EXHIBIT (g)(2)
Custodian Contract
Between
Orbitex Group of Funds
and
Circle Trust Company
TABLE OF CONTENTS
PAGE
1. Employment of Custodian and Property to be Held by It................... 1
2. Duties of the Custodian with Respect to Property
of the Fund Held By the Custodian in the United States.................. 2
2.1 Holding Securities............................................ 2
2.2 Delivery of Securities........................................ 2
2.3 Registration of Securities.................................... 4
2.4 Bank Accounts................................................. 5
2.5 Availability of Federal Funds................................. 5
2.6 Collection of Income.......................................... 5
2.7 Payment of Fund Monies........................................ 5
2.8 Liability for Payment in Advance of Receipt of
Securities Purchased.......................................... 7
2.9 Appointment of Agents......................................... 7
2.10 Deposit of Fund Assets in U.S. Securities System................... 7
2.11 Fund Assets Held in the Custodian's Direct Paper System............ 8
2.12 Segregated Account................................................. 9
2.13 Ownership Certificates for Tax Purposes............................10
2.14 Proxies............................................................10
2.15 Communications Relating to Portfolio Securities....................10
3. Duties of the Custodian with Respect to Property
of the Fund Held Outside of the United States......................11
3.1 Appointment of Foreign Sub-Custodians.........................11
3.2 Assets to be Held.............................................11
3.3 Foreign Securities Systems....................................11
3.4 Holding Securities............................................11
3.5 Agreements with Foreign Banking Institutions..................12
3.6 Access of Independent Accountants of the Fund.................12
3.7 Reports by Custodian..........................................12
3.8 Transactions in Foreign Custody Accounts......................12
3.9 Liability of Foreign Sub-Custodian............................13
3.10 Liability of Custodian.............................................13
3.11 Reimbursement for Advances.........................................13
3.12 Monitoring Responsibilities........................................13
3.13 Branches of U.S. Banks.............................................14
3.14 Tax Law............................................................14
4. Payments for Sales or Redemptions of Shares of the Fund.................14
5. Proper Instructions.....................................................15
6. Actions Permitted Without Express Authority.............................15
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7. Evidence of Authority...................................................15
8. Duties of Custodian with Respect to the Books of Account
And Calculation of Net Asset Value and Net Income.......................16
9. Records ................................................................16
10. Opinion of Fund's Independent Accountants...............................16
11. Reports to Fund by Independent Public Accountants.......................17
12. Compensation of Custodian...............................................17
13. Responsibility of Custodian.............................................17
14. Effective Period, Termination and Amendment.............................19
15. Successor Custodian.....................................................19
16. Interpretive and Additional Provisions..................................20
17. Additional Funds........................................................20
18. Connecticut Law to Apply................................................21
19. Prior Contracts.........................................................21
20. Reproduction of Documents...............................................21
21. Shareholder Communications Election.....................................21
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CUSTODIAN CONTRACT
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This Contract between Orbitex Group of Funds, a business trust organized and
existing under the laws of Delaware, having its principal place of business at
000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx hereinafter called the "Fund", and Circle
Trust Company, a Connecticut trust company, having its principal place of
business at Metro Center, One Station Place, Stamford, Connecticut, hereinafter
called the "Custodian",
WITNESSETH:
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WHEREAS, the Fund is authorized to issue shares in separate series, with each
such series representing interests in a separate portfolio and other assets; and
WHEREAS, the Fund currently offers shares in twelve series, Orbitex Info-Tech &
Communications Fund, Orbitex Internet Fund, Orbitex Emerging Technology Fund,
Orbitex Strategic Infrastructure Fund, Orbitex Health & Biotechnology Fund,
Orbitex Energy & Basic Materials Fund, Orbitex Financial Services Fund, Orbitex
Focus 30 Fund, Orbitex Growth Fund, , Orbitex Xxxxxxx Fund, Orbitex Clermont
Fund and Orbitex Cash Reserves Fund, (such series together with all other series
subsequently established by the Fund and made subject to this Contract in
accordance with paragraph 17, being herein referred to as the "Portfolio(s)");
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
1. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT
The Fund hereby employs the Custodian as the custodian of the assets
of the Portfolios of the Fund, including securities which the Fund, on behalf of
the applicable Portfolio desires to be held in places within the United States
("domestic securities") and securities it desires to be held outside the United
States ("foreign securities") pursuant to the provisions of the Declaration of
Trust. The Fund on behalf of the Portfolio(s) agrees to deliver to the Custodian
all securities and cash of the Portfolios, and all payments of principal or
capital distributions received by it with respect to all securities owned by the
Portfolio(s) from time to time, and the cash consideration received by it for
such new or treasury shares of beneficial interest of the Fund representing
interests in the Portfolios, ("Shares") as may be issued or sold from time to
time. The Custodian shall not be responsible for any property of a Portfolio
held or received by the Portfolio and not delivered to the Custodian.
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Upon receipt of "Proper Instructions" (within the meaning of Article
5), the Custodian shall on behalf of the applicable Portfolio(s) from time to
time employ one or more sub-custodians, located in the United States but only in
accordance with an applicable vote by the Board of Trustees of the Fund on
behalf of the applicable Portfolio(s), and provided that the Custodian shall
have no more or less responsibility or liability to the Fund on account of any
actions or omissions of any sub-custodian so employee than any such
sub-custodian has to the Custodian. The Custodian may employ as sub-custodian
for the Fund's foreign securities on behalf of the applicable Portfolio(s) the
foreign banking institutions and foreign securities depositories designated in
Schedule A hereto but only in accordance with the provisions of Article 3.
2. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE FUND HELD BY
THE CUSTODIAN IN THE UNITED STATES
2.1 HOLDING SECURITIES. The Custodian shall hold and physically segregate
for the account of each Portfolio all non-cash property, to be held
by it in the United States including all domestic securities owned by
such Portfolio, other than (a) securities which are maintained
pursuant to Section 2.10 in a clearing agency which acts as a
securities depository or in a book-entry system authorized by the
U.S. Department of the Treasury (each, a "U.S. Securities System")
and (b) commercial paper of an issuer for which the Custodian acts as
issuing and paying agent ("Direct Paper") which is deposited and/or
maintained in the Direct Paper System of the Custodian (the "Direct
Paper System") pursuant to Section 2.11.
2.2 DELIVERY OF SECURITIES. The Custodian shall release and deliver
domestic securities owned by a Portfolio held by the Custodian or in
a U.S. Securities System account of the Custodian or in the
Custodian's Direct Paper book entry system account ("Direct Paper
System Account") only upon receipt of Proper Instructions from the
Fund on behalf of the applicable Portfolio, which may be continuing
instructions when deemed appropriate by the parties, and only in the
following cases:
1. Upon sale of such securities for the account of the Portfolio
and receipt of payment therefor;
2. Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the
Portfolio;
3. In the case of a sale effected through a U.S. Securities
System, in accordance with the provisions of Section 2.10
hereof;
4. To the depository agent in connection with tender or other
similar offers for securities of the Portfolios;
5. To the issuer thereof or its agent when such securities are
called, redeemed, retired or otherwise become payable;
provided that, in any such case, the cash or other
consideration is to be delivered to the Custodian;
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6. To the issuer thereof, or its agent, for transfer into the
name of the Portfolio or into the name of any nominee or
nominees of the Custodian or into the name or nominee name of
any agent appointed pursuant to Section 2.9 or into the name
or nominee name of any sub-custodian appointed pursuant to
Article 1; or for exchange for a different number of bonds,
certificates or other evidence representing the same aggregate
face amount or number of units; provided that, in any such
case, the new securities are to be delivered to the Custodian;
7. Upon the sale of such securities for the account of the
Portfolio, to the broker or its clearing agent, against a
receipt, for examination in accordance with "street delivery"
custom; provided that in any such case, the Custodian shall
have no responsibility or liability for any loss arising from
the delivery of such securities prior to receiving payment for
such securities except as may arise from the Custodian's own
negligence or willful misconduct;
8. For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or
readjustment of the securities of the issuer of such
securities, or pursuant to provisions for conversion contained
in such securities, or pursuant to any deposit agreement;
provided that, in any such case, the new securities and cash,
if any, are to be delivered to the Custodian.
