EXHIBIT 23(g)(2)
MUTUAL FUND CUSTODY AND
SERVICES AGREEMENT
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TABLE OF CONTENTS
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DEFINITIONS....................................................................................................1
ARTICLE I -- CUSTODY PROVISIONS................................................................................3
1.....APPOINTMENT OF CUSTODIAN..............................................................................3
2.....CUSTODY OF CASH AND SECURITIES........................................................................3
3.....SETTLEMENT OF SERIES TRANSACTIONS.....................................................................7
4.....LENDING OF SECURITIES.................................................................................8
5.....PERSONS HAVING ACCESS TO ASSETS OF THE SERIES.........................................................8
6.....STANDARD OF CARE; SCOPE OF CUSTODIAL RESPONSIBILITIES.................................................9
7.....APPOINTMENT OF SUBCUSTODIANS.........................................................................10
8.....OVERDRAFT FACILITY AND SECURITY FOR PAYMENT..........................................................10
9.....TAX OBLIGATIONS......................................................................................11
ARTICLE II -- FOREIGN CUSTODY MANAGER SERVICES................................................................12
1.....DELEGATION...........................................................................................12
2.....CHANGES TO APPENDIX C................................................................................12
3.....REPORTS TO BOARD.....................................................................................12
4.....MONITORING SYSTEM....................................................................................12
5.....STANDARD OF CARE.....................................................................................12
6.....USE OF SECURITIES DEPOSITORIES.......................................................................12
ARTICLE III - INFORMATION SERVICES............................................................................13
1.....RISK ANALYSIS........................................................................................13
2.....MONITORING OF SECURITIES DEPOSITORIES................................................................13
3.....USE OF AGENTS........................................................................................13
4.....EXERCISE OF REASONABLE CARE..........................................................................13
5.....LIABILITIES AND WARRANTIES...........................................................................13
ARTICLE IV -- GENERAL PROVISIONS..............................................................................13
1.....COMPENSATION.........................................................................................13
2.....INSOLVENCY OF FOREIGN CUSTODIANS.....................................................................14
3.....LIABILITY FOR DEPOSITORIES...........................................................................14
4.....DAMAGES..............................................................................................14
5.....INDEMNIFICATION; LIABILITY OF THE SERIES.............................................................14
6.....FORCE MAJEURE........................................................................................14
7.....TERMINATION..........................................................................................15
8.....INSPECTION OF BOOKS AND RECORDS......................................................................15
9.....MISCELLANEOUS........................................................................................15
APPENDIX A. AUTHORIZED PERSONS................................................................................i
APPENDIX B. FUND OFFICERS....................................................................................ii
APPENDIX C. SELECTED COUNTRIES..............................................................................iii
APPENDIX D. SERIES...........................................................................................iv
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MUTUAL FUND CUSTODY AND
SERVICES AGREEMENT
THIS AGREEMENT, effective as of the 10th day of September 2003, and is
between ADVANTUS SERIES FUND, INC., (the "Fund") a corporation organized under
the laws of the State of Minnesota having its principal office and place of
business at St. Xxxx, Minnesota, and MELLON BANK, N.A., (the "Custodian") a
national banking association with its principal place of business at Xxx Xxxxxx
Xxxxxx, Xxxxxxxxxx, XX 00000.
W I T N E S S E T H:
WHEREAS, the Fund is authorized to issue shares in separate series with
each such series representing interests in a separate portfolio of securities
and other assets, and the Fund has made the Series listed on Appendix D subject
to this Agreement (each such series, together with all other series subsequently
established by the Fund and made subject to the Agreement in accordance with the
terms hereof, shall be referred to as a "Series" and collectively as the
"Series");
WHEREAS, the Fund and the Custodian desire to set forth their agreement
with respect to the custody of the Series' Securities and cash and the
processing of Securities transactions;
WHEREAS, the Board desires to delegate certain of its responsibilities
for performing the services set forth in paragraphs (c)(1), (c)(2) and (c)(3) of
Rule 17f-5 to the Custodian as a Foreign Custody Manager;
WHEREAS, the Custodian agrees to accept such delegation with respect to
Assets, including those held by Foreign Custodians in the Selected Countries as
set forth in jurisdictions listed on Appendix C as set forth in Article II; and
WHEREAS, the Custodian agrees to perform the function of a Primary
Custodian under Rule 17f-7;
NOW THEREFORE, the Fund and the Custodian agree as follows:
DEFINITIONS
The following words and phrases, unless the context requires otherwise,
shall have the following meanings:
1. "ACT": the Investment Company Act of 1940 and the Rules and
Regulations thereunder, all as amended from time to time.
2. "AGREEMENT": this agreement and any amendments.
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3. "ASSETS": any of the Series' investments, including foreign
currencies and investments for which the primary market is outside the United
States, and such cash and cash equivalents as are reasonably necessary to effect
the Series' transactions in such investments.
4. "AUTHORIZED PERSON": the Chairman of the Fund's Board, its
President, and any Vice President, Secretary, Treasurer or any other person,
whether or not any such person is an officer or employee of the Fund, duly
authorized by the Board to add or delete jurisdictions pursuant to Article II
and to give Instructions on behalf of a Series which is listed in the
Certificate annexed hereto as Appendix A or such other Certificate as may be
received by the Custodian from time to time.
