CUSTODY AGREEMENT
Dated December 30, 1994
Between
UMB BANK, N.A.
and
ICAP FUNDS, INC.
Prototype Custody Agreement
for
Registered Investment Company
TABLE OF CONTENTS
SECTION PAGE
1. APPOINTMENT OF CUSTODIAN 1
2. DEFINITIONS 1
(a) Securities 1
(b) Assets 1
(c)(1) Instructions 1
(c)(2) Special Instructions 2
3. DELIVERY OF CORPORATE DOCUMENTS 2
POWERS AND DUTIES OF CUSTODIAN AND DOMESTIC
SUBCUSTODIAN 3
(a) Safekeeping 3
(b) Manner of Holding Securities 3
(c) Free Delivery of Assets 5
(d) Exchange of Securities 5
(e) Purchases of Assets 6
(f) Sales of Assets 7
(g) Options 7
(h) Futures Contracts 8
(i) Segregated Accounts 8
(j) Depositary Receipts 9
(k) Corporate Actions, Put Bonds, Called
Bonds, Etc. 9
(1) Interest Bearing Deposits 10
(m) Foreign Exchange Transactions Other than
as Principal 10
(n) Pledges or Loans of Securities 10
(o) Stock Dividends, Rights, Etc. 11
(p) Routine Dealings 11
(q) Collections 11
(r) Bank Accounts 12
(s) Dividends, Distributions and Redemptions 12
(t) Proceeds from Shares Sold 12
(u) Proxies and Notices; Compliance with the
Shareholders Communication Act of 1985 13
(v) Books and Records 13
(w) Opinion of Fund's Independent Certified
Public Accountants 13
(x) Reports by Independent Certified Public
Accountants 14
(y) Bills and Other Disbursements 14
5. SUBCUSTODIANS 14
(a) Domestic Subcustodians 14
(b) Foreign Subcustodians 15
(c) Interim Subcustodians 15
(d) Special Subcustodians 16
(e) Termination of a Subcustodian 16
(f) Certification Regarding Foreign
Subcustodians 16
6. STANDARD OF CARE 17
(a) General Standard of Care 17
(b) Actions Prohibited by Applicable Law,
Events Beyond Custodian's Control, Armed
Conflict, Sovereign Risk, Etc. 17
(c) Mitigation by Custodian 17
(d) Liability for Past Records 18
(e) Advice of Counsel 18
(f) Advice of the Fund and Others 18
(g) Instructions Appearing to be Genuine 18
(h) Exceptions from Liability 18
7. LIABILITY OF THE CUSTODIAN FOR ACTIONS OF
OTHERS 19
(a) Domestic Subcustodians 19
(b) Liability for Acts and Omissions of
Foreign Subcustodians 19
(c) Securities Systems, Interim
Subcustodians, Special Subcustodians,
Securities Depositories and Clearing
Agencies 19
(d) Defaults or Insolvencies of Brokers,
Banks, Etc. 19
(e) Reimbursement of Expenses 20
8. INDEMNIFICATION 20
(a) Indemnification by Fund 20
(b) Indemnification by Custodian 20
9. ADVANCES 20
10. LIENS 21
11. COMPENSATION 21
12. POWERS OF ATTORNEY 22
13. TERMINATION AND ASSIGNMENT 22
14. NOTICES 22
15 MISCELLANEOUS 23
CUSTODY AGREEMENT
This agreement made as of this 30th day of
December, 1994, between ICAP Funds, Inc. with its
principal place of business located at ▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇ (hereinafter
"Fund"), and UMB Bank, n.a., a national banking
association with its principal place of business
located at Kansas City, Missouri (hereinafter
"Custodian").
WITNESSETH:
WHEREAS, the Fund is registered as an open-end
management investment company under the Investment
Company Act of 1940, as amended; and
WHEREAS, the Fund desires to appoint Custodian as
its custodian for the custody of Assets (as hereinafter
defined) owned by the Fund which Assets are to be held
in such accounts as the Fund may establish from time to
time; and
WHEREAS, Custodian is willing to accept such
appointment on the terms and conditions hereof.
NOW, THEREFORE, in consideration of the mutual
promises contained herein, the parties hereto,
intending to be legally bound, mutually covenant and
agree as follows:
1. APPOINTMENT OF CUSTODIAN.
The Fund hereby constitutes and appoints the
Custodian as custodian of Assets belonging to the Fund
which have been or may be from time to time deposited
with the Custodian. Custodian accepts such appointment
as a custodian and agrees to perform the duties and
responsibilities of Custodian as set forth herein on
the conditions set forth herein.
2. DEFINITIONS.
For purposes of this Agreement, the following
terms shall have the meanings so indicated:
(a) "Security" or "Securities" shall mean
stocks, bonds, bills, rights, scrip, warrants,
interim certificates and all negotiable or
nonnegotiable paper commonly known as Securities
and other instruments or obligations.
(b) "Assets" shall mean Securities, monies
and other property held by the Custodian for the
benefit of the Fund.
(c)(1) "Instructions," as used herein,
shall mean: (i) a tested telex, a written
(including, without limitation, facsimile
transmission) request, direction, instruction or
certification signed or initialed by or on behalf
of the Fund by an Authorized Person; (ii) a
telephonic or other oral communication from a
person the Custodian reasonably believes to be an
Authorized Person; or (iii) a communication
effected directly between an electro-mechanical or
electronic device or system (including, without
limitation, computers) on behalf of the Fund.
Instructions in the form of oral communications
shall be confirmed by the Fund by tested telex or
in writing in the manner set forth in clause (i)
above, but the lack of such confirmation shall in
no way affect any action taken by the Custodian in
reliance upon such oral Instructions prior to the
Custodian's receipt of such confirmation. The
Fund authorizes the Custodian to record any and
all telephonic or other oral Instructions
communicated to the Custodian.
(2) "Special Instructions," as used herein,
shall mean Instructions countersigned or confirmed
in writing by the Treasurer or any Assistant
Treasurer of the Fund or any other person
designated by the Treasurer of the Fund in
writing, which countersignature or confirmation
shall be included on the same instrument
containing the Instructions or on a separate
instrument relating thereto.
(3) Instructions and Special Instructions
shall be delivered to the Custodian at the address
and/or telephone, facsimile transmission or telex
number agreed upon from time to time by the
Custodian and the Fund.
(4) Where appropriate, Instructions shall be
continuing instructions.
3. DELIVERY OF CORPORATE DOCUMENTS.
Each of the parties to this Agreement represents
that its execution does not violate any of the
provisions of its respective charter, articles of
incorporation, articles of association or bylaws and
all required corporate action to authorize the
execution and delivery of this Agreement has been
taken.
The Fund has furnished the Custodian with copies,
properly certified or authenticated, with all
amendments or supplements thereto, of the following
documents:
(a) Certificate of Incorporation (or
equivalent document) of the Fund as in effect on
the date hereof;
(b) By-Laws of the Fund as in effect on the
date hereof;
(c) Resolutions of the Board of Directors of
the Fund appointing the Custodian and approving
the form of this Agreement; and
(d) The Fund's current prospectus and
statements of additional information.
The Fund shall promptly furnish the Custodian with
copies of any updates, amendments or supplements to the
foregoing documents.
