CUSTODIAN CONTRACT
BETWEEN
ADVANTUS VENTURE FUND, INC.
AND
NORWEST BANK MINNESOTA, N.A.
TABLE OF CONTENTS
1. Employment of Custodian and Property to be Held by It ...................1
2. Duties of the Custodian with Respect to Property of the Fund Held
by the Custodian.........................................................1
2.1 Holding Securities.................................................1
2.2 Delivery of Securities.............................................1
2.3 Registration of Securities.........................................4
2.4 Bank Accounts......................................................4
2.5 Payments for Shares................................................4
2.6 Availability of Federal Funds......................................4
2.7 Collection of Income...............................................5
2.8 Payment of Fund Monies.............................................5
2.9 Liability for Payment in Advance of Receipt of
Securities Purchased...............................................6
2.10 Payments for Repurchases or Redemption of Shares of the Fund.......6
2.11 Appointment of Agents..............................................7
2.12 Deposit of Fund Assets in Securities Systems.......................7
2.13 Segregated Account.................................................8
2.14 Ownership Certificates for Tax Purposes............................9
2.15 Proxies............................................................9
2.16 Communications Relating to Fund Portfolio Securities...............9
2.17 Proper Instructions................................................9
2.18 Actions Permitted Without Express Authority.......................10
2.19 Evidence of Authority.............................................10
2.20 Class Actions.....................................................10
2.21 Duties of the Custodian with Respect to Fund Property
Held Outside of the United States.................................11
2.21(a) Appointment of Foreign Sub-Custodian....................11
2.21(b) Assets to be Held.......................................11
2.21(c) Segregation of Securities...............................11
2.21(d) Agreement with Foreign Banking Institution..............12
2.21(e) Access of Independent Accountants of the Company........12
2.21(f) Repots by Custodian.....................................12
2.21(g) Foreign Securities Transactions.........................13
2.21(h) Foreign Securities Lending..............................14
2.21(i) Liability of Foreign Sub-Custodian......................15
2.21(j) Monitoring Responsibilities.............................15
2.21(k) Branches of United States Banks.........................15
2.21(l) Expropriation Insurance.................................15
3. Duties of Custodian with Respect to the Books of Account and
Calculation of Net Asset Value and Net Income...........................16
i
4. Records.................................................................16
5. Opinion of Fund's Independent Accountant................................17
6. Reports to Fund by Independent Public Accountants.......................17
7. Compensation of Custodian...............................................17
8. Responsibility of Custodian.............................................17
9. Effective Period, Termination and Amendment.............................18
10. Successor Custodian.....................................................19
11. Interpretive and Additional Provisions..................................20
12. Minnesota Law to Apply..................................................20
13. Prior Contracts.........................................................20
ii
CUSTODIAN CONTRACT
This Contract is between the Advantus Venture Fund, Inc., a corporation
organized and existing under the laws of the State of Minnesota, having its
principal place of business at 000 Xxxxxx Xxxxxx Xxxxx, Xx. Xxxx, Xxxxxxxxx
00000, attached hereto (hereinafter called the "Fund") and Norwest Bank
Minnesota, N.A., a national banking association having its principal place of
business at Sixth and Marquette, Xxxxxxxxxxx, Xxxxxxxxx 00000 (hereinafter
called the "Custodian")
WITNESSETH, that in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:
1. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT
The Fund hereby employs the Custodian as the custodian of its assets
pursuant to the provisions of the Articles of Incorporation. The Fund agrees to
deliver to the Custodian all securities and cash owned by it, and all payments
of income, payments of principal or capital distributions received by it with
respect to all securities owned by the Fund from time to time, and the cash
consideration received by it for such new or treasury shares of capital stock
("Shares") of the Fund as may be issued or sold 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.
Upon receipt of "Proper Instructions" (within the meaning of
Section 2.17), the Custodian shall from time to time employ one or more
sub-custodians, but only in accordance with an applicable vote by the Board of
Directors of the Fund, and provided that the Custodian shall have no more or
less responsibility or liability to the Fund on account of any actions or
omissions of any sub-custodian so employed than any such sub-custodian has to
the Custodian.
2. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE FUND HELD BY THE
CUSTODIAN
2.1. HOLDING SECURITIES
The Custodian shall hold and physically segregate for the account
of the Fund all non-cash property, including all securities owned by the
fund, other than (a) securities which are maintained pursuant to
Section 2.12 in a clearing agency which acts as a securities depository
or in a book-entry system authorized by the U.S. Department of the
Treasury, collectively referred to herein as a "Securities System."