5. "BOARD": the Board of Managers (or the body authorized to exercise
authority similar to that of the board of directors of a corporation) of the
Fund.
6. "BOOK-ENTRY SYSTEM": the Federal Reserve/Treasury book-entry system
for United States and federal agency Securities, its successor or successors and
its nominee or nominees.
7. "BUSINESS DAY": any day on which the Series, the Custodian, the
Book-Entry System and appropriate clearing corporation(s) are open for business.
8. "CERTIFICATE": any notice, instruction or other instrument in
writing, authorized or required by this Agreement to be given to the Custodian,
which is actually received by the Custodian and signed on behalf of a Series by
an Authorized Person or Persons designated by the Board to issue a Certificate.
9. "ELIGIBLE SECURITIES DEPOSITORY": the meaning of the term set forth
in Rule 17f-7(b)(1).
10. "FOREIGN CUSTODIAN": (a) a banking institution or trust company
incorporated or organized under the laws of a country other than the United
States, that is regulated as such by the country's government or an agency of
the country's government; (b) a majority-owned direct or indirect subsidiary of
a U.S. Bank or bank-holding company; or (c) any entity other than a Securities
Depository with respect to which exemptive or no-action relief has been granted
by the Securities and Exchange Commission. For the avoidance of doubt, the term
"Foreign Custodian" shall not include Euroclear, Clearstream, Bank One or any
other transnational system for the central handling of securities or equivalent
book-entries regardless of whether or not such entities or their service
providers are acting in a custodial capacity with respect to Assets, Securities
or other property of the Series.
11. "INSTRUCTIONS": directions and instructions to the Custodian from
an Authorized Person in writing by facsimile or electronic transmission subject
to the Custodian's practices or any other method specifically agreed upon,
provided that the
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Custodian may, in its discretion, accept oral directions and
instructions from an individual it reasonably believes to be an Authorized
Person and may require confirmation in writing.
12. "PRIMARY CUSTODIAN": the meaning set forth in Rule 17f-7(b)(2).
13. "PROSPECTUS": a Series' current prospectus and statement of
additional information relating to the registration of the Shares under the
Securities Act of 1933, as amended.
14. "RISK ANALYSIS": the analysis required under Rule
17f-7(a)(1)(i)(A).
15. "RULES 17F-4, 17F-5 and 17F-7": such Rules as promulgated under
Section 17(f) of the Act, as such rules (and any successor rules or regulations)
may be amended from time to time.
16. "SECURITY" or "SECURITIES": bonds, debentures, notes, stocks,
shares, evidences of indebtedness, and other securities, commodities, interests
and investments from time to time owned by the Series.
17. "SECURITIES DEPOSITORY": a system for the central handling of
securities as defined in Rule 17f-4.
18. "SELECTED COUNTRIES": the jurisdictions listed on Appendix C as
such may be amended from time to time in accordance with Article II.
19. "SHARES": shares of each Series, however designated.
ARTICLE I -- CUSTODY PROVISIONS
1. APPOINTMENT OF CUSTODIAN. The Board appoints, and the Custodian
accepts appointment as custodian of all the Securities and monies at the time
owned by or in the possession of the Series during the period of this Agreement.
2. CUSTODY OF CASH AND SECURITIES.
a. Receipt and Holding of Assets. The Series will deliver or cause to
be delivered to the Custodian all Securities and monies owned by it at any time
during the period of this Custody Agreement. The Custodian will not be
responsible for such Securities and monies until actually received. The Board
specifically authorizes the Custodian to hold Securities, Assets or other
property of the Series with any domestic subcustodian, or Securities Depository,
and Foreign Custodians or Eligible Securities Depositories in the Selected
Countries as provided in Article II. Securities and monies of the Series
deposited in a Securities Depository or Eligible Securities Depositories will be
reflected in an account or accounts which include only assets held by the
Custodian or a Foreign Custodian for its customers.
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b. Disbursements of Cash and Delivery of Securities. The Custodian
shall disburse cash or deliver out Securities only for the purposes listed
below. Instructions must specify or evidence the purpose for which any
transaction is to be made and the Series shall be solely responsible to assure
that Instructions are in accord with any limitations or restrictions applicable
to the Series
(1) In payment for Securities purchased for the applicable
Series;
(2) In payment of dividends or distributions with respect to
Shares;
(3) In payment for Shares which have been redeemed by the
applicable Series;
(4) In payment of taxes;
(5) When Securities are sold, called, redeemed, retired, or
otherwise become payable;
(6) In exchange for or upon conversion into other securities
alone or other securities and cash pursuant to any plan or merger,
consolidation, reorganization, recapitalization or readjustment;
(7) Upon conversion of Securities pursuant to their terms into
other securities;
(8) Upon exercise of subscription, purchase or other similar
rights represented by Securities;
(9) For the payment of interest, management or supervisory
fees, distributions or operating expenses;
(10) In payment of fees and in reimbursement of the expenses
and liabilities of the Custodian attributable to the applicable Series;
(11) In connection with any borrowings by the applicable
Series or short sales of securities requiring a pledge of Securities,
but only against receipt of amounts borrowed;
(12) In connection with any loans, but only against receipt of
adequate collateral as specified in Instructions which shall reflect
any restrictions applicable to the Series.