In addition, the Fund has delivered or will
promptly deliver to the Custodian, copies of the
Resolution(s) of its Board of Directors or Trustees and
all amendments or supplements thereto, properly
certified or authenticated, designating certain
officers or employees of the Fund who will have
continuing authority to certify to the Custodian: (a)
the names, titles, signatures and scope of authority of
all persons authorized to give Instructions or any
other notice, request, direction, instruction,
certificate or instrument on behalf of the Fund, and
(b) the names, titles and signatures of those persons
authorized to countersign or confirm Special
Instructions on behalf of the Fund (in both cases
collectively, the "Authorized Persons" and
individually, an "Authorized Person"). Such
Resolutions and certificates may be accepted and relied
upon by the Custodian as conclusive evidence of the
facts set forth therein and shall be considered to be
in full force and effect until delivery to the
Custodian of a similar Resolution or certificate to the
contrary. Upon delivery of a certificate which deletes
or does not include the name(s) of a person previously
authorized to give Instructions or to countersign or
confirm Special Instructions, such persons shall no
longer be considered an Authorized Person authorized to
give Instructions or to countersign or confirm Special
Instructions. Unless the certificate specifically
requires that the approval of anyone else will first
have been obtained, the Custodian will be under no
obligation to inquire into the right of the person
giving such Instructions or Special Instructions to do
so. Notwithstanding any of the foregoing, no
Instructions or Special Instructions received by the
Custodian from the Fund will be deemed to authorize or
permit any director, trustee, officer, employee, or
agent of the Fund to withdraw any of the Assets of the
Fund upon the mere receipt of such authorization,
Special Instructions or Instructions from such
director, trustee, officer, employee or agent.
4. POWERS AND DUTIES OF CUSTODIAN AND DOMESTIC
SUBCUSTODIAN.
Except for Assets held by any Subcustodian
appointed pursuant to Sections 5(b), (c), or (d) of
this Agreement, the Custodian shall have and perform
the powers and duties hereinafter set forth in this
Section 4. For purposes of this Section 4 all
references to powers and duties of the "Custodian"
shall also refer to any Domestic Subcustodian appointed
pursuant to Section 5(a).
(a) Safekeeping.
The Custodian will keep safely the Assets of
the Fund which are delivered to it from time to
time. The Custodian shall not be responsible for
any property of the Fund held or received by the
Fund and not delivered to the Custodian.
(b) Manner of Holding Securities.
(1) The Custodian shall at all times hold
Securities of the Fund either: (i) by physical
possession of the share certificates or other
instruments representing such Securities in
registered or bearer form; or (ii) in book-entry
form by a Securities System (as hereinafter
defined) in accordance with the provisions of sub-
paragraph (3) below.
(2) The Custodian may hold registrable
portfolio Securities which have been delivered to
it in physical form, by registering the same in
the name of the Fund or its nominee, or in the
name of the Custodian or its nominee, for whose
actions the Fund and Custodian, respectively,
shall be fully responsible. Upon the receipt of
Instructions, the Custodian shall hold such
Securities in street certificate form, so called,
with or without any indication of fiduciary
capacity. However, unless it receives
Instructions to the contrary, the Custodian will
register all such portfolio Securities in the name
of the Custodian's authorized nominee. All such
Securities shall be held in an account of the
Custodian containing only assets of the Fund or
only assets held by the Custodian as a fiduciary,
provided that the records of the Custodian shall
indicate at all times the Fund or other customer
for which such Securities are held in such
accounts and the respective interests therein.
(3) The Custodian may deposit and/or
maintain domestic Securities owned by the Fund in,
and the Fund hereby approves use of: (a) The
Depository Trust Company; (b) The Participants
Trust Company; and (c) any book-entry system as
provided in (i) Subpart O of Treasury Circular ▇▇.
▇▇▇, ▇▇ ▇▇▇ 306.115, (ii) Subpart B of Treasury
Circular Public Debt Series ▇▇. ▇▇-▇▇, ▇▇ ▇▇▇
350.2, or (iii) the book-entry regulations of
federal agencies substantially in the form of 3l
CFR 306.115. Upon the receipt of Special
Instructions, the Custodian may deposit and/or
maintain domestic Securities owned by the Fund in
any other domestic clearing agency registered with
the Securities and Exchange Commission ("SEC")
under Section 17A of the Securities Exchange Act
of 1934 (or as may otherwise be authorized by the
SEC to serve in the capacity of depository or
clearing agent for the Securities or other assets
of investment companies) which acts as a
Securities depository. Each of the foregoing
shall be referred to in this Agreement as a
"Securities System," and all such Securities
Systems shall be listed on the attached Appendix
A. Use of a Securities System shall be in
accordance with applicable Federal Reserve Board
and SEC rules and regulations, if any, and subject
to the following provisions:
(i) The Custodian may deposit the
Securities directly or through one or more
agents or Subcustodians which are also
qualified to act as custodians for investment
companies.
(ii) The Custodian shall deposit and/or
maintain the Securities in a Securities
System, provided that such Securities are
represented in an account ("Account") of the
Custodian in the Securities System that
includes only assets held by the Custodian as
a fiduciary, custodian or otherwise for
customers.
(iii) The books and records of the
Custodian shall at all times identify those
Securities belonging to the Fund which are
maintained in a Securities System.
(iv) The Custodian shall pay for
Securities purchased for the account of the
Fund only upon (a) receipt of advice from the
Securities System that such Securities have
been transferred to the Account of the
Custodian in accordance with the rules of the
Securities System, and (b) the making of an
entry on the records of the Custodian to
reflect such payment and transfer for the
account of the Fund. The Custodian shall
transfer Securities sold for the account of
the Fund only upon (a) receipt of advice from
the Securities System that payment for such
Securities has been transferred to the
Account of the Custodian in accordance with
the rules of the Securities System, and (b)
the making of an entry on the records of the
Custodian to reflect such transfer and
payment for the account of the Fund. Copies
of all advices from the Securities System
relating to transfers of Securities for the
account of the Fund shall be maintained for
the Fund by the Custodian. The Custodian
shall deliver to the Fund on the next
succeeding business day daily transaction
reports which shall include each day's
transactions in the Securities System for the
account of the Fund. Such transaction
reports shall be delivered to the Fund or any
agent designated by the Fund pursuant to
Instructions, by computer or in such other
manner as the Fund and Custodian may agree.
(v) The Custodian shall, if requested
by the Fund pursuant to Instructions, provide
the Fund with reports obtained by the
Custodian or any Subcustodian with respect to
a Securities System's accounting system,
internal accounting control and procedures
for safeguarding Securities deposited in the
Securities System.
(vi) Upon receipt of Special
Instructions, the Custodian shall terminate
the use of any Securities System on behalf of
the Fund as promptly as practicable and shall
take all actions reasonably practicable to
safeguard the Securities of the Fund
maintained with such Securities System.
(c) Free Delivery of Assets.
Notwithstanding any other provision of this
Agreement and except as provided in Section 3
hereof, the Custodian, upon receipt of Special
Instructions, will undertake to make free delivery
of Assets, provided such Assets are on hand and
available, in connection with the Fund's
transactions and to transfer such Assets to such
broker, dealer, Subcustodian, bank, agent,
Securities System or otherwise as specified in
such Special Instructions.
(d) Exchange of Securities.
Upon receipt of Instructions, the Custodian
will exchange portfolio Securities held by it for
the Fund for other Securities or cash paid in
connection with any reorganization,
recapitalization, merger, consolidation, or
conversion of convertible Securities, and will
deposit any such Securities in accordance with the
terms of any reorganization or protective plan.
Without Instructions, the Custodian is
authorized to exchange Securities held by it in
temporary form for Securities in definitive form,
to surrender Securities for transfer into a name
or nominee name as permitted in Section 4(b)(2),
to effect an exchange of shares in a stock split
or when the par value of the stock is changed, to
sell any fractional shares, and, upon receiving
payment therefor, to surrender bonds or other
Securities held by it at maturity or call.