9. In the case of warrants, rights or similar securities, the
surrender thereof in the exercise of such warrants, rights or
similar securities or the surrender of interim receipts or
temporary securities for definitive securities; provided that,
in any such case, the new securities and cash, if any, are to
be delivered to the Custodian.
10. For delivery in connection with any loans of securities made
by the Portfolio, but only against receipt of adequate
collateral as agreed upon from time to time by the Custodian
and the Fund on behalf of the Portfolio, which may be in the
form of cash or obligations issued by the United States
government, its agencies or instrumentalities, except that in
connection with any loans for which collateral is to be
credited to the Custodian's account in the book-entry system
authorized by the U.S. Department of the Treasury, the
Custodian will not be held liable or responsible for the
delivery of securities owned by the Portfolio prior to the
receipt of such collateral;
11. For delivery as security in connection with any borrowings by
the Fund on behalf of the Portfolio requiring a pledge of
assets by the Fund on behalf of the Portfolio, but only
against receipt of amounts borrowed;
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12. For delivery in accordance with the provisions of any
agreement among the Fund on behalf of the Portfolio, 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 Portfolio of the Fund;
13. For delivery in accordance with the provisions of any
agreement among the Fund on behalf of the Portfolio, the
Custodian, and a Futures Commission Merchant registered under
the Commodity Exchange Act, relating to compliance with the
rules of the Commodity Futures Trading Commission and/or any
Contract Market, or any similar organization or organizations,
regarding account deposits in connection with transactions by
the Portfolio of the Fund;
14. Upon receipt of instructions from the transfer agent
("Transfer Agent") for the Fund, for delivery to such Transfer
Agent or to the holders of shares in connection with
distributions in kind, as may be described from time to time
in the currently effective prospectus and statement of
additional information of the Fund, related to the Portfolio
("Prospectus"), in satisfaction of requests by holders of
Shares for repurchase or redemption; and
15. For any other proper corporate purpose, but only upon receipt
of, in addition to Proper Instructions from the Fund on behalf
of the applicable Portfolio, a certified copy of a resolution
of the Board of Trustees or of the Executive Committee signed
by an officer of the Fund and certified by the Secretary or
Assistant Secretary, specifying the securities of the
Portfolio to be delivered, setting forth the purpose for which
such delivery is to be made, declaring such purpose to be a
proper corporate purpose, and naming the person or persons to
whom delivery of such securities shall be made.
2.3 REGISTRATION OF SECURITIES. Domestic securities held by the custodian
(other than bearer securities) shall be registered in the name of the
Portfolio or in the name of any nominee of the Fund on behalf of the
Portfolio or of any nominee of the Custodian which nominee shall be
assigned exclusively to the Portfolio, unless the Fund has authorized
in writing the appointment of a nominee to be used in common with
other registered investment companies having the same investment
adviser as the Portfolio, or in the name or nominee name of any agent
appointed pursuant to Section 2.9 or in the name or nominee name of
any sub-custodian appointed pursuant to Article 1. All securities
accepted by the Custodian on behalf of the Portfolio under the terms
of this Contract shall be in "street name" or other good delivery
form. If, however, the Fund directs the Custodian to maintain
securities in "street name", the Custodian shall utilize its
reasonable best efforts only to timely collect income due the Fund on
such securities and to notify the Fund on a reasonable best efforts
basis only of relevant corporate actions including, without
limitation, pendency of calls, maturities, tender or exchange offers.
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2.4 BANK ACCOUNTS. The Custodian shall open and maintain a separate bank
account or accounts in the United States in the name of each
Portfolio of the Fund, subject only to draft or order by the
Custodian acting pursuant to the terms of this Contract, and shall
hold in such account or accounts, subject to the provisions hereof,
all cash received by it from or for the account of the Portfolio,
other than cash maintained by the Portfolio in a bank account
established and used in accordance with Rule 17f-3 under the
Investment Company Act of 1940. Funds held by the Custodian for a
Portfolio may be deposited by it to its credit as Custodian in the
Banking Department of the Custodian or in such other banks or trust
companies as it may in its discretion deem necessary or desirable;
provided, however, that every such bank or trust company shall be
qualified to act as a custodian under the Investment Company Act of
1940 and that each such bank or trust company and the funds to be
deposited with each such bank or trust company shall on behalf of
each applicable Portfolio be approved by vote of a majority of the
Board of Trustees of the Fund. Such funds shall be deposited by the
Custodian in its capacity as Custodian and shall be withdrawable by
the Custodian only in that capacity.
2.5 AVAILABILITY OF FEDERAL FUNDS. Upon mutual agreement between the Fund
on behalf of each applicable Portfolio and the Custodian, the
Custodian shall, upon the receipt of Proper Instructions from the
Fund on behalf of a Portfolio, make federal funds available to such
Portfolio as of specified times agreed upon from time to time by the
Fund and the Custodian in the amount of checks received in payment
for Shares of such Portfolio which are deposited into the Portfolio's
account.
2.6 COLLECTION OF INCOME. Subject to the provisions of Section 2.3, the
Custodian shall collect on a timely basis all income and other
payments with respect to registered domestic securities held
hereunder to which each Portfolio shall be entitled either by law or
pursuant to custom in the securities business, and shall collect on a
timely basis all income and other payments with respect to bearer
domestic securities if, on the date of payment by the issuer, such
securities are held by the Custodian or its agent thereof and shall
credit such income, as collected, to such Portfolio's custodian
account. Without limiting the generality of the foregoing, the
Custodian shall detach and present for payment all coupons and other
income items requiring presentation as and when they become due and
shall collect interest when due on securities held hereunder. Income
due each Portfolio on securities loaned pursuant to the provisions of
Section 2.2 (10) shall be the responsibility of the Fund. The
Custodian will have no duty or responsibility in connection
therewith, other than to provide the Fund with such information or
data as may be necessary to assist the Fund in arranging for the
timely delivery to the Custodian of the income to which the Portfolio
is properly entitled.
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2.7 PAYMENT OF FUND MONIES. Upon receipt of Proper Instructions from the
Fund on behalf of the applicable Portfolio, which may be continuing
instructions when deemed appropriate by the parties, the Custodian
shall pay out monies of a Portfolio in the following cases only:
1. Upon the purchase of domestic securities, options, futures
contracts or options on futures contracts for the account of
the Portfolio but only (a) against the delivery of such
securities or evidence of title to such options, futures
contracts or options on futures contracts to the Custodian (or
any bank, banking firm or trust company doing business in the
United States or abroad which is qualified under the
Investment Company Act of 1940, as amended, to act as a
custodian and has be designated by the Custodian as its agent
for this purpose) registered in the name of the Portfolio or
in the name of a nominee of the Custodian referred to in
Section 2.3 hereof or in proper form for transfer; (b) in the
case of a purchase effected through a U.S. Securities System,
in accordance with the conditions set forth in Section 2.10
hereof; (c) in the case of a purchase involving the Direct
Paper System, in accordance with the conditions set forth in
Section 2.11; (d) in the case of repurchase agreements entered
into between the Fund on behalf of the Portfolio and the
Custodian, or another bank, or a broker-dealer which is a
member of NASD, (i) against delivery of the securities either
in certificate form or through an entry crediting the
Custodian's account at the Federal Reserve Bank with such
securities or (ii) against delivery of the receipt evidencing
purchase by the Portfolio of securities owned by the Custodian
along with written evidence of the agreement by the Custodian
to repurchase such securities from the Portfolio or (e) for
transfer to a time deposit account of the Fund in any bank,
whether domestic or foreign; such transfer may be effected
prior to receipt of a confirmation from a broker and/or the
applicable bank pursuant to Proper Instructions from the Fund
as defined in Article 5;
2. In connection with conversion, exchange or surrender of
securities owned by the Portfolio as set forth in Section 2.2
hereof;
3. For the redemption or repurchase of Shares issued by the
Portfolio as set forth in Article 4 hereof;
4. For the payment of any expense or liability incurred by the
Portfolio, including but not limited to the following payments
for the account of the Portfolio: interest, taxes, management,
accounting, transfer agent and legal fees, and operating
expenses of the Fund whether or not such expenses are to be in
whole or part capitalized or treated as deferred expenses;
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5. For the payment of any dividends on Shares of the Portfolio
declared pursuant to the governing documents of the Fund;
6. For payment of the amount of dividends received in respect of
securities sold short;
7. For any other proper purpose, but only upon receipt of, in
addition to Proper Instructions from the Fund on behalf of the
Portfolio, a certified copy of a resolution of the Board of
Trustees or of the Executive Committee of the Fund signed by
an officer of the fund and certified by its Secretary or an
Assistant Secretary, specifying the amount of such payment,
setting for the purpose for which such payment is to be made,
declaring such purpose to be a proper purpose, and naming the
person or persons to whom such payment is to be made.
