CUSTODY AGREEMENT
THIS AGREEMENT, is made as of April 21, 1998, by and between MILLENNIUM
INCOME TRUST, a business trust organized under the laws of the State of
Massachusetts (the "Trust"), and THE FIFTH THIRD BANK, a banking company
organized under the laws of the State of Ohio (the "Custodian").
WITNESSETH:
WHEREAS, the Trust desires that the Securities and cash of each of the
investment portfolios identified in Exhibit A hereto (such investment
portfolios and individually referred to herein as a "Fund" and collectively
as the "Funds"), be held and administered by the Custodian pursuant to this
Agreement; and
WHEREAS, the Trust is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Custodian represents that it is a bank having the
qualifications prescribed in Section 26(a)(i) of the 1940 Act;
NOW, THEREFORE, in consideration of the mutual agreements herein made,
the Trust and the Custodian hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
1.1 "Authorized Person" means any Officer or other person duly
authorized by resolution of the Board of Trustees to give Oral Instructions
and Written Instructions on behalf of the Trust and named in Exhibit B
hereto or in such resolutions of the Board of Trustees, certified by an
Officer, as may be received by the Custodian from time to time.
1.2 "Board of Trustees" shall mean the Trustees from time to time
serving under the Trust's Agreement and Declaration of Trust, dated August
19, 1994, as from time to time amended.
1.3 "Book-Entry System" shall mean a federal book-entry system as
provided in Subpart O of Treasury Circular Xx. 000, 00 XXX 306, in Subpart
B of 31 CFR Part 350, or in such book-entry regulations of federal agencies
as are substantially in the form of such Subpart O.
1.4 "Business Day" shall mean any day recognized as a settlement day
by The New York Stock Exchange, Inc. and any other day for which the Fund
computes the net asset value of the Fund.
1.5 "NASD" shall mean The National Association of Securities Dealers,
Inc.
1.6 "Officer" shall mean the President, any Vice President, the
Secretary, any Assistant Secretary, the Treasurer, or any Assistant
Treasurer of the Trust.
1.7 "Oral Instructions" shall mean instructions orally transmitted to
and accepted by the Custodian because such instructions are: (i)
reasonably believed by the Custodian to have been given by an Authorized
Person, (ii) recorded and kept among the records of the Custodian made in
the ordinary course of business and (iii) orally confirmed by the
Custodian. The Trust shall cause all Oral Instructions to be confirmed by
Written Instructions. If such Written Instructions confirming Oral
Instructions are not received by the Custodian prior to a transaction, it
shall in no way affect the validity of the transaction or the authorization
thereof by the Trust. If Oral Instructions vary from the Written
Instructions which purport to confirm them, the Custodian shall notify the
Trust of such variance but such Oral Instructions will govern unless the
Custodian has not yet acted.
1.8 "Custody Account" shall mean any account in the name of the
Trust, which is provided for in Section 3.2 below.
1.9 "Proper Instructions" shall mean Oral Instructions or Written
Instructions. Proper Instructions may be continuing Written Instructions
when deemed appropriate by both parties.
1.10 "Securities Depository" shall mean The Participants Trust Company
or The Depository Trust Company and (provided that Custodian shall have
received a copy of a resolution of the Board of Trustees, certified by an
Officer, specifically approving the use of such clearing agency as a
depository for the Trust) any other clearing agency registered with the
Securities and Exchange Commission under Section 17A of the Securities and
Exchange Act of 1934 (the "1934 Act"), which acts as a system for the
central handling of Securities where all Securities of any particular class
or series of an issuer deposited within the system are treated as fungible
and may be transferred or pledged by bookkeeping entry without physical
delivery of the Securities.
1.11 "Securities" shall include, without limitation, common and
preferred stocks, bonds, call options, put options, debentures, notes, bank
certificates of deposit, bankers' acceptances, mortgage-backed securities,
other money market instruments or other obligations, and any certificates,
receipts, warrants or other instruments or documents representing rights to
receive, purchase or subscribe for the same, or evidencing or representing
any other rights or interests therein, or any similar property or assets
that the Custodian has the facilities to clear and to service.
1.12 "Shares" shall mean the units of beneficial interest issued by
the Trust.
1.13 "Written Instructions" shall mean (i) written communications
actually received by the Custodian and signed by one or more persons as the
Board of Trustees shall have from time to time authorized, or (ii)
communications by telex or any other such system from a person or persons
reasonably believed by the Custodian to be Authorized, or (iii)
communications transmitted electronically through the Institutional
Delivery System (IDS), or any other similar electronic instruction system
acceptable to Custodian and approved by resolutions of the Board of
Trustees, a copy of which, certified by an Officer, shall have been
delivered to the Custodian.
ARTICLE II
APPOINTMENT OF CUSTODIAN
2.1 Appointment. The Trust hereby constitutes and appoints the
Custodian as custodian of all Securities and cash owned by or in the
possession of the Trust at any time during the period of this Agreement,
provided that such Securities or cash at all times shall be and remain the
property of the Trust.
2.2 Acceptance. The Custodian hereby accepts appointment as such
custodian and agrees to perform the duties thereof as hereinafter set forth
and in accordance with the 1940 Act as amended. Except as specifically set
forth herein, the Custodian shall have no liability and assumes no
responsibly for any non-compliance by the Trust or a Fund of any laws,
rules or regulations.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
3.1 Segregation. All Securities and non-cash property held by the
Custodian for the account of the Fund, except Securities maintained in a
Securities Depository or Book-Entry System, shall be physically segregated
from other Securities and non-cash property in the possession of the
Custodian and shall be identified as subject to this Agreement.
