Exhibit j.1
CUSTODY AGREEMENT
THIS AGREEMENT is made and entered into as of this ___ day of November,
2002, by and between MeVC Xxxxxx Xxxxxx Jurvetson Fund I, Inc., a Delaware
corporation (the "Fund") and U.S. Bank National Association, a national banking
association (the "Custodian").
WHEREAS, the Fund is registered under the Investment Company Act of 1940,
as amended (the"1940 Act"), as a closed-end management investment company, which
has elected to do business as a business development company;
WHEREAS, the Fund desires to retain U.S. Bank National Association to act
as Custodian for the Fund;
WHEREAS, the Fund desires that the Fund's Securities (defined below) and
cash be held and administered by the Custodian pursuant to this Agreement; and
WHEREAS, the Custodian is a bank having the qualifications prescribed in
Section 26(a)(1) of the 1940 Act;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto, intending to be legally bound,
do hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
1.1 "Authorized Person" means any Officer or other person duly
authorized by resolution of the Board of Directors to give Oral
Instructions and Written Instructions on behalf of the Fund and
named in Exhibit A hereto or in such resolutions of the Board of
Directors, certified by an Officer, as may be received by the
Custodian from time to time.
1.2 "Board of Directors" shall mean the Directors from time to time
serving under the Fund's Articles of Incorporation, as from time to
time amended.
1.3 "Book-Entry System" shall mean a federal book-entry system as
provided in Subpart O of Treasury Circular Xx. 000, 00 XXX 306, in
Subpart B of 31 CFR Part 350, or in such book-entry regulations of
federal agencies as are substantially in the form of such Subpart O.
1.4 "Business Day" shall mean any day recognized as a settlement day by
The New York Stock Exchange, Inc., and any other day for which the
Fund computes the net asset value of Shares of the Fund.
1.5 "Fund Custody Account" shall mean any of the accounts in the name of
the Fund, which is provided for in Section 3.2 below.
1.6 "NASD" shall mean The National Association of Securities Dealers,
Inc.
1.7 "Officer" shall mean the Chairman, President, any Vice President,
any Assistant Vice President, the Secretary, any Assistant
Secretary, the Treasurer, any Assistant Treasurer of the Fund, and
any other officer designated by the Fund's Board of Directors.
1.8 "Oral Instructions" shall mean instructions orally transmitted to
and accepted by the Custodian because such instructions are: (i)
reasonably believed by the Custodian to have been given by an
Authorized Person, (ii) recorded and kept among the records of the
Custodian made in the ordinary course of business and (iii) orally
confirmed by the Custodian. The Fund shall cause all Oral
Instructions to be confirmed by Written Instructions prior to the
end of the next Business Day. If such Written Instructions
confirming Oral Instructions are not received by the Custodian prior
to a transaction, it shall in no way affect the validity of the
transaction or the authorization thereof by the Fund. If Oral
Instructions vary from the Written Instructions that purport to
confirm them, the Custodian shall notify the Fund of such variance
but such Oral Instructions will govern unless the Custodian has not
yet acted.
1.9 "Proper Instructions" shall mean Oral Instructions or Written
Instructions. Proper Instructions may be continuing Written
Instructions when deemed appropriate by both parties.
1.10 "Securities Depository" shall mean The Depository Trust Company and
(provided that Custodian shall have received a copy of a resolution
of the Board of Directors, certified by an Officer, specifically
approving the use of such clearing agency as a depository for the
Fund) any other clearing agency registered with the Securities and
Exchange Commission under Section 17A of the Securities Exchange Act
of 1934, as amended (the "1934 Act"), which acts as a system for the
central handling of Securities where all Securities of any
particular class or series of an issuer deposited within the system
are treated as fungible and may be transferred or pledged by
bookkeeping entry without physical delivery of the Securities.
1.11 "Securities" shall include, without limitation, common and preferred
stocks, bonds, corporate loans, call options, put options,
debentures, notes, bank certificates of deposit, bankers'
acceptances, mortgage-backed securities or other obligations, and
any certificates, receipts, warrants or other instruments or
documents representing rights to receive, purchase or subscribe for
the same, or evidencing or representing any other rights or
interests therein, or any similar property or assets that the
Custodian has the facilities to clear and to service.
1.12 "Shares" shall mean, with respect to the Fund, the shares of common
stock issued by the Fund on account of the Fund.
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1.13 [Reserved]
1.14 "Written Instructions" shall mean (i) written communications
actually received by the Custodian and signed by an Authorized
Person, or (ii) communications by telex or any other such system
from one or more persons reasonably believed by the Custodian to be
Authorized Persons, or (iii) communications between
electro-mechanical or electronic devices provided that the use of
such devices and the procedures for the use thereof shall have been
approved by resolutions of the Board of Directors, a copy of which,
certified by an Officer, shall have been delivered to the Custodian.
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ARTICLE II
APPOINTMENT OF CUSTODIAN
2.1 Appointment. The Fund hereby appoints the Custodian as custodian of
all Securities and cash owned by or in the possession of the Fund at
any time during the period of this Agreement, on the terms and
conditions set forth in this Agreement, and the Custodian hereby
accepts such appointment and agrees to perform the services and
duties set forth in this Agreement.
2.2 Documents to be Furnished. The following documents, including any
amendments thereto, will be provided contemporaneously with the
execution of the Agreement to the Custodian by the Fund:
(a) A copy of the Articles of Incorporation certified by the
Secretary;
(b) A copy of the Bylaws of the Fund certified by the Secretary;
(c) A copy of the resolution of the Board of Directors of the Fund
appointing the Custodian, certified by the Secretary; and
(d) A certification of the Chairman and Secretary of the Fund
setting forth the names and signatures of the current Officers
of the Fund and other Authorized Persons.