2.8 LIABILITY FOR PAYMENT IN ADVANCE OF RECEIPT OF SECURITIES PURCHASED.
Except as specifically stated otherwise in this Contract, in any and
every case where payment for purchase of domestic securities for the
account of a Portfolio is made by the Custodian in advance of receipt
of the securities purchased in the absence of specific written
instructions from the Fund on behalf of such Portfolio to so pay in
advance, the Custodian shall be absolutely liable to the Fund for
such securities to the same extent as if the securities had been
received by the Custodian.
2.9 APPOINTMENT OF AGENTS. The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or
trust company which is itself qualified under the Investment Company
Act of 1940, as amended, to act as a custodian, as its agent to carry
out such of the provisions of this Article 2 as the Custodian may
from time to time direct; provided however, that the appointment of
any agent shall not relieve the Custodian of its responsibilities or
liabilities hereunder.
2.10 DEPOSIT OF FUND ASSETS IN U.S. SECURITIES SYSTEMS. The Custodian may
deposit and/or maintain securities owned by a Portfolio in a clearing
agency registered with the Securities and Exchange Commission under
Section 17A of the Securities Exchange Act of 1934, which acts as a
securities depository, or in the book-entry system authorized by the
U.S. Department of the Treasury and certain federal agencies,
collectively referred to herein as "U.S. Securities System" in
accordance with applicable Federal Reserve Board and Securities and
Exchange Commission rules and regulations, if any, and subject to the
following provisions:
1. The Custodian may keep securities of the portfolio in a U.S.
Securities System provided that such securities are
represented in an account ("Account") of the Custodian in the
U.S. Securities System which shall not include any assets of
the custodian other than assets held as a fiduciary, custodian
or otherwise for customers;
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2. The records of the custodian with respect to securities of the
Portfolio which are maintained in a U.S. Securities System
shall identify by book-entry those securities belonging to the
Portfolio;
3. The Custodian shall pay for securities purchased for the
account of the Portfolio upon (i) receipt of advice from the
U.S. Securities System that such securities have been
transferred to the Account, and (ii) the making of an entry on
the records of the Custodian to reflect such payment and
transfer for the account of the Portfolio. The Custodian shall
transfer securities sold for the account of the Portfolio upon
(i) receipt of advice from the U.S. Securities System that
payment for such securities has been transferred to the
Account, and (ii) the making of an entry on the records of the
Custodian to reflect such transfer and payment for the account
of the Portfolio. Copies of all advices from the U.S.
Securities System of transfers of securities for the account
of the Portfolio shall identify the Portfolio, be maintained
for the Portfolio by the custodian and be provided to the Fund
at its request. Upon request, the Custodian shall furnish the
Fund on behalf of the Portfolio confirmation of each transfer
to or from the account of the Portfolio in the form of a
written advice or notice and shall furnish to the Fund on
behalf of the Portfolio copies of daily transaction sheets
reflecting each day's transactions in the U.S. Securities
System for the account of the Portfolio;
4. The Custodian shall provide the Fund for the Portfolio with
any report obtained by the Custodian on the U.S. Securities
System's accounting system, internal accounting control and
procedures for safeguarding securities deposited in the U.S.
Securities System;
5. The Custodian shall have received from the Fund on behalf of
the Portfolio the initial or annual certificate, as the case
may be, required by Article 14 hereof;
6. Anything to the contrary in this Contract notwithstanding, the
Custodian shall be liable to the Fund for the benefit of the
Portfolio for any loss or damage to the Portfolio resulting
from use of the U.S. Securities System by reason of any
negligence, misfeasance or misconduct of the Custodian or any
of its agents or of any of its or their employees or from
failure of the Custodian or any such agent to enforce
effectively such rights as it may have against the U.S.
Securities System; at the election of the Fund, it shall be
entitled to be subrogated to the rights of the Custodian with
respect to any claim against the U.S. Securities System or any
other person which the Custodian may have as a consequence of
any such loss or damage if and to the extent that the
Portfolio has not been made whole for any such loss or damage.
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2.11 FUND ASSETS HELD IN THE CUSTODIAN'S DIRECT PAPER SYSTEM.
The Custodian may deposit and/or maintain securities owned by a
Portfolio in the Direct Paper System of the Custodian subject to the
following provisions:
1. No transaction relating to securities in the Direct Paper
System will be effected in the absence of Proper Instructions
from the Fund on behalf of the Portfolio;
2. The Custodian may keep securities of the Portfolio in the
Direct Paper System only if such securities are represented in
an account ("Account") of the Custodian in the Direct Paper
System which shall not include any assets of the Custodian
other than assets held as a fiduciary, custodian or otherwise
for customers;
3. The records of the Custodian with respect to securities of the
portfolio which are maintained in the Direct Paper System
shall identify by book-entry those securities belonging to the
Portfolio;
4. The Custodian shall pay for securities purchased for the
account of the Portfolio upon the making of an entry on the
records of the Custodian to reflect such payment and transfer
of securities to the account of the Portfolio. The Custodian
shall transfer securities sold for the account of the
Portfolio upon the making of an entry on the records of the
Custodian to reflect such transfer and receipt of payment for
the account of the Portfolio.
5. The Custodian shall furnish the Fund on behalf of the
Portfolio confirmation of each transfer to or from the account
of the Portfolio, in the form of a written advice or notice,
of Direct Paper on the next business day following such
transfer and shall furnish to the Fund on behalf of the
Portfolio copies of daily transaction sheets reflecting each
day's transaction in the U.S. Securities System for the
account of the Portfolio;
6. The Custodian shall provide the Fund on behalf of the
Portfolio with any report on its system of internal accounting
control as the Fund may reasonably request from time to time.
2.12 SEGREGATED ACCOUNT. The Custodian shall upon receipt of Proper
Instructions from the Fund on behalf of each applicable Portfolio
establish and maintain a segregated account or accounts for and on
behalf of each such Portfolio, into which account or accounts may be
transferred cash and/or securities, including securities maintained
in an account by the Custodian pursuant to Section 2.10 hereof, (i)
in accordance with the provisions of any agreement among the Fund on
behalf of the Portfolio, the Custodian and a broker-dealer registered
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under the Exchange Act and a member of the NASD (or any futures
commission merchant registered under the Commodity Exchange Act),
relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange (or
the Commodity Futures Trading Commission or any registered contract
market), or of any similar organization or organizations, regarding
escrow or other arrangements in connection with transactions by the
Portfolio, (ii) for purposes of segregating cash or government
securities in connection with options purchased, sold or written by
the Portfolio or commodity futures contracts or options thereon
purchased or sold by the Portfolio, (iii) for the purposes of
compliance by the Portfolio with the procedures required by
Investment Company Release No. 10666, or any subsequent release or
releases of the Securities and Exchange Commission relating to the
maintenance of segregated accounts by registered investment companies
and (iv) for other proper corporate purposes, but only, in the case
of clause (iv), upon receipt of, in addition to Proper Instructions
from the Fund on behalf of the applicable Portfolio, a certified copy
of a resolution of the Board of Trustees or of the Executive
Committee signed by an officer of the Fund and certified by the
Secretary or an Assistant Secretary, setting forth the purpose or
purposes of such segregated account and declaring such purposes to be
proper corporate purposes.