3.2 Custody Account. The Custodian shall open and maintain in its
trust department a custody account in the name of each Fund, subject only
to draft or order of the Custodian, in which the Custodian shall enter and
carry all Securities, cash and other assets of the Fund which are delivered
to it.
3.3 Appointment of Agents. In its discretion, the Custodian may
appoint, and at any time remove, any domestic bank or trust company, which
has been approved by the Board of Trustees and is qualified to act as a
custodian under the 1940 Act, as sub-custodian to hold Securities and cash
of the Funds and to carry out such other provisions of this Agreement as it
may determine, and may also open and maintain one or more banking accounts
with such a bank or trust company (any such accounts to be in the name of
the Custodian and subject only to its draft or order), provided, however,
that the appointment of any such agent shall not relieve the Custodian of
any of its obligations or liabilities under this Agreement.
3.4 Delivery of Assets to Custodian. The Fund shall deliver, or
cause to be delivered, to the Custodian all of the Fund's Securities, cash
and other assets, including (a) all payments of income, payments of
principal and capital distributions received by the Fund with respect to
such Securities, cash or other assets owned by the Fund at any time during
the period of this Agreement, and (b) all cash received by the Fund for the
issuance, at any time during such period, of Shares. The Custodian shall
not be responsible for such Securities, cash or other assets until actually
received by it.
3.5 Securities Depositories and Book-Entry Systems. The Custodian
may deposit and/or maintain Securities of the Funds in a Securities
Depository or in a Book-Entry System, subject to the following provisions:
(a) Prior to a deposit of Securities of the Funds in any Securities
Depository or Book-Entry System, the Fund shall deliver to the
Custodian a resolution of the Board of Trustees, certified by an
Officer, authorizing and instructing the Custodian on an on-going
basis to deposit in such Securities Depository or Book-Entry
System all Securities eligible for deposit therein and to make
use of such Securities Depository or Book-Entry System to the
extent possible and practical in connection with its performance
hereunder, including, without limitation, in connection with
settlements of purchases and sales of Securities, loans of
Securities, and deliveries and returns of collateral consisting
of Securities. So long as such Securities Depository or Book-
Entry System shall continue to be employed for the deposit of
Securities of the Funds, the Trust shall annually re-adopt such
resolution and deliver a copy thereof, certified by an Officer,
to the Custodian.
(b) Securities of the Fund kept in a Book-Entry System or Securities
Depository shall be kept in an account ("Depository Account") of
the Custodian in such Book-Entry System or Securities Depository
which includes only assets held by the Custodian as a fiduciary,
custodian or otherwise for customers.
(c) The records of the Custodian and the Custodian's account on the
books of the Book-Entry System and Securities Depository as the
case may be, with respect to Securities of a Fund maintained in a
Book-Entry System or Securities Depository shall, by book-entry,
or otherwise identify such Securities as belonging to the Fund.
(d) If Securities purchases by the Fund are to be held in a Book-
Entry System or Securities Depository, the Custodian shall pay
for such Securities upon (i) receipt of advice from the Book-
Entry System or Securities Depository that such Securities have
been transferred to the Depository 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 Fund. If Securities
sold by the Fund are held in a Book-Entry System or Securities
Depository, the Custodian shall transfer such Securities upon (i)
receipt of advice from the Book-Entry System or Securities
depository that payment for such Securities has been transferred
to the Depository 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 Fund.
(e) Upon request, the Custodian shall provide the Fund with copies of
any report (obtained by the Custodian from a Book-Entry System or
Securities Depository in which Securities of the Fund is kept) on
the internal accounting controls and procedures for safeguarding
Securities deposited in such Book-Entry System or Securities
Depository.
(f) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Trust for any loss or damage to
the Trust resulting (i) from the use of a Book-Entry System or
Securities Depository by reason of any negligence or willful
misconduct on the part of Custodian or any sub-custodian
appointed pursuant to Section 3.3 above or any of its or their
employees, or (ii) from failure of Custodian or any such sub-
custodian to enforce effectively such rights as it may have
against a Book-Entry System or Securities Depository. At its
election, the Trust shall be subrogated to the rights of the
Custodian with respect to any claim against a Book-Entry System
or Securities Depository or any other person for any loss or
damage to the Funds arising from the use of such Book-Entry
System or Securities Depository, if and to the extent that the
Trust has been made whole for any such loss or damage.