(13) For the purpose of redeeming Shares of the capital stock
of the applicable Series and the delivery to, or the crediting to the
account of, the Custodian or the applicable Series' transfer agent,
such Shares to be purchased or redeemed;
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(14) For the purpose of redeeming in kind Shares of the
applicable Series against delivery to the Custodian, its Subcustodian
or the Customer Series' transfer agent of such Shares to be so
redeemed;
(15) For delivery in accordance with the provisions of any
agreement among the Fund, the Custodian and a broker-dealer registered
under the Securities Exchange Act of 1934 (the "Exchange Act") and a
member of The National Association of Securities Dealers, Inc.
("NASD"), relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange, or of
any similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Fund. The Custodian
will act only in accordance with Instructions in the delivery of
Securities to be held in escrow and will have no responsibility or
liability for any such Securities which are not returned promptly when
due other than to make proper requests for such return;
(16) For spot or forward foreign exchange transactions to
facilitate security trading, receipt of income from Securities or
related transactions;
(17) Upon the termination of this Agreement; and
(18) For other proper purposes as may be specified in
Instructions issued by an officer of the Fund which shall include a
statement of the purpose for which the delivery or payment is to be
made, the amount of the payment or specific Securities to be delivered,
the name of the person or persons to whom delivery or payment is to be
made, and a Certificate stating that the purpose is a proper purpose
under the instruments governing the Fund.
c. Actions Which May be Taken Without Instructions. Unless an
Instruction to the contrary is received, the Custodian shall:
(1) Collect all income due or payable, provided that the
Custodian shall not be responsible for the failure to receive payment
of (or late payment of) distributions or other payments with respect to
Securities or other property held in the account;
(2) Present for payment and collect the amount payable upon
all Securities which may mature or be called, redeemed, retired or
otherwise become payable. Notwithstanding the foregoing, the Custodian
shall have no responsibility to the Series for monitoring or
ascertaining any call, redemption or retirement dates with respect to
put bonds or similar instruments which are owned by the Series and held
by the Custodian or its nominees where such dates are not published in
sources routinely used by the Custodian. Nor shall the Custodian have
any responsibility or liability to the Series for any loss by the
Series for any missed payments or other defaults resulting therefrom,
unless the Custodian received timely notification from the Series
specifying the time, place and manner for the presentment of any such
put bond owned by the Series and held by the Custodian or its nominee.
The Custodian shall not be responsible and assumes no liability for the
accuracy or completeness of any
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notification the Custodian may furnish to the Series with respect to
put bonds or similar instruments;
(3) Surrender Securities in temporary form for definitive
Securities;
(4) Hold directly, or through a Securities Depository with
respect to Securities therein deposited, for the account of the
applicable Series all rights and similar Securities issued with respect
to any Securities held by the Custodian hereunder for that Series;
(5) Submit or cause to be submitted to the applicable Series
or its investment advisor as designated by the Fund information
actually received by the Custodian regarding ownership rights
pertaining to property held for the applicable Series;
(6) Deliver or cause to be delivered any Securities held for
the applicable Series 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;
(7) Deliver or cause to be delivered any Securities held for
the applicable Series to any protective committee, reorganization
committee or other person in connection with the reorganization,
refinancing, merger, consolidation or 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;
(8) Make or cause to be made such transfers or exchanges of
the assets specifically allocated to the applicable Series and take
such other steps as shall be stated in Instructions to be for the
purpose of effectuating any duly authorized plan of liquidation,
reorganization, merger, consolidation or recapitalization of the
applicable Series;
(9) Deliver Securities upon the receipt of payment in
connection with any repurchase agreement related to such Securities
entered into by the Series;
(10) Deliver Securities owned by the applicable Series to the
issuer thereof or its agent when such Securities are called, redeemed,
retired or otherwise become payable; provided, however, that in any
such case the cash or other consideration is to be delivered to the
Custodian. Notwithstanding the foregoing, the Custodian shall have no
responsibility to the Series for monitoring or ascertaining any call,
redemption or retirement dates with respect to the put bonds or similar
instruments which are owned by the Series and held by the Custodian or
its nominee where such dates are not published in sources routinely
used by the Custodian. Nor shall the Custodian have any responsibility
or liability to the Series for any loss by the Series for any missed
payment or other default
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resulting therefrom unless the Custodian received timely notification
from the Series specifying the time, place and manner for the
presentment of any such put bond owned by the Series and held by the
Custodian or its nominee. The Custodian shall not be responsible and
assumes no liability to the Series for the accuracy or completeness of
any notification the Custodian may furnish to the applicable Series
applicable Series with respect to put bonds or similar investments;
(11) Endorse and collect all checks, drafts or other orders
for the payment of money received by the Custodian for the account of
the applicable Series; and
(12) Execute any and all documents, agreements or other
instruments as may be necessary or desirable for the accomplishment of
the purposes of this Agreement.
d. Confirmation and Statements. Promptly after the close of business on
each day, the Custodian shall furnish each Series with confirmations and a
summary of all transfers to or from the account of the Series during the day.