(e) Purchases of Assets.
(1) Securities Purchases. In accordance
with Instructions, the Custodian shall, with
respect to a purchase of Securities, pay for such
Securities out of monies held for the Fund's
account for which the purchase was made, but only
insofar as monies are available therein for such
purpose, and receive the portfolio Securities so
purchased. Unless the Custodian has received
Special Instructions to the contrary, such payment
will be made only upon receipt of Securities by
the Custodian, a clearing corporation of a
national securities exchange of which the
Custodian is a member, or a Securities System in
accordance with the provisions of Section 4(b)(3)
hereof. Notwithstanding the foregoing, upon
receipt of Instructions: (i) in connection with a
repurchase agreement, the Custodian may release
funds to a Securities System prior to the receipt
of advice from the Securities System that the
Securities underlying such repurchase agreement
have been transferred by book-entry into the
Account maintained with such Securities System by
the Custodian, provided that the Custodian's
instructions to the Securities System require that
the Securities System may make payment of such
funds to the other party to the repurchase
agreement only upon transfer by book-entry of the
Securities underlying the repurchase agreement
into such Account; (ii) in the case of Interest
Bearing Deposits, currency deposits, and other
deposits, foreign exchange transactions, futures
contracts or options, pursuant to Sections 4(g),
4(h), 4(l), and 4(m) hereof, the Custodian may
make payment therefor before receipt of an advice
of transaction; and (iii) in the case of
Securities as to which payment for the Security
and receipt of the instrument evidencing the
Security are under generally accepted trade
practice or the terms of the instrument
representing the Security expected to take place
in different locations or through separate
parties, such as commercial paper which is indexed
to foreign currency exchange rates, derivatives
and similar Securities, the Custodian may make
payment for such Securities prior to delivery
thereof in accordance with such generally accepted
trade practice or the terms of the instrument
representing such Security.
(2) Other Assets Purchased. Upon receipt of
Instructions and except as otherwise provided
herein, the Custodian shall pay for and receive
other Assets for the account of the Fund as
provided in Special Instructions.
(f) Sales of Assets.
(1) Securities Sold. In accordance with
Instructions, the Custodian will, with respect to
a sale, deliver or cause to be delivered the
Securities thus designated as sold to the broker
or other person specified in the Instructions
relating to such sale. Unless the Custodian has
received Special Instructions to the contrary,
such delivery shall be made only upon receipt of
payment therefor in the form of: (a) cash,
certified check, bank cashier's check, bank
credit, or bank wire transfer; (b) credit to the
account of the Custodian with a clearing
corporation of a national securities exchange of
which the Custodian is a member; or (c) credit to
the Account of the Custodian with a Securities
System, in accordance with the provisions of
Section 4(b)(3) hereof. Notwithstanding the
foregoing, Securities held in physical form may be
delivered and paid for in accordance with "street
delivery custom" to a broker or its clearing
agent, against delivery to the Custodian of a
receipt for such Securities, provided that the
Custodian shall have taken reasonable steps to
ensure prompt collection of the payment for, or
return of, such Securities by the broker or its
clearing agent, and provided further that the
Custodian shall not be responsible for the
selection of or the failure or inability to
perform of such broker or its clearing agent or
for any related loss arising from delivery or
custody of such Securities prior to receiving
payment therefor.
(2) Other Assets Sold. Upon receipt of
Instructions and except as otherwise provided
herein, the Custodian shall receive payment for
and deliver other Assets for the account of the
Fund as provided in Instructions.
(g) Options.
(1) Upon receipt of Instructions relating to
the purchase of an option or sale of a covered
call option, the Custodian shall: (a) receive and
retain confirmations or other documents, if any,
evidencing the purchase or writing of the option
by the Fund; (b) if the transaction involves the
sale of a covered call option, deposit and
maintain in a segregated account the Securities
(either physically or by book-entry in a
Securities System) subject to the covered call
option written on behalf of the Fund; and (c) pay,
release and/or transfer such Securities, cash or
other Assets in accordance with any notices or
other communications evidencing the expiration,
termination or exercise of such options which are
furnished to the Custodian by the Options Clearing
Corporation (the "OCC"), the securities or options
exchanges on which such options were traded, or
such other organization as may be responsible for
handling such option transactions.
(2) Upon receipt of Instructions relating to
the sale of a naked option (including but not
limited to, stock index and commodity options),
the Custodian, the Fund and the broker-dealer
shall enter into an agreement to comply with the
rules of the OCC or of any registered national
securities exchange or similar organizations(s).
Pursuant to that agreement and the Fund's
Instructions, the Custodian shall: (a) receive and
retain confirmations or other documents, if any,
evidencing the writing of the option; (b) deposit
and maintain in a segregated account, Securities
(either physically or by book-entry in a
Securities System), cash and/or other Assets; and
(c) pay, release and/or transfer such Securities,
cash or other Assets in accordance with any such
agreement and with any notices or other
communications evidencing the expiration,
termination or exercise of such option which are
furnished to the Custodian by the OCC, the
securities or options exchanges on which such
options were traded, or such other organization as
may be responsible for handling such option
transactions. The Fund and the broker-dealer
shall be responsible for determining the quality
and quantity of assets held in any segregated
account established in compliance with applicable
margin maintenance requirements and the
performance of other terms of any option contract.
(h) Futures Contracts.
Upon receipt of Instructions, the Custodian
shall enter into a futures margin procedural
agreement among the Fund, the Custodian and the
designated futures commission merchant (a
"Procedural Agreement"). Under the Procedural
Agreement the Custodian shall: (a) receive and
retain confirmations, if any, evidencing the
purchase or sale of a futures contract or an
option on a futures contract by the Fund; (b)
deposit and maintain in a segregated account cash,
Securities and/or other Assets designated as
initial, maintenance or variation "margin"
deposits intended to secure the Fund's performance
of its obligations under any futures contracts
purchased or sold, or any options on futures
contracts written by the Fund, in accordance with
the provisions of any Procedural Agreement
designed to comply with the provisions of the
Commodity Futures Trading Commission and/or any
commodity exchange or contract market (such as the
Chicago Board of Trade), or any similar
organization(s), regarding such margin deposits;
and (c) release Assets from and/or transfer Assets
into such margin accounts only in accordance with
any such Procedural Agreements. The Fund and such
futures commission merchant shall be responsible
for determining the type and amount of Assets held
in the segregated account or paid to the broker-
dealer in compliance with applicable margin
maintenance requirements and the performance of
any futures contract or option on a futures
contract in accordance with its terms.
(i) Segregated Accounts.
Upon receipt of Instructions, the Custodian
shall establish and maintain on its books a
segregated account or accounts for and on behalf
of the Fund, into which account or accounts may be
transferred Assets of the Fund, including
Securities maintained by the Custodian in a
Securities System pursuant to Paragraph (b)(3) of
this Section 4, said account or accounts to be
maintained (i) for the purposes set forth in
Sections 4(g), 4(h) and 4(n) and (ii) for the
purpose of compliance by the Fund with the
procedures required by the SEC Investment Company
Act Release Number 10666 or any subsequent
release, releases, or no-action or interpretive
letters relating to the maintenance of segregated
accounts by registered investment companies, or
(iii) for such other purposes as may be set forth,
from time to time, in Special Instructions. The
Custodian shall not be responsible for the
determination of the type or amount of Assets to
be held in any segregated account referred to in
this paragraph, or for compliance by the Fund with
required procedures noted in (ii) above.