3.6 Disbursement of Moneys from Custody Accounts. Upon receipt of
Proper Instructions, the Custodian shall disburse moneys from a Fund
Custody Account but only in the following cases:
(a) For the purchase of Securities for the Fund but only upon
compliance with Section 4.1 of this Agreement and only (i) in the
case of Securities (other than options on Securities, futures
contracts and options on futures contracts), against the delivery
to the Custodian (or any sub-custodian appointed pursuant to
Section 3.3 above) of such Securities registered as provided in
Section 3.9 below in proper form for transfer, or if the purchase
of such Securities is effected through a Book-Entry System or
Securities Depository, in accordance with the conditions set
forth in Section 3.5 above; (ii) in the case of options on
Securities, against delivery to the Custodian (or such sub-
custodian) of such receipts as are required by the customs
prevailing among dealers in such options; (iii) in the case of
futures contracts and options on futures contracts, against
delivery to the Custodian (or such sub-custodian) of evidence of
title thereto in favor of the Trust or any nominee referred to in
Section 3.9 below; and (iv) in the case of repurchase or reverse
repurchase agreements entered into between the Trust and a bank
which is a member of the Federal Reserve System or between the
Trust and a primary dealer in U.S. Government securities, against
delivery of the purchased Securities either in certificate form
or through an entry crediting the Custodian's account at a Book-
Entry System or Securities Depository for the account of the Fund
with such Securities;
(b) In connection with the conversion, exchange or surrender, as set
forth in Section 3.7(f) below, of Securities owned by the Fund;
(c) For the payment of any dividends or capital gain distributions
declared by the Fund;
(d) In payment of the redemption price of Shares as provided in
Section 5.1 below;
(e) For the payment of any expense or liability incurred by the
Trust, including but not limited to the following payments for
the account of a Fund: interest; taxes; administration,
investment management, investment advisory, accounting, auditing,
transfer agent, custodian, trustee and legal fees; and other
operating expenses of a Fund; in all cases, whether or not such
expenses are to be in whole or in part capitalized or treated as
deferred expenses;
(f) For transfer in accordance with the provisions of any agreement
among the Trust, the Custodian and a broker-dealer registered
under the 1934 Act and a member of the NASD, relating to
compliance with 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 Trust;
(g) For transfer in accordance with the provisions of any agreement
among the Trust, 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 Trust;
(h) For the funding of any uncertificated time deposit or other
interest-bearing account with any banking institution (including
the Custodian), which deposit or account has a term of one year
or less; and
(i) For any other proper purposes, but only upon receipt, in addition
to Proper Instructions, of a copy of a resolution of the Board of
Trustees, certified by an Officer, specifying the amount and
purpose of such payment, declaring such purpose to be a proper
corporate purpose, and naming the person or persons to whom such
payment is to be made.
3.7 Delivery of Securities from Fund Custody Accounts. Upon receipt
of Proper Instructions, the Custodian shall release and deliver Securities
from a Custody Account but only in the following cases:
(a) Upon the sale of Securities for the account of a Fund but only
against receipt of payment therefor in cash, by certified or
cashiers check or bank credit;
(b) In the case of a sale effected through a Book-Entry System or
Securities Depository, in accordance with the provisions of
Section 3.5 above;
(c) To an Offeror's depository agent in connection with tender or
other similar offers for Securities of a Fund; provided that, in
any such case, the cash or other consideration is to be delivered
to the Custodian;
(d) To the issuer thereof or its agent (i) for transfer into the name
of the Trust, the Custodian or any sub-custodian appointed
pursuant to Section 3.3 above, or of any nominee or nominees of
any of the foregoing, or (ii) for exchange for a different number
of 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;
(e) To the broker selling Securities, for examination in accordance
with the "street delivery" custom;
(f) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment
of the issuer of such Securities, or pursuant to provisions for
conversion contained in such Securities, or pursuant to any
deposit agreement, including surrender or receipt of underlying
Securities in connection with the issuance or cancellation of
depository receipts; provided that, in any such case, the new
Securities and cash, if any, are to be delivered to the
Custodian;
(g) Upon receipt of payment therefor pursuant to any repurchase or
reverse repurchase agreement entered into by a Fund;
(h) In the case of warrants, rights or similar Securities, upon the
exercise thereof, provided that, in any such case, the new
Securities and cash, if any, are to be delivered to the
Custodian;
(i) For delivery in connection with any loans of Securities of a
Fund, but only against receipt of such collateral as the Trust
shall have specified to the Custodian in Proper Instructions;
(j) For delivery as security in connection with any borrowings by the
Trust on behalf of a Fund requiring a pledge of assets by such
Fund, but only against receipt by the Custodian of the amounts
borrowed;
(k) Pursuant to any authorized plan of liquidation, reorganization,
merger, consolidation or recapitalization of the Trust or a Fund;
(l) For delivery in accordance with the provisions of any agreement
among the Trust, the Custodian and a broker-dealer registered
under the 1934 Act and a member of the 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 Trust on
behalf of a Fund;
(m) For delivery in accordance with the provisions of any agreement
among the Trust on behalf of a Fund, 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 Trust on behalf of a Fund; or
(n) For any other proper corporate purposes, but only upon receipt,
in addition to Proper Instructions, of a copy of a resolution of
the Board of Trustees, certified by an Officer, specifying the
Securities 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.
3.8 Actions Not Requiring Proper Instructions. Unless otherwise
instructed by the Trust, the Custodian shall with respect to all Securities
held for a Fund;
(a) Subject to Section 7.4 below, collect on a timely basis all
income and other payments to which the Trust is entitled either
by law or pursuant to custom in the securities business;
(b) Present for payment and, subject to Section 7.4 below, collect on
a timely basis the amount payable upon all Securities which may
mature or be called, redeemed, or retired, or otherwise become
payable;
(c) Endorse for collection, in the name of the Trust, checks, drafts
and other negotiable instruments;
(d) Surrender interim receipts or Securities in temporary form for
Securities in definitive form;
(e) Execute, as custodian, any necessary declarations or certificates
of ownership under the federal income tax laws or the laws or
regulations of any other taxing authority now or hereafter in
effect, and prepare and submit reports to the Internal Revenue
Service ("IRS") and to the Trust at such time, in such manner and
containing such information as is prescribed by the IRS;
(f) Hold for a Fund, either directly or, with respect to Securities
held therein, through a Book-Entry System or Securities
Depository, all rights and similar securities issued with respect
to Securities of the Fund; and
(g) In general, and except as otherwise directed in Proper
Instructions, attend to all non-discretionary details in
connection with sale, exchange, substitution, purchase, transfer
and other dealings with Securities and assets of the Fund.