2.2 DELIVERY OF SECURITIES
The Custodian shall release and deliver securities owned by the
Fund held by the Custodian or in a Securities System account of the
Custodian only upon receipt of Proper Instructions, which may be
continuing instructions when deemed appropriate by the parties, and only
in the following cases:
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1) Upon sale of such securities for the account of the Fund and receipt
of payment therefor;
2) Upon the receipt of payment in connection with any repurchase
agreement related to such securities entered into by the Fund;
3) In the case of a sale effected through a Securities System, in
accordance with the provisions of Section 2.12 hereof;
4) To the depository agent in connection with tender or other similar
offers for portfolio securities of the Fund;
5) To the issuer thereof or its agent when such securities are called,
redeemed, retired or otherwise become payable; provided that, in any
such case, the cash or other consideration is to be delivered to the
Custodian;
6) To the issuer thereof, or its agent, for transfer into the name of
the Fund or into the name of any nominee or nominees of the
Custodian or into the name or nominee name of any agent appointed
pursuant to Section 2.11 or into the name or nominee name of any
sub-custodian appointed pursuant to Article 1; or for exchange for a
different number of bonds, certificates or other evidence
representing the same aggregate face amount or number of units;
PROVIDED that, in any such case, the new securities are to be
delivered to the Custodian;
7) Upon the sale of such securities for the account of the Fund, to the
broker or its clearing agent, against a receipt, for examination in
accordance with "street delivery" custom; provided that in any such
case, the Custodian shall have no responsibility or liability for
any loss arising from the delivery of such securities prior to
receiving payment for such securities except as may arise from the
Custodian's own negligence or willful misconduct;
8) For exchange or conversion pursuant to any plan or merger,
consolidation, recapitalization, reorganization or readjustment of
the securities of the issuer of such securities, or pursuant to
provisions for conversion contained in such securities, or pursuant
to any deposit agreement; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the Custodian;
9) In the case of warrants, rights or similar securities, the surrender
thereof in the exercise of such warrants, rights or similar
securities or the surrender of interim receipts of temporary
securities for definitive securities; provided that, in any such
case, the new securities and cash, if any, are to be delivered to
the Custodian;
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10) For delivery in connection with any loans of securities, made by the
Fund, BUT ONLY against receipt of adequate collateral as agreed upon
from time to time by the Custodian and the Fund, which may be in the
form of cash or obligations issued by the United States government,
its agencies or instrumentalities, except that in connection with
any loans for which collateral is to be credited to the Custodian's
account in the book-entry system authorized by the U.S. Department
of the Treasury, the Custodian will not be held liable or
responsible for the delivery of securities owned by the Fund prior
to the receipt of such collateral;
11) For delivery as security in connection with any borrowings by the
Fund requiring a pledge of assets by the Fund, BUT ONLY against
receipt of amounts borrowed;
12) For delivery in accordance with the provisions of any agreement
among the Fund, the Custodian and a broker-dealer registered under
the Securities Exchange Act of 1934 (the "Exchange Act") and a
member of the National Association of Securities Dealers, Inc.
("NASD"), relating to the compliance with the rules of The Options
Clearing Corporation and of any registered national securities
exchange, or of any similar organization or organizations, regarding
escrow or other arrangements in connection with transactions by the
Fund;
13) For delivery in accordance with the provisions of any agreement
among the 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
Fund;
14) Upon receipt of instructions from the transfer agent ("Transfer
Agent") for the Fund, for delivery to such Transfer Agent or to the
holders of shares in connection with distributions in kind, as may
be described from time to time in the Fund's currently effective
prospectus and statement of additional information ("prospectus"),
in satisfaction of requests by holders of Shares for repurchase or
redemptions; and
15) For any other proper corporate purpose, BUT ONLY upon receipt of, in
addition to Proper Instructions, a certified copy of a resolution of
the Board of Directors or of the Executive Committee signed by an
officer of the Fund and certified by the Secretary or an Assistant
Secretary, 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.
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2.3 REGISTRATION OF SECURITIES
Securities held by the Custodian (other than bearer securities)
shall be registered in the name of the Fund or in the name of any nominee
of the Fund or of any nominee of the Custodian which nominee shall be
assigned exclusively to the Fund, UNLESS the Fund has authorized in
writing the appointment of a nominee to be used in common with other
registered investment companies having the same investment adviser as the
Fund, or in the name of nominee name of any agent appointed pursuant to
Section 2.11 or in the name or nominee name of any sub-custodian
appointed pursuant to Article 1. All securities accepted by the Custodian
on behalf of the Fund under the terms of this Contract shall be in
"street name" or other good delivery form.
2.4 BANK ACCOUNTS
The Custodian shall open and maintain a separate bank account or
accounts in the name of the Fund, subject only to draft or order by the
Custodian acting pursuant to the terms of this Contract, and shall hold
in such account or accounts, subject to the provisions hereof, all cash
received by it from or for the account of the Fund, other than cash
maintained by the Fund in a bank account established and used in
accordance with Rule 17f-3 under the Investment Company Act of 1940.
Funds held by the Custodian for the Fund may be deposited by it to its
credit as Custodian in the Banking Department of the Custodian or in such
other banks or trust companies as it may in its discretion deem necessary
or desirable; PROVIDED, however, that every such bank or trust company
shall be qualified to act as a custodian under the Investment Company Act
of 1940 and that each bank or trust company and the funds to be deposited
with each such bank or trust company shall be approved by vote of a
majority of the Board of Directors of the Fund. Such funds shall be
deposited by the Custodian in its capacity as Custodian and shall be
withdrawable by the Custodian only in that capacity.
2.5 PAYMENTS FOR SHARES
The Custodian shall receive from the distributor for the Fund's
Shares or from the Transfer Agent of the Fund and deposit into the Fund's
account such payments as are received for Shares of the Fund issued or
sold from time to time by the Fund. The Custodian will provide timely
notification to the Fund and the Transfer Agent of any receipt by it of
payments for Shares of the Fund.
2.6 AVAILABILITY OF FEDERAL FUNDS
Upon mutual agreement between the Fund and the Custodian, the
Custodian shall, upon the receipt of Proper Instructions, 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 of the Fund which are deposited into the Fund's
account.
2.7 COLLECTION OF INCOME
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The Custodian shall collect on a timely basis all income and other
payments with respect to registered securities held hereunder to which
the Fund shall be entitled either by law or pursuant to custom in the
securities business, and shall collect on a timely basis all income and
other payments with respect to bearer securities if, on the date of
payment by the issuer, such securities are held by the Custodian or its
agent thereof and shall credit such income, as collected, to the Fund's
custodian account. Without limiting the generality of the foregoing, the
Custodian shall detach and present for payment all coupons and other
income items requiring presentation as and when they become due and shall
collect interest when due on securities held hereunder. Income due the
Fund on securities loaned pursuant to the provisions of Section 2.2(10)
shall be the responsibility of the Fund. The Custodian will have no duty
or responsibility in connection therewith, other than to provide the Fund
with such information or data as may be necessary to assist the Fund in
arranging for the timely delivery to the Custodian of the income to which
the Fund is properly entitled.