(j) Depositary Receipts.
Upon receipt of Instructions, the Custodian
shall surrender or cause to be surrendered
Securities to the depositary used for such
Securities by an issuer of American Depositary
Receipts or International Depositary Receipts, or
other U.S. dollar denominated receipts
(hereinafter referred to, collectively, as
"ADRs"), against a written receipt therefor
adequately describing such Securities and written
evidence satisfactory to the organization
surrendering the same that the depositary has
acknowledged receipt of instructions to issue ADRs
with respect to such Securities in the name of the
Custodian or a nominee of the Custodian, for
delivery in accordance with such instructions.
Upon receipt of Instructions, the Custodian
shall surrender or cause to be surrendered ADRs to
the issuer thereof, against a written receipt
therefor adequately describing the ADRs
surrendered and written evidence satisfactory to
the organization surrendering the same that the
issuer of the ADRs has acknowledged receipt of
instructions to cause its depository to deliver
the Securities underlying such ADRs in accordance
with such instructions.
(k) Corporate Actions, Put Bonds, Called
Bonds, Etc.
Upon receipt of Instructions, the Custodian
shall: (a) deliver warrants, puts, calls, rights
or similar Securities to the issuer or trustee
thereof (or to the agent of such issuer or
trustee) for the purpose of exercise or sale,
provided that the new Securities, cash or other
Assets, if any, acquired as a result of such
actions are to be delivered to the Custodian; and
(b) deposit Securities upon invitations for
tenders thereof, provided that the consideration
for such Securities is to be paid or delivered to
the Custodian, or the tendered Securities are to
be returned to the Custodian.
Notwithstanding any provision of this
Agreement to the contrary, the Custodian shall
take all necessary action, unless otherwise
directed to the contrary in Instructions, to
comply with the terms of all mandatory or
compulsory exchanges, calls, tenders, redemptions,
or similar rights of security ownership, and shall
notify the Fund of such action in writing by
facsimile transmission or in such other manner as
the Fund and Custodian may agree in writing.
The Fund agrees that if it gives an
Instruction for the performance of an act on the
last permissible date of a period established by
any optional offer or on the last permissible date
for the performance of such act, the Fund shall
hold the Bank harmless from any adverse
consequences in connection with acting upon or
failing to act upon such Instructions.
(1) Interest Bearing Deposits.
Upon receipt of Instructions directing the
Custodian to purchase interest bearing fixed-term
and call deposits (hereinafter referred to,
collectively, as "Interest Bearing Deposits") for
the account of the Fund, the Custodian shall
purchase such Interest Bearing Deposits in the
name of the Fund with such banks or trust
companies, including the Custodian, any
Subcustodian or any subsidiary or affiliate of the
Custodian (hereinafter referred to as "Banking
Institutions"), and in such amounts as the Fund
may direct pursuant to Instructions. Such
Interest Bearing Deposits may be denominated in
U.S. Dollars or other currencies, as the Fund may
determine and direct pursuant to Instructions.
The responsibilities of the Custodian to the Fund
for Interest Bearing Deposits issued by the
Custodian shall be that of a U.S. bank for a
similar deposit. With respect to Interest Bearing
Deposits other than those issued by the Custodian,
(a) the Custodian shall be responsible for the
collection of income and the transmission of cash
to and from such accounts; and (b) the Custodian
shall have no duty with respect to the selection
of the Banking Institution or for the failure of
such Banking Institution to pay upon demand.
(m) Foreign Exchange Transactions Other than
as Principal.
(1) Upon receipt of Instructions, the
Custodian shall settle foreign exchange contracts
or options to purchase and sell foreign currencies
for spot and future delivery on behalf of and for
the account of the Fund with such currency brokers
or Banking Institutions as the Fund may determine
and direct pursuant to Instructions. The Fund
accepts full responsibility for its use of third
party foreign exchange brokers and for execution
of said foreign exchange contracts and understands
that the Fund shall be responsible for any and all
costs and interest charges which may be incurred
as a result of the failure or delay of its third
party broker to deliver foreign exchange. The
Custodian shall have no responsibility with
respect to the selection of the currency brokers
or Banking Institutions with which the Fund deals
or, so long as the Custodian acts in accordance
with Instructions, for the failure of such brokers
or Banking Institutions to comply with the terms
of any contract or option.
(2) Notwithstanding anything to the contrary
contained herein, upon receipt of Instructions the
Custodian may, in connection with a foreign
exchange contract, make free outgoing payments of
cash in the form of U.S. Dollars or foreign
currency prior to receipt of confirmation of such
foreign exchange contract or confirmation that the
countervalue currency completing such contract has
been delivered or received.
(n) Pledges or Loans of Securities.
(1) Upon receipt of Instructions from the
Fund, the Custodian will release or cause to be
released Securities held in custody to the
pledgees designated in such Instructions by way of
pledge or hypothecation to secure loans incurred
by the Fund with various lenders including but not
limited to UMB Bank, n.a.; provided, however, that
the Securities shall be released only upon payment
to the Custodian of the monies borrowed, except
that in cases where additional collateral is
required to secure existing borrowings, further
Securities may be released or delivered, or caused
to be released or delivered for that purpose upon
receipt of Instructions. Upon receipt of
Instructions, the Custodian will pay, but only
from funds available for such purpose, any such
loan upon re-delivery to it of the Securities
pledged or hypothecated therefor and upon
surrender of the note or notes evidencing such
loan. In lieu of delivering collateral to a
pledgee, the Custodian, on the receipt of
Instructions, shall transfer the pledged
Securities to a segregated account for the benefit
of the pledgee.
(2) Upon receipt of Special Instructions,
and execution of a separate Securities Lending
Agreement, the Custodian will release Securities
held in custody to the borrower designated in such
Instructions and may, except as otherwise provided
below, deliver such Securities prior to the
receipt of collateral, if any, for such borrowing,
provided that, in case of loans of Securities held
by a Securities System that are secured by cash
collateral, the Custodian's instructions to the
Securities System shall require that the
Securities System deliver the Securities of the
Fund to the borrower thereof only upon receipt of
the collateral for such borrowing. The Custodian
shall have no responsibility or liability for any
loss arising from the delivery of Securities prior
to the receipt of collateral. Upon receipt of
Instructions and the loaned Securities, the
Custodian will release the collateral to the
borrower.
(o) Stock Dividends, Rights, Etc.
The Custodian shall receive and collect all
stock dividends, rights, and other items of like
nature and, upon receipt of Instructions, take
action with respect to the same as directed in
such Instructions.
(p) Routine Dealings.
The Custodian will, in general, attend to all
routine and mechanical matters in accordance with
industry standards in connection with the sale,
exchange, substitution, purchase, transfer, or
other dealings with Securities or other property
of the Fund except as may be otherwise provided in
this Agreement or directed from time to time by
Instructions from the Fund. The Custodian may
also make payments to itself or others from the
Assets for disbursements and out-of-pocket
expenses incidental to handling Securities or
other similar items relating to its duties under
this Agreement, provided that all such payments
shall be accounted for to the Fund.
(q) Collections.