3.9 Registration and Transfer of Securities. All Securities held for
a Fund that are issued or issuable only in bearer form shall be held by the
Custodian in that form, provided that any such Securities shall be held in
a Book-Entry System for the account of the Trust on behalf of a Fund, if
eligible therefor. All other Securities held for a Fund may be registered
in the name of the Trust on behalf of such Fund, the Custodian, or any sub-
custodian appointed pursuant to Section 3.3 above, or in the name of any
nominee of any of them, or in the name of a Book-Entry System, Securities
Depository or any nominee of either thereof; provided, however, that such
Securities are held specifically for the account of the Trust on behalf of
a Fund. The Trust shall 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 any of the nominees hereinabove referred to or
in the name of a Book-Entry System or Securities Depository, any Securities
registered in the name of a Fund.
3.10 Records. (a) The Custodian shall maintain, by Fund,
complete and accurate records with respect to Securities, cash or other
property held for the Trust, including (i) journals or other records of
original entry containing an itemized daily record in detail of all
receipts and deliveries of Securities and all receipts and disbursements of
cash; (ii) ledgers (or other records) reflecting (A) Securities in
transfer, (B) Securities in physical possession, (C) monies and Securities
borrowed and monies and Securities loaned (together with a
record of the collateral therefor and substitutions of such collateral),
(D) dividends and interest received, and (E) dividends receivable and
interest accrued; and (iii) canceled checks and bank records related
thereto. The Custodian shall keep such other books and records of the
Trust as the Trust shall reasonably request, or as may be required by the
1940 Act, including, but not limited to Section 3.1 and Rule 31a-1 and Rule
31a-2 promulgated thereunder.
(b) All such books and records maintained by the Custodian shall (i)
be maintained in a form acceptable to the Trust and in compliance with
rules and regulations of the Securities and Exchange Commission, (ii) be
the property of the Trust and at all times during the regular business
hours of the Custodian be made available upon request for inspection by
duly authorized officers, employees or agents of the Trust and employees or
agents of the Securities and Exchange Commission, and (iii) if required to
be maintained by Rule 31a-1 under the 1940 Act, be preserved for the
periods prescribed in Rule 31a-2 under the 0000 Xxx.
3.11 Fund Reports by Custodian. The Custodian shall furnish the
Trust with a daily activity statement by Fund and a summary of all
transfers to or from the Custody Account on the day following such
transfers. At least monthly and from time to time, the Custodian shall
furnish the Trust with a detailed statement, by Fund, of the Securities and
moneys held for the Trust under this Agreement.
3.12 Other Reports by Custodian. The Custodian shall provide the
Trust with such reports, as the Trust may reasonably request from time to
time, on the internal accounting controls and procedures for safeguarding
Securities, which are employed by the Custodian or any sub-custodian
appointed pursuant to Section 3.3 above.
3.13 Proxies and Other Materials. The Custodian shall cause all
proxies if any, relating to Securities which are not registered in the name
of a Fund, to be promptly executed by the registered holder of such
Securities, without indication of the manner in which such proxies are to
be voted, and shall include all other proxy materials, if any, promptly
deliver to the Trust such proxies, all proxy soliciting materials, which
should include all other proxy materials, if any, and all notices to such
Securities.
3.14 Information on Corporate Actions. Custodian will promptly
notify the Trust of corporate actions, limited to those Securities
registered in nominee name and to those Securities held at a Depository or
sub-Custodian acting as agent for Custodian. Custodian will be responsible
only if the notice of such corporate actions is published by the Financial
Daily Card Service, X.X. Xxxxx Called Bond Service, DTC, or received by
first class mail from the agent. For market announcements not yet received
and distributed by Custodian's services, Trust will inform its custody
representative with appropriate instructions. Custodian will, upon receipt
of Trust's response within the required deadline, affect such action for
receipt or payment for the Trust. For those responses received after the
deadline, Custodian will affect such action for receipt or payment, subject
to the limitations of the agent(s) affecting such actions. Custodian will
promptly notify Trust for put options only if the notice is received by
first class mail from the agent. The Trust will provide or cause to be
provided to Custodian with all relevant information contained in the
prospectus for any security which has unique put/option provisions and
provide Custodian with specific tender instructions at least ten business
days prior to the beginning date of the tender period.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
4.1 Purchase of Securities. Promptly upon each purchase of
Securities for the Trust, Written Instructions shall be delivered to the
Custodian, specifying (a) the name of the issuer or writer of such
Securities, and the title or other description thereof, (b) the number of
shares, principal amount (and accrued interest, if any) or other units
purchased, (c) the date of purchase and settlement, (d) the purchase price
per unit, (e) the total amount payable upon such purchase, and (f) the name
of the person to whom such amount is payable. The Custodian shall upon
receipt of such Securities purchased by a Fund pay out of the moneys held
for the account of such Fund the total amount specified in such Written
Instructions to the person named therein. The Custodian shall not be under
any obligation to pay out moneys to cover the cost of a purchase of
Securities for a Fund, if in the relevant Custody Account there is
insufficient cash available to the Fund for which such purchase was made.