2.8 PAYMENT OF FUND MONIES
Upon receipt of Proper Instructions, which may be continuing
instructions when deemed appropriate by the parties, the Custodian shall
pay out monies of the fund in the following cases only:
1) Upon the purchase of securities, options, futures contracts
or options on futures contracts for the account of the Fund
but only (a) against the delivery of such securities or
evidence of title to such options, futures contracts or
options on futures contracts, to the Custodian (or any bank,
banking firm or trust company doing business in the United
States or abroad which is qualified under the Investment
Company Act of 1940 to act as a custodian and has been
designated by the Custodian as its agent for this purpose)
registered in the name of the Fund or in the name of a
nominee of the Custodian referred to in Section 2.3 hereof or
in proper form for transfer; (b) in the case of a purchase
effected through a Securities System, in accordance with the
conditions set forth in Section 2.12 hereof or (c) in the
case of the repurchase agreements entered into between the
Fund and the Custodian, or another bank, or a broker-dealer
which is a member of NASD, (i) against delivery of the
securities either in certificate form or through an entry
crediting the Custodian's account at the Federal Reserve Bank
with such securities or (ii) against delivery of the receipt
evidencing purchase by the Fund of securities owned by the
Custodian along with written evidence of the agreement by the
Custodian to repurchase such securities from the Fund.
2) In connection with conversion, exchange or surrender of
securities owned by the Fund as set forth in Section 2.2
hereof;
3) For the redemption or repurchase of Shares issued by the Fund
as set forth in Section 2.10 hereof;
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4) For the payment of any expense or liability incurred by the
Fund, including but not limited to the following payments for
the account of the Fund: interest, taxes, management,
accounting, transfer agent and legal fees, and operating
expenses of the Fund whether or not such expenses are to be
in whole or part capitalized or treated as deferred expenses;
5) For the payment of any dividends declared pursuant to the
governing documents of the Fund;
6) For payment of the amount of dividends received in respect
of securities sold short;
7) For any other proper purpose, BUT ONLY upon receipt of, in
addition to Proper Instructions, a certified copy of a
resolution of the Board of Directors or of the Executive
Committee of the Fund signed by an officer of the Fund and
certified by its Secretary or an Assistant Secretary,
specifying the amount of such payment, setting forth the
purpose for which such payment is to be made, declaring such
purpose to be a proper purpose, and naming the person or
persons to whom such payment is to be made.
2.9 LIABILITY FOR PAYMENT IN ADVANCE OF RECEIPT OF SECURITIES
PURCHASED
The Custodian shall not make payment for the purchase of domestic
securities for the account of the Fund in advance of receipt of the
securities purchased in the absence of specific written instructions from
the Fund to so pay in advance. In any and every case where payment for
purchase of domestic securities of the account of the Fund is made by the
Custodian in advance of receipt of the securities purchased in the
absence of specific written instructions from the Fund to so pay in
advance, the Custodian shall be absolutely liable to the Fund for such
securities to the same extent as if the securities had been received by
the Custodian.
2.10 PAYMENTS FOR REPURCHASES OR REDEMPTIONS OF SHARES OF THE FUND
From such funds as may be available for the purpose but subject to
the limitations of the Articles of Incorporation and any applicable votes
of the Board of Directors of the Fund pursuant thereto, the Custodian
shall, upon receipt of instructions from the Transfer Agent, make funds
available for payment to holders of Shares who have delivered to the
Transfer Agent a request for redemption or repurchase of their Shares. In
connection with the redemption or repurchase of Shares of the fund, the
Custodian is authorized upon receipt of instructions from the Transfer
Agent to wire funds to or through a commercial bank designated by the
redeeming shareholders. In connection with the redemption or repurchase
of Shares of the Fund, the Custodian shall honor checks drawn on the
Custodian by a holder of Shares, which checks have been furnished by the
Fund to the holder of Shares, when presented to the Custodian in
accordance with such
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procedures and controls as are mutually agreed upon from time to time
between the Fund and the Custodian.
2.11 APPOINTMENT OF AGENTS
The Custodian may at any time or times in its discretion appoint
(and may at any time remove) any other bank or trust company which is
itself qualified under the Investment Company Act of 1940 to act as a
custodian, as its agent to carry out such of the provisions of this
Article 2 as the Custodian may from time to time direct; PROVIDED,
however, that the appointment of any agent shall not relieve the
Custodian of its responsibilities or liabilities hereunder.
2.12 DEPOSIT OF FUND ASSETS IN SECURITIES SYSTEMS
The Custodian may deposit and/or maintain domestic securities
owned by any Fund in a clearing agency registered with the Securities and
Exchange Commission under Section 17A of the Exchange Act, which acts as
a securities depository, or in a Federal Reserve Bank, as Custodian or
Custodian's agent or nominee on the records of such Federal Reserve Bank
or such registered clearing agency or the nominee of either (collectively
referred to herein as "Securities System") in accordance with applicable
Federal Reserve Board and Securities and Exchange Commission rules and
regulations, if any, and subject to the following provisions:
1) The Custodian may keep domestic securities of the Fund in a
Securities System provided that such securities are
represented in an account ("Account") of the Custodian in the
Securities System which shall not include any assets of the
Custodian other than assets held as a fiduciary custodian or
otherwise for customers;
2) The records of the Custodian with respect to domestic
securities of the Fund which are maintained in a Securities
System shall identify by book-entry those securities
belonging to the Fund;
3) The Custodian shall pay for domestic securities purchased for
the account of the Fund upon (i) the simultaneous receipt of
advice from the Securities System that such securities have
been transferred to the Account, and (ii) the making of an
entry on the records of the Custodian to reflect such payment
and transfer for the account of the Fund. The Custodian shall
transfer domestic securities sold for the account of the Fund
upon (a) the simultaneous receipt of advice from the
Securities System that payment for such securities has been
transferred to the Account, 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 advises
from the Securities System of transfers of securities for the
account of a Fund shall identify the Fund, be maintained for
the Fund by the Custodian and be provided to the Fund at its
request. Upon request, the Custodian shall furnish the Fund
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confirmation of each transfer to or from the account in the
form of a written advice or notice and shall furnish to the
Fund copies of daily transaction sheets reflecting each day's
transactions in the Securities System for the account.