The Custodian shall (a) collect amounts due
and payable to the Fund with respect to portfolio
Securities and other Assets; (b) promptly credit
to the account of the Fund all income and other
payments relating to portfolio Securities and
other Assets held by the Custodian hereunder upon
Custodian's receipt of such income or payments or
as otherwise agreed in writing by the Custodian
and the Fund; (c) promptly endorse and deliver any
instruments required to effect such collection;
and (d) promptly execute ownership and other
certificates and affidavits for all federal,
state, local and foreign tax purposes in
connection with receipt of income or other
payments with respect to portfolio Securities and
other Assets, or in connection with the transfer
of such Securities or other Assets; provided,
however, that with respect to portfolio Securities
registered in so-called street name, or physical
Securities with variable interest rates, the
Custodian shall use its best efforts to collect
amounts due and payable to the Fund. The
Custodian shall notify the Fund in writing by
facsimile transmission or in such other manner as
the Fund and Custodian may agree in writing if any
amount payable with respect to portfolio
Securities or other Assets is not received by the
Custodian when due. The Custodian shall not be
responsible for the collection of amounts due and
payable with respect to portfolio Securities or
other Assets that are in default.
(r) Bank Accounts.
Upon Instructions, the Custodian shall open
and operate a bank account or accounts on the
books of the Custodian; provided that such bank
account(s) shall be in the name of the Custodian
or a nominee thereof, for the account of the Fund,
and shall be subject only to draft or order of the
Custodian. The responsibilities of the Custodian
to the Fund for deposits accepted on the
Custodian's books shall be that of a U.S. bank for
a similar deposit.
(s) Dividends, Distributions and
Redemptions.
To enable the Fund to pay dividends or other
distributions to shareholders of the Fund and to
make payment to shareholders who have requested
repurchase or redemption of their shares of the
Fund (collectively, the "Shares"), the Custodian
shall release cash or Securities insofar as
available. In the case of cash, the Custodian
shall, upon the receipt of Instructions, transfer
such funds by check or wire transfer to any
account at any bank or trust company designated by
the Fund in such Instructions. In the case of
Securities, the Custodian shall, upon the receipt
of Special Instructions, make such transfer to any
entity or account designated by the Fund in such
Special Instructions.
(t) Proceeds from Shares Sold.
The Custodian shall receive funds
representing cash payments received for shares
issued or sold from time to time by the Fund, and
shall credit such funds to the account of the
Fund. The Custodian shall notify the Fund of
Custodian's receipt of cash in payment for shares
issued by the Fund by facsimile transmission or in
such other manner as the Fund and the Custodian
shall agree. Upon receipt of Instructions, the
Custodian shall: (a) deliver all federal funds
received by the Custodian in payment for shares as
may be set forth in such Instructions and at a
time agreed upon between the Custodian and the
Fund; and (b) make federal funds available to the
Fund 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
which are deposited to the accounts of the Fund.
(u) Proxies and Notices; Compliance with the
Shareholders Communication Act of 1985.
The Custodian shall deliver or cause to be
delivered to the Fund all forms of proxies, all
notices of meetings, and any other notices or
announcements affecting or relating to Securities
owned by the Fund that are received by the
Custodian, any Subcustodian, or any nominee of
either of them, and, upon receipt of Instructions,
the Custodian shall execute and deliver, or cause
such Subcustodian or nominee to execute and
deliver, such proxies or other authorizations as
may be required. Except as directed pursuant to
Instructions, neither the Custodian nor any
Subcustodian or nominee shall vote upon any such
Securities, or execute any proxy to vote thereon,
or give any consent or take any other action with
respect thereto.
The Custodian will not release the identity
of the Fund to an issuer which requests such
information pursuant to the Shareholder
Communications Act of 1985 for the specific
purpose of direct communications between such
issuer and the Fund unless the Fund directs the
Custodian otherwise in writing.
(v) Books and Records.
The Custodian shall maintain such records
relating to its activities under this Agreement as
are required to be maintained by Rule 31a-1 under
the Investment Company Act of 1940 ("▇▇▇ ▇▇▇▇
▇▇▇") and to preserve them for the periods
prescribed in Rule 31a-2 under the 1940 Act.
These records shall be open for inspection by duly
authorized officers, employees or agents
(including independent public accountants) of the
Fund during normal business hours of the
Custodian.
The Custodian shall provide accountings
relating to its activities under this Agreement as
shall be agreed upon by the Fund and the
Custodian.
(w) Opinion of Fund's Independent Certified
Public Accountants.
The Custodian shall take all reasonable
action as the Fund may request to obtain from year
to year favorable opinions from the Fund's
independent certified public accountants with
respect to the Custodian's activities hereunder
and in connection with the preparation of the
Fund's periodic reports to the SEC and with
respect to any other requirements of the SEC.
(x) Reports by Independent Certified Public
Accountants.
At the request of the Fund, the Custodian
shall deliver to the Fund a written report
prepared by the Custodian's independent certified
public accountants with respect to the services
provided by the Custodian under this Agreement,
including, without limitation, the Custodian's
accounting system, internal accounting control and
procedures for safeguarding cash, Securities and
other Assets, including cash, Securities and other
Assets deposited and/or maintained in a Securities
System or with a Subcustodian. Such report shall
be of sufficient scope and in sufficient detail as
may reasonably be required by the Fund and as may
reasonably be obtained by the Custodian.
(y) Bills and Other Disbursements.
Upon receipt of Instructions, the Custodian
shall pay, or cause to be paid, all bills,
statements, or other obligations of the Fund.
5. SUBCUSTODIANS.
From time to time, in accordance with the relevant
provisions of this Agreement, the Custodian may appoint
one or more Domestic Subcustodians, Foreign
Subcustodians, Special Subcustodians, or Interim
Subcustodians (as each are hereinafter defined) to act
on behalf of the Fund. A Domestic Subcustodian, in
accordance with the provisions of this Agreement, may
also appoint a Foreign Subcustodian, Special
Subcustodian, or Interim Subcustodian to act on behalf
of the Fund. For purposes of this Agreement, all
Domestic Subcustodians, Foreign Subcustodians, Special
Subcustodians and Interim Subcustodians shall be
referred to collectively as "Subcustodians."
(a) Domestic Subcustodians.
The Custodian may, at any time and from time
to time, appoint any bank as defined in Section
2(a)(5) of the 1940 Act or any trust company or
other entity, any of which meet the requirements
of a custodian under Section 17(f) of the 1940 Act
and the rules and regulations thereunder, to act
for the Custodian on behalf of the Fund as a
subcustodian for purposes of holding Assets of the
Fund and performing other functions of the
Custodian within the United States (a "Domestic
Subcustodian"). The Fund shall approve in writing
the appointment of the proposed Domestic
Subcustodian; and the Custodian's appointment of
any such Domestic Subcustodian shall not be
effective without such prior written approval of
the Fund. Each such duly approved Domestic
Subcustodian shall be listed on Appendix A
attached hereto, as it may be amended, from time
to time.
(b) Foreign Subcustodians.