4.2 Liability for Payment in Advance of Receipt of Securities
Purchased. In any and every case where payment for the purchase of
Securities for a Fund is made by the Custodian in advance of receipt for
the account of the Fund of the Securities purchased but in the absence of
specific Written or Oral Instructions to so pay in advance, the Custodian
shall be liable to the Fund for such Securities to the same extent as if
the Securities had been received by the Custodian.
4.3 Sale of Securities. Promptly upon each sale of Securities by a
Fund, Written Instructions shall be delivered to the Custodian, specifying
(a) the name of the issuer or writer of such Securities, and the title or
other description thereof, (b) the number of shares, principal amount (and
accrued interest, if any), or other units sold, (c) the date of sale and
settlement (d) the sale price per unit, (e) the total amount payable upon
such sale, and (f) the person to whom such Securities are to be delivered.
Upon receipt of the total amount payable to the Trust as specified in such
Written Instructions, the Custodian shall deliver such Securities to the
person specified in such Written Instructions. Subject to the foregoing,
the Custodian may accept payment in such form as shall be satisfactory to
it, and may deliver Securities and arrange for payment in accordance with
the customs prevailing among dealers in Securities.
4.4 Delivery of Securities Sold. Notwithstanding Section 4.3 above
or any other provision of this Agreement, the Custodian, when instructed to
deliver Securities against payment, shall be entitled, if in accordance
with generally accepted market practice, to deliver such Securities prior
to actual receipt of final payment therefor. In any such case, the Trust
shall bear the risk that final payment for such Securities may not be made
or that such Securities may be returned or otherwise held or disposed of by
or through the person to whom they were delivered, and the Custodian shall
have no liability for any of the foregoing.
4.5 Payment for Securities Sold, etc. In its sole discretion and
from time to time, the Custodian may credit the relevant Custody Account,
prior to actual receipt of final payment thereof, with (i) proceeds from
the sale of Securities which it has been instructed to deliver against
payment, (ii) proceeds from the redemption of Securities or other assets of
the Trust, and (iii) income from cash, Securities or other assets of the
Trust. Any such credit shall be conditional upon actual receipt by
Custodian of final payment and may be reversed if final payment is not
actually received in full. The Custodian may, in its sole discretion and
from time to time, permit the Trust to use funds so credited to its Custody
Account in anticipation of actual receipt of final payment. Any such funds
shall be repayable immediately upon demand made by the Custodian at any
time prior to the actual receipt of all final payments in anticipation of
which funds were credited to the Custody Account.
4.6 Advances by Custodian for Settlement. The Custodian may, in its
sole discretion and from time to time, advance funds to the Trust to
facilitate the settlement of a Trust transactions on behalf of a Fund in
its Custody Account. Any such advance shall be repayable immediately upon
demand made by Custodian.
ARTICLE V
REDEMPTION OF TRUST SHARES
Transfer of Funds. From such funds as may be available for the
purpose in the relevant Custody Account, and upon receipt of Proper
Instructions specifying that the funds are required to redeem Shares of a
Fund, the Custodian shall wire each amount specified in such Proper
Instructions to or through such bank as the Trust may designate with
respect to such amount in such Proper Instructions. Upon effecting payment
or distribution in accordance with proper Instruction, the Custodian shall
not be under any obligation or have any responsibility thereafter with
respect to any such paying bank.
ARTICLE VI
SEGREGATED ACCOUNTS
Upon receipt of Proper Instructions, the Custodian shall establish and
maintain a segregated account or accounts for and on behalf of each Fund,
into which account or accounts may be transferred cash and/or Securities,
including Securities maintained in a Depository Account,
(a) in accordance with the provisions of any agreement among the
Trust, the Custodian and a broker-dealer registered under the 1934 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 Trust,
(b) for purposes of segregating cash or Securities in connection with
securities options purchased or written by a Fund or in connection with
financial futures contracts (or options thereon) purchased or sold by a
Fund,
(c) which constitute collateral for loans of Securities made by a
Fund,
(d) for purposes of compliance by the Trust with requirements under
the 1940 Act for the maintenance of segregated accounts by registered
investment companies in connection with reverse repurchase agreements and
when-issued, delayed delivery and firm commitment transactions, and
(e) for other proper corporate purposes, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a resolution of the
Board of Trustees, certified by an Officer, setting forth the purpose or
purposes of such segregated account and declaring such purposes to be
proper corporate purposes.