2.13 OWNERSHIP CERTIFICATES FOR TAX PURPOSES. The Custodian shall execute
ownership and other certificates and affidavits for all federal and
state tax purposes in connection with receipt of income or other
payments with respect to domestic securities of each Portfolio held
by it and in connection with transfers of securities.
2.14 PROXIES. The Custodian shall, with respect to the domestic securities
held hereunder, cause to be promptly executed by the registered
holder of such securities, if the securities are registered otherwise
than in the name of the Portfolio or a nominee of the Portfolio, all
proxies, without indication of the manner in which such proxies are
to be voted, and shall promptly deliver to the Portfolio such
proxies, all proxy soliciting materials and all notices relating to
such securities.
2.15 COMMUNICATIONS RELATING TO PORTFOLIO SECURITIES. Subject to the
provisions of Section 2.3, the Custodian shall transmit promptly to
the Fund for each Portfolio all written information (including,
without limitation, pendency of calls and maturities of domestic
securities and expiration of rights in connection therewith and
notices of exercise of call and put options written by the Fund on
behalf of the Portfolio and the maturity of futures contracts
purchased or sold by the Portfolio) received by the Custodian from
issuers of the securities being held for the Portfolio. With respect
to tender or exchange offers, the Custodian shall transmit promptly
to the Portfolio all written information received by the Custodian
from issuers of the securities whose tender or exchange is sought and
from the party (or his agents) making the tender or exchange offer.
If the Portfolio desires to take action with respect to any tender
offer, exchange offer or any other similar transaction, the Portfolio
shall notify the Custodian at least three business days prior to the
date on which the Custodian is to take such action.
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3. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE FUND HELD
OUTSIDE OF THE UNITED STATES.
3.1 APPOINTMENT OF FOREIGN SUB-CUSTODIANS. The Fund hereby authorizes and
instructs the custodian to employ as sub-custodians for the
Portfolio's securities and other assets maintained outside the United
States the foreign banking institutions and foreign securities
depositories designated on Schedule A hereto ("foreign
sub-custodians"). Upon receipt of "Proper Instructions", as defined
in Section 5 of this Contract, together with a certified resolution
of the Fund's Board of Trustees, the Custodian and the Fund may agree
to amend Schedule A hereto from time to time to designate additional
foreign banking institutions and foreign securities depositories to
act as sub-custodian. Upon receipt of Proper Instructions, the Fund
may instruct the Custodian to cease the employment of any one or more
such sub-custodians for maintaining custody of the Portfolio's
assets.
3.2 ASSETS TO BE HELD. The Custodian shall limit the securities and other
assets maintained in the custody of the foreign sub-custodians to:
(a) "foreign securities", as defined in paragraph (c)(1) of Rule
17-f5 under the Investment Company Act of 1940 and (b) cash and cash
equivalents in such amounts as the Custodian or the Fund may
determine to be reasonably necessary to effect the Portfolio's
foreign securities transactions. The Custodian shall identify on its
books as belonging to the Fund, the foreign securities of the Fund
held by each foreign sub-custodian.
3.3 FOREIGN SECURITIES SYSTEMS. Except as may otherwise be agreed upon in
writing by the Custodian and the Fund, assets of the Portfolios shall
be maintained in a clearing agency which acts as a securities
depository or in a book-entry system for the central handling of
securities located outside the United States (each a "Foreign
Securities System") only through arrangements implemented by the
foreign banking institutions serving as sub-custodians pursuant to
the terms hereof (Foreign Securities Systems and U.S. Securities
Systems are collectively referred to herein as the "Securities
Systems"). Where possible, such arrangements shall include entry into
agreements containing the provisions set forth in Section 3.5 hereof.
3.4 HOLDING SECURITIES. The Custodian may hold securities and other
non-cash property for all of its customers, including the Fund, with
a foreign sub-custodian in a single account that is identified a
belonging to the Custodian for the benefit of its customers, provided
however, that (i) the records of the custodian with respect to
securities and other non-cash property of the Fund which are
maintained in such account shall identify by book-entry those
securities and other non-cash property belonging to the Fund and (ii)
the Custodian shall require that securities and other non-cash
property so held by the foreign sub-custodian be held separately from
any assets of the foreign sub-custodian or of others.
-11-
3.5 AGREEMENTS WITH FOREIGN BANKING INSTITUTIONS. Each agreement with a
foreign banking institution shall provide that: (a) the assets of
each Portfolio will not be subject to any right, charge, security
interest, lien or claim of any kind in favor of the foreign banking
institution or its creditors or agent, except a claim of payment for
their safe custody or administration; (b) beneficial ownership for
the assets of each Portfolio will be freely transferable without the
payment of money or value other than for custody or administration;
(c) adequate records will be maintained identifying the assets as
belonging to each applicable Portfolio; (d) officers of or auditors
employed by, or other representatives of the Custodian, including to
the extent permitted under applicable law the independent public
accountants for the Fund, will be given access to the books and
records of the foreign banking institution relating to its actions
under its agreement with the Custodian; and (e) assets of the
Portfolios held by the foreign sub-custodian will be subject only to
the instructions of the Custodian or its agents.
3.6 ACCESS OF INDEPENDENT ACCOUNTANTS OF THE FUND. Upon request of the
Fund, the Custodian will use its best efforts to arrange for the
independent accountants of the Fund to be afforded access to the
books and records of any foreign banking institution employed as a
foreign sub-custodian insofar as such books and records relate to the
performance of such foreign banking institution under its agreement
with the Custodian.
3.7 REPORTS BY CUSTODIAN. The Custodian will supply to the Fund from time
to time, as mutually agreed upon, statements in respect of the
securities and other assets of the Portfolio(s) held by foreign
sub-custodians, including but not limited to an identification of
entities having possession of the Portfolio(s) securities and other
assets and advices or notifications of any transfers of securities to
or from each custodial account maintained by a foreign banking
institution for the Custodian on behalf of each applicable Portfolio
indicating, as to securities acquired for a Portfolio, the identity
of the entity having physical possession of such securities.
3.8 TRANSACTIONS IN FOREIGN CUSTODY ACCOUNT. (a) Except as otherwise
provided in paragraph (b) of this Section 3.8, the provision of
Sections 2.2 and 2.7 of this Contract shall apply, mutatis mutandis
to the foreign securities of the Fund held outside the United States
by foreign sub-custodians. (b) Notwithstanding any provision of this
Contract to the contrary, settlement and payment for securities
received for the account of each applicable Portfolio and delivery of
securities maintained for the account of each applicable Portfolio
may be effected in accordance with the customary established
securities trading or securities processing practices and procedures
in the jurisdiction or market in which the transaction occurs,
including, without limitation, delivering securities to the purchaser
thereof or to a dealer therefor (or an agent for such purchaser or
dealer) against a receipt with the expectation of receiving later
payment for such securities from such purchaser or dealer. (c)
Securities maintained in the custody of a foreign sub-custodian may
be maintained in the name of such entity's nominee to the same extent
as set forth in Section 2.3 of this Contract, and the Fund agrees to
hold any such nominee harmless from any liability as a holder of
record of such securities.
-12-
3.9 LIABILITY OF FOREIGN SUB-CUSTODIANS. Each agreement pursuant to which
the Custodian employs a foreign banking institution as a foreign
sub-custodian shall require the institution to exercise reasonable
care in the performance of its duties and to indemnify, and hold
harmless, the Custodian and the Fund from and against any loss,
damage, cost, expense, liability or claim arising out of or in
connection with the institution's performance of such obligations. At
the election of the Fund, it shall be entitled to be subrogated to
the rights of the Custodian with respect to any claims against a
foreign banking institution as a consequence of any such loss,
damage, cost, expense, liability or claim if and to the extent that
the Fund has not been made whole for any such loss, damage, cost,
expense, liability or claim.
