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EXHIBIT 8(i)
CUSTODY AGREEMENT
THIS AGREEMENT, is made effective as of December 12, 1989, by and
between FOUNTAIN SQUARE FUNDS (the "Trust"), a business trust organized under
the laws of the State of Massachusetts, acting with respect to the Fountain
Square Treasury Obligations Fund and the Fountain Square Commercial Paper Fund
(the "Funds"), and such other portfolios as may be added from time to time and
administered by the Trust, and THE FIFTH THIRD BANK, a banking company organized
under the laws of the State of Ohio (the "Custodian").
WITNESSETH:
WHEREAS, the Trust desires that the Funds' Securities and cash be held
and administered by the Custodian pursuant to this Agreement; and
WHEREAS, the Trust is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Custodian represents that it is a bank having the
qualifications prescribed in Section 26(a)(i) of the 1940 Act;
NOW, THEREFORE, in consideration of the mutual agreements herein made,
the Trust and the Custodian hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
1.1 "AUTHORIZED PERSON" means any Officer or other person duly
authorized by resolution of the Board of Trustees to give Oral Instructions and
Written Instructions on behalf of the Funds and named in Exhibit A hereto or in
such resolutions of the Board of Trustees, certified by an Officer, as may be
received by the Custodian from time to time.
1.2 "BOARD OF TRUSTEES" shall mean the Trustees from time to time
serving under the Trust's Agreement and Declaration of Trust, dated September
15, 1988, 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.
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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 Trust computes
the net asset value of a Fund.
1.5 "NASD" shall mean The National Association of Securities Dealers,
Inc.
1.6 "OFFICER" shall mean the Chairman, President, any Vice President,
the Secretary, any Assistant Secretary, the Treasurer, or any Assistant
Treasurer of the Trust.
1.7 "ORAL INSTRUCTIONS" shall mean instructions orally transmitted to
and accepted by the Custodian because such instructions are: (i) reasonably
believed by the Custodian to have been given by an Authorized Person, (ii)
1.8 "FUND CUSTODY ACCOUNT" shall mean any of the accounts in the name
of the Trust, which are provided for in Section 3.2 below.
1.9 "PROPER INSTRUCTIONS" shall mean Oral Instructions or Written
Instructions. Proper Instructions may be continuing Written Instructions when
deemed appropriate by both parties.
1.10 "SECURITIES DEPOSITORY" shall mean The Depository Trust Company
and (provided that Custodian shall have received a copy of a resolution of the
Board of Trustees, certified by an Officer, specifically approving the use of
such clearing agency as a depository for the Funds) any other clearing agency
registered with the Securities and Exchange Commission under Section 17A of the
Securities and Exchange Act of 1934, which acts as a system for the central
handling of Securities where all Securities of any particular class or series of
an issuer deposited within the system are treated as fungible and may be
transferred or pledged by bookkeeping entry without physical delivery of the
Securities.
1.11 "SECURITIES" shall include, without limitation, common and
preferred stocks, bonds, call options, put options, debentures, notes, bank
certificates of deposit, bankers' acceptances, mortgage-backed securities, other
money market instruments or other obligations, and any certificates, receipts,
warrants or other instruments or documents representing rights to receive,
purchase or subscribe for the same, or evidencing or representing any other
rights or interests therein, or any similar property or assets that