Where securities purchased by a Series are in a fungible bulk of securities
registered in the name of the Custodian (or its nominee) or shown on the
Custodian's account on the books of a Securities Depository, the Custodian shall
by book-entry or otherwise identify the quantity of those securities belonging
to that Series. At least monthly, the Custodian shall furnish each Series with a
detailed statement of the Securities and monies held for the Series under this
Custody Agreement.
e. Registration of Securities. The Custodian is authorized to hold all
Securities, Assets, or other property of each Series in nominee name, in bearer
form or in book-entry form. The Custodian may register any Securities, Assets or
other property of each Series in the name of the Fund or the Series, in the name
of the Custodian, any domestic subcustodian, or Foreign Custodian, in the name
of any duly appointed registered nominee of such entity, or in the name of a
Securities Depository or its successor or successors, or its nominee or
nominees. The Fund agrees to furnish to the Custodian appropriate instruments to
enable the Custodian to hold or deliver in proper form for transfer, or to
register in the name of its registered nominee or in the name of a Securities
Depository, any Securities which it may hold for the account of the applicable
Series and which may from time to time be registered in the name of the Fund or
the applicable Series.
f. Segregated Accounts. Upon receipt of Instructions, the Custodian
will, from time to time establish segregated accounts on behalf of the
applicable Series to hold and deal with specified assets as shall be directed.
3. SETTLEMENT OF SERIES TRANSACTIONS.
a. Customary Practices. Settlement of transactions may be effected in
accordance with trading and processing practices customary in the jurisdiction
or market
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where the transaction occurs. The Fund acknowledges that this may, in certain
circumstances, require the delivery of cash or Securities (or other property)
without the concurrent receipt of Securities (or other property) or cash. In
such circumstances, the Custodian shall have no responsibility for nonreceipt of
payments (or late payment) or nondelivery of Securities or other property (or
late delivery) by the counterparty.
b. Contractual Income. Unless the parties agree to the contrary, the
Custodian shall credit the applicable Series, in accordance with the Custodian's
standard operating procedure, with income and maturity proceeds on securities on
contractual payment date net of any taxes or upon actual receipt. To the extent
the Custodian credits income on contractual payment date, the Custodian may
reverse such accounting entries with back value to the contractual payment date
if the Custodian reasonably believes that such amount will not be received.
c. Contractual Settlement. Unless the parties agree to the contrary,
the Custodian will attend to the settlement of securities transactions in
accordance with the Custodian's standard operating procedure, on the basis of
either contractual settlement date accounting or actual settlement date
accounting. To the extent the Custodian settles certain securities transactions
on the basis of contractual settlement date accounting, the Custodian may
reverse with back value to the contractual settlement date any entry relating to
such contractual settlement if the Custodian reasonably believes that such
amount will not be received.
4. LENDING OF SECURITIES. The Custodian may lend the assets of the
Series in accordance with the terms and conditions of a separate securities
lending agreement, approved by the Fund.
5. PERSONS HAVING ACCESS TO ASSETS OF THE SERIES.
a. No trustee or agent of the Fund, and no officer, director, employee
or agent of the Fund's investment adviser, of any sub-investment adviser of the
Fund, or of the Fund's administrator, shall have physical access to the assets
of the Series held by the Custodian or be authorized or permitted to withdraw
any investments of the Series, nor shall the Custodian deliver any assets of the
Series to any such person. No officer, director, employee or agent of the
Custodian who holds any similar position with the Fund's investment adviser,
with any sub-investment adviser of the Fund or with the Fund's administrator
shall have access to the assets of the Series.
b. Nothing in this Section 5 shall prohibit any duly authorized
officer, employee or agent of the Fund, or any duly authorized officer,
director, employee or agent of the investment adviser, of any sub-investment
adviser of the Series or of the Series' administrator, from giving Instructions
to the Custodian or executing a Certificate so long as it does not result in
delivery of or access to assets of the Series prohibited by paragraph (a) of
this Section 5.
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6. STANDARD OF CARE; SCOPE OF CUSTODIAL RESPONSIBILITIES.
a. Standard of Care. Custodian shall be required to exercise reasonable
care with respect to its duties under this Agreement unless otherwise provided.
(1) Notwithstanding any other provision of this Custody
Agreement, the Custodian shall not be liable for any loss or damage,
including counsel fees, resulting from its action or omission to act or
otherwise, except for any such loss or damage arising out of the
negligence or willful misconduct of the Custodian.
(2) The Custodian may, with respect to questions of law, apply
for and obtain the advice and opinion of counsel to the Fund or of its
own counsel, at the expense of the Fund, and shall be fully protected
with respect to anything done or omitted by it in good faith in
conformity with such advice or opinion.
b. Scope of Duties. Without limiting the generality of the foregoing,
the Custodian shall be under no duty or obligation to inquire into, and shall
not be liable for:
(1) The acts or omissions of any agent appointed pursuant to
Instructions of the Fund or its investment advisor including, but not
limited to, any broker-dealer or other entity to hold any Securities or
other property of the Fund as collateral or otherwise pursuant to any
investment strategy.