The Custodian may at any time appoint, or
cause a Domestic Subcustodian to appoint, any
bank, trust company or other entity meeting the
requirements of an "eligible foreign custodian"
under Section 17(f) of the 1940 Act and the rules
and regulations thereunder to act for the
Custodian on behalf of the Fund as a subcustodian
or sub-subcustodian (if appointed by a Domestic
Subcustodian) for purposes of holding Assets of
the Fund and performing other functions of the
Custodian in countries other than the United
States of America (hereinafter referred to as a
"Foreign Subcustodian" in the context of either a
subcustodian or a sub-subcustodian); provided that
the Custodian shall have obtained written
confirmation from the Fund of the approval of the
Board of Directors or other governing body of the
Fund (which approval may be withheld in the sole
discretion of such Board of Directors or other
governing body or entity) with respect to (i) the
identity of any proposed Foreign Subcustodian
(including branch designation), (ii) the country
or countries in which, and the securities
depositories or clearing agencies (hereinafter
"Securities Depositories and Clearing Agencies"),
if any, through which, the Custodian or any
proposed Foreign Subcustodian is authorized to
hold Securities and other Assets of the Fund, and
(iii) the form and terms of the subcustodian
agreement to be entered into with such proposed
Foreign Subcustodian. Each such duly approved
Foreign Subcustodian and the countries where and
the Securities Depositories and Clearing Agencies
through which they may hold Securities and other
Assets of the Fund shall be listed on Appendix A
attached hereto, as it may be amended, from time
to time. The Fund shall be responsible for
informing the Custodian sufficiently in advance of
a proposed investment which is to be held in a
country in which no Foreign Subcustodian is
authorized to act, in order that there shall be
sufficient time for the Custodian, or any Domestic
Subcustodian, to effect the appropriate
arrangements with a proposed Foreign Subcustodian,
including obtaining approval as provided in this
Section 5(b). In connection with the appointment
of any Foreign Subcustodian, the Custodian shall,
or shall cause the Domestic Subcustodian to, enter
into a subcustodian agreement with the Foreign
Subcustodian in form and substance approved by the
Fund. The Custodian shall not consent to the
amendment of, and shall cause any Domestic
Subcustodian not to consent to the amendment of,
any agreement entered into with a Foreign
Subcustodian, which materially affects the Fund's
rights under such agreement, except upon prior
written approval of the Fund pursuant to Special
Instructions.
(c) Interim Subcustodians.
Notwithstanding the foregoing, in the event
that the Fund shall invest in an Asset to be held
in a country in which no Foreign Subcustodian is
authorized to act, the Custodian shall notify the
Fund in writing by facsimile transmission or in
such other manner as the Fund and Custodian shall
agree in writing of the unavailability of an
approved Foreign Subcustodian in such country; and
upon the receipt of Special Instructions from the
Fund, the Custodian shall, or shall cause its
Domestic Subcustodian to, appoint or approve an
entity (referred to herein as an "Interim
Subcustodian") designated in such Special
Instructions to hold such Security or other Asset.
(d) Special Subcustodians.
Upon receipt of Special Instructions, the
Custodian shall, on behalf of the Fund, appoint
one or more banks, trust companies or other
entities designated in such Special Instructions
to act for the Custodian on behalf of the Fund as
a subcustodian for purposes of: (i) effecting
third-party repurchase transactions with banks,
brokers, dealers or other entities through the use
of a common custodian or subcustodian; (ii)
providing depository and clearing agency services
with respect to certain variable rate demand note
Securities, (iii) providing depository and
clearing agency services with respect to dollar
denominated Securities, and (iv) effecting any
other transactions designated by the Fund in such
Special Instructions. Each such designated
subcustodian (hereinafter referred to as a
"Special Subcustodian") shall be listed on
Appendix A attached hereto, as it may be amended
from time to time. In connection with the
appointment of any Special Subcustodian, the
Custodian shall enter into a subcustodian
agreement with the Special Subcustodian in form
and substance approved by the Fund in Special
Instructions. The Custodian shall not amend any
subcustodian agreement entered into with a Special
Subcustodian, or waive any rights under such
agreement, except upon prior approval pursuant to
Special Instructions.
(e) Termination of a Subcustodian.
The Custodian may, at any time in its
discretion upon prior notification to the Fund,
terminate any Subcustodian of the Fund in
accordance with the termination provisions under
the applicable subcustodian agreement, and upon
the receipt of Special Instructions, the Custodian
will terminate any Subcustodian in accordance with
the termination provisions under the applicable
subcustodian agreement.
(f) Certification Regarding Foreign
Subcustodians.
Upon request of the Fund, the Custodian shall
deliver to the Fund a certificate stating: (i) the
identity of each Foreign Subcustodian then acting
on behalf of the Custodian; (ii) the countries in
which and the Securities Depositories and Clearing
Agencies through which each such Foreign
Subcustodian is then holding cash, Securities and
other Assets of the Fund; and (iii) such other
information as may be requested by the Fund, and
as the Custodian shall be reasonably able to
obtain, to evidence compliance with rules and
regulations under the 1940 Act.
6. STANDARD OF CARE.
(a) General Standard of Care.
The Custodian shall be liable to the Fund for
all losses, damages and reasonable costs and
expenses suffered or incurred by the Fund
resulting from the gross negligence or willful
misfeasance of the Custodian; provided, however,
in no event shall the Custodian be liable for
special, indirect or consequential damages arising
under or in connection with this Agreement.
(b) Actions Prohibited by Applicable Law,
Events Beyond Custodian's Control,
Sovereign Risk, Etc.
In no event shall the Custodian or any
Domestic Subcustodian incur liability hereunder if
the Custodian or any Subcustodian or Securities
System, or any subcustodian, Securities System,
Securities Depository or Clearing Agency utilized
by the Custodian or any such Subcustodian, or any
nominee of the Custodian or any Subcustodian
(individually, a "Person") is prevented, forbidden
or delayed from performing, or omits to perform,
any act or thing which this Agreement provides
shall be performed or omitted to be performed, by
reason of: (i) any provision of any present or
future law or regulation or order of the United
States of America, or any state thereof, or of any
foreign country, or political subdivision thereof
or of any court of competent jurisdiction (and
neither the Custodian nor any other Person shall
be obligated to take any action contrary thereto);
or (ii) any event beyond the control of the
Custodian or other Person such as armed conflict,
riots, strikes, lockouts, labor disputes,
equipment or transmission failures, natural
disasters, or failure of the mails,
transportation, communications or power supply; or
(iii) any "Sovereign Risk." A "Sovereign Risk"
shall mean nationalization, expropriation,
devaluation, revaluation, confiscation, seizure,
cancellation, destruction or similar action by any
governmental authority, de facto or de jure; or
enactment, promulgation, imposition or enforcement
by any such governmental authority of currency
restrictions, exchange controls, taxes, levies or
other charges affecting the Fund's Assets; or acts
of armed conflict, terrorism, insurrection or
revolution; or any other act or event beyond the
Custodian's or such other Person's control.
(c) Mitigation by Custodian.
Upon the occurrence of any event which causes
or may cause any loss, damage, or expense to the
Fund, (i) the Custodian shall, (ii) the Custodian
shall cause any applicable Domestic Subcustodian
to, and (iii) the Custodian shall use its best
efforts to cause any applicable Foreign
Subcustodian, Special Subcustodian or Interim
Subcustodian to, use all commercially reasonable
efforts to take all reasonable steps under the
circumstances to mitigate the effects of such
event and to avoid continuing harm to the Fund.
(d) Liability for Past Records.
Neither the Custodian nor any Domestic
Subcustodian shall have any liability in respect
of any loss, damage or expense suffered by the
Fund, insofar as such loss, damage or expense
arises from the performance of the Custodian or
any Domestic Subcustodian in reliance upon records
that were maintained for the Fund by entities
other than the Custodian or any Domestic
Subcustodian prior to the Custodian's employment
hereunder.
(e) Advice of Counsel.
The Custodian and all Domestic Subcustodians
shall be entitled to receive and act upon advice
of counsel of its own choosing on all matters.
The Custodian and all Domestic Subcustodians shall
be without liability for any actions taken or
omitted in good faith pursuant to the advice of
counsel.
(f) Advice of the Fund and Others.
The Custodian and any Domestic Subcustodian
may rely upon the advice of the Fund and upon
statements of the Fund's accountants and .other
persons believed by it in good faith to be expert
in matters upon which they are consulted, and
neither the Custodian nor any Domestic
Subcustodian shall be liable for any actions taken
or omitted, in good faith, pursuant to such advice
or statements.