4) The Custodian shall provide the Fund with any report obtained
by the Custodian on the Securities System's accounting system
internal accounting control and procedures for safeguarding
securities deposited in the Securities System;
5) The Custodian shall have received the initial or annual
certificate, as the case may be, required by Article 9
hereof;
6) Anything to the contrary in this Contract notwithstanding,
the Custodian shall be liable to the Fund for any loss or
damage to the Fund resulting from use of the Securities
System by reason of any negligence, misfeasance or misconduct
of the Custodian or any of its agents or of any of its or
their employees or from failure of the Custodian or any such
agent or employee to enforce effectively such rights as it
may have against the Securities System; at the election of
the Fund, it shall be entitled to be subrogated to the rights
of the Custodian with respect to any claim against the
Securities System or any other person which the Custodian may
have as a consequence of any such loss or damage if and to
the extent that the Fund has not been made whole for any such
loss or damage.
2.13 SEGREGATED ACCOUNT
The Custodian shall upon receipt of Proper Instructions establish
and maintain a segregated account or accounts for and on behalf of the
Fund, into which account or accounts may be transferred cash and/or
securities, including securities maintained in an account by the
Custodian pursuant to Section 2.12 hereof, (i) in accordance with the
provisions of any agreement among the Fund, the Custodian and a
broker-dealer registered under the Exchange Act and a member of 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 Fund, (ii) for
the purpose of segregating cash or government securities in connection
with options purchased, sold or written by the Fund or commodity futures
contracts or options thereon purchased or sold by the Fund, (iii) for the
purpose of compliance by the Fund with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release or
releases of the Securities and Exchange Commission relating to the
maintenance of segregated accounts by registered investment companies and
(iv) for other proper corporate purposes, BUT ONLY, in the case of the
clause (iv), upon receipt of, in addition to Proper Instructions, a
certified copy of a resolution of the Board of Directors or of the
Executive
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Committee signed by an officer of the Fund and certified by the Secretary
or an Assistant Secretary, setting forth the purpose or purposes of such
segregated account and declaring such purposes to be proper corporate
purposes.
2.14 OWNERSHIP CERTIFICATES FOR TAX PURPOSES
The Custodian shall execute ownership and other certificates and
affidavits for all federal and state tax purposes in connection with
receipt of income or other payments with respect to securities of the
Fund held by it and in connection with transfers of securities.
2.15 PROXIES
The Custodian shall, with respect to the securities held
hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name
of the Fund or a nominee of the Fund, all proxies, without indication of
the manner in which such proxies are to be voted, and shall promptly
deliver to the Fund such proxies, all proxy soliciting materials and all
notices relating to such securities.
2.16 COMMUNICATIONS RELATING TO FUND PORTFOLIO SECURITIES
The Custodian shall transmit promptly to the Fund all written
information (including, without limitation, pendency of calls and
maturities of securities and expirations of rights in connection
therewith and notices of exercise of call and put options written by the
Fund and the maturity of futures contracts purchased or sold by the Fund)
received by the Custodian from issuers of the securities being held for
the Fund. With respect to tender or exchange offers, the Custodian shall
transmit promptly to the Fund all written information received by the
Custodian from issuers of the securities whose tender or exchange is
sought and from the party (or his agents) making the tender or exchange
offer. If the Fund desires to take action with respect to any tender
offer, exchange offer or any other similar transaction, the Fund shall
notify the Custodian at least three (3) business days prior to the date
on which the Custodian is to take such action.
2.17 PROPER INSTRUCTIONS
Proper Instructions as used throughout this Article 2 means a
writing signed or initialed by one or more person or persons as the Board
of Directors shall have from to time authorized. Each such writing shall
set forth the specific transaction or type of transaction involved,
including a specific statement of the purpose for which such action is
requested. Oral instructions will be considered Proper Instructions if
the Custodian reasonably believes them to have been given by a person
authorized to give such instructions with respect to the transaction
involved. The Fund shall cause all oral instructions to be confirmed in
writing. Upon receipt of a certificate of the Secretary or an Assistant
Secretary as to the authorization by the Board of Directors of the Fund
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accompanied by a detailed description of procedures approved by the Board
of Directors, Proper Instructions may include communications effected
directly between electro-mechanical or electronic devices provided that
the Board of Directors and the Custodian are satisfied that such
procedures afford adequate safeguards for the Fund's assets.
2.18 ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY
The Custodian may in its discretion, without express authority
from the Fund;
1) Make payments to itself or others for minor expenses of
handling securities PROVIDED that all such payments shall be
accounted for to the Fund;
2) Surrender securities in temporary form for securities in
definitive form;
3) Endorse for collection, in the name of the Fund, checks,
drafts and other negotiable instruments; and
4) In general, attend to all non-discretionary details in
connection with the sale, exchange, substitution, purchase,
transfer and other dealings with the securities and property
of the Fund except as otherwise directed by the Board of
Directors of the Fund.
2.19 EVIDENCE OF AUTHORITY
The Custodian shall be protected in acting upon any instructions,
notice, request, consent, certificate or other instrument of paper
believed by it to be genuine and to have been properly executed by or on
behalf of the Fund. The Custodian may receive and accept a certified copy
of a vote of the Board of Directors of the Fund as conclusive evidence
(a) of the authority of any person to act in accordance with such vote or
(b) or any determination or of any action by the Board of Directors
pursuant to the Articles of Incorporation as described in such vote, and
such vote may be considered as in full force and effect until receipt by
the Custodian of written notice to the contrary.
2.20 CLASS ACTIONS
The Custodian shall transmit promptly to the Fund all notices or
other communications received by it in connection with any class action
lawsuit relating to securities currently or previously held for the Fund.
Upon being directed by the Fund to do so, the Custodian shall furnish to
the Fund any and all written materials which establish the
holding/ownership, amount held/owned, and period of holding/ownership of
the securities in question.
