile
transmissions), telephone or telegraphic instructions from a person or persons
authorized from time to time by the Trustees of the Trust to give the particular
class of instructions. Telephone or telegraphic instructions shall be confirmed
in writing by such persons as said Trustees shall have from time to time
authorized to give the particular class of instructions in question. The
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Custodian may act upon telephone or telegraphic instructions without awaiting
receipt of written confirmation, and shall not be liable for the Trust's failure
to confirm such instructions in writing.
SECURITIES: The term Securities means stocks, bonds, rights, warrants and all
other negotiable or non-negotiable paper issued in certificated or book-entry
form commonly known as Securities in banking custom or practice.
SHAREHOLDERS: The term Shareholders shall mean the registered owners from time
to time of the Shares of the Trust in accordance with the registry records
maintained by the Trust or agents on its behalf.
SECTION 2. The Trust hereby acknowledges and confirms the appointment of the
Custodian as Custodian of the Trust's cash, securities and other property, to be
held by the Custodian as provided in the Master Agreement and as provided in
this Agreement. The Custodian hereby accepts such appointment subject to the
terms and conditions as stated in the Master Agreement and as hereinafter
provided. The Bank shall, upon receipt of Proper Instructions, establish and
maintain a segregated custodial account or accounts for and on behalf of the
Trust on the books and records of the Bank to hold the Securities of the Trust
deposited with, transferred to or collected by the Bank for the account of each
Fund of the Trust, and a separate cash account to which the Bank shall credit
monies received by the Bank for the account of or from each Fund of the Trust.
Such cash shall be segregated from the assets of others and shall be and remain
the sole property of the Trust.
SECTION 3. The Trust shall from time to time file with the Custodian a
certified copy of each resolution of its Board of Trustees authorizing the
person or persons to give Proper Instructions and specifying the class of
instructions that may be given by each person to the Custodian under this
Agreement, together with certified signatures of such persons authorized to
sign, which shall constitute conclusive evidence of the authority of the
officers and signatories designated therein to act, and shall be considered in
full force and effect with the Custodian fully protected in acting in reliance
thereon until it receives written notice to the contrary; provided, however,
that if the certifying officer is authorized to give Proper Instructions, the
certification shall be also signed by a second officer of the Trust. The Trust
shall also supply the funds' most recent prospectus including all amendments and
supplements thereto (the "Prospectus").
SECTION 4. The Trust will cause to be deposited with the Custodian hereunder
the applicable net asset value of Shares sold from time to time whether
representing initial issue, other stock or reinvestments of dividends and/or
distributions payable to Shareholders.
SECTION 5. The Bank, acting as agent for the Trust, is authorized, directed and
instructed subject to the further provisions of this Agreement.
(a) to hold Securities issued only in bearer form;
(b) to register in the name of the nominee of the Bank, the Bank's
Depositories, or sub-custodians, (i) Securities issued only in
registered form, and (ii) Securities issued in both bearer and
registered form, which are freely interchangeable without
penalty;
(c) to deposit any securities which are eligible for deposit (i)
with any domestic or foreign Depository on such terms and
conditions as such Depository may require, including
provisions for limitation or exclusion of liability on the
part of the Depository; and (ii) with any sub-custodian which
the Bank uses, including any subsidiary or affiliate of the
Bank;
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(d) (i) to credit for the account of the Trust all
proceeds received and payable on or in respect of the
assets maintained hereunder.