(2) The validity of the issue of any Securities purchased by
the Series, the legality of the purchase thereof, or the propriety of
the amount paid therefor;
(3) The legality of the sale of any Securities by the Series
or the propriety of the amount for which the same are sold;
(4) The legality of the issue or sale of any Shares, or the
sufficiency of the amount to be received therefor;
(5) The legality of the redemption of any Shares, or the
propriety of the amount to be paid therefore
(6) The legality of the declaration or payment of any
distribution of the Series;
(7) The legality of any borrowing for temporary administrative
or emergency purposes.
c. No Liability Until Receipt. The Custodian shall not be liable for,
or considered to be the Custodian of, any money, whether or not represented by
any check, draft, or other instrument for the payment of money, received by it
on behalf of the Series until the Custodian actually receives and collects such
money.
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d. Amounts Due from Transfer Agent. The Custodian shall not be required
to effect collection of any amount due to the Series from the Series' transfer
agent nor be required to cause payment or distribution by such transfer agent of
any amount paid by the Custodian to the transfer agent.
e. Collection Where Payment Refused. The Custodian shall not be
required to take action 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 it shall be directed to take such
action and it shall be assured to its satisfaction of reimbursement of its
related costs and expenses.
f. No Duty to Ascertain Authority. 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 Series are such as may properly be held by the Series
under the provisions of its governing instruments or Prospectus.
g. Reliance on Instructions. The Custodian shall be entitled to rely
upon any Instruction, notice or other instrument in writing received by the
Custodian and reasonably believed by the Custodian to be genuine and to be
signed by an officer or Authorized Person of the Series. Where the Custodian is
issued Instructions orally, the Series acknowledge that if written confirmation
is requested, the validity of the transactions or enforceability of the
transactions authorized by the Series shall not be affected if such confirmation
is not received or is contrary to oral Instructions given. The Custodian shall
be under no duty to question any direction of an Authorized Person to review any
property held in the account, to make any suggestions with respect to the
investment of the assets in the account, or to evaluate or question the
performance of any Authorized Person. The Custodian shall not be responsible or
liable for any diminution of value of any securities or other property held by
the Custodian.
7. APPOINTMENT OF SUBCUSTODIANS. The Custodian is hereby authorized to
appoint one or more domestic subcustodians (which may be an affiliate of the
Custodian) to hold Securities and monies at any time owned by the Series. The
Custodian is also hereby authorized when acting pursuant to Instructions to: 1)
place assets with any Foreign Custodian located in a jurisdiction which is not a
Selected Country and with Euroclear, Clearstream, Banc One or any other
transnational depository; and 2) place assets with a broker or other agent as
subcustodian in connection with futures, options, short selling or other
transactions. When acting pursuant to such Instructions, the Custodian shall not
be liable for the acts or omissions of any subcustodian so appointed.
8. OVERDRAFT FACILITY AND SECURITY FOR PAYMENT. In the event that the
Custodian receives Instructions to make payments or transfers of monies on
behalf of the Series for which there would be, at the close of business on the
date of such payment or transfer, insufficient monies held by the Custodian on
behalf of the Series, the Custodian may, in its sole discretion, provide an
overdraft (an "Overdraft") to the Series in an amount sufficient to allow the
completion of such payment or transfer. Any Overdraft
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provided hereunder: (a) shall be payable on the next Business Day, unless
otherwise agreed by the Series and the Custodian; and (b) shall accrue interest
from the date of the Overdraft to the date of payment in full by the Series at a
rate agreed upon from time to time, by the Custodian and the Series or, in the
absence of specific agreement, by such rate as charged to other customers of
Custodian under procedures uniformly applied. The Custodian and the Series
acknowledge that the purpose of such Overdraft is to temporarily finance the
purchase of Securities for prompt delivery in accordance with the terms hereof,
to meet unanticipated or unusual redemptions, to allow the settlement of foreign
exchange contracts or to meet other unanticipated Series expenses. The Custodian
shall promptly notify the Series (an "Overdraft Notice") of any Overdraft. To
secure payment of any Overdraft, the Series hereby grant to the Custodian a
continuing security interest in and right of setoff against the Securities and
cash in the Series' account from time to time in the full amount of such
Overdraft. Should the Series fail to pay promptly any amounts owed hereunder,
the Custodian shall be entitled to use available cash in the Series' account and
to liquidate Securities in the account as necessary to meet the Series'
obligations under the Overdraft. In any such case, and without limiting the
foregoing, the Custodian shall be entitled to take such other actions(s) or
exercise such other options, powers and rights as the Custodian now or hereafter
has as a secured creditor under the Pennsylvania Uniform Commercial Code or any
other applicable law.
9. TAX OBLIGATIONS. For purposes of this Agreement, "Tax Obligations"
shall mean taxes, withholding, certification and reporting requirements, claims
for exemptions or refund, interest, penalties, additions to tax and other
related expenses. To the extent that the Custodian has received relevant and
necessary information with respect to the Account, the Custodian shall perform
the following services with respect to Tax Obligations:
h. The Custodian shall file claims for exemptions or refunds with
respect to withheld foreign (non-U.S.) taxes in instances in which such claims
are appropriate;
i. The Custodian shall withhold appropriate amounts, as required by
U.S. tax laws, with respect to amounts received on behalf of nonresident aliens;
and
j. The Custodian shall provide to the Fund or the Authorized Person
such information received by the Custodian which could, in the Custodian's
reasonable belief, assist the Fund or the Authorized Person in the submission of
any reports or returns with respect to Tax Obligations. The Fund shall inform
the Custodian in writing as to which party or parties shall receive information
from the Custodian.