3.10 LIABILITY OF CUSTODIAN. The Custodian shall be liable for the acts or
omissions of a foreign banking institution to the same extent as set
forth with respect to sub-custodians generally in this Contract and,
regardless of whether assets are maintained in the custody of a
foreign banking institution, a foreign securities depository or a
branch of a U.S. bank as contemplated by paragraph 3.13 hereof, the
Custodian shall not be liable for any loss, damage, cost, expense,
liability or claim resulting from nationalization, expropriation,
currency restrictions, or acts of war or terrorism or any loss where
the sub-custodian has otherwise exercised reasonable care.
3.11 REIMBURSEMENT FOR ADVANCES. If the Fund requires the Custodian to
advance cash or securities for any purpose for the benefit of a
Portfolio including the purchase or sale of foreign exchange or of
contracts for foreign exchange, or in the event that the Custodian or
its nominee shall incur or be assessed any taxes, charges, expenses,
assessments, claims or liabilities in connection with the performance
of this Contract, except such as may arise from its or its nominee's
own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the applicable
Portfolio shall be security therefor and should the Fund fail to
repay the Custodian promptly, the Custodian shall be entitled to
utilize available cash and to dispose of such Portfolio's assets to
the extent necessary to obtain reimbursement.
3.12 MONITORING RESPONSIBILITIES. The Custodian shall furnish annually to
the Fund, during the month of June, information concerning the
foreign sub-custodians employed by the Custodian. Such information
shall be similar in kind and scope to that furnished to the Fund in
connection with the initial approval of this Contract. In addition,
the Custodian will promptly inform the Fund in the event that the
Custodian learns of a material adverse change in the financial
condition of a foreign sub-custodian or any material loss of assets
of the Fund or in the case of any foreign sub-custodian not the
subject of an exemptive order from the Securities and Exchange
Commission is notified by such foreign sub-custodian that there
appears to be a substantial likelihood that its shareholders' equity
will decline below $200 million (U.S. dollars or the equivalent
thereof) or that its shareholders' equity has declined below $200
million (in each case computed in accordance with generally accepted
U.S. accounting principles).
-13-
3.13 BRANCHES OF U.S. BANKS. Except as otherwise set forth in this
Contract, the provisions hereof shall not apply where the custody of
the Portfolio's assets are maintained in a foreign branch of banking
institution which is a "bank" as defined by Section 2(a)(5) of the
Investment Company Act of 1940 meeting the qualification set forth in
Section 26(a) of the said Act. The appointment of any such branch as
a sub-custodian shall be governed by paragraph 1 of this Contract.
3.14 TAX LAW. The Custodian shall have no responsibility or liability for
any obligations now or hereafter imposed on the Fund or the Custodian
as custodian of the Fund by the tax law of the United States of
America or any state or political subdivision thereof. It shall be
the responsibility of the Fund to notify the Custodian of the
obligations imposed on the Fund or the Custodian as custodian of the
Fund by the tax law of jurisdictions other than those mentioned in
the above sentence, including responsibility for withholding and
other taxes, assessments or other governmental charges,
certifications and governmental reporting. The sole responsibility of
the Custodian with regard to such tax law shall be to use reasonable
efforts to assist the Fund with respect to any claim for exemption or
refund under the tax law of jurisdictions for which the Fund has
provided such information.
4. PAYMENTS FOR SALES OR REPURCHASES OR REDEMPTIONS OF SHARES OF THE
FUND
The Custodian shall receive from the distributor for the Shares or
from the Transfer Agent of the Fund and deposit into the account of
the appropriate Portfolio such payments as are received for Shares of
that Portfolio issued or sold from time to time by the Fund. The
Custodian will provide timely notification to the Fund on behalf of
each such Portfolio and the Transfer Agent of any receipt by it of
payments for Shares of such Portfolio.
From such funds as may be available for the purpose but subject to
the limitations of the Declaration of Trust and any applicable votes
of the Board of Trustees of the Fund pursuant thereto, the Custodian
shall, upon receipt of instructions from the Transfer Agent, make
funds available for payment to holders of Shares who have delivered
to the Transfer Agent a request for redemption or repurchase of their
Shares. In connection with the redemption or repurchase of Shares of
a Portfolio, the Custodian is authorized upon receipt of instructions
from the Transfer Agent to wire funds to or through a commercial bank
designated by the redeeming shareholders.
-14-
5. PROPER INSTRUCTIONS
Proper Instructions as used throughout this Contract means a writing
signed or initialled by one or more person or persons as the Board of
Trustees shall have from time to time authorized. Each such writing
shall set forth the specific transaction or type of transaction
involved, including a specific statement of the purpose for which
such action is requested. Oral instructions will be considered Proper
Instructions if the Custodian reasonably believes them to have been
given by a person authorized to give such instructions with respect
to the transaction involved. The Fund shall cause all oral
instructions to be confirmed in writing. Upon receipt of a
certificate of the Secretary or an Assistant Secretary as to the
authorization by the Board of Trustees of the Fund accompanied by a
detailed description of procedures approved by the Board of Trustees,
Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the
Board of Trustees and the Custodian are satisfied that such
procedures afford adequate safeguards for the Portfolios' assets. For
purposes of this Section, Proper Instructions shall include
instructions received by the Custodian pursuant to any three - party
agreement which requires a segregated asset account in accordance
with Section 2.12.
6. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY
The custodian may in its discretion, without express authority from
the Fund on behalf of each applicable Portfolio:
1. make payments to itself or others for minor expenses of
handling securities or other similar items relating to its
duties under this Contract, provided that all such payments
shall be accounted for to the Fund on behalf of the Portfolio;
2. surrender securities in temporary form for securities in
definitive form;
3. endorse for collection, in the name of the Portfolio, checks,
drafts and other negotiable instruments; and
4. in general, attend to all non-discretionary details in
connection with the sale, exchange, substitution, purchase,
transfer and other dealings with the securities and property
of the Portfolio except as otherwise directed by the Board of
Trustees of the Fund.
-15-
7. EVIDENCE OF AUTHORITY
The Custodian shall be protected in acting upon any instructions,
notice, request, consent, certificate or other instrument or paper
believed by it to be genuine and to have been properly executed by or
on behalf of the Fund. The Custodian may receive and accept a
certified copy of a vote of the Board of Trustees of the Fund as
conclusive evidence (a) of the authority of any person to act in
accordance with such vote or (b) of any determination or of any
action by the Board of Trustees pursuant to the Declaration of Trust
as described in such vote, and such vote may be considered as in full
force and effect until receipt by the Custodian of written notice to
the contrary.
8. DUTIES OF CUSTODIAN WITH RESPECT TO THE BOOKS OF ACCOUNT AND
CALCULATION OF NET ASSET VALUE AND NET INCOME
The Custodian shall cooperate with and supply necessary information
to the entity or entities appointed by the Board of Trustees of the
Fund to keep the books of account of each Portfolio and/or compute
the net asset value per share of the outstanding shares of each
Portfolio or, if directed in writing to do so by the Fund on behalf
of the Portfolio, shall itself keep such books of account and/or
compute such net asset value per share. If so directed, the Custodian
shall also calculate daily the net income of the Portfolio as
described in the Fund's currently effective prospectus related to
such Portfolio and shall advise the Fund and the Transfer Agent daily
of the total amounts of such net income and, if instructed in writing
by an officer of the Fund to do so, shall advise the Transfer Agent
periodically of the division of such net income among its various
components. The calculations of the net asset value per share and the
daily income of each Portfolio shall be made at the time or times
described from time to time in the Fund's currently effective
prospectus related to such Portfolio.
9. RECORDS
The Custodian shall with respect to each Portfolio create and
maintain all records relating to its activities and obligations under
this Contract in such manner as will meet the obligations of the Fund
under the Investment Company Act of 1940, with particular attention
to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder. All such
records shall be the property of the Fund and shall at all times
during the regular business hours of the Custodian be open for
inspection by duly authorized officers, employees or agents of the
Fund and employees and agents of the Securities and Exchange
Commission. The Custodian shall, at the Fund's request, supply the
Fund with a tabulation of securities owned by each Portfolio and held
by the Custodian and shall, when requested to do so by the Fund and
for such compensation as shall be agreed upon between the Fund and
the Custodian, include certificate numbers in such tabulations.