(ii) to debit the account of the Trust for the cost of
acquiring Securities the Bank has received for the
Trust, against delivery of such Securities to the
Bank,
(iii) to present for payment Securities and other
obligations (including coupons) upon maturity, when
called for redemption, and when income payments are
due, and
(iv) to make exchanges of Securities which, in the Bank's
opinion, are purely ministerial as, for example, the
exchange of Securities in temporary form for
Securities in definitive form or the mandatory
exchange of certificates;
(e) to forward to the Trust, and/or any other person designated by
the Trust, all proxies and proxy materials received by the
Bank in connection with Securities held in the Trust's
account, which have been registered in the name of the Bank's
nominee, or are being held by any Depository, or
sub-custodian, on behalf of the Bank;
(f) to sell any fractional interest of any Securities which the
Bank has received resulting from any stock dividend, stock
split, distribution, exchange, conversion or similar activity;
(g) to release the Trust's name, address and aggregate share
position to the issuers of any domestic Securities held in the
account of the Trust;
(h) to endorse and collect all checks, drafts or other orders for
the payment of money received by the Bank for the account of
or from the Trust;
(i) at the direction of the Trust, to enroll designated Securities
belonging to the Trust and held hereunder in a program for the
automatic reinvestment of all income and capital gains
distributions on those Securities in new shares (an Automatic
Reinvestment Program), or instruct any Depository holding such
Securities to enroll those Securities in an Automatic
Reinvestment Program;
(j) at the direction of the Trust, to receive, deliver and
transfer Securities and make payments and collections of
monies in connection therewith, enter purchase and sale orders
and perform any other acts incidental or necessary to the
performance of the above acts with brokers, dealers or similar
agents selected by the Trust, including any broker, dealer or
similar agent affiliated with the Bank, for the account and
risk of the Trust in accordance with accepted industry
practice in the relevant market, provided, however, if it is
determined that any certificated Securities transferred to a
Depository or sub- custodian, the Bank, or the Bank's nominee,
the Bank's sole responsibility for such Securities under this
Agreement shall be to safekeep the Securities in accordance
with Section 11 hereof; and
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(k) to notify the Trust and/or any other person designated by the
Trust upon receipt of notice by the Bank of any call for
redemption, tender offer, subscription rights, merger,
consolidation, reorganization or recapitalization which (i)
appears in nationally recognized publications or services to
which the Bank subscribes, (ii) requires the Bank to act in
response thereto, and (iii) pertain to Securities belonging to
the Trust and held hereunder which have been registered in the
name of the Bank's nominee or are being held by a Depository
or sub-custodian on behalf of the Bank. Notwithstanding
anything contained herein to the contrary, the Trust shall
have the sole responsibility for monitoring the applicable
dates on which Securities with put option features must be
exercised. All solicitation fees payable to the Bank as agent
in connection herewith will be retained by the Bank unless
expressly agreed to the contrary in writing by the Bank.
(l) to retain shares with respect to tender offers for under 5% of
the outstanding shares at less than 99% of current market
value, without obligation of providing notice of such offers.
Notwithstanding anything in this Section to the contrary, the Bank is authorized
to hold Securities for the Trust which have transfer limitations imposed upon
them by the Securities Act of 1993, as amended, or represent shares of mutual
funds (i) in the name of the Trust, (ii) in the name of the Bank's nominee, or
(iii) with any Depository or sub-custodian.
SECTION 6. The Custodian's compensation shall be as set forth in the Master
Agreement. It is understood and agreed that the Administrator shall be
responsible for paying the Custodian's monthly fees as outlined in Exhibit B of
the Master Agreement out of the Administrator's compensation under that certain
Amended and Restated Fund Accounting and Compliance Administration Agreement,
dated _____, between the Administrator and the Trust. Notwithstanding the
foregoing, however, the Trust shall be responsible for paying the Custodian,
directly, out-of pocket expenses, including but not limited to all costs
associated with the conversion of the Trust's securities hereunder and the
transfer of Securities and records kept in connection with this Agreement, all
expenses and taxes payable with respect to the Securities in the account of the
Trust including, without limitation, commission charges on purchases and sales
and the amount of any loss or liability for stockholders assessments or
otherwise, claimed or asserted against the bank or against the Bank's nominee by
reason of any registration hereunder; and expenses of third parties providing
services to the Fund (other than services of third parties as are already
compensated as described in this Agreement), including services of legal counsel
and independent accountants, appraisers, and brokers.
SECTION 7. In connection with its functions under this Agreement, the Custodian
shall:
(a) render to the Trust a daily report of all monies received or
paid on behalf of the Trust; and
(b) furnish to the Trust a periodic statement of the Trust's
account(s) holdings; and
(c) create, maintain and retain all records relating to its
activities and obligations under this Agreement in such manner
as will meet the obligations of the Trust with respect to said
Custodian's activities in accordance with generally accepted
accounting principles. All records maintained by the Custodian
in connection with the performance of its duties under this
Agreement will remain the property of the Trust and in the
event of termination of this Agreement will be relinquished to
the Trust.