2.3 Notice of Appointment of Dividend and Transfer Agent. The Fund
agrees to notify the Custodian in writing of the appointment,
termination or change in appointment of any Dividend and Transfer
Agent of the Fund.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
3.1 Segregation. All Securities and non-cash property held by the
Custodian for the account of the Fund (other than Securities
maintained in a Securities Depository or Book-Entry System) shall be
physically segregated from other Securities and non-cash property in
the possession of the Custodian (including the Securities and
non-cash property of the other series of the Fund) and shall be
identified as subject to this Agreement.
3.2 Fund Custody Accounts. As to the Fund, the Custodian shall open and
maintain in its trust department a custody account in the name of
the Fund coupled with the name of the Fund, subject only to draft or
order of the Custodian, in which the Custodian shall enter and carry
all Securities, cash and other assets of such Fund which are
delivered to it.
3.3 [RESERVED]
3.4 Delivery of Assets to Custodian. The Fund shall deliver, or cause to
be delivered, to the Custodian all of the Fund's Securities, cash
and other assets, including (a) all payments of income, payments of
principal and capital distributions received by the Fund with
respect to such Securities, cash or other assets owned by the Fund
at any time during the period of this Agreement, and (b) all cash
received by the Fund for
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the issuance, at any time during such period, of Shares. The
Custodian shall not be responsible for such Securities, cash or
other assets until actually received by it.
3.5 Manner of Holding Securities. The Custodian shall at all times hold
Securities of the Fund either: (a) by physical possession of the
share certificates or other instruments representing such Securities
in registered or bearer form, subject to the following provisions:
(i) 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 Proper Instructions, the Custodian shall hold such
Securities in street certificate form, so called, with or
without any indication of fiduciary capacity. The Custodian
will hold such securities in the Fund's name, unless, however,
the Custodian receives Proper Instructions to 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.
or (b) the Custodian may deposit and/or maintain Securities of the
Fund in a Securities Depository or in a Book-Entry System, subject
to the following provisions:
(i) Prior to a deposit of Securities of the Fund in any Securities
Depository or Book-Entry System, the Fund shall deliver to the
Custodian a resolution of the Board of Directors, certified by
an Officer, authorizing and instructing the Custodian on an
on-going basis to deposit in such Securities Depository or
Book-Entry System all Securities eligible for deposit therein
and to make use of such Securities Depository or Book-Entry
System to the extent possible and practical in connection with
its performance hereunder, including, without limitation, in
connection with settlements of purchases and sales of
Securities, loans of Securities, and deliveries and returns of
collateral consisting of Securities.
(ii) Securities of the Fund kept in a Book-Entry System or
Securities Depository shall be kept in an account ("Depository
Account") of the Custodian in such Book-Entry System or
Securities Depository which includes only assets held by the
Custodian as a fiduciary, custodian or otherwise for
customers.
(iii) The records of the Custodian with respect to Securities of the
Fund maintained in a Book-Entry System or Securities
Depository shall, by book-entry, identify such Securities as
belonging to the Fund.
(iv) If Securities purchased by the Fund are to be held in a
Book-Entry System or Securities Depository, the Custodian
shall pay for such Securities upon (i)
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receipt of advice from the Book-Entry System or Securities
Depository that such Securities have been transferred to the
Depository Account, and (ii) the making of an entry on the
records of the Custodian to reflect such payment and transfer
for the account of the Fund. If Securities sold by the Fund
are held in a Book-Entry System or Securities Depository, the
Custodian shall transfer such Securities upon (i) receipt of
advice from the Book-Entry System or Securities Depository
that payment for such Securities has been transferred to the
Depository Account, and (ii) the making of an entry on the
records of the Custodian to reflect such transfer and payment
for the account of the Fund.
(v) The Custodian shall provide the Fund with copies of any report
(obtained by the Custodian from a Book-Entry System or
Securities Depository in which Securities of the Fund are
kept) on the internal accounting controls and procedures for
safeguarding Securities deposited in such Book-Entry System or
Securities Depository.
(vi) Anything to the contrary in this Agreement notwithstanding,
the Custodian shall be liable to the Fund for any loss or
damage to the Fund resulting (i) from the use of a Book-Entry
System or Securities Depository by reason of any negligence or
willful misconduct on the part of Custodian or any of its or
their employees, or (ii) from failure of Custodian to enforce
effectively such rights as it may have against a Book-Entry
System or Securities Depository. At its election, the Fund
shall be subrogated to the rights of the Custodian with
respect to any claim against a Book-Entry System or Securities
Depository or any other person from any loss or damage to the
Fund arising from the use of such Book-Entry System or
Securities Depository, if and to the extent that the Fund has
not been made whole for any such loss or damage.
3.6 Disbursement of Moneys from Fund Custody Account. Upon receipt of
Proper Instructions, the Custodian shall disburse moneys from the
Fund Custody Account but only in the following cases:
(a) For the purchase of Securities for the Fund but only in
accordance with Section 4.1 of this Agreement and only (i) in
the case of Securities (other than options on Securities,
futures contracts and options on futures contracts), against
the delivery to the Custodian of such Securities registered as
provided in Section 3.9 below or in proper form for transfer,
or if the purchase of such Securities is effected through a
Book-Entry System or Securities Depository, in accordance with
the conditions set forth in Section 3.5 above; (ii) in the
case of options on Securities, against delivery to the
Custodian of such receipts as are required by the customs
prevailing among dealers in such options; (iii) in the case of
futures contracts and options on futures contracts, against
delivery to the Custodian of evidence of title thereto in
favor of the Fund or any nominee referred to in Section 3.9
below; (iv) in the case of repurchase or reverse repurchase
agreements entered into between the Fund and a bank which is a
member of the Federal Reserve System or between the Fund and a
primary dealer in U.S. Government securities, against delivery
of the purchased
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Securities either in certificate form or through an entry
crediting the Custodian's account at a Book-Entry System or
Securities Depository with such Securities; and (v) 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.