10. OPINION OF FUND'S INDEPENDENT ACCOUNTANT
The Custodian shall take all reasonable action, as the Fund on behalf
of each applicable Portfolio may from time to time request, to obtain
from year to year favorable opinions from the Fund's independent
accountants with respect to its activities hereunder in connection
with the preparation of the Fund's Form N-1A, and Form N-SAR or other
annual reports to the Securities and Exchange Commission and with
respect to any other requirements of such Commission.
-16-
11. REPORTS TO FUND BY INDEPENDENT PUBLIC ACCOUNTANTS
The Custodian shall provide the Fund, on behalf of each of the
Portfolios at such times as the Fund may reasonably require, with
reports by independent public accountants on the accounting system,
internal accounting control and procedures for safeguarding
securities, futures contracts and options on futures contracts,
including securities deposited and/or maintained in a Securities
Systems, relating to the services proved by the Custodian under this
contract; such reports, shall be of sufficient scope and in
sufficient detail, as may reasonably be required by the Fund to
provide reasonable assurance that any material inadequacies would be
disclosed by such examination, and, if there are no such
inadequacies, the reports shall so state.
12. COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to reasonable compensation for its
services and expenses as Custodian, as agreed upon from time to time
between the Fund on behalf of each applicable Portfolio and the
Custodian.
13. RESPONSIBILITY OF CUSTODIAN
So long as and to the extent that it is in the exercise of reasonable
care, the Custodian shall not be responsible for the title, validity
or genuineness of any property or evidence of title thereto received
by it or delivered by it pursuant to this Contract and shall be held
harmless in acting upon any notice, request, consent, certificate or
other instrument reasonably believed by it to be genuine and to be
signed by the proper party or parties, including any futures
commission merchant acting pursuant to the terms of a three-party
futures of options agreement. The Custodian shall be held to the
exercise of reasonable care in carrying out the provisions of this
Contract, but shall be kept indemnified by and shall be without
liability to the Fund for any action taken or omitted by it in good
faith without negligence. It shall be entitled to rely on and may act
upon advice of counsel (who may be counsel for the Fund) on all
matters, and shall be without liability for any action reasonably
taken or omitted pursuant to such advice.
-17-
Except as may arise from the Custodian's own negligence or willful
misconduct or the negligence or willful misconduct of a sub-custodian
or agent, the Custodian shall be without liability, claim or expense
resulting from or caused by; (i) events or circumstances beyond the
reasonable control of the Custodian or any sub-custodian or
Securities System or any agent or nominee of any of the foregoing,
including, without limitation, nationalization or expropriation,
imposition of currency controls or restrictions, the interruption,
suspension or restriction of trading on or the closure of any
securities market, power or other mechanical or technological
failures or interruptions, computer viruses or communications
disruptions, acts of war or terrorism, riots, revolutions, work
stoppages, natural disasters or other similar events or acts; (ii)
errors by the Fund or the Investment Advisor in their instructions to
the Custodian provided such instructions have been in accordance with
this Contract; (iii) the insolvency of or acts or omissions by a
Securities System; (iv) any delay or failure of any broker, agent or
intermediary, central bank or other commercially prevalent payment of
clearing system to deliver to the Custodian's sub-custodian or agent
securities purchased or in the remittance of payment made in
connection with securities sold; (v) any delay or failure of any
company corporation, or other body in charge of registering or
transferring securities in the name of the Custodian, the Fund, the
Custodian's sub-custodians, nominees or agents or agents or any
consequential losses arising out of such delay or failure to transfer
such securities including non-receipt of bonus, dividends and rights
and other accretions or benefits; (vi) delays or inability to perform
its duties due to any disorder in market infrastructure with respect
to any particular security or Securities System; and (vii) any
provision of any present or future law or regulation or order of the
United States of America, or any state thereof, or any other country,
or political subdivision thereof or of any court of competent
jurisdiction.
The Custodian shall be liable for the acts or omissions of a foreign
banking institution to the same extent as set forth with respect to
sub-custodians generally in this Contract.
If the Fund requires the Custodian to take any action with respect to
securities, which action involves the payment of money or which
action may, in the opinion of the Custodian, result in the Custodian
or its nominee assigned to the Fund being liable for the payment of
money or incurring liability of some other form, the Fund, as a
prerequisite to requiring the custodian to take such action, shall
provide indemnity to the Custodian in an amount and form satisfactory
to the Custodian.
If the Fund requires the Custodian, its affiliates, subsidiaries or
agents, to advance cash or securities for any purpose (including but
not limited to securities settlements, foreign exchange contracts and
assumed settlement) or in the event that the Custodian or its nominee
shall incur or be assessed any taxes, charges, expenses, assessments,
claims or liabilities in connection with the performance of this
Contract, except such as may arise from its or its nominee's own
negligent action, negligent failure to act or willful misconduct, any
property at any time held for the account of the fund shall be
security therefor and should the Fund fail to repay the Custodian
promptly, the Custodian shall be entitled to utilize available cash
and to dispose of the Fund assets to the extent necessary to obtain
reimbursement.
In no event shall the Custodian be liable for indirect, special,
consequential or punitive damages.
-18-
14. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT
This Contract shall become effective as of its execution, shall
continue in full force and effect until terminated as hereinafter
provided, may be amended at any time by mutual agreement of the
parties hereto and may be terminated by either party by an instrument
in writing delivered or mailed, postage prepaid to the other party,
such termination to take effect not sooner than thirty (30) days
after the date of such delivery or mailing; provided, however that
the Custodian shall not with respect to a Portfolio act under Section
2.10 hereof in the absence of receipt of an initial certificate of
the Secretary or an Assistant Secretary that the Board of Trustees of
the Fund has approved the initial use of a particular Securities
System by such Portfolio, as required by Rule 17f-4 under the
Investment company Act of 1940, as amended and that the Custodian
shall not with respect to a Portfolio act under Section 2.11 hereof
in the absence of receipt of an initial certificate of the Secretary
or an Assistant Secretary that the Board of Trustees has approved the
initial use of the Direct Paper System by such Portfolio; provided
further, however, that the Fund shall not amend or terminate this
Contract in Contravention of any applicable federal or state
regulations, or any provision of the Declaration of Trust, and
further provided, that the Fund on behalf of one or more of the
Portfolios may at any time by action of its Board of Trustees (i)
substitute another bank or trust company for the Custodian by giving
notice as described above to the Custodian, or (ii) immediately
terminate this Contract in the event of the appointment of a
conservator or receiver for the Custodian by the Connecticut
Department of Banking or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.
Upon termination of the Contract, the Fund on behalf of each
applicable Portfolio shall pay to the Custodian such compensation as
may be due as of the date of such termination and shall likewise
reimburse the Custodian for its costs, expenses and disbursements.
15. SUCCESSOR CUSTODIAN
If a successor custodian for the Fund, of one or more of the
Portfolios shall be appointed by the Board of Trustees of the Fund,
the Custodian shall, upon termination, deliver to such successor
custodian at the office of the Custodian, duly endorsed and in the
form for transfer, all securities of each applicable Portfolio then
held by it hereunder and shall transfer to an account of the
successor custodian all of the securities of each such Portfolio held
in a Securities System.
If no such successor custodian shall be appointed, the Custodian
shall, in like manner, upon receipt of a certified copy of a vote of
the Board of Trustees of the Fund, deliver at the office of the
Custodian and transfer such securities, funds and other properties in
accordance with such vote.
-19-
In the event that no written order designating a successor custodian
or certified copy of a vote of the Board of Trustees shall have been
delivered to the Custodian on or before the date when such
termination shall become effective, then the Custodian shall have the
right to deliver to a bank or trust company, which is a "bank" as
defined in the Investment Company Act of 1940, doing business in the
State of Connecticut, of its own selection, having an aggregate
capital, surplus, and undivided profits, as shown by its last
published report, of not less than $25,000,000, all securities, funds
and other properties held by the Custodian on behalf of each
applicable Portfolio and all instruments held by the Custodian
relative thereto and all other property held by it under this
Contract on behalf of each applicable Portfolio and to transfer to an
account of such successor custodian all of the securities of each
such Portfolio held in any Securities System. Thereafter, such bank
or trust company shall be the successor of the Custodian under this
Contract.