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SECTION 8. Any Securities deposited with any Depository or with any
sub-custodian will be represented in accounts in the name of the Bank, which
include only property held by the Bank as Custodian for customers in which the
Bank acts in a fiduciary or agency capacity.
Should any Securities which are forwarded to the Bank by the Trust, and which
are subsequently deposited to the Bank's account in any Depository or with any
sub-custodian, or which the Trust may arrange to deposit in the Bank's account
in any Depository or with any sub-custodian, not be deemed acceptable for
deposit by such Depository or sub-custodian, for any reason, and as a result
thereof there is a short position in the account of the Bank with the Depository
for such Security, the Trust agrees to furnish the Bank immediately with like
Securities in acceptable form.
The Bank may refuse to accept securities and other property registered in the
Trust's name or in any other name than that of a nominee described in Section
5(b). If the Bank accepts these securities or other property, the Bank will not
be responsible for collecting income or principal or for any other action the
Bank customarily takes in connection with registered securities. The Bank may
refuse to accept any securities or other property the Bank deems inappropriate.
SECTION 9. The Trust represents and warrants that: (i) it has the legal right,
power and authority to execute, deliver and perform this Agreement and to carry
out all of the transactions contemplated hereby; (ii) it has obtained all
necessary authorizations; (iii) the execution, delivery and performance of this
Agreement and the carrying out of any of the transactions contemplated hereby
will not be in conflict with, result in a breach of or constitute a default
under any agreement or other instrument to which the Trust is a party or which
is otherwise known to the Trust; (iv) it does not require the consent or
approval of any governmental agency or instrumentality, except any such consents
and approvals which the Trust has obtained; (v) the execution and delivery of
this Agreement by the Trust will not violate any law, regulation, charter,
by-law, order of any court or governmental agency or judgment applicable to the
Trust; and (vi) all persons executing this Agreement on behalf of the Trust and
carrying out the transactions contemplated hereby on behalf of the Trust are
duly authorized to do so.
In the event any of the foregoing representations should become untrue,
incorrect or misleading, the Trust agrees to notify the Bank immediately in
writing thereof.
SECTION 10. The Bank represents and warrants that: (i) it has the legal right,
power and authority to execute, deliver and perform this Agreement and to carry
out all of the transactions contemplated hereby; (ii) it has obtained all
necessary authorizations; (iii) the execution, delivery and performance of this
Agreement and the carrying out of any of the transactions contemplated hereby
will not be in conflict with, result in a breach of or constitute a default
under any agreement or other instrument to which the Bank is a party or which is
otherwise known to the Bank; (iv) it does not require the consent or approval of
any governmental agency or instrumentality, except any such consents and
approvals which the Bank has obtained; (v) the execution and delivery of this
Agreement by the Bank will not violate any law, regulation, charter, by-law,
order of any court or governmental agency or judgment applicable to the Bank;
and (vi) all persons executing this Agreement on behalf of the Bank and carrying
out the transactions contemplated hereby on behalf of the Bank are duly
authorized to do so. In the event that any of the foregoing representations
should become untrue, incorrect or misleading, the Bank agrees to notify the
Trust immediately in writing thereof.
SECTION 11. All cash and Securities held by the Bank hereunder shall be kept
with the care exercised as to the Bank's own similar property. The Bank may at
5
its option insure itself against loss from any cause but shall be under no
obligation to insure for the benefit of the Trust.