(b) In connection with the conversion, exchange or surrender, as
set forth in Section 3.7(f) below, of Securities owned by the
Fund;
(c) For the payment of any dividends or capital gain distributions
declared by the Fund;
(d) In payment of the price of Shares repurchased in open market
purchases or through tender offers as provided in Section 5.1
below;
(e) 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; administration,
investment advisory, accounting, auditing, transfer agent,
custodian, director and legal fees; employees' salaries and
other benefits; and other operating expenses of the Fund; in
all cases, whether or not such expenses are to be in whole or
in part capitalized or treated as deferred expenses;
(f) For transfer in accordance with the provisions of any
agreement among the Fund, the Custodian and a broker-dealer
registered under the 1934 Act and a member of the NASD,
relating to compliance with rules of The Options Clearing
Corporation and of any registered national securities exchange
(or of any similar organization or organizations) regarding
escrow or other arrangements in connection with transactions
by the Fund;
(g) For transfer in accordance with the provision 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;
(h) For the funding of any uncertificated time deposit or other
interest-bearing account with any banking institution
(including the Custodian), which deposit or account has a term
of one year or less; and
(i) For any other proper purpose, but only upon receipt, in
addition to Proper
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Instructions, of a copy of a resolution of the Board of
Directors, certified by an Officer, specifying the amount and
purpose of such payment, declaring such purpose to be a proper
corporate purpose, and naming the person or persons to whom
such payment is to be made.
3.7 Delivery of Securities from Fund Custody Account. Upon receipt of
Proper Instructions, the Custodian shall release and deliver
Securities from the Fund Custody Account but only in the following
cases:
(a) Upon the sale of Securities for the account of the Fund but
only against receipt of payment therefor in cash, by certified
or cashiers check or bank credit;
(b) In the case of a sale effected through a Book-Entry System or
Securities Depository, in accordance with the provisions of
Section 3.5 above;
(c) To an offeror's depository agent in connection with tender or
other similar offers for Securities of the Fund; provided
that, in any such case, the cash or other consideration is to
be delivered to the Custodian;
(d) To the issuer thereof or its agent (i) for transfer into the
name of the Fund, the Custodian, or of any nominee or nominees
of any of the foregoing, or (ii) for exchange for a different
number of certificates or other evidence representing the same
aggregate face amount or number of units; provided that, in
any such case, the new Securities are to be delivered to the
Custodian;
(e) 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.;
(f) For exchange or conversion pursuant to any plan or merger,
consolidation, recapitalization, reorganization or
readjustment of the issuer of such Securities, or pursuant to
provisions for conversion contained in such Securities, or
pursuant to any deposit agreement, including surrender or
receipt of underlying Securities in connection with the
issuance or cancellation of depository receipts; provided
that, in any such case, the new Securities and cash, if any,
are to be delivered to the Custodian;
(g) Upon receipt of payment therefor pursuant to any repurchase or
reverse repurchase agreement entered into by the Fund;
(h) In the case of warrants, rights or similar Securities, upon
the exercise thereof, provided that, in any such case, the new
Securities and cash, if any, are to be
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delivered to the Custodian;
(i) For delivery in connection with any loans of Securities of the
Fund, but only against receipt of such collateral as the Fund
shall have specified to the Custodian in Proper Instructions;
(j) For delivery as security in connection with any borrowings by
the Fund requiring a pledge of assets by the Fund, but only
against receipt by the Custodian of the amounts borrowed;
(k) Pursuant to any authorized plan of liquidation,
reorganization, merger, consolidation or recapitalization of
the Fund;
(l) For delivery in accordance with the provisions of any
agreement among the Fund, the Custodian and a broker-dealer
registered under the 1934 Act and a member of the NASD,
relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange
(or of any similar organization or organizations) regarding
escrow or other arrangements in connection with transactions
by the Fund;
(m) 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; or
(n) For any other proper corporate purpose, but only upon receipt,
in addition to Proper Instructions, of a copy of a resolution
of the Board of Directors, certified by an Officer, specifying
the Securities to be delivered, setting forth the purpose for
which such delivery is to be made, declaring such purpose to
be a proper corporate purpose, and naming the person or
persons to whom delivery of such Securities shall be made.
3.8 Actions Not Requiring Proper Instructions. Unless otherwise
instructed by the Fund, the Custodian shall with respect to all
Securities held for the Fund:
(a) Subject to Section 7.4 below, collect on a timely basis all
income and other payments to which the Fund is entitled either
by law or pursuant to custom in the securities business;
(b) Present for payment and, subject to Section 7.4 below, collect
on a timely basis the amount payable upon all Securities which
may mature or be called, redeemed, or retired, or otherwise
become payable;
(c) Endorse for collection, in the name of the Fund, checks,
drafts and other negotiable instruments;
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(d) Surrender interim receipts or Securities in temporary form for
Securities in definitive form;
(e) Execute, as custodian, any necessary declarations or
certificates of ownership under the federal income tax laws or
the laws or regulations of any other taxing authority now or
hereafter in effect, and prepare and submit reports to the
Internal Revenue Service ("IRS") and to the Fund at such time,
in such manner and containing such information as is
prescribed by the IRS;
(f) Hold for the Fund, either directly or, with respect to
Securities held therein, through a Book-Entry System or
Securities Depository, all rights and similar securities
issued with respect to Securities of the Fund; and
(g) In general, and except as otherwise directed in Proper
Instructions, attend to all non-discretionary details in
connection with the sale, exchange, substitution, purchase,
transfer and other dealings with Securities and assets of the
Fund.