2.21 DUTIES OF THE CUSTODIAN WITH RESPECT TO FUND PROPERTY HELD OUTSIDE
OF THE UNITED STATES
2.21(a) APPOINTMENT OF FOREIGN SUB-CUSTODIAN
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The Custodian is authorized and instructed, either directly or
indirectly (through one or more sub-custodian U.S. banks), to employ as
sub-custodians for the Fund's securities and other assets maintained
outside of the United States the foreign institutions, foreign securities
depositories and foreign clearing agencies, if any, designated on
Schedule A hereto ("foreign sub-custodians"); provided, however, that,
notwithstanding the contents of Schedule A hereto, the Custodian
(including any of its agents and sub-custodians) is authorized to
directly or indirectly employ or retain any sub-custodian, depository or
clearing agency only if said employed or retained institution qualifies
as either (a) an "eligible foreign custodian," as defined in Rule 17f-5
under the Investment Company Act of 1940, or (b) a "bank," as defined in
Section 2(a)(5) of the Investment Company Act of 1940, that in turn
qualifies as an eligible domestic custodian under Section 17(f) of the
Investment Company Act of 1940; and provided further that the Custodian
shall be liable to the Fund for any loss of any Fund assets custodied
with any institution directly or indirectly employed or retained by the
Custodian (or any of its agents or sub-custodians) that does not meet the
qualifications of either clause (a) or (b) of the preceding proviso.
Upon receipt of Proper Instructions, together with a certified
resolution of the Fund's Board of Directors, the Custodian and the Fund
may agree to amend Schedule A hereto from time to time to designate
additional or alternative foreign banking institutions, foreign
securities depositories and foreign clearing agencies to act as
sub-custodian. Each foreign banking institution shall be authorized to
deposit securities in foreign securities depositories and foreign
clearing agencies authorized pursuant to Rule 17f-5 under the Investment
Company Act of 1940. Upon receipt of Proper Instructions from the Fund
the Custodian shall promptly cease the employment of any one or more of
such sub-custodians for maintaining custody of the assets of the
application Fund(s).
2.21(b) ASSETS TO BE HELD
The Custodian shall limit the securities and other assets
maintained in the custody of the foreign sub-custodian to: (a) "foreign
securities," as defined in paragraph (c)(1) of Rule 17f-5 under the
Investment Company Act of 1940, and (b) cash and cash equivalents in such
amounts as the Custodian or the Fund may determine to be reasonably
necessary to effect the foreign securities transactions of the Fund.
2.21(c) SEGREGATION OF SECURITIES
The Custodian shall identify on its books as belonging to the
Fund, the foreign securities of the Fund held by each foreign
sub-custodian. Each agreement pursuant to which the Custodian or its duly
appointed U.S. sub-custodian employs a foreign banking institution shall
require that such institution establish a custody account for the
Custodian (or its U.S. sub-custodian, as the case may be) on behalf of
its customers and physically segregate in that account securities and
other assets of the Custodian's customers, and, in the event that such
institution deposits the Fund's securities in a foreign securities
depository, the sub-custodian shall identify on its books as belonging to
the Custodian (or
- 11 -
is U.S. sub-custodian, as the case may be), as agent for the Custodian's
customers, the securities so deposited (all collectively referred to as
the "Account").
2.21(d) AGREEMENT WITH FOREIGN BANKING INSTITUTION
Each agreement with a foreign banking institution shall provide
that: (a) the Fund's assets will not be subject to any right, charge,
security interest, lien or claim or any kind in favor of the foreign
banking institution or its creditors, except a claim of payment for their
safe custody or administration; (b) beneficial ownership for the Fund's
assets will be freely transferable without the payment of money or value
other than for custody or administration, which may include payment of
stamp duties or government taxes; (c) adequate records will be maintained
identifying the assets as belonging to the customers of Custodian; (d)
officers of or auditors employed by, or other representatives of the
Custodian, including independent public accountants for the Fund, will be
given access to the books and records of the foreign banking institution
relating to its actions given under its agreement with the Custodian or
shall be given confirmation of the contents of such books and records;
and (e) assets of the Fund held by the foreign sub-custodian will be
subject only to the instructions of the Fund, the Custodian or their
agents.
2.21(e) ACCESS OF INDEPENDENT ACCOUNTANTS OF THE FUND
Upon request of the Fund, the Custodian will use its best efforts
to arrange for the independent accountants of the Fund to be afforded
access to the books and records of any foreign banking institution
employed as a foreign sub-custodian insofar as such books and records
relate to the performance of such foreign banking institutions under its
agreement with the Custodian (or its U.S. sub-custodian, as the case may
be).
2.21(f) REPORTS BY CUSTODIAN
The Custodian will supply to the Fund from time to time, as
mutually agreed upon, statements in respect of the securities and other
assets of the Fund held by foreign sub-custodians, including but not
limited to an identification of entities having possession of the Fund's
securities and other assets and advices or notifications of any transfers
of securities to or from each custodial account maintained by a foreign
sub-custodian for the Custodian and Fund indicating, as to securities
acquired for the Fund, the identity of the entity having physical
possession of such securities.
- 12 -
2.21(g) FOREIGN SECURITIES TRANSACTIONS
1) Upon receipt of Proper Instructions, which may be continuing
instructions when deemed appropriate by the parties, the
Custodian shall make or cause its foreign sub-custodian to
transfer, exchange, or deliver foreign securities owned by
the Fund, but except to the extent explicitly provided herein
only in any of the cases specified in Section 2.2.
2) Upon receipt of Proper Instructions, which may be continuing
instructions when deemed appropriate by the parties the
Custodian shall pay out or cause its foreign sub-custodian to
pay out monies of the Fund, but except to the extent
explicitly provided herein only in any of the cases specified
in Section 2.8.
3) Settlement and payment for securities received for the
account of the Fund and delivery of securities maintained for
the account of the Fund may, upon receipt of Proper
Instructions, be effected in accordance with the customary or
established securities trading or securities processing
practices and procedures in the jurisdiction or market in
which the transaction occurs, including, without limitation,
delivering securities to the purchaser thereof or to a dealer
therefor (or an agent for such purchaser or dealer) against a
receipt with the expectation of receiving later payment for
such securities from such purchaser or dealer.