SECTION 12. No liability of any kind shall be attached to or incurred by the
Custodian by reason of its custody of the Trust's assets held by it from time to
time under this Agreement, or otherwise by reason of its position as Custodian
hereunder except only for its own negligence, bad faith, or willful misconduct
in the performance of its duties as specifically set forth in the Custodian
Agreement. Without limiting the generality of the foregoing sentence, the
Custodian:
(a) may rely upon the advice of counsel for the Trust; and for any
action taken or suffered in good faith based upon such advice
or statements the Custodian shall not be liable to anyone;
(b) shall not be liable for anything done or suffered to be done
in good faith in accordance with any request or advice of, or
based upon information furnished by, the Trust or its
authorized officers or agents;
(c) is authorized to accept a certificate of the Secretary or
Assistant Secretary of the Trust, or Proper Instructions, to
the effect that a resolution in the form submitted has been
duly adopted by its Board of Trustees or by the Shareholders,
as conclusive evidence that such resolution has been duly
adopted and is in full force and effect; and
(d) may rely and shall be protected in acting upon any signature,
written (including telegraph or other mechanical)
instructions, request, letter of transmittal, certificate,
opinion of counsel, statement, instrument, report, notice,
consent, order, or other paper or document reasonably believed
by it to be genuine and to have been signed, forwarded or
presented by the purchaser, Trust or other proper party or
parties.
SECTION 13. The Trust, its successors and assigns do hereby fully indemnify and
hold harmless the Custodian its successors and assigns, from any and all loss,
liability, claims, demand, actions, suits and expenses of any nature as the same
may arise from the failure of the Trust to comply with any law, rule regulation
or order of the United States, any state or any other jurisdiction, governmental
authority, body, or board relating to the sale, registration, qualification of
units of beneficial interest in the Trust, or from the failure of the Trust to
perform any duty or obligation under this Agreement.
Upon written request of the Custodian, the Trust shall assume the entire defense
of any claim subject to the foregoing indemnity, or the joint defense with the
Custodian of such claim, as the Custodian shall request. The indemnities and
defense provisions of this Section 13 shall indefinitely survive termination of
this Agreement.
SECTION 14. This Agreement may be amended from time to time without notice to
or approval of the Shareholders by a supplemental agreement executed by the
Trust and the Bank and amending and supplementing this Agreement in the manner
mutually agreed.
SECTION 15. Either the Trust or the Custodian may give ninety (90) days written
notice to the other of the termination of this Agreement, such termination to
take effect at the time specified in the notice. In case such notice of
termination is given either by the Trust or by the Custodian, the Trustees of
the Trust shall, by resolution duly adopted, promptly appoint a successor
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Custodian (the Successor Custodian) which Successor Custodian shall be a bank,
trust company, or a bank and trust company in good standing, with legal capacity
to accept custody of the cash and Securities of a mutual fund. Upon receipt of
written notice from the Trust of the appointment of such Successor Custodian and
upon receipt of Proper Instructions, the Custodian shall deliver such cash and
Securities as it may then be holding hereunder directly and only to the
Successor Custodian. Unless or until a Successor Custodian has been appointed as
above provided, the Custodian then acting shall continue to act as Custodian
under this Agreement.
Every Successor Custodian appointed hereunder shall execute and deliver an
appropriate written acceptance of its appointment and shall thereupon become
vested with the rights, powers, obligations and custody of its predecessor
Custodian. The Custodian ceasing to act shall nevertheless, upon request of the
Trust and the Successor Custodian and upon payment of its charges and
disbursements, execute and instrument in form approved by its counsel
transferring to the Successor Custodian all the predecessor Custodian's rights,
duties, obligations and custody.
Subject to the provisions of Section 22 hereof, in case the Custodian shall
consolidate with or merge into any other corporation, the corporation remaining
after or resulting from such consolidation or merger shall ipso facto without
the execution of filing of any papers or other documents, succeed to and be
substituted for the Custodian with like effect as though originally named as
such, provided, however, in every case that said Successor corporation maintains
the qualifications set out in Section 17(f) of the Investment Company Act of
1940, as amended.
In addition to the termination rights set forth above, the Administrator has the
right to terminate this Agreement as provided in the Master Agreement.
SECTION 16. This Agreement shall take effect when assets of the Trust are first
delivered to the Custodian.
SECTION 17. This Agreement may be executed in two or more counterparts, each of
which when so executed shall be deemed to be an original, but such counterparts
shall together constitute but one and the same instrument.