3.9 Registration and Transfer of Securities. All Securities held for the
Fund that are issued or issuable only in bearer form shall be held
by the Custodian in that form, provided that any such Securities
shall be held in a Book-Entry System if eligible therefor. All other
Securities held for the Fund may be registered in the name of the
Fund, the Custodian, or in the name of any nominee of any of them,
or in the name of a Book-Entry System, Securities Depository or any
nominee of either thereof. The Fund shall furnish to the Custodian
appropriate instruments to enable the Custodian to hold or deliver
in proper form for transfer, or to register in the name of any of
the nominees hereinabove referred to or in the name of a Book-Entry
System or Securities Depository, any Securities registered in the
name of the Fund.
3.10 Records.
(a) The Custodian shall maintain, for the Fund, complete and
accurate records with respect to Securities, cash or other
property held for the Fund, including (i) journals or other
records of original entry containing an itemized daily record
in detail of all receipts and deliveries of Securities and all
receipts and disbursements of cash; (ii) ledgers (or other
records) reflecting (A) Securities in transfer, (B) Securities
in physical possession, (C) monies and Securities borrowed and
monies and Securities loaned (together with a record of the
collateral therefor and substitutions of such collateral), (D)
dividends and interest received, and (E) dividends receivable
and interest receivable; and (iii) canceled checks and bank
records related thereto. The Custodian shall keep such other
books and records of the Fund as the Fund shall reasonably
request, or as may be required by the 1940 Act, including, but
not limited to, Section 31 of the 1940 Act and Rule 31a-2
promulgated thereunder.
(b) All such books and records maintained by the Custodian shall
(i) be maintained in a form acceptable to the Fund and in
compliance with rules and regulations of the Securities and
Exchange Commission, (ii) be the property of the Fund and at
all times during the regular business hours of the Custodian
be made
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available upon request for inspection by duly authorized
officers, employees or agents of the Fund and employees or
agents of the Securities and Exchange Commission, and (iii) if
required to be maintained by Rule 31a-1 under the 1940 Act, be
preserved for the periods prescribed in Rule 31a-2 under the
1940 Act.
(c) The Custodian agrees to provide to the Fund any records and
certifications necessary for the Fund to comply with the
Fund's disclosure controls and procedures adopted in
accordance with the Xxxxxxxx-Xxxxx Act. Without limiting the
generality of the foregoing, the custodian shall cooperate
with the Fund and assist the Fund as necessary by providing
information to enable the appropriate officers of the Fund to
execute any required certifications.
3.11 Fund Reports by Custodian. The Custodian shall furnish the Fund with
a daily activity statement and a summary of all transfers to or from
each Fund Custody Account on the day following such transfers. At
least monthly and from time to time, the Custodian shall furnish the
Fund with a detailed statement of the Securities and moneys held by
the Custodian for the Fund under this Agreement.
3.12 Other Reports by Custodian. The Custodian shall provide the Fund
with such reports, as the Fund may reasonably request from time to
time, on the internal accounting controls and procedures for
safeguarding Securities, which are employed by the Custodian.
3.13 Proxies and Other Materials. The Custodian shall cause all proxies
relating to Securities which are not registered in the name of the
Fund, to be promptly executed by the registered holder of such
Securities, without indication of the manner in which such proxies
are to be voted, and shall promptly deliver to the Fund such
proxies, all proxy soliciting materials and all notices relating to
such Securities.
3.14 Information on Corporate Actions. The Custodian shall promptly
deliver to the Fund all information received by the Custodian and
pertaining to Securities being held by the Fund with respect to
optional tender or exchange offers, calls for redemption or
purchase, or expiration of rights as described in the Standards of
Service Guide attached as Exhibit B. If the Fund desires to take
action with respect to any tender offer, exchange offer or other
similar transaction, the Fund shall notify the Custodian at least
five Business Days prior to the date on which the Custodian is to
take such action. The Fund will provide or cause to be provided to
the Custodian all relevant information for any Security which has
unique put/option provisions at least five Business Days prior to
the beginning date of the tender period.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
4.1 Purchase of Securities. Promptly upon each purchase of Securities
for the Fund, Written Instructions shall be delivered to the
Custodian, specifying (a) the name of the issuer or writer of such
Securities, and the title or other description thereof, (b) the
number of shares, principal amount (and accrued interest, if any) or
other units
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purchased, (c) the date of purchase and settlement, (d) the purchase
price per unit, (e) the total amount payable upon such purchase, and
(f) the name of the person to whom such amount is payable. THE
CUSTODIAN SHALL UPON RECEIPT OF SUCH SECURITIES PURCHASED BY THE
FUND PAY OUT OF THE MONEYS HELD FOR THE ACCOUNT OF THE FUND THE
TOTAL AMOUNT SPECIFIED IN SUCH WRITTEN INSTRUCTIONS TO THE PERSON
NAMED THEREIN. The Custodian shall not be under any obligation to
pay out moneys to cover the cost of a purchase of Securities for the
Fund, if in the Fund Custody Account there is insufficient cash
available to the Fund for which such purchase was made.
4.2 Liability for Payment in Advance of Receipt of Securities Purchased.
In any and every case where payment for the purchase of Securities
for the Fund is made by the Custodian in advance of receipt of the
Securities purchased but in the absence of specified Written
Instructions to so pay in advance, the Custodian shall be liable to
the Fund for such Securities to the same extent as if the Securities
had been received by the Custodian.