The Custodian shall provide such other services with respect to Tax
Obligations, including preparation and filing of tax returns and reports and
payment of amounts due (to the extent funded), as requested by the Fund and
agreed to by the Custodian in writing. The Custodian shall have no independent
obligation to determine the existence of any information with respect to, or the
extent of, any Tax Obligations now or hereafter
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imposed on the Fund or the Account by any taxing authority. Except as
specifically provided herein or agreed to in writing by the Custodian, the
Custodian shall have no obligations or liability with respect to Tax
Obligations, including, without limitation, any obligation to file or submit
returns or reports with any taxing authorities.
In making payments to service providers pursuant to Instructions, the
Fund acknowledges that the Custodian is acting as a paying agent and not as the
payor, for tax information reporting and withholding purposes.
ARTICLE II. -- FOREIGN CUSTODY MANAGER SERVICES
1. DELEGATION. The Board delegates to, and the Custodian hereby agrees
to accept responsibility as the Fund's Foreign Custody Manager for selecting,
contracting with and monitoring Foreign Custodians in Selected Countries set
forth in Appendix C in accordance with Rule 17f-5(c).
2. CHANGES TO APPENDIX C. Appendix C may be amended by written
agreement from time to time to add or delete jurisdictions by written agreement
signed by an Authorized Person of the Fund and the Custodian, but the Custodian
reserves the right to delete jurisdictions upon reasonable notice to the Series.
3. REPORTS TO BOARD. Custodian shall provide written reports notifying
the Board of the placement of Assets with a particular Foreign Custodian and of
any material change in a Series' foreign custody arrangements. Such reports
shall be provided to the Board quarterly, except as otherwise agreed by the
Custodian and the Fund.
4. MONITORING SYSTEM. In each case in which the Custodian has exercised
delegated authority to place Assets with a Foreign Custodian, the Custodian
shall establish a system, to re-assess or re-evaluate selected Foreign
Custodians, at least annually in accordance with Rule 17f-5(c)(3).
5. STANDARD OF CARE. In exercising the delegated authority under this
Article II of the Agreement, the Custodian agrees to exercise reasonable care,
prudence and diligence such as a person having responsibility for the
safekeeping of the Assets would exercise in like circumstances. Contracts with
Foreign Custodians shall provide for reasonable care for Assets based on the
standards applicable to Foreign Custodians in the Selected Country. In making
this determination, the Custodian shall consider the provisions of Rule
17f-5(c)(2).
6. USE OF SECURITIES DEPOSITORIES. In exercising its delegated
authority, the Custodian may assume that the Series and its investment adviser
have determined, pursuant to Rule 17f-7, that the depository provides reasonable
safeguards against custody risks, if a Series decides to place and maintain
foreign assets with any Securities Depository as to which the Custodian has
provided the Fund on behalf of such Series with a Risk Analysis.
12
ARTICLE III. -- INFORMATION SERVICES
1. RISK ANALYSIS. The Custodian will provide the Fund on behalf of the
Series with a Risk Analysis with respect to Securities Depositories operating in
the countries listed in Appendix C. If the Custodian is unable to provide a Risk
Analysis with respect to a particular Securities Depository, it will notify the
Fund on behalf of the Series. If a new Securities Depository commences operation
in one of the Appendix C countries, the Custodian will provide the Fund on
behalf of the Series with a Risk Analysis in a reasonably practicable time after
such Securities Depository becomes operational. If a new country is added to
Appendix C, the Custodian will provide the Fund on behalf of the Series with a
Risk Analysis with respect to each Securities Depository in that country within
a reasonably practicable time after the addition of the country to Appendix C.
2. MONITORING OF SECURITIES DEPOSITORIES. The Custodian will monitor
the custody risks associated with maintaining assets with each Securities
Depository for which it has provided the Fund on behalf of the Series with a
Risk Analysis as required under Rule 17f-7. The Custodian will promptly notify
the Fund on behalf of the Series or its investment adviser of any material
change in these risks.
3. USE OF AGENTS. The Custodian may employ agents, including, but not
limited to Foreign Custodians, to perform its responsibilities under Sections 1
and 2 above.
4. EXERCISE OF REASONABLE CARE The Custodian will exercise reasonable
care, prudence, and diligence in performing its responsibilities under this
Article III. With respect to the Risk Analyses provided or monitoring performed
by an agent, the Custodian will exercise reasonable care in the selection of
such agent, and shall be entitled to rely upon information provided by agents so
selected in the performance of its duties and responsibilities under this
Article III.
5. LIABILITIES AND WARRANTIES. While the Custodian will take reasonable
precautions to ensure that information provided is accurate, the Custodian shall
have no liability with respect to information provided to it by third parties.
Due to the nature and source of information, and the necessity of relying on
various information sources, most of which are external to the Custodian, the
Custodian shall have no liability for direct or indirect use of such
information.
ARTICLE IV. -- GENERAL PROVISIONS
1. COMPENSATION.
a. The Fund will compensate the Custodian for its services rendered
under this Agreement in accordance with the fees set forth in a separate Fee
Schedule which schedule may be modified by the Custodian upon not less than
sixty days prior written notice to the Fund.