ARTICLE VII
CONCERNING THE CUSTODIAN
7.1 Standard of Care. The Custodian shall be held to the exercise of
reasonable care in carrying out its obligations under this Agreement, and
shall be without liability to the Trust for any loss, damage, cost, expense
(including attorneys' fees and disbursements), liability or claim unless
such loss, damages, cost, expense, liability or claim arises from
negligence, bad faith or willful misconduct on its part or on the part of
any sub-custodian appointed pursuant to Section 3.3 above. The Custodian's
cumulative liability within a calendar year shall be limited with respect
to the Trust or any party claiming by, through or on behalf of the Trust
for the initial and all subsequent renewal terms of this Agreement, to the
lessor amount of (a) the actual damages sustained by the Trust, (actual
damages for uninvested funds shall be the overnight Feds fund rate), or (b)
to an amount not to exceed one-half of the net fees paid to the Custodian
within the prior three calendar months. The Custodian shall be entitled to
rely on and may act upon advice of counsel on all matters, and shall be
without liability for any action reasonably taken or omitted pursuant to
such advice. The Custodian shall promptly notify the Trust of any action
taken or omitted by the Custodian pursuant to advice of counsel. The
Custodian shall not be under any obligation at any time to ascertain
whether the Trust is in compliance with the 1940 Act, the regulations
thereunder, the provisions of the Trust's charter documents or by-laws, or
its investment objectives and policies as then in effect.
7.2 Actual Collection Required. The Custodian shall not be liable
for, or considered to be the custodian of, any cash belonging to the Trust
or any money represented by a check, draft or other instrument for the
payment of money, until the Custodian or its agents actually receive such
cash or collect on such instrument.
7.3 No Responsibility for title, etc. 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 or delivered by it pursuant to this
Agreement.
7.4 Limitation on Duty to Collect. Custodian shall not be required
to enforce collection, by legal means or otherwise, of any money or
property due and payable with respect to Securities held for the Trust if
such Securities are in default or payment is not made after due demand or
presentation.
7.5 Reliance Upon Documents and Instructions. The Custodian shall be
entitled to rely upon any certificate, notice or other instrument in
writing received by it and reasonably believed by it to be genuine. The
Custodian shall be entitled to rely upon any Oral Instructions and/or any
Written Instructions actually received by it pursuant to this Agreement.
7.6 Express Duties Only. The Custodian shall have no duties or
obligations whatsoever except such duties and obligations as are
specifically set forth in this Agreement, and no covenant or obligation
shall be implied in this Agreement against the Custodian.
7.7 Cooperation. The Custodian shall cooperate with and supply
necessary information, by the Trust, to the entity or entities appointed by
the Trust to keep the books of account of the Trust and/or compute the
value of the assets of the Trust. The Custodian shall take all such
reasonable actions as the Trust may from time to time request to enable the
Trust to obtain, from year to year, favorable opinions from the Trust's
independent accountants with respect to the Custodian's activities
hereunder in connection with (a) the preparation of the Trust's report on
Form N-1A and Form N-SAR and any other reports required by the Securities
and Exchange Commission, and (b) the fulfillment by the Trust of any other
requirements of the Securities and Exchange Commission.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification. The Trust shall indemnify and hold harmless the
Custodian and any sub-custodian appointed pursuant to Section 3.3 above,
and any nominee of the Custodian or of such sub-custodian from and against
any loss, damage, cost, expense (including attorneys' fees and
disbursements), liability (including, without limitation, liability
arising under the Securities Act of 1933, the 1934 Act, the 1940 Act, and
any state or foreign securities and/or banking laws) or claim arising
directly or indirectly (a) from the fact that Securities are registered in
the name of any such nominee, or (b) from any action or inaction by the
Custodian or such sub-custodian (i) at the request or direction of or in
reliance on the advice of the Trust, or (ii) upon Proper Instructions, or
(c) generally, from the performance of its obligations under this Agreement
or any sub-custody agreement with a sub-custodian appointed pursuant to
Section 3.3 above or, in the case of any such sub-custodian, from the
performance of its obligations under such custody agreement, provided that
neither the Custodian nor any such sub-custodian shall be indemnified and
held harmless from and against any such loss, damage, cost, expense,
liability or claim arising from the Custodian's or such sub-custodian's
negligence, bad faith or willful misconduct.
8.2 Indemnity to be Provided. If the Trust requests the Custodian to
take any action with respect to Securities, which may, in the opinion of
the custodian, result in the Custodian or its nominee becoming liable for
the payment of money or incurring liability of some other form, the
Custodian shall not be required to take such action until the Trust shall
have provided indemnity therefor to the Custodian in an amount and form
satisfactory to the Custodian.
ARTICLE IX
FORCE MAJEURE
Neither the Custodian nor the Trust shall be liable for any failure or
delay in performance of its obligations under this Agreement arising out of
or caused, directly or indirectly, by circumstances beyond its reasonable
control, including, without limitation, acts of God; earthquakes; fires;
floods; wars; civil or military disturbances; sabotage; strikes; epidemics;
riots; power failures; computer failure and any such circumstances beyond
its reasonable control as may cause interruption, loss or malfunction of
utility, transportation, computer (hardware or software) or telephone
communication service; accidents; labor disputes, acts of civil or military
authority; governmental actions; or inability to obtain labor, material,
equipment or transportation; provided, however, that the Custodian in the
event of a failure or delay shall use its best efforts to ameliorate the
effects of any such failure or delay. Notwithstanding the foregoing, the
Custodian shall maintain sufficient disaster recovery procedures to
minimize interruptions.
ARTICLE X
EFFECTIVE PERIOD; TERMINATION
10.1 Effective Period. This Agreement shall become effective as of
the date first set forth above and shall continue in full force and effect
until terminated as hereinafter provided.