In the event that securities, funds and other properties remain in
the possession of the Custodian after the date of termination hereof
owing to failure of the Fund to procure the certified copy of the
vote referred to or of the Board of Trustees to appoint a successor
custodian, the Custodian shall be entitled to fair compensation for
its services during such period as the Custodian retains possession
of such securities, funds and other properties and the provisions of
this Contract relating to the duties and obligations of the Custodian
shall remain in full force and effect.
16. INTERPRETIVE AND ADDITIONAL PROVISIONS
In connection with the operation of this contract, the Custodian and
the Fund on behalf of each of the Portfolios, may from time to time
agree on such provisions interpretive of or in addition to the
provisions of this Contract as may in their joint opinion be
consistent with the general tenor of this Contract. Any such
interpretive or additional provisions shall be in a writing signed by
both parties and shall be annexed hereto, provided that no such
interpretive or additional provisions shall contravene any applicable
federal or state regulations or any provision of the Declaration of
Trust of the Fund. No interpretive or additional provisions made as
provided in the preceding sentence shall be deemed to be an amendment
of this Contract.
17. ADDITIONAL FUNDS
In the event that the Fund establishes one or more series of Shares
in addition to Orbitex Info-Tech & Communications Fund, Orbitex
Internet Fund, Orbitex Emerging Technology Fund, Orbitex Strategic
Infrastructure Fund, Orbitex Health & Biotechnology Fund, Orbitex
Energy & Basic Materials Fund, Orbitex Financial Services Fund,
Orbitex Focus 30 Fund, Orbitex Growth Fund, , Orbitex Xxxxxxx Fund,
Orbitex Clermont Fund and Orbitex Cash Reserves Fund, with respect to
which it desires to have the Custodian render services as custodian
under the terms hereof, it shall so notify the Custodian in writing,
and if the Custodian agrees in writing to provide such services, such
series of Shares shall become a Portfolio hereunder.
-20-
18. CONNECTICUT LAW TO APPLY
This Contract shall be construed and the provisions thereof
interpreted under and in accordance with laws of the State of
Connecticut.
19. PRIOR CONTRACTS
This Contract supersedes and terminates, as of the date hereof, all
prior contracts between the Fund on behalf of each of the Portfolios
and the Custodian relating to the custody of the Fund's assets.
20. REPRODUCTION OF DOCUMENTS
This Contract and all schedules, exhibits, attachments and amendments
hereto may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The
parties hereto all/each agree that any such reproduction shall be
admissible in evidence as the original itself in any judicial or
administrative proceeding, whether or not the original is in
existence and whether of not such reproduction was made by a party in
the regular course of business, and that any enlargement, facsimile
or further reproduction of such reproduction shall likewise be
admissible in evidence.
21. SHAREHOLDER COMMUNICATIONS ELECTION
Securities and Exchange Commission Rule 14b-2 requires banks which
hold securities for the account of customers to respond to requests
by issuers of securities for the names, addresses and holdings of
beneficial owners of securities of that issuer held by the bank
unless the beneficial owner has expressly objected to disclosure of
this information. In order to comply with the rule, the Custodian
needs the Fund to indicate whether it authorizes the Custodian to
provide the Fund's name, address, and share position to requesting
companies whose securities the Fund owns. If the Fund tells the
Custodian "no", the Custodian will not provide this information to
requesting companies. If the Fund tells the Custodian "yes" or does
not check either "yes" or "no" below, the Custodian is required by
the rule to treat the fund as consenting to disclosure of this
information for all securities owned by the Fund or any funds or
accounts established by the Fund. For the Fund's protection, the Rule
prohibits the requesting company from using the Fund's name and
address for any purpose other than corporate communications. Please
indicate below whether the Fund consents or objects by checking one
of the alternatives below.
-21-
YES [ ] The Custodian is authorized to release the
Fund's name, address, and share positions.
NO [ ] The Custodian is not authorized to release
the Fund's name, address, and share positions.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 19th day of September, 2000.
ATTEST: ORBITEX GROUP OF FUNDS
___________________________ By:________________________________
ATTEST: Circle Trust Company
___________________________ By:________________________________
-22-
SCHEDULE A
COUNTRIES, FOREIGN SUB-CUSTODIANS AND
FOREIGN SECURITIES DEPOSITORIES
------------------ ----------------------------------- -------------- ---------------------------------------------
COUNTRY/ COUNTRY/
MARKET SUBCUSTODIAN(S) MARKET SUBCUSTODIAN(S)
-------------------------------------------------------------------------------------------------------------------
ARGENTINA Banco Xxx xx xx Xxxxx XXXXXXX Xxxxxxxxxx Xxxxxxx
XXXXXXXXX Commonwealth Bank of Australia/ INDIA HSBC / Deutsche Bank AG
National Australia Bank Limited
AUSTRIA Bank Austria AG INDONESIA HSBC
BAHRAIN HSBC Bank Middle East IRELAND Allied Irish Banks, plc
BANGLADESH Standard Chartered Bank ISRAEL Bank Leumi LE - Israel B.M.
BELGIUM Banque Bruxelles Xxxxxxx ITALY Banca Commerciale Italiana / BNP Paribas
BENIN Societe Generale de Banques en
Cote d'Ivoire IVORY COAST Societe Generale - Abidjan
BERMUDA Bank of Bermuda Limited JAMAICA CIBC Trust & Merchant Bank Jamaica Ltd.
BOLIVIA Citibank, N.A. JAPAN The Bank of Tokyo-Mitsubishi Limited/
The Fuji Bank, Limited
BOTSWANA Barclays Bank of Botswana Ltd. JORDAN HSBC Bank Middle East
BRAZIL BankBoston, N.A. KAZAKHSTAN ABN/AMRO
BULGARIA ING Bank KENYA Barclays Bank of Kenya Ltd.
BURKINA FASO Societe Generale de Banques en
Cote d'Ivoire LATVIA Hansabanka Limited
CANADA Royal Bank of Canada LEBANON HSBC Bank Middle East
CHILE BankBoston, N.A. LITHUANIA Vilniaus Bankas
CHINA Standard Chartered Bank LUXEMBOURG Banque et Caisse d'Epargne de l'Etat
COLOMBIA Cititrust Colombia S.A. MALAYSIA HongKong Bank Malaysia Berhad
COSTA RICA Banco BCT MALI Societe Generale de Banques en Cote d'Ivoire
CROATIA Privredna Banka Zagreb d.d. MALTA HSBC Bank Malta p.l.c.
CYPRUS Bank of Cyprus MAURITIUS HSBC
CZECH REPUBLIC Ceskoslovenska Obchodni Banka
A.S. MEXICO Banco Nacional de Mexico
DENMARK Den Danske Bank MOROCCO Banque Commerciale du Maroc
EASDAQ Banque Bruxelles Xxxxxxx NAMIBIA Stanbic Bank Namibia Limited
ECUADOR Citibank, N.A. NETHERLANDS MeesPierson
EGYPT Citibank, N.A. NEW ZEALAND Australia and New Zealand Banking Group
ESTONIA Hansabank Limited NIGER Societe Generale de Banques en Cote d'Ivoire
EUROMARKET Clearstream NIGERIA Stanbic Merchant Bank Nigeria Limited
EUROMARKET Euroclear NORWAY Den norske Bank ASA
FINLAND Xxxxxx Bank plc OMAN HSBC Bank Middle East
FRANCE BNP Paribas / Credit
Agricole Indosuez PAKISTAN Standard Chartered Bank
GERMANY Dresdner Bank AG PANAMA BankBoston, N.A.
GHANA Barclays Bank of Ghana Ltd. PERU Citibank, N.A.
GREECE BNP Paribas PHILIPPINES HSBC
GUINEA BISSAU Societe Generale de Banques en
Cote d'Ivoire POLAND Bank Handlowy W Warszawie S.A.