(g) Instructions Appearing to be Genuine.
The Custodian and all Domestic Subcustodians
shall be fully protected and indemnified in acting
as a custodian hereunder upon any Resolutions of
the Board of Directors or Trustees, Instructions,
Special Instructions, advice, notice, request,
consent, certificate, instrument or paper
appearing to it to be genuine and to have been
properly executed and shall, unless otherwise
specifically provided herein, be entitled to
receive as conclusive proof of any fact or matter
required to be ascertained from the Fund hereunder
a certificate signed by any officer of the Fund
authorized to countersign or confirm Special
Instructions.
(h) Exceptions from Liability.
Without limiting the generality of any other
provisions hereof, neither the Custodian nor any
Domestic Subcustodian shall be under any duty or
obligation to inquire into, nor be liable for:
(i) the validity of the issue of any
Securities purchased by or for the Fund, the
legality of the purchase thereof or evidence
of ownership required to be received by the
Fund, or the propriety of the decision to
purchase or amount paid therefor;
(ii) the legality of the sale of any
Securities by or for the Fund, or the
propriety of the amount for which the same
were sold; or
(iii) any other expenditures,
encumbrances of Securities, borrowings or
similar actions with respect to the Fund's
Assets;
and may, until notified to the contrary, presume
that all Instructions or Special Instructions
received by it are not in conflict with or in any
way contrary to any provisions of the Fund's
Declaration of Trust, Partnership Agreement,
Articles of Incorporation or By-Laws or votes or
proceedings of the shareholders, trustees,
partners or directors of the Fund, or the Fund's
currently effective Registration Statement on file
with the SEC.
7. LIABILITY OF THE CUSTODIAN FOR ACTIONS OF
OTHERS.
(a) Domestic Subcustodians.
The Custodian shall be liable for the acts or
omissions of any Domestic Subcustodian to the same
extent as if such actions or omissions were
performed by the Custodian itself.
(b) Liability for Acts and Omissions of
Foreign Subcustodians.
The Custodian shall be liable to the Fund for
any loss or damage to the Fund caused by or
resulting from the acts or omissions of any
Foreign Subcustodian to the extent that, under the
terms set forth in the subcustodian agreement
between the Custodian or a Domestic Subcustodian
and such Foreign Subcustodian, the Foreign
Subcustodian has failed to perform in accordance
with the standard of conduct imposed under such
subcustodian agreement.
(c) Securities Systems, Interim
Subcustodians, Special Subcustodians,
Securities Depositories and Clearing
Agencies.
The Custodian shall not be liable to the Fund
for any loss, damage or expense suffered or
incurred by the Fund resulting from or occasioned
by the actions or omissions of a Securities
System, Interim Subcustodian, Special
Subcustodian, or Securities Depository and
Clearing Agency unless such loss, damage or
expense is caused by, or results from, the gross
negligence or willful misfeasance of the
Custodian.
(d) Defaults or Insolvencies of Brokers,
Banks, Etc.
The Custodian shall not be liable for any
loss, damage or expense suffered or incurred by
the Fund resulting from or occasioned by the
actions, omissions, neglects, defaults or
insolvency of any broker, bank, trust company or
any other person with whom the Custodian may deal
(other than any of such entities acting as a
Subcustodian, Securities System or Securities
Depository and Clearing Agency, for whose actions
the liability of the Custodian is set out
elsewhere in this Agreement) unless such loss,
damage or expense is caused by, or results from,
the gross negligence or willful misfeasance of the
Custodian.
(e) Reimbursement of Expenses.
The Fund agrees to reimburse the Custodian
for all out-of-pocket expenses incurred by the
Custodian in connection with this Agreement, but
excluding salaries, usual overhead expenses, and
expenses occasioned by or resulting from the
negligence or willful misconduct of the Custodian.
8. INDEMNIFICATION.
(a) Indemnification by Fund.
Subject to the limitations set forth in this
Agreement, the Fund agrees to indemnify and hold
harmless the Custodian and its nominees from all
losses, damages and expenses (including reasonable
attorneys' fees) suffered or incurred by the
Custodian or its nominee caused by or arising from
actions taken by the Custodian, its employees or
agents in the performance of its duties and
obligations under this Agreement, including, but
not limited to, any indemnification obligations
undertaken by the Custodian under any relevant
subcustodian agreement; provided, however, that
such indemnity shall not apply to the extent the
Custodian is liable under Sections 6 or 7 hereof.
If the Fund requires the Custodian to take
any action with respect to Securities, which
action involves the payment of money or which 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
it.
(b) Indemnification by Custodian.
Subject to the limitations set forth in this
Agreement and in addition to the obligations
provided in Sections 6 and 7, the Custodian agrees
to indemnify and hold harmless the Fund from all
losses, damages and expenses suffered or incurred
by the Fund caused by the gross negligence or
willful misfeasance of the Custodian.
9. ADVANCES.
In the event that, pursuant to Instructions, the
Custodian or any Subcustodian, Securities System, or
Securities Depository or Clearing Agency acting either
directly or indirectly under agreement with the
Custodian (each of which for purposes of this Section 9
shall be referred to as "Custodian"), makes any payment
or transfer of funds on behalf of the Fund as to which
there would be, at the close of business on the date of
such payment or transfer, insufficient funds held by
the Custodian on behalf of the Fund, the Custodian may,
in its discretion without further Instructions, provide
an advance ("Advance") to the Fund in an amount
sufficient to allow the completion of the transaction
by reason of which such payment or transfer of funds is
to be made. In addition, in the event the Custodian is
directed by Instructions to make any payment or
transfer of funds on behalf of the Fund as to which it
is subsequently determined that the Fund has overdrawn
its cash account with the Custodian as of the close of
business on the date of such payment or transfer, said
overdraft shall constitute an Advance. Any Advance
shall be payable by the Fund on demand by Custodian,
unless otherwise agreed by the Fund and the Custodian,
and shall accrue interest from the date of the Advance
to the date of payment by the Fund to the Custodian at
a rate agreed upon in writing from time to time by the
Custodian and the Fund. It is understood that any
transaction in respect of which the Custodian shall
have made an Advance, including but not limited to a
foreign exchange contract or transaction in respect of
which the Custodian is not acting as a principal, is
for the account of and at the risk of the Fund, and
not, by reason of such Advance, deemed to be a
transaction undertaken by the Custodian for its own
account and risk. The Custodian and the Fund
acknowledge that the purpose of Advances is to meet
emergency expenses not reasonably foreseeable by the
Fund. The Custodian shall promptly notify the Fund of
any Advance. Such notification shall be sent by
facsimile transmission or in such other manner as the
Fund and the Custodian may agree.
10. LIENS.
The Bank shall have a lien on the Property in the
Custody Account to secure payment of fees and expenses
for the services rendered under this Agreement. If the
Bank advances cash or securities to the Fund for any
purpose or in the event that the Bank or its nominee
shall incur or be assessed any taxes, charges,
expenses, assessments, claims or liabilities in
connection with the performance of its duties
hereunder, except such as may arise from its or its
nominee's negligent action, negligent failure to act or
willful misconduct, any Property at any time held for
the Custody Account shall be security therefor and the
Fund hereby grants a security interest therein to the
Bank. The Fund shall promptly reimburse the Bank for
any such advance of cash or securities or any such
taxes, charges, expenses, assessments, claims or
liabilities upon request for payment, but should the
Fund fail to so reimburse the Bank, the Bank shall be
entitled to dispose of such Property to the extent
necessary to obtain reimbursement. The Bank shall be
entitled to debit any account of the Fund with the Bank
including, without limitation, the Custody Account, in
connection with any such advance and any interest on
such advance as the Bank deems reasonable.