4.3 Sale of Securities. Promptly upon each sale of Securities by the
Fund, Written Instructions shall be delivered to the Custodian,
specifying (a) the name of the issuer or writer of such Securities,
and the title or other description thereof, (b) the number of
shares, principal amount (and accrued interest, if any), or other
units sold, (c) the date of sale and settlement, (d) the sale price
per unit, (e) the total amount payable upon such sale, and (f) the
person to whom such Securities are to be delivered. Upon receipt of
the total amount payable to the Fund as specified in such Written
Instructions, the Custodian shall deliver such Securities to the
person specified in such Written Instructions. Subject to the
foregoing, the Custodian may accept payment in such form as shall be
satisfactory to it, and may deliver Securities and arrange for
payment in accordance with the customs prevailing among dealers in
Securities.
4.4 Delivery of Securities Sold. Notwithstanding Section 4.3 above or
any other provision of this Agreement, the Custodian, when
instructed to deliver Securities against payment, shall be entitled,
if in accordance with generally accepted market practice, to deliver
such Securities prior to actual receipt of final payment therefor.
In any such case, the Fund shall bear the risk that final payment
for such Securities may not be made or that such Securities may be
returned or otherwise held or disposed of by or through the person
to whom they were delivered, and the Custodian shall have no
liability for any for the foregoing.
4.5 Payment for Securities Sold, etc. In its sole discretion and from
time to time, the Custodian may credit the Fund Custody Account,
prior to actual receipt of final payment thereof, with (i) proceeds
from the sale of Securities which it has been instructed to deliver
against payment, (ii) proceeds from the redemption of Securities or
other assets of the Fund, and (iii) income from cash, Securities or
other assets of the Fund. Any such credit shall be conditional upon
actual receipt by Custodian of final payment and may be reversed if
final payment is not actually received in full.
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The Custodian may, in its sole discretion and from time to time,
permit the Fund to use funds so credited to the Fund Custody Account
in anticipation of actual receipt of final payment. Any such funds
shall be repayable immediately upon demand made by the Custodian at
any time prior to the actual receipt of all final payments in
anticipation of which funds were credited to the Fund Custody
Account.
4.6 Advances by Custodian for Settlement. The Custodian may, in its sole
discretion and from time to time, advance funds to the Fund to
facilitate the settlement of a Fund's transactions in the Fund
Custody Account. Any such advance shall be repayable immediately
upon demand made by Custodian.
ARTICLE V
REPURCHASE OF FUND SHARES
5.1 Transfer of Funds. From such funds as may be available for the
purpose in the relevant Fund Custody Account, and upon receipt of
Proper Instructions specifying that the funds are required to
repurchase Shares of the Fund in open market purchases or pursuant
to a tender offer, the Custodian shall wire each amount specified in
such Proper Instructions to or through such bank or broker-dealer as
the Fund may designate with respect to such amount in such Proper
Instructions.
5.2 No Duty Regarding Paying Banks. The Custodian shall not be under any
obligation to effect payment or distribution by any bank designated
in Proper Instructions given pursuant to Section 5.1 above of any
amount paid by the Custodian to such bank in accordance with such
Proper Instructions.
ARTICLE VI
SEGREGATED ACCOUNTS
Upon receipt of Proper Instructions, the Custodian shall establish and
maintain a segregated account or accounts for and on behalf of the Fund, into
which account or accounts may be transferred cash and/or Securities, including
Securities maintained in a Depository Account,
(a) in accordance with the provisions of any agreement among the
Fund, the Custodian and a broker-dealer registered under the
1934 Act and a member of the NASD (or any futures commission
merchant registered under the Commodity Exchange Act),
relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange
(or the Commodity Futures Trading Commission or any registered
contract market), or of any similar organization or
organizations, regarding escrow or other arrangements in
connection with transactions by the Fund,
(b) for purposes of segregating cash or Securities in connection
with securities options purchased or written by the Fund or in
connection with financial futures contracts (or options
thereon) purchased or sold by the Fund,
(c) which constitute collateral for loans of Securities made by
the Fund,
13
(d) for purposes of compliance by the Fund with requirements under
the 1940 Act for the maintenance of segregated accounts by
registered investment companies in connection with reverse
repurchase agreements and when-issued, delayed delivery and
firm commitment transactions, and
(e) for other proper corporate purposes, but only upon receipt of,
in addition to Proper Instructions, a certified copy of a
resolution of the Board of Directors, certified by an Officer,
setting forth the purpose or purposes of such segregated
account and declaring such purposes to be proper corporate
purposes.
Each segregated account established under this Article VI shall be
established and maintained for the Fund only. All Proper Instructions relating
to a segregated account shall specify the Fund.
ARTICLE VII
CONCERNING THE CUSTODIAN
7.1 Standard of Care. The Custodian shall be held to the exercise of
reasonable care in carrying out its obligations under this
Agreement, and shall be without liability to the Trust or any Fund
for any loss, damage, cost, expense (including attorneys' fees and
disbursements), liability or claim unless such loss, damage, cost,
expense, liability or claim arises from negligence, bad faith or
willful misconduct on its part. The Custodian shall be entitled to
rely on and may act upon advice of counsel on all matters, and shall
be without liability for any action reasonably taken or omitted in
good faith and without negligence pursuant to such advice. The
Custodian shall promptly notify the Fund of any action taken or
omitted by the Custodian pursuant to advice of counsel. The
Custodian shall not be under any obligation at any time to ascertain
whether the Fund is in compliance with the 1940 Act, the regulations
thereunder, the provisions of the Fund's charter documents or
by-laws, or its investment objectives and policies as then in
effect.
7.2 Actual Collection Required. The Custodian shall not be liable for,
or considered to be the custodian of, any cash belonging to the Fund
or any money represented by a check, draft or other instrument for
the payment of money, until the Custodian or its agents actually
receive such cash or collect on such instrument.
7.3 No Responsibility for Title, etc. So long as and to the extent that
it is in the exercise of reasonable care, the Custodian shall not be
responsible for the title, validity or genuineness of any property
or evidence of title thereto received or delivered by it pursuant to
this Agreement.