4) With respect to any transaction involving foreign securities,
the Custodian or any sub-custodian in its discretion may
cause the Fund's account to be credited on either the
contractual settlement date or the actual settlement date
with the proceeds of any sale or exchange of foreign
securities from the account of the Fund and to be debited on
either the contractual settlement date or the actual
settlement date for the cost of foreign securities purchased
or acquired for the Fund according to Custodian's then
current internal policies and procedures pertaining to
securities settlement, which policies and procedures may
change from time to time. Custodian shall advise the Fund of
any changes to such policies and procedures. The Custodian
may reverse any such credit or debit made on the contractual
settlement date if the transaction with respect to which such
credit or debit was made fails to settle within a reasonable
period, determined by Custodian in its reasonable discretion,
after the contractual settlement date except that if any
foreign securities delivered pursuant to this section are
returned by the recipient thereof, the Custodian may cause
any such credits and debits to be reversed at any time.
5) Securities maintained in the custody of a foreign
sub-custodian may be maintained in the name of such entity's
nominee to the same extent as set forth in Section 2.3 of
this Contract and the Fund agrees to hold any such nominee
harmless from any liability as a holder of record of such
securities.
- 13 -
6) Until the Custodian receives written instructions to the
contrary, the Custodian shall, or shall cause the
sub-custodian to collect all interest and dividends paid on
securities held in each applicable Fund's account, unless
such payment is in default. Unless otherwise instructed, the
Custodian shall convert interest, dividends and principal
received with respect to securities in the Fund's account
into United States dollars, and the Custodian shall perform
foreign exchange contracts for the conversion of United
States dollars to foreign currencies for the settlement of
trades whenever it is practicable to do so through customary
banking channels. Customary banking channels may vary based
upon industry practice in each jurisdiction, and shall
include the banking facilities of the Custodian's affiliates,
in accordance with such affiliate's then prevailing internal
policy on funds repatriation. All risk and expense incident
to such foreign collection and conversions is the
responsibility of the Fund's account, and Custodian shall
have no responsibility for fluctuation in exchange rates
affecting collections or conversions.
2.21(h) FOREIGN SECURITIES LENDING
Notwithstanding any other provisions contained in this Contract,
the Custodian and any sub-custodian shall deliver and receive securities
loaned or returned in connection with securities lending transactions
only upon and in accordance with Proper Instructions; provided, if the
Custodian is not the lending agent in connection with such securities
lending, then neither the Custodian or any sub-custodian shall undertake,
or otherwise be responsible for,
(i) marking to market values for such loaned securities,
(ii) collection of dividends, interest or other disbursements or
distributions made with respect to such loaned securities,
(iii) receipt of corporate action notices, communications, proxies
or instruments with respect to such loaned securities, and
(iv) custody, safekeeping, valuation or any other actions or
services with respect to any collateral securing any such
securities lending transactions.
In the event that the Custodian is the applicable Fund's lending
agent in connection with a specific securities loan, the Custodian shall
undertake to perform all of the above duties with regard to such loan,
except that the Fund shall not receive, nor be enabled to vote, proxies
in connection with such loaned security.
- 14 -
2.21(i) LIABILITY OF FOREIGN SUB-CUSTODIAN
Each agreement pursuant to which the Custodian (or its U.S.
sub-custodian bank, as applicable) employs a foreign banking institution
as a foreign sub-custodian shall require the institution to exercise
reasonable care in performance of its duties and to indemnify, and hold
harmless, the Custodian and Custodian's customers from and against any
loss, damage, cost, expense, liability or claim arising out of such
sub-custodian's negligence, fraud, bad faith, willful misconduct or
reckless disregard of its duties. At the election of the Fund, it shall
be entitled to be subrogated to the right of the Custodian with respect
to any claims against the Custodian's U.S. sub-custodian bank (if any) or
a foreign banking institution as a consequence of any such loss, damage,
cost, expense, liability or claim if and to the extent that the Fund has
not been made whole for any such loss, damage, cost, expense, liability
or claims.
2.21(j) MONITORING RESPONSIBILITIES
The Custodian shall furnish annually to the Fund information
concerning the foreign sub-custodian employed by the Custodian (or its
U.S. sub-custodian bank, as applicable). Such information shall be
similar in kind and scope to that furnished to the Fund in connection
with the initial approval of this Contract (and any contracts with U.S.
and foreign sub-custodians entered into pursuant hereto). In addition,
the Custodian will promptly inform the Fund in the event that the
Custodian learns of a material adverse change in the financial condition
of a foreign sub-custodian or is notified by the Custodian's U.S.
sub-custodian bank (if any) or a foreign banking institution employed as
foreign sub-custodian that there appears to be a substantial likelihood
that its shareholders' equity will decline below $200 million (United
States dollars or the equivalent thereof) or that its shareholders'
equity has declined below $200 million (in each case computed in
accordance with generally accepted United States accounting principles).
2.21(k) BRANCHES OF UNITED STATES BANKS
Except as otherwise set forth in this Contract, the provisions
hereof shall not apply where the custody of the Fund's assets maintained
in a foreign branch of a banking institution which is a "bank" as defined
by Section 2(a)(5) of the Investment Company Act of 1940 which meets the
qualification set forth in Section 26(a) of said Act. The appointment of
any such branch as a sub-custodian shall be governed by Article 1 of this
Contract.
2.21(l) EXPROPRIATION INSURANCE
The Custodian represents that it does not intend to obtain any
insurance for the benefit of the Fund which protects against the
imposition of exchange control restrictions or the transfer from any
foreign jurisdiction of the proceeds of sale of any securities or against
confiscation, expropriation or nationalization of any securities or the
assets of the issuer of such securities is organized or in which
securities are held for safekeeping either
- 15 -
by Custodian or any sub-custodians in such country. The Custodian
represents that its understanding of the position of the Staff of the
Securities and Exchange Commission is that any investment company
investing in securities of foreign issuers has the responsibility for
reviewing the possibility of the imposition of exchange control
restrictions which would affect the liquidity of such investment
company's assets and the possibility of exposure to political risk,
including the appropriateness of insuring against such risk.