10.2 Termination. Either party hereto may terminate this Agreement
by giving to the other party a notice in writing specifying the date of
such termination, which shall be not less than ninety (90) days after the
date of the giving of such notice. If a successor custodian shall have
been appointed by the Board of Trustees, the Custodian shall, upon receipt
of a notice of acceptance by the successor custodian, on such specified
date of termination (a) deliver directly to the successor custodian all
Securities (other than Securities held in a Book-Entry System or Securities
Depository) and cash then owned by the Trust and held by the Custodian as
custodian, and (b) transfer any Securities held in a Book-Entry System or
Securities Depository to an account of or for the benefit of the Trust at
the successor custodian, provided that the Trust shall have paid to the
Custodian all fees, expenses and other amounts to the payment or
reimbursement of which it shall then be entitled. Upon such delivery and
transfer, the Custodian shall be relieved of all obligations under this
Agreement. The Trust may at any time immediately terminate this Agreement
in the event of the appointment of a conservator or receiver for the
Custodian by regulatory authorities in the State of Ohio or upon the
happening of a like event at the direction of an appropriate regulatory
agency or court of competent jurisdiction.
10.3 Failure to Appoint Successor Custodian. If a successor
custodian is not designated by the Trust on or before the date of
termination specified pursuant to Section 10.1 above, then the Custodian
shall have the right to deliver to a bank or trust company of its own
selection, which is (a) a "Bank" as defined in the 1940 Act, (b) has
aggregate capital, surplus and undivided profits as shown on its then most
recent published report of not less than $25 million, and (c) is doing
business in New York, New York, all Securities, cash and other property
held by Custodian under this Agreement and to transfer to an account of or
for the Trust at such bank or trust company all Securities of the Trust
held in a Book-Entry System or Securities Depository. Upon such delivery
and transfer, such bank or trust company shall be the successor custodian
under this Agreement and the Custodian shall be relieved of all obligations
under this Agreement. If, after reasonable inquiry, Custodian cannot find
a successor custodian as contemplated in this Section 10.3, then Custodian
shall have the right to deliver to the Trust all Securities and cash then
owned by the Trust and to transfer any Securities held in a Book-Entry
System or Securities Depository to an account of or for the Trust.
Thereafter, the Trust shall be deemed to be its own custodian with respect
to the Trust and the Custodian shall be relieved of all obligations under
this Agreement.
ARTICLE XI
COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to compensation as agreed upon from
time to time by the Trust and the Custodian. The fees and other charges in
effect on the date hereof and applicable to the Funds are set forth in
Exhibit B attached hereto.
ARTICLE XII
LIMITATION OF LIABILITY
The Trust is a business trust organized under the laws of the State of
Illinois and under a Declaration of Trust, to which reference is hereby
made a copy of which is on file at the office of the Secretary of State of
Illinois as required by law, and to any and all amendments thereto so filed
or hereafter filed. The obligations of the Trust entered into in the name
of the Trust or on behalf thereof by any of the Trustees, officers,
employees or agents are made not individually, but in such capacities, and
are not binding upon any of the Trustees, officers, employees, agents or
shareholders of the Trust or the Funds personally, but bind only the assets
of the Trust, and all persons dealing with any of the Funds of the Trust
must look solely to the assets of the Trust belonging to such Fund for the
enforcement of any claims against the Trust.
ARTICLE XIII
NOTICES
Unless otherwise specified herein, all demands, notices, instructions,
and other communications to be given hereunder shall be in writing and
shall be sent or delivered to The receipt at the address set forth after
its name herein below:
To the Trust:
Millennium Income Trust c/o Trias Capital Management,
Inc.
000 X. Xxxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxxxxx, Xx.
Telephone: (000) 000-0000
Facsimile: (000)-000-0000
To the Custodian:
The Fifth Third Bank
00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attn: Area Manager - Trust Operations
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or at such other address as either party shall have provided to the other
by notice given in accordance with this Article XIII. Writing shall
include transmission by or through teletype, facsimile, central processing
unit connection, on-line terminal and magnetic tape.
ARTICLE XIV
MISCELLANEOUS
14.1 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois.
14.2 References to Custodian. The Trust shall not circulate any
printed matter which contains any reference to Custodian without the prior
written approval of Custodian, excepting printed matter contained in the
prospectus or statems to be of
high quality and to its registration
statement for the Trust and such other printed matter as merely identifies
Custodian as custodian for the Trust. The Trust shall submit printed
matter requiring approval to Custodian in draft form, allowing sufficient
time for review by Custodian and its counsel prior to any deadline for
printing.
14.3 No Waiver. No failure by either party hereto to exercise and no
delay by such party in exercising, any right hereunder shall operate as a
waiver thereof. The exercise by either party hereto of any right hereunder
shall not preclude the exercise of any other right, and the remedies
provided herein are cumulative and not exclusive of any remedies provided
at law or in equity.
14.4 Amendments. This Agreement cannot be changed orally and no
amendment to this Agreement shall be effective unless evidenced by an
instrument in writing executed by the parties hereto.
14.5 Counterparts. This Agreement may be executed in one or more
counterparts, and by the parties hereto on separate counterparts, each of
which shall be deemed an original but all of which together shall
constitute but one and the same instrument.
14.6 Severability. If any provision of this Agreement shall be
invalid, illegal or unenforceable in any respect under any applicable law,
the validity, legality and enforceability of the remaining provisions shall
not be affected or impaired thereby.