7.4 Limitation on Duty to Collect. Custodian shall not be required to
enforce collection, by legal means or otherwise, of any money or
property due and payable with respect to Securities held for the
Fund if such Securities are in default or payment is not made after
due demand or presentation.
7.5 Reliance Upon Documents and Instructions. The Custodian shall be
entitled to rely
14
upon any certificate, notice or other instrument in writing received
by it and reasonably believed by it to be genuine. The Custodian
shall be entitled to rely upon any Oral Instructions and any Written
Instructions actually received by it pursuant to this Agreement.
7.6 Express Duties Only. The Custodian shall have no duties or
obligations whatsoever except such duties and obligations as are
specifically set forth in this Agreement, and no covenant or
obligation shall be implied in this Agreement against the Custodian.
7.7 Co-operation. The Custodian shall cooperate with and supply
necessary information to the entity or entities appointed by the
Fund to keep the books of account of the Fund and/or compute the
value of the assets of the Fund. The Custodian shall take all such
reasonable actions as the Fund may from time to time request to
enable the Fund to obtain, from year to year, favorable opinions
from the Fund's independent accountants with respect to the
Custodian's activities hereunder in connection with (a) the
preparation of the Fund's reports on Form 00-X, 00-X, 0-X and any
other reports required by the Securities and Exchange Commission,
and (b) the fulfillment by the Fund of any other requirements of the
Securities and Exchange Commission.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification by Fund. The Fund shall indemnify and hold harmless
the Custodian , and any nominee of the Custodian from and against
any loss, damage, cost, expense (including reasonable attorneys'
fees and disbursements), liability (including, without limitation,
liability arising under the Securities Act of 1933, the 1934 Act,
the 1940 Act, and any state) or claim arising directly or indirectly
(a) from the fact that Securities are registered in the name of any
such nominee, or (b) from any action or inaction by the Custodian
(i) at the request or direction of or in reliance on the advice of
the Fund, or (ii) upon Proper Instructions, or (c) generally, from
the performance of its obligations under this Agreement, provided
that neither the Custodian nor any nominee shall be indemnified and
held harmless from and against any such loss, damage, cost, expense,
liability or claim arising directly or indirectly from the
Custodian's negligence, bad faith or willful misconduct.
8.2 Indemnification by Custodian. The Custodian shall indemnify and hold
harmless the Fund and its officers, directors and employees from and
against any loss, damage, cost, expense (including reasonable
attorneys' fees and disbursements), liability (including without
limitation, liability arising under the Securities Act of 1933, the
1934 Act, the 1940 Act, and any state or foreign securities and/or
banking laws) or claim arising directly or indirectly from the
negligence, bad faith or willful misconduct of the Custodian or any
nominee of the Custodian.
8.3 Indemnity to be Provided. If the Fund requests the Custodian to take
any action with respect to Securities, which may, in the opinion of
the Custodian, result in the Custodian or its nominee becoming
liable for the payment of money or incurring
15
liability of some other form, the Custodian shall not be required to
take such action until the Fund shall have provided indemnity
therefor to the Custodian in an amount and form satisfactory to the
Custodian.
8.4 Security. If the Custodian advances cash or Securities to the Fund
for any purpose, either at the Fund's request or as otherwise
contemplated in this Agreement, or in the event that the Custodian
has not received payment due for its services under this Agreement,
then, in any such event, any property at any time held for the
account of the Fund shall be security therefor, and should the Fund
fail promptly to repay or indemnify the Custodian, the Custodian
shall be entitled to utilize available cash of such Fund and to
dispose of other assets of such Fund to the extent necessary to
obtain reimbursement or indemnification.
ARTICLE IX
FORCE MAJEURE
Neither the Custodian nor the Fund shall be liable for any failure or
delay in performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable control,
including, without limitation, acts of God; earthquakes; fires; floods; wars;
civil or military disturbances; sabotage; strikes; epidemics; riots; power
failures; computer failure and any such circumstances beyond its reasonable
control as may cause interruption, loss or malfunction of utility,
transportation, computer (hardware or software) or telephone communication
service; accidents; labor disputes; acts of civil or military authority;
governmental actions; or inability to obtain labor, material, equipment or
transportation; provided, however, that the Custodian in the event of a failure
or delay (i) shall not discriminate against the Fund in favor of any other
customer of the Custodian in making computer time and personnel available to
input or process the transactions contemplated by this Agreement and (ii) shall
use its best efforts to ameliorate the effects of any such failure or delay.
ARTICLE X
EFFECTIVE PERIOD; TERMINATION
10.1 Effective Period. This Agreement shall become effective as of its
execution and shall continue in full force and effect until
terminated as hereinafter provided.
10.2 Termination. Either party hereto may terminate this Agreement by
giving to the other party a notice in writing specifying the date of
such termination, which shall be not less than sixty (60) days after
the date of the giving of such notice. If a successor custodian
shall have been appointed by the Board of Directors, the Custodian
shall, upon receipt of a notice of acceptance by the successor
custodian, on such specified date of termination (a) deliver
directly to the successor custodian all Securities (other than
Securities held in a Book-Entry System or Securities Depository) and
cash then owned by the Fund and held by the Custodian as custodian,
and (b) transfer any Securities held in a Book-Entry System or
Securities Depository to an account of or for the benefit of the
Fund at the successor custodian, provided that the Fund shall have
paid to the Custodian all fees, expenses and other amounts to the
payment or
16
reimbursement of which it shall then be entitled. Upon such delivery
and transfer, the Custodian shall be relieved of all obligations
under this Agreement. The Fund may at any time immediately terminate
this Agreement in the event of the appointment of a conservator or
receiver for the Custodian by regulatory authorities or upon the
happening of a like event at the direction of an appropriate
regulatory agency or court of competent jurisdiction.