3. DUTIES OF CUSTODIAN WITH RESPECT TO THE BOOKS OF ACCOUNT AND CALCULATION
OF NET ASSET VALUE AND NET INCOME
The Custodian shall cooperate with and supply necessary information to
the entity or entities appointed by the Board of Directors of the Fund to keep
the books of account of the Fund and/or compute the net asset value per share of
the outstanding shares of the Fund or, if directed in writing to do so by the
Fund, shall itself keep such books of account and/or computer such net asset
value per share. If so directed, the Custodian shall also calculate daily the
net income of the Fund as described in the Fund's currently effective prospectus
and shall advise the Fund and the Transfer Agent daily of the total amounts of
such net income and, if instructed in writing by an officer of the Fund to do
so, shall advise the Transfer Agent periodically of the division of such net
income among its various components. The calculations of the net asset value per
share and the daily income of the Fund shall be made at the time or times
described from time to time in the Fund's currently effective prospectus.
4. RECORDS
The Custodian shall create and maintain all records relating to its
activities and obligations under this Contract in such manner as will meet the
obligations of the Fund under the Investment Company Act of 1940, with
particular attention to Section 31 thereof and Rule 31a-1 and 31a-2 thereunder.
The Custodian shall also maintain records as directed by the Fund in connection
with applicable federal and state tax laws and any other law or administrative
rules or procedures which may be applicable to the Fund. With respect to
securities and cash deposited with a Securities System, a sub-custodian or an
agent of the Custodian, the Custodian shall identify on its books all such
securities and cash as belonging to the Fund. All such records shall be the
property of the Fund and shall at all times during the regular business hours of
the Custodian be open for inspection by duly authority officers, employees or
agents of the Fund or its agents. Such records shall be made available to the
Fund for review by employees and agents of the Securities and Exchange
Commission. The Custodian shall furnish to the Fund, and its agents, as of the
close of business on the last day of each month a statement showing all
transactions and entries for the account of the Fund during that month, and all
holdings as of month-end.
All records so maintained in connection with the performance of its
duties under this Contract shall remain the property of the Fund and, in the
event of termination of this Contract, shall be delivered to the Fund.
Subsequent to such delivery, and surviving the termination of this Contract, the
Fund shall provide the Custodian access to examine and photocopy such records as
- 16 -
the Custodian, in its discretion, deems necessary, for so long as such records
are retained by the Fund.
5. OPINION OF FUND'S INDEPENDENT ACCOUNTANT
The Custodian shall take all reasonable action, as the Fund may from
time to time request, to obtain from year to year favorable opinions from the
Fund's independent accountants with respect to its activities hereunder in
connection with the preparation of the Fund's, Form N-1A, and Form N-SAR or
other annual reports to the Securities and Exchange Commission and with respect
to any other requirements of such Commission.
6. REPORTS TO FUND BY INDEPENDENT PUBLIC ACCOUNTANTS
The Custodian shall provide the Fund, at such times as the Fund may
reasonably require, with reports by independent public accountants on the
accounting system, internal accounting control and procedures for safeguarding
securities, futures contracts and options on futures contracts, including
securities deposited and/or maintained in a Securities System, relating to the
services provided by the Custodian under this Contract; such reports shall be of
sufficient scope, and in sufficient detail, as may reasonably be required by the
Fund to provide reasonable assurance that any material inadequacies would be
disclosed by such examination, and, if there are no such inadequacies, the
reports shall so state.
7. COMPENSATION OF CUSTODIAN
For performance by the Custodian pursuant to this Contract, the Fund
agrees to pay the Custodian annual asset fees and supplemental charges as set
out in the fee schedule attached hereto.
8. RESPONSIBILITY OF CUSTODIAN
So long as and to the extent that it is in the exercise of reasonable
care, the Custodian shall not be responsible for the title, validity or
genuineness of any property or evidence of title thereto received by it or
delivered by it pursuant to this Contract shall be held harmless in acting upon
any notice, request, consent, certificate or other instrument reasonably
believed by it to be genuine and to be signed by the proper party or parties.
The Custodian shall be held to the exercise of reasonable care in carrying out
the provisions of this Contract, but shall be kept indemnified by and shall be
without liability to the Fund for any action taken or omitted by it in good
faith and without negligence. It shall be entitled to rely on and may act upon
advice of counsel of, or reasonably acceptable to, the Fund or its agents on all
matters, and shall be without liability for any action reasonably taken or
omitted pursuant to such advice. Notwithstanding the foregoing, the
responsibility of the Custodian with respect to redemptions effected by check
shall be in accordance with a separate Contract entered into between the
Custodian and the Fund or its agent.
If the Fund requires the Custodian to take any action with respect to
securities, which action involves the payment of money or which action may, in
the reasonable opinion of the
- 17 -
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 reasonably satisfactory
to it.
If the Fund requires the Custodian to advance cash or securities for
any purpose or in the event that the Custodian or its nominee shall incur or be
assessed any taxes, charges, expenses, assessments, claims or liabilities in
connection with the performance of this Contract, except such as may arise from
its or its nominee's own negligent action, negligent failure to act or willful
misconduct, any property at any time held for the account of a Fund shall be
security therefor and should the Fund fail to repay the Custodian promptly, the
Custodian shall be entitled to utilize available cash and to dispose of assets
to the extent necessary to obtain reimbursement.
The Custodian shall not be liable for any loss or damage to the Fund
resulting from participation in a securities depository unless such loss or
damage arises by reason of any negligence, misfeasance, or willful misconduct of
officers or employees of the Custodian, or from its failure to enforce
effectively such rights as it may have against any securities depository or from
use of a sub-custodian or agent. Anything in this Contract to the contrary
notwithstanding, the Custodian shall exercise, in the performance of its
obligations undertaken or reasonably assumed with respect to this Contract,
reasonable care, for which the Custodian shall be responsible to the same extent
as if it were performing such duties directly. The Custodian shall be
responsible for the securities and cash held by or deposited with any
sub-custodian or agent to the same extent as if such securities and cash were
directly held by or deposited with the Custodian. The Custodian hereby agrees
that it shall indemnify and hold the Fund harmless from and against any loss
which shall occur as a result of the failure of a foreign sub-custodian holding
the securities and cash to provide a level of safeguards for maintaining any
Fund's securities and cash not materially different from that provided by a
United States custodian holding such securities and cash in the United States.