14.7 Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that this Agreement shall not be
assignable by either party hereto without the written consent of the other
party hereto.
14.8 Headings. The headings of sections in this Agreement are for
convenience of reference only and shall not affect the meaning or
construction of any provision of this Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed and delivered in its name and on its behalf by its
representatives thereunto duly authorized, all as of the day and year first
above written.
ATTEST: MILLENNIUM INCOME TRUST
/s/ Xxxx X. Xxxxxxxxxx By: /s/ Xxxxx X. Xxxxxxxxxxx,
Xx.
------------------------------------ --------------------------
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Its: President
--------------------------
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ATTEST: THE FIFTH THIRD BANK
/s/ Xxxxxxxxx X. Xxxxxxxxxx By: /s/ JKenneth O. Save
--------------------------------- --------------------------
---
Its: Vice President
--------------------------
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Dated: April
21, 1998
EXHIBIT A
TO THE CUSTODY AGREEMENT BETWEEN
MILLENIUM INCOME AND THE FIFTH THIRD BANK
April 21, 1998
Name of Fund Date
------------ ----
Treasurers' Government Money Market Fund 4/21/98
MILLENNIUM INCOME TRUST
By: /s/ Xxxxx X. Xxxxxxxxxxx,
Xx.
--------------------------
---
Its: President
--------------------------
---
THE FIFTH THIRD BANK
By: /s/ JKenneth O. Save
--------------------------
---
Its: Vice President
--------------------------
---
Dated: April 21, 1998
EXHIBIT B
TO THE CUSTODY AGREEMENT BETWEEN
MILLENIUM INCOME AND THE FIFTH THIRD BANK
April 21, 1998
AUTHORIZED PERSONS
Set forth below are the names and specimen signatures of the persons
authorized by the Trust to Administer each Custody Account.
Name Signature
Xxxxx X. Xxxxxxxxxxx, Xx. /s/ Xxxxx X. Xxxxxxxxxxx,
Xx.
------------------------- --------------------------
---
Xxxxx X. England /s/ Xxxxx X. England
------------------------- --------------------------
---
------------------------- --------------------------
---
------------------------- --------------------------
---
------------------------- --------------------------
---
------------------------- --------------------------
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Dated: April 21,
1998
EXHIBIT C
TO THE CUSTODY AGREEMENT BETWEEN
MILLENIUM INCOME AND THE FIFTH THIRD BANK
April 21, 1998
MUTUAL FUND CUSTODY FEE SCHEDULE
Market Value Charge (per fund)
------------------------------
Total Fund Assets Under $25MM
0.0100%
$25MM - $100MM
0.0075%
$100MM - $200MM
0.0050%
Over $200MM
0.0025%
Yearly Minimum
$2,400.00
Transaction Charges
-------------------
Book Entry Settlements $
9.00
Physical/Ineligible Settlements $
25.00
PTC (GNMAs) Settlements $
25.00
Futures & Options $
25.00
Euroclear Settlements $
50.00
Other Foreign
TBD
Mutual Fund Settlements $
15.00
A transaction is a purchase, sale, maturity, redemption, tender, exchange,
dividend reinvestment, deposit or withdrawal of a security (with the
exception of Fifth Third Certificates of Deposit, Commercial Paper &
Repurchase Agreements).
Maintenance Charges
-------------------
Amortized Securities $
5.00
Miscellaneous Charges
---------------------
5/3 Repurchase Agreement Sweep (monthly) $
50.00
Per addtl issue Repo collateral $
5.00
Voluntary Corporate Actions $
25.00
Wire Transfers $
7.00
Check Requests $
6.00
Special Services (per hour) $
75.00
Cash Offsets based on amounts and
rates
Maximum of 50% of fee
offset
SIGNATURE RESOLUTION
RESOLVED, That all of the following officers of Millennium Income Trust and
any of them, namely the Chairman, President, Vice President, Secretary and
Treasurer, are hereby authorized as signers for the conduct of business for
an on behalf of the Funds with THE FIFTH THIRD BANK:
CHAIRMAN
------------------------ --------------------------
---
Xxxxx X. Xxxxxxxxxxx, Xx. PRESIDENT /s/ Xxxxx X. Xxxxxxxxxxx,
Xx.
------------------------ --------------------------
---
VICE PRESIDENT
------------------------ --------------------------
---
VICE PRESIDENT
------------------------ --------------------------
---
VICE PRESIDENT
------------------------ --------------------------
---
VICE PRESIDENT
------------------------ --------------------------
---
Xxxxx X. England TREASURER /s/ Xxxxx X. England
------------------------ --------------------------
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SECRETARY
------------------------ --------------------------
---
In addition, the following Assistant Treasurer is authorized to sign on
behalf of the Trust for the purpose of effecting securities transactions:
ASSISTANT TREASURER
------------------------ --------------------------
---
The undersigned officers of Millennium Income Trust hereby certify that the
foregoing is within the parameters of a Resolution adopted by Trustees of
the Trust in a meeting held May 27, 1997 , directing and authorizing
preparation of documents and to do everything necessary to effect the
Custody Agreement between Millennium Income Trust and THE FIFTH THIRD BANK.
By: /s/ Xxxxx X. England
---------------------------
---
Its: Secretary & Treasurer
---------------------------
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