10.3 Failure to Appoint Successor Custodian. If a successor custodian is
not designated by the Fund on or before the date of termination
specified pursuant to Section 10.1 above, then the Custodian shall
have the right to deliver to a bank or corporation company of its
own selection, which (a) is a "bank" as defined in the 1940 Act and
(b) has aggregate capital, surplus and undivided profits as shown on
its then most recent published report of not less than $100 million,
all Securities, cash and other property held by Custodian under this
Agreement and to transfer to an account of or for the Fund at such
bank or trust company all Securities of the Fund held in a
Book-Entry System or Securities Depository. Upon such delivery and
transfer, such bank or trust company shall be the successor
custodian under this Agreement and the Custodian shall be relieved
of all obligations under this Agreement.
ARTICLE XI
COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to compensation as agreed upon from time
to time by the Fund and the Custodian. The fees and other charges in effect on
the date hereof and applicable to the Fund are set forth in Exhibit C attached
hereto.
ARTICLE XII
LIMITATION OF LIABILITY
It is expressly agreed that the obligations of the Fund hereunder shall
not be binding upon any of the Directors, shareholders, nominees, officers,
agents or employees of the Fund personally, but shall bind only the property of
the Fund as provided in the Fund's Articles of Incorporation, as from time to
time amended. The execution and delivery of this Agreement have been authorized
by the Directors, and this Agreement has been signed and delivered by an
authorized officer of the Fund, acting as such, and neither such authorization
by the Directors nor such execution and delivery by such officer shall be deemed
to have been made by any of them individually or to impose any liability on any
of them personally, but shall bind only the property of the Fund as provided in
the above-mentioned Articles of Incorporation.
ARTICLE XIII
NOTICES
Any notice required or permitted to be given by either party to the other
shall be in writing and shall be deemed to have been given on the date delivered
personally or by courier service, or when delivered after sent by registered or
certified mail, postage prepaid, return receipt requested, or on the date sent
and confirmed received by facsimile transmission to the other party's address
set
17
forth below:
Notice to the Fund shall be sent to:
MeVC Xxxxxx Xxxxxx Jurvetson Fund I, Inc.
000 Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxxxx, XX 00000
and notice to the Custodian shall be sent to:
U.S. Bank National Association
000 Xxxxxx Xxxxxx, X.X. XX-XX-X0XX
Xxxxxxxxxx, Xxxx 00000
Attention: Mutual Fund Custody Services
Facsimile: 000-000-0000
or at such other address as either party shall have provided to the other by
notice given in accordance with this Article XIII.
18
ARTICLE XIV
MISCELLANEOUS
14.1 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
14.2 References to Custodian. The Fund shall not circulate any printed
matter which contains any reference to Custodian without the prior
written approval of Custodian, excepting printed matter contained in
the prospectus or statement of additional information for the Fund
and such other printed matter as merely identifies Custodian as
custodian for the Fund. The Fund shall submit printed matter
requiring approval to Custodian in draft form, allowing sufficient
time for review by Custodian and its counsel prior to any deadline
for printing.
14.3 No Waiver. No failure by either party hereto to exercise, and no
delay by such party in exercising, any right hereunder shall operate
as a waiver thereof. The exercise by either party hereto of any
right hereunder shall not preclude the exercise of any other right,
and the remedies provided herein are cumulative and not exclusive of
any remedies provided at law or in equity.
14.4 Amendments. This Agreement cannot be changed orally and no amendment
to this Agreement shall be effective unless evidenced by an
instrument in writing executed by the parties hereto.
14.5 Counterparts. This Agreement may be executed in one or more
counterparts, and by the parties hereto on separate counterparts,
each of which shall be deemed an original but all of which together
shall constitute but one and the same instrument.
14.6 Severability. If any provision of this Agreement shall be invalid,
illegal or unenforceable in any respect under any applicable law,
the validity, legality and enforceability of the remaining
provisions shall not be affected or impaired thereby.
14.7 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their
respective successors and assigns; provided, however, that this
Agreement shall not be assignable by either party hereto without the
written consent of the other party hereto.
14.8 Headings. The headings of sections in this Agreement are for
convenience of reference only and shall not affect the meaning or
construction of any provision of this Agreement.
14.9 Entire Agreement. This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersedes
all prior agreements, arrangements and understandings, whether
written or oral.
19
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by a duly authorized officer on one or more counterparts as of the date
first above written.
MEVC XXXXXX XXXXXX JURVETSON FUND I, INC. U.S. BANK NATIONAL ASSOCIATION
By: ___________________________________ By:________________________________
Xxx X. Xxxxxxx
Title: ________________________________ Title: Senior Vice President
20
EXHIBIT A
AUTHORIZED PERSONS
Set forth below are the names and specimen signatures of the persons
authorized by the Fund to administer the Fund Custody Accounts.
Authorized Persons Specimen Signatures
President: ___________________
Secretary: ___________________
Treasurer: ___________________
Vice President: ___________________
___________________
___________________
Transfer Agent/Fund Accountant
Employees: ___________________
___________________
___________________
___________________
___________________
21
EXHIBIT B
USBANK INSTITUTIONAL CUSTODY SERVICES
STANDARDS OF SERVICE GUIDE
USBank, N.A. is committed to providing superior quality service to all
customers and their agents at all times. We have compiled this guide as a tool
for our clients to determine our standards for the processing of security
settlements, payment collection, and capital change transactions. Deadlines
recited in this guide represent the times required for USBank to guarantee
processing. Failure to meet these deadlines will result in settlement at our
client's risk. In all cases, USBank will make every effort to complete all
processing on a timely basis.
USBank is a direct participant of the Depository Trust Company, a direct
member of the Federal Reserve Bank of Cleveland, and utilizes the Bank of New
York as its agent for ineligible and foreign securities.