The Custodian agrees to indemnify and hold the Fund harmless for any
and all loss, liability and expense, including reasonable legal fees and
expenses, arising out of the Custodian's own negligence or willful misconduct or
that of its officers, agents, sub-custodian or employees in the performance of
the Custodian's duties and obligations under this Contract.
9. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT
The Contract shall become effective as of its execution, shall continue
in full force and effect until terminated as hereinafter provided, may be
amended at any time by mutual agreement of the parties hereto and may be
terminated by either party by an instrument in writing delivered or mailed,
postage prepaid to the other party, such termination to take effect not sooner
than sixty (60) days after the date of such delivery or mailing; provided,
however, that the Custodian shall not act under Section 2.12 hereof in the
absence of receipt of an initial certificate of the Secretary or an Assistant
Secretary that the Board of Directors of the Fund has approved the initial use
of a particular Securities System and the receipt of an annual certificate of
the Secretary or an Assistant Secretary that the Board of Directors has reviewed
the use by the Fund of such Securities System, as required in each case by Rule
17f-4 under the Investment Company
- 18 -
Act of 1940; PROVIDED FURTHER, however, that the Fund shall not amend or
terminate this Contract in contravention of any applicable federal or state
regulations, or any provision of the Articles of Incorporation, and further
provided, that the Fund may at any time be action of its Board of Directors (i)
substitute another bank or trust company for the Custodian by giving notice as
described above to the Custodian, or (ii) immediately terminate this Contract in
the event of the appointment of a conservator or receiver for the Custodian by
the Comptroller of the Currency or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.
Upon termination of the Contract, the Fund shall pay to the Custodian
such compensation as may be due as of the date of such termination and shall
likewise reimburse the Custodian for its costs, expenses and disbursements.
10. SUCCESSOR CUSTODIAN
If a successor custodian shall be appointed by the Board of Directors
of the Fund, the Custodian shall, upon termination, deliver to such successor
custodian at the office of the Custodian, duly endorsed and in the form for
transfer to an account of the successor custodian all of the Fund" securities
held in a Securities System.
If no such successor custodian shall be appointed, the Custodian shall,
in like manner, upon receipt of a certified copy of a vote of the Board of
Directors of the Fund, deliver at the office of the Custodian and transfer such
securities, funds and other properties in accordance with such vote.
In the event that no written order designating a successor custodian or
certified copy of a vote of the Board of Directors shall have been delivered to
the Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank or trust
company, which is a "bank" as defined in the Investment Company Act of 1940, of
its own selection, having an aggregate capital, surplus, and undivided profits,
as shown by its last published report, or not less than $25,000,000, all
securities, funds and other properties held by the Custodian and all instruments
held by the Custodian relative thereto and all other property held by it under
this Contract and to transfer to an account of such successor custodian all of
the Fund's securities held in any Securities System. Thereafter, such bank or
trust company shall be the successor of the Custodian under this Contract.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Fund to procure the certified copy of the vote referred to or of
the Board of Directors to appoint a successor custodian, the Custodian shall be
entitled to fair compensation for its services during such period as the
Custodian retains possession of such securities, Funds and other properties and
the provisions of this Contract relating to the duties and obligations of the
Custodian shall remain in full force and effect.
- 19 -
11. INTERPRETIVE AND ADDITIONAL PROVISIONS
In connection with the operation of this Contract, the Custodian and
the Fund may from time to time agree on such provisions interpretive of or in
addition to the provisions of this Contract as may in their joint opinion be
consistent with the general tenor of this Contract. Any such interpretive or
additional provisions shall be in a writing signed by both parties and shall be
annexed hereto, provided that no such interpretive or additional provisions
shall contravene any applicable federal or state regulations or any provision of
the Articles of Incorporation of the Fund. No interpretive or additional
provisions made as provided in the preceding sentence shall be deemed to be an
amendment of this Contract.
12. MINNESOTA LAW TO APPLY
This Contract shall be construed and the provisions thereof interpreted
under and in accordance with laws of the State of Minnesota.
13. PRIOR CONTRACTS
This Contract supersedes and terminates, as of the date hereof, all
prior contracts between the Fund and the Custodian relating to the custody of
the Fund's assets.
IN WITNESS WHEREOF, each of the parties has caused this instrument to
be executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 1st day of November, 1999.
ADVANTUS VENTURE FUND, INC.
By:
-----------------------------------
ATTEST
By:
-----------------------------------
NORWEST BANK MINNESOTA, N.A.
By:
-----------------------------------
ATTEST
By:
-----------------------------------
- 20 -
SCHEDULE A
TO THE
CUSTODIAL CONTRACT
BETWEEN
ADVANTUS VENTURE FUND, INC.
AND
NORWEST BANK MINNESOTA, N.A.
No Foreign Sub-Custodians at this time.
A-1
FEE SCHEDULE
ADVANTUS
ANNUAL MARKET VALUE CHARGE: $.000010
---------------------------------------------------------------
DOMESTIC TRANSACTION CHARGES:
DOMESTIC DEPOSITORY SETTLEMENTS -DTC/FED/PTC $6.00
PHYSICAL SETTLEMENTS (NEW YORK, MPLS.) $30.00
MUTUAL FUND SETTLEMENTS $30.00
PRIVATE PLACEMENTS SETTLEMENTS $15.00
OPTIONS/FUTURE SETTLEMENTS $15.00
PRINCIPAL PAYDOWN- NON VARIABLE $8.00
PRINCIPAL PAYDOWNS - CMO'S $15.00
REORGANIZATION/CORPORATE ACTIONS $20.00
MONEY MOVEMENTS (WIRES, CHECKS) $5.00
Fee Schedule - 1