SECTION 18. A copy of the Declaration of Trust is on file with the Secretary of
the state of ________, and notice is hereby given that this instrument is
executed on behalf of the Trustees of the Trust as Trustees and not individually
and that the obligations of this instrument are not binding upon any of the
Trustees, officers or Shareholders of the Trust individually, but binding only
upon the assets and property of the Trust. No Fund of the Trust shall be liable
for the obligations of any other Fund of the Trust.
SECTION 19. The Custodian shall create and maintain all records relating to its
activities and obligations under this Agreement in such manner as will meet the
obligations of the Trust under the Investment Company Act of 1940, as amended,
with particular attention to Section 31 thereof and Rules 31a-1 and 31a-2
thereunder, applicable Federal and state tax laws and any other law or
administrative rules or procedures which may be applicable to the Trust.
Subject to security requirements of the Custodian applicable to its own
employees having access to similar records within the Custodian, the books and
records of the Custodian pertaining to this Agreement shall be open to
inspection and audit at any reasonable times by officers of, attorneys for, and
auditors employed by, the Trust.
SECTION 20. Any sub-custodian appointed hereunder shall be qualified under
Section 17(f) of the 1940 Act and will perform its duties in accordance with the
requirements of this Agreement.
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SECTION 21. Nothing contained in this Agreement is intended to or shall require
the Custodian in any capacity hereunder to perform any functions or duties on
any holiday or other day of special observance on which the Custodian is closed.
Functions or duties normally scheduled to be performed on such days shall be
performed on, and as of, the next business day the Custodian is open.
SECTION 22. 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 Trust without the written
consent of the Custodian, or by the Custodian without the written consent of the
Trust, authorized or approved by a resolution of its Board of Trustees.
SECTION 23. All communications (other than Proper Instructions) which are to be
furnished hereunder to either party, or under any amendment hereto, shall be
sent by mail to the address listed below, provided that in the event that the
Bank, in its sole discretion, shall determine that an emergency exists, the Bank
may use such other means of communications as the Bank deems advisable.
To the Trust: _____________ Trust
000 X. Xxxxxxxx Xxxxxx
Post Xxxxxx Xxx 00
Xxxxx Xxxxx, XX 00000
Attn: C. Xxxxx Xxxxxx, III
Secretary
To the Bank: First Union National Bank
Institutional Custody Group-PA4942
000 X. Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
SECTION 24. This Agreement, and any amendments hereto, shall be governed,
construed and interpreted in accordance with the laws of The Commonwealth of
Pennsylvania applicable to agreements made and to be performed entirely within
such Commonwealth.
SECTION 25. If Custodian in its sole discretion advances funds in any currency
hereunder or if there shall arise for whatever reason an overdraft in an Account
(including, without limitation, overdrafts incurred in connection with the
settlement of securities transactions, funds transfers or foreign exchange
transactions) or if Customer is for any other reason indebted to Custodian,
Customer agrees to repay Custodian on demand the amount of the advance,
overdraft or indebtedness plus accrued interest at a rate Custodian ordinarily
charges to its institutional custody customers in the relevant currency.
To secure repayment of Customer's and each third party's obligations to
Custodian hereunder, Customer hereby pledges and grants to Custodian a
continuing lien and security interest in, and right of set off against, all of
Customer's right, title and interest in and to (a) all Accounts in Customer's
name and the securities, money and other property now or hereafter held in such
Accounts (including proceeds thereof), (b) each Account in respect of which or
for whose benefit the advance, overdraft or indebtedness relates and the
securities, money and other property now or hereafter held in such Account
(including proceeds thereof), and (c) any other property at any time Custodian
holds for the account of Customer. In this regard, Custodian shall be entitled
to all the rights and remedies of a pledge and secured creditor under applicable
laws, rules or regulations then in effect.
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IN WITNESS WHEREOF, the Trust and the Custodian have caused this Agreement to be
signed by their respective officers as of the day and year first above written.
[Trust]
By: ___________________________
Name:___________________________
Title:___________________________
FIRST UNION NATIONAL BANK
By: ____________________________
Name: ___________________________
Title: ___________________________