13
b. The Custodian will xxxx the Fund as soon as practicable after the
end of each calendar month. The Fund will promptly pay to the Custodian the
amount of such billing.
c. If not paid directly or timely by the Fund, the Custodian may charge
against assets held on behalf of the Series compensation and any expenses
incurred by the Custodian in the performance of its duties pursuant to this
Agreement. The Custodian shall also be entitled to charge against assets of the
Series the amount of any loss, damage, liability or expense incurred with
respect to the Series, including counsel fees, for which it shall be entitled to
reimbursement under the provisions of this Agreement. The expenses which the
Custodian may charge include, but are not limited to, the expenses of domestic
subcustodians and Foreign Custodians incurred in settling transactions.
2. INSOLVENCY OF FOREIGN CUSTODIANS. The Custodian shall be responsible
for losses or damages suffered by the Series arising as a result of the
insolvency of a Foreign Custodian only to the extent that the Custodian failed
to comply with the standard of care set forth in Article II with respect to the
selection and monitoring of such Foreign Custodian.
3. LIABILITY FOR DEPOSITORIES. The Custodian shall not be responsible
for any losses resulting from the deposit or maintenance of Securities, Assets
or other property of the Series with a Securities Depository.
4. DAMAGES. Under no circumstances shall the Custodian be liable for
any indirect, consequential or special damages with respect to its role as
Foreign Custody Manager, Custodian or information vendor.
5. INDEMNIFICATION; LIABILITY OF THE SERIES.
a. The Fund shall indemnify the Custodian from all liability and
expense, including reasonable counsel fees and expenses, arising out of the
performance of the Custodian's obligations under this Agreement except as a
result of the Custodian's negligence or willful misconduct.
b. The Series and the Custodian agree that the obligations of the Fund
under this Agreement shall not be binding upon any of the trustees,
shareholders, nominees, officers, employees or agents, whether past, present or
future, of the Series, individually, but are binding only upon the assets and
property of the Fund.
6. FORCE MAJEURE. Notwithstanding anything in this Agreement to the
contrary, the Custodian shall not be liable for any losses resulting from or
caused by events or circumstances beyond its reasonable control, including, but
not limited to, losses resulting from nationalization, strikes, expropriation,
devaluation, revaluation,
14
confiscation, seizure, cancellation, destruction or similar action by any
governmental authority, de facto or de jure; or enactment, promulgation,
imposition or enforcement by any such governmental authority of currency
restrictions, exchange controls, taxes, levies or other charges affecting the
Series' property; or the breakdown, failure or malfunction of any utilities or
telecommunications systems; or any order or regulation of any banking or
securities industry including changes in market rules and market conditions
affecting the execution or settlement of transactions; or acts of war,
terrorism, insurrection or revolution; or any other similar event.
7. TERMINATION.
a. Either party may terminate this Agreement by giving the other party
sixty (60) days notice in writing, specifying the date of such termination. In
the event notice is given by the Fund, it shall be accompanied by a Certificate
evidencing the vote of the Fund's Board to terminate this Agreement and
designating a successor.
b. In the event notice of termination is given by the Custodian, the
Fund shall, on or before the termination date, deliver to the Custodian a
Certificate evidencing the vote of the Board designating a successor custodian.
In the absence of such designation, the Custodian may designate a successor
custodian, which shall be a person qualified to so act under the Act or the
Series. If the Fund fails to designate a successor custodian, the Fund shall,
upon the date specified in the notice of termination, and upon the delivery by
the Custodian of all Securities and monies then owned by the Series, be deemed
to be its own custodian and the Custodian shall thereby be relieved of all
duties and or the Series responsibilities under this Agreement other than the
duty with respect to Securities held in the Book-Entry System which cannot be
delivered to the Series.
c. Upon termination of the Agreement, the Custodian shall, upon receipt
of a notice of acceptance by the successor custodian, deliver to the successor
all Securities and monies then held by the Custodian on behalf of the Series,
after deducting all fees, expenses and other amounts owed.
d. In the event of a dispute following the termination of this
Agreement, all relevant provisions shall be deemed to continue to apply to the
obligations and liabilities of the parties.
8. INSPECTION OF BOOKS AND RECORDS. The books and records of the
Custodian shall be open to inspection and audit at reasonable times by officers
and auditors employed by the Fund at its own expense and with prior written
notice to the Custodian, and by the appropriate employees of the Securities and
Exchange Commission.
9. MISCELLANEOUS.
a. Appendix A is a document setting forth the names and the signatures
of
15
Authorized Persons. The Fund shall furnish a new document when the list of
Authorized Persons is changed in any way. Until a new certification is received,
the Custodian shall be fully protected in acting upon Instructions from
Authorized Persons as set forth in the last delivered Certificate.
b. Appendix B is a Certificate signed by the Secretary of the Fund
setting forth the names and the signatures of the present officers of the Fund.
The Fund agrees to furnish to the Custodian a new Certificate when any changes
are made. Until a new Certificate is received, the Custodian shall be fully
protected in relying upon the last delivered Certificate.
c. Any required written notice or other instrument shall be
sufficiently given if addressed to the Custodian or the Fund as the case may be
and delivered to it at its offices at:
The Custodian: Mellon Bank, N. A.