HONG KONG HSBC PORTUGAL Banco Comercial Portugues
HUNGARY Citibank Budapest Rt. ROMANIA ING Bank
------------------ ----------------------------------- -------------- ---------------------------------------------
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COUNTRY/ COUNTRY/
MARKET SUBCUSTODIAN(S) MARKET SUBCUSTODIAN(S)
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RUSSIA Vneshtorgbank (Min Fin Bonds only)/ THAILAND Standard Chartered Bank/
Credit Suisse First Boston AO Bangkok Bank Public Company Limited
SENEGAL Societe Generale de Banques en
Cote d'Ivoire TOGO Societe Generale de Banques en Cote d'Ivoire
SINGAPORE United Overseas Bank Limited/ TRINIDAD & TOBAGO Republic Bank Limited
The Development Bank of Singapore Ltd.
SLOVAKIA Ceskoslovenska Obchodni Banka, a.s. TUNISIA Banque Internationale Arabe de Tunisie
SLOVENIA Bank Austria Creditanstalt d.d. Ljubljana TURKEY Osmanli Bankasi A.S. (Ottoman Bank)
SOUTH AFRICA Societe Generale, Johannesburg / UKRAINE ING Bank
The Standard Bank of South Africa Limited
SOUTH KOREA Standard Chartered Bank UNITED KINGDOM The Bank of New York /
The Depository & Clearing Centre (DCC)
SPAIN Banco Bilbao Vizcaya Argentaria S.A. (BBVA) / UNITED STATES The Bank of New York
Banco Santander Central Hispano (BSCH)
SRI LANKA Standard Chartered Bank URUGUAY BankBoston, N.A.
SWAZILAND Stanbic Bank Swaziland Limited VENEZUELA Citibank, N.A.
SWEDEN Skandinaviska Enskilda Banken ZAMBIA Barclays Bank of Zambia Ltd.
SWITZERLAND Credit Suisse First Boston ZIMBABWE Barclays Bank of Zimbabwe Ltd.
TAIWAN HSBC
------------------- ---------------------------------------------- -------------------- --------------------------------------------
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FINALIZING MARKETS
------------------ ---------------------- ---------------------- ---------------------- ---------------------- ---------------------
FINALIZING/ Palestine
IMPLEMENTING Qatar
---------------------- ---------------------- ---------------------- ---------------------- ---------------------
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EVALUATING: Albania Barbados Kuwait Mozambique Uganda
Algeria El Salvador Lesotho Saudi Arabia Vietnam
Armenia Georgia Macedonia Tanzania
Azerbaijan Honduras Malawi U.A.E
------------------ ---------------------- ---------------------- ---------------------- ---------------------- ---------------------
MONITORING Angola Dominican Republic Mongolia Syria
(EMERGING): Belarus Iran Myanmar Tajikistan
Bhutan Kyrgyzstan Nepal Turkmenistan
Cambodia Madagascar Nicaragua Uzbekistan
Guatemala Moldova Paraguay Yugoslavia
------------------ ---------------------- ---------------------- ---------------------- ---------------------- ---------------------
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CIRCLE TRUST COMPANY
ORBITEX GROUP OF FUNDS
GLOBAL CUSTODY AND ACCOUNTING FEE SCHEDULE
1. Global Custody.
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Maintain custody of fund assets. Settle portfolio purchases and
sales. Report buy and sell fails. Determine and collect portfolio
income. Make cash disbursements and report cash transactions in local
and base currency. Withhold foreign taxes. File foreign tax reclaims.
Monitor corporate actions. Report portfolio positions.
A. COUNTRY GROUPING
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GROUP A GROUP B GROUP C GROUP D GROUP E
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USA Australia Austria Botswana Argentina
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Canada Belgium Brazil Bangladesh
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Denmark Finland China Bolivia*
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Euroclear Hong Kong Czech Republic Chile
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France Indonesia Ecuador* Columbia
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Germany Ireland Egypt Cyprus
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Italy Malaysia Ghana Greece
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Japan Mexico Israel Hungary
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New Zealand Netherlands Kenya India
------------- --------------- -------------- --------------------- -------------
South Africa Norway Luxembourg Jamaica*
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Switzerland Philippines Morocco Jordan
------------- --------------- -------------- --------------------- -------------
U.K. Portugal Sri Lanka Mauritus
------------- --------------- -------------- --------------------- -------------
Singapore Taiwan Namibia
------------- --------------- -------------- --------------------- -------------
Spain Trinidad and Tobago* Pakistan
------------- --------------- -------------- --------------------- -------------
Sweden Turkey Peru
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Thailand Zambia Poland
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Zimbabwe Slovakia*
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South Korea
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Tunisia*
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Uruguay
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Venezuela
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* Not 17f-5 eligible at this time.
B. TRANSACTION CHARGES
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Group A Group B Group C Group D Group E
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------------------------------ ---------- ---------- ---------- -----------
Circle Trust Co. $25 $50 $100 $125
Repos or Euros - $7.00
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DTC or Fed Book Entry- $12.00
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All other - $25.00
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C. HOLDING CHARGES IN BASIS POINTS (ANNUAL FEE)
------------- ---------- ---------- ------------ ------------
Group A Group B Group C Group D Group E
------------- ---------- ---------- ------------ ------------
------------- ---------- ---------- ------------ ------------
1.5 5.0 15.0 35.0 45.0
------------- ---------- ---------- ------------ ------------
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II. Multicurrency Accounting
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Maintain investment ledgers in local and base currency, provide
selected portfolio transactions, position and income reports.
Maintain general ledger and capital stock accounts in compliance with
GAAP (FAS 52). Prepare daily trial balance. Calculate net asset value
daily. Provide selected general ledger reports in multicurrency
detail.
Portfolios with U.S. Holdings Only $3,000 per month/portfolio
Global Portfolios $4,000 per month/portfolio
Multi-Managed with U.S. Holdings Only $12,000 per year/portfolio/
add. mgr.
Multi-Managed Global $24,000 per year/portfolio/
add. mgr.
The multi-currency accounting fees will be waived for the first three
months.
III. Navigator Automated Pricing
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Monthly Base Charge $375.00
Monthly Quote Charge:
Municipal Bonds via Xxxxx/S&P or Xxxxxx Data $16.00
Corporate, Municipal, Convertible, Government Bonds
And Adjustable Rate Preferred Stocks Via IDSI $13.00
Government, Corporate Bonds via Xxxxx/S&P or Xxxxxx $11.00
Government, Corporate and Convertible Bonds
Via Xxxxxxx Xxxxx $11.00
Foreign Bonds via Extel $10.00
Options, Futures and Private Placements $6.00
Listed Equities (including International)
and OTC Equities $6.00
For billing purposes, the monthly quote charge will be based on the
number of positions in the portfolio at month end.
IV. Special Features
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Fees for activities of a non-recurring nature such as fund
consolidations or reorganizations, extraordinary security shipments
and the preparation of special reports will be subject to
negotiation. Fees for SEC yield calculation, fund administration
activities, self directed securities lending transactions, XxXxXx
financial reporting, multiple class and core/feeder accounting, and
other special items will be negotiated separately.
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V. Out-of-Pocket Expenses
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A billing for the recovery of applicable out-of-pocket expenses will
be made as of the end of each month. Out-of-pocket expenses include,
but are not limited to the following:
- Telephone - Transfer Fees
- Wire Charge ($5.25 in and $5.00 out) - Price Waterhouse Audit
Letter
- Postage and Insurance - Federal Reserve Fee for
Return
- Courier Service Check items of $2,500
($4.25 each)
- Duplicating -GNMA Transfer ($15 each)
- Legal Fees - PTC Deposit/Withdrawal for
same day turnaround
- Supplies Related to Fund Records ($50 each)
- Rush Transfer ($8 each) - Subcustodian charges
- Items held in Street name over record
date at request of trader ($50 each)
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VI. Payment
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The above fees will be charged against the Fund's custodian checking
account five (5) days after the invoice is mailed to the Fund's offices.
Orbitex Group of Funds Circle Trust Company
By: ____________________________ By: __________________________
Title: _________________________ Title: _______________________
Date: __________________________ Date: ________________________
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