11. COMPENSATION.
The Fund will pay to the Custodian such
compensation as is agreed to in writing by the
Custodian and the Fund from time to time as set forth
on Appendix B, Fee Schedule. Such compensation,
together with all amounts for which the Custodian is to
be reimbursed in accordance with Section 7(e), shall be
billed to the Fund and paid in cash to the Custodian.
12. POWERS OF ATTORNEY.
Upon request, the Fund shall deliver to the
Custodian such proxies, powers of attorney or other
instruments as may be reasonable and necessary or
desirable in connection with the performance by the
Custodian or any Subcustodian of their respective
obligations under this Agreement or any applicable
subcustodian agreement.
13. TERMINATION AND ASSIGNMENT.
The Fund or the Custodian may terminate this
Agreement by notice in writing, delivered or mailed,
postage prepaid (certified mail, return receipt
requested) to the other not less than 60 days prior to
the date upon which such termination shall take effect.
Upon termination of this Agreement, the Fund shall pay
to the Custodian such fees as may be due the Custodian
hereunder as well as its reimbursable disbursements,
costs and expenses paid or incurred. Upon termination
of this Agreement, the Custodian shall deliver, at the
terminating party's expense, all Assets held by it
hereunder to the Fund or as otherwise designated by the
Fund by Special Instructions. Upon such delivery, the
Custodian shall have no further obligations or
liabilities under this Agreement except as to the final
resolution of matters relating to activity occurring
prior to the effective date of termination.
This Agreement may not be assigned by the
Custodian or the Fund without the respective consent of
the other, duly authorized by a resolution by its Board
of Directors or Trustees.
14. NOTICES.
Notices, requests, instructions and other writings
delivered to the Fund at ▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
postage prepaid, or to such other address as the Fund
may have designated to the Custodian in writing, shall
be deemed to have been properly delivered or given to
the Fund.
Notices, requests, instructions and other writings
delivered to the Securities Administration Department
of the Custodian at its office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, or mailed postage prepaid, to
the Custodian's Securities ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or to
such other addresses as the Custodian may have
designated to the Fund in writing, shall be deemed to
have been properly delivered or given to the Custodian
hereunder; provided, however, that procedures for the
delivery of Instructions and Special Instructions shall
be governed by Section 2(c) hereof.
15 MISCELLANEOUS.
(a) This Agreement is executed and delivered
in the State of Missouri and shall be governed by
the laws of such state.
(b) All of the terms and provisions of this
Agreement shall be binding upon, and inure to the
benefit of, and be enforceable by the respective
successors and assigns of the parties hereto.
(c) No provisions of this Agreement may be
amended, modified or waived, in any manner except
in writing, properly executed by both parties
hereto; provided, however, Appendix A may be
amended from time to time as Domestic
Subcustodians, Foreign Subcustodians, Special
Subcustodians, and Securities Depositories and
Clearing Agencies are approved or terminated
according to the terms of this Agreement.
(d) The captions in this Agreement are
included for convenience of reference only, and in
no way define or delimit any of the provisions
hereof or otherwise affect their construction or
effect.
(e) This Agreement shall be effective as of
the date of execution hereof.
(f) This Agreement may be executed
simultaneously in two or more counterparts, each
of which will be deemed an original, but all of
which together will constitute one and the same
instrument.
(g) The following terms are defined terms
within the meaning of this Agreement, and the
definitions thereof are found in the following
sections of the Agreement:
Term Section
Account 4(b)(3)(ii)
ADR'S 4(j)
Advance 9
Assets 2(b)
Authorized Person 3
Banking Institution 4(l)
Domestic Subcustodian 5(a)
Foreign Subcustodian 5(b)
Instruction 2(c)(1)
Interim Subcustodian 5(c)
Interest Bearing Deposit 4(l)
Liens 10
OCC 4(g)(1)
Person 6(b)
Procedural Agreement 4(h)
SEC 4(b)(3)
Securities 2(a)
Securities Depositories and 5(b)(ii)
Clearing Agencies
Securities System 4(b)(3)
Shares 4(s)
Sovereign Risk 6(b)
Special Instruction 2(c)(2)
Special Subcustodian 5(d)
Subcustodian 5
1940 Act 4(v)
(h) If any part, term or provision of this
Agreement is held to be illegal, in conflict with
any law or otherwise invalid by any court of
competent jurisdiction, the remaining portion or
portions shall be considered severable and shall
not be affected, and the rights and obligations of
the parties shall be construed and enforced as if
this Agreement did not contain the particular
part, term or provision held to be illegal or
invalid.
(i) This Agreement constitutes the entire
understanding and agreement of the parties hereto
with respect to the subject matter hereof, and
accordingly supersedes, as of the effective date
of this Agreement, any custodian agreement
heretofore in effect between the Fund and the
Custodian.
IN WITNESS WHEREOF, the parties hereto have caused
this Custody Agreement to be executed by their duly
respective authorized officers.
ICAP FUNDS, INC.
ATTEST:
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------- -----------------------------
Title: Senior Vice President
UMB BANK, N.A.
ATTEST:
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------- ---------------------------
Title: Senior Vice President
APPENDIX A
DOMESTIC SUBCUSTODIANS:
United Missouri Trust Company of New York
▇▇▇▇▇ Brothers ▇▇▇▇▇▇▇▇ & Company (Foreign
Securities Only)
SECURITIES SYSTEMS:
Federal Book Entry
Depository Trust Company
Participant's Trust Company
SPECIAL SUBCUSTODIANS:
SECURITIES DEPOSITORIES
COUNTRIES FOREIGN SUBCUSTODIANS AND CLEARING AGENCIES
Euroclear
ICAP FUNDS, INC. UMB Bank, n.a.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By:/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------- -------------------------------
Title: Senior Vice President Title: Senior Vice President
Date: 12/30/94
APPENDIX B
UMB Bank, n.a.
Institutional Custody Services - U.S. Domestic
Schedule of Fees
Net Asset Value Charges
A fee to be computed as of month end and payable
on the last day of each month of the portfolios'
fiscal year, at the annual rate of:
1.00 basis point on the combined net assets
up to $250,000,000;
.75 basis points on the next $250,000,000 of
combined net assets;
.50 basis points on the combined net assets
in excess of $500,000,000;
subject to a $100.00 per month minimum per
portfolio.
Portfolio Transaction Fees
DTC* $5.00
PTC* 12.00
Fed Book Entry* 8.00
Physical* 20.00
Third Party (Bank Book Entry)* 15.00
Principal & Interest Payments 5.00
Options/Futures 25.00
Corporate Actions/Calls/Reorgs 25.00
*A transaction includes buys, sells, maturities,
or free security movements.
Out-of-Pocket Expenses
Includes, but is not limited to, security transfer
fees, certificate fees, shipping/courier fees or
charges, and remote system access charges.
Earnings Credits
Earnings credits will be computed on all collected
custody balances using the United Missouri Bank
daily Fed Funds rate, less reserve requirements
and FDIC premiums. Overdrafts will be computed
using the Fed Funds rate plus 1.5% (150 basis
points) on each day an overdraft occurs. Positive
and/or negative credits will be monitored daily
and the net positive or negative credit amount(s)
will be included in the monthly fee statement.
Excess credits can be carried forward
indefinitely.