Xxx Xxxxxx Xxxxxx
Xxxx 0000
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxx Xxxxxxxxx, Vice President
The Fund: Advantus Series Fund, Inc.
000 Xxxxxx Xxxxxx Xxxxx
Xx. Xxxx, XX 00000-0000
Attn. Xxxxxxx X. Xxxxx, Compliance Counsel
or at such other place as the parties may from time to time designate
to the other in writing.
d. This Agreement may not be amended or modified except by a written
agreement executed by both parties.
e. 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 Fund without the written consent
of the Custodian, or by the Custodian without the written consent of the Fund
authorized or approved by a vote of the Board, provided, however, that the
Custodian may assign the Agreement or any function thereof to any corporation or
entity which directly or indirectly is controlled by, or is under common control
with, the Custodian and any other attempted assignment without written consent
shall be null and void.
f. Nothing in this Agreement shall give or be construed to give or
confer upon any third party any rights hereunder.
16
g. The Custodian represents that it is a U.S. Bank within the meaning
of paragraph (a)(7) of Rule 17f-5.
h. The Fund acknowledges and agrees that, except as expressly set forth
in this Agreement, the Fund is solely responsible to assure that the maintenance
of the Series' Securities and cash hereunder complies with applicable laws and
regulations, including without limitation the Act and the rules and regulations
promulgated thereunder and applicable interpretations thereof or exemptions
therefrom. The Fund represents that it has determined that it is reasonable to
rely on Custodian to perform the responsibilities delegated pursuant to this
Agreement.
i. This Agreement shall be construed in accordance with the laws of the
Commonwealth of Pennsylvania.
j. The captions of the Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
k. Each party represents to the other that it has all necessary power
and authority, and has obtained any consent or approval necessary to permit it,
to enter into and perform this Agreement and that this Agreement does not
violate, give rise to a default or right of termination under or otherwise
conflict with any applicable law, regulation, ruling, decree or other
governmental authorization or any contract to which it is a party or by which
any of its assets is bound.
l. 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.
17
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective representatives duly authorized as of the day and
year first above written.
ADVANTUS SERIES FUND, INC.
By:
-----------------------------------
Name:
Title:
MELLON BANK, N.A.
By:
-----------------------------------
Name:
Title:
18
APPENDIX A
LIST OF AUTHORIZED PERSONS
ADVANTUS SERIES FUND, INC., (the "Fund") a corporation organized under
the laws of the state of Minnesota (the "Fund"), do hereby certify that:
The individuals listed on the following pages have been duly authorized
as Authorized Persons to give Instructions on behalf of the Fund and each Series
thereof and the specimen signatures set forth opposite their respective names
are their true and correct signatures:
i
APPENDIX B
FUND OFFICERS
ADVANTUS SERIES FUND, INC., (the "Fund") a corporation organized under
the laws of the state of Minnesota (the "Fund"), do hereby certify that:
The following individuals serve in the following positions with the
Series and each individual has been duly elected or appointed to each such
position and qualified therefor in conformity with the Fund's governing
instrument and the specimen signatures set forth opposite their respective names
are their true and correct signatures:
Name Position Signature
---- -------- ---------
Chairman of the Board ______________________________
President ______________________________
Treasurer ______________________________
Secretary ______________________________
Vice President and
Investment Officer ______________________________
Vice President and
Investment Officer ______________________________
By: ______________________________
Secretary
Dated:
ii
APPENDIX C
SELECTED COUNTRIES
The Advantus Series Fund, Inc. (the "Fund") Prospectus (the "Prospectus"),
discusses allowable investments for all Portfolios of the Fund. The Bond
Portfolio, Mortgage Securities Portfolio and the 2 Maturing Government Bond
Portfolios focus on U.S. domestic investments. However, the International Bond
Portfolio, as its name indicates focuses on international securities.
The Prospectus, as it pertains to the International Bond Portfolio states, on
page 41 "The Portfolio invests mainly in a variety of investment-grade debt
securities issued by foreign issuers. These debt securities include, among other
things, debt obligations issued or guaranteed by foreign governments of any of
their agencies or instrumentalities, debt obligations issued or guaranteed by
supranational organizations established or supported by foreign governments and
debt obligations issued by foreign companies. In addition, the Portfolio may
invest up to 20% of its net assets in U.S. debt obligations issued or guaranteed
by the U.S. government."
Further, on page 74 of the Prospectus, the following language can be found:
"Under normal circumstances, the Portfolio will maintain investments in at least
three foreign markets or in developing or emerging markets>"
The language found in the Prospectus does not prohibit investments in any
particular country. Therefore, the Fund agrees that this Appendix C shall
contain all countries in which Custodian is eligible to act as a Foreign Custody
Manager.
iii
APPENDIX D
SERIES
Advantus Series Fund, Inc. -- Bond Portfolio
Advantus Series Fund, Inc. -- Mortgage Securities Portfolio
Advantus Series Fund, Inc.- Maturing Government Bond Portfolio, 2006
Advantus Series Fund, Inc.- Maturing Government Bond Portfolio, 2010
Advantus Series Fund, Inc. -- International Bond Portfolio
iv