For corporate reorganizations, USBank utilizes SEI's Reorg Source,
Financial Information, Inc., XCITEK, DTC Important Notices, Capital Changes
Daily (CCH) and the Wall Street Journal.
For bond calls and mandatory puts, USBank utilizes SEI's Bond Source,
Xxxxx Information Systems, Standard & Poor's Corporation, XCITEK, and DTC
Important Notices. USBank will not notify clients of optional put opportunities.
Any securities delivered free to USBank or its agents must be received
three (3) business days prior to any payment or settlement in order for the
USBank standards of service to apply.
Should you have any questions regarding the information contained in this
guide, please feel free to contact your account representative.
The information contained in this Standards of Service Guide
is subject to change. Should any changes be made USBank will
provide you with an updated copy of its Standards of Service
Guide.
22
USBANK SECURITY SETTLEMENT STANDARDS
TRANSACTION TYPE INSTRUCTIONS DEADLINES* DELIVERY INSTRUCTIONS
DTC 1:30 P.M. on Settlement Date DTC Participant #0000
Xxxxx Xxxx XX 00000
Institutional #________________
For Account #____________
Federal Reserve Book Entry 12:30 P.M. on Settlement Date Federal Reserve Bank of Cleveland
for Firstar Bank, N.A. ABA# 000000000
XXXXX/1050
For Account #_____________
Federal Reserve Book Entry (Repurchase 1:00 P.M. on Settlement Date Federal Reserve Bank of Cleveland
Agreement Collateral Only) for Firstar Bank, N.A. ABA# 000000000
XXXXX/1040
For Account #_____________
PTC Securities 12:00 P.M. on Settlement Date PTC For Account BYORK
(GNMA Book Entry) Firstar Bank / 117612
9:30 A.M. EST on Settlement Date Bank of New York
Physical Securities (for Deliveries, by 4:00 P.M. on Settlement One Wall Street- 3rd Floor - Window A
Date minus 1) Xxx Xxxx, XX 00000
For account of Firstar Bank / Cust #117612
Attn: Xxxxxx Xxxxxx
CEDEL/EURO-CLEAR 11:00 A..M. on Settlement Date minus 2 Cedel a/c 55021
FFC: a/c 387000
Firstar Bank /Global Omnibus
Euroclear a/c 97816
FFC: a/c 387000
Firstar Bank/Global Omnibus
Cash Wire Transfer 3:00 P.M. U.S. Bank, X.X. Xxxxx/Trust ABA# 000000000
Credit Account #112950027
Account of Firstar Trust Services
Further Credit to ___________
Account # _______________ *
* All times listed are Eastern Standard Time.
23
USBANK PAYMENT STANDARDS
SECURITY TYPE INCOME PRINCIPAL
Equities Payable Date
Municipal Bonds* Payable Date Payable Date
Corporate Bonds* Payable Date Payable Date
Federal Reserve Bank Book Entry* Payable Date Payable Date
PTC GNMA's (P&I) Payable Date + 1 Payable Date + 1
CMOs*
DTC Payable Date + 1 Payable Date + 1
Bankers Trust Payable Date + 1 Payable Date + 1
SBA Loan Certificates When Received When Received
Unit Investment Trust Certificates* Payable Date Payable Date
Certificates of Deposit* Payable Date + 1 Payable Date + 1
Limited Partnerships When Received When Received
Foreign Securities When Received When Received
*Variable Rate Securities
Federal Reserve Bank Book Entry Payable Date Payable Date
DTC Payable Date + 1 Payable Date + 1
Bankers Trust Payable Date + 1 Payable Date + 1
NOTE: If a payable date falls on a weekend or bank holiday, payment will be made
on the immediately following business day.
24
USBANK CORPORATE REORGANIZATION STANDARDS
DEADLINE FOR CLIENT INSTRUCTIONS TRANSACTION
TYPE OF ACTION NOTIFICATION TO CLIENT TO USBANK POSTING
Rights, Warrants, Later of 10 business days prior to expiration 5 business days prior to expiration Upon receipt
and Optional Mergers or receipt of notice
Mandatory Puts with Later of 10 business days prior to expiration 5 business days prior to expiration Upon receipt
Option to Retain or receipt of notice
Class Actions 10 business days prior to expiration date 5 business days prior to expiration Upon receipt
Voluntary Tenders,
Exchanges, Later of 10 business days prior to expiration 5 business days prior to expiration Upon receipt
and Conversions or receipt of notice
Mandatory Puts, Defaults, At posting of funds or securities received None Upon receipt
Liquidations, Bankruptcies, Stock
Splits, Mandatory Exchanges
Full and Partial Calls Later of 10 business days prior to expiration None Upon receipt
or receipt of notice
NOTE: Fractional shares/par amounts resulting from any of the above will be
sold.
25
EXHIBIT C
U.S. Bank National Association.
DOMESTIC CUSTODY FEE SCHEDULE
Minimum Annual Fee:
$15,000 or an asset based fee of 1 basis point, whichever is
greater (portfolio transaction fees not included)
Portfolio Transaction Fees:
$ 5.00 per disbursement (waived if U.S. Bancorp is Administrator)
$ 7.00 per repurchase agreement transaction
$ 9.00 per book entry security (depository or Federal Reserve system)
$25.00 per portfolio transaction processed through our New York custodian
definitive security (physical)
$ 9.00 per GNMA Amortized security purchase
$ 8.00 per GNMA principal/interest paydown, GNMA sales
$15.00 per option/future contract written, exercised or expired
$50.00 per Cedel/Euroclear transaction
$15.00 per mutual fund trade, per Fed Wire or withdrawal (waived if U.S. Bancorp
is affiliated with the mutual fund)
$10.00 per margin variation
$ 6.00 per short sale, per paydown transaction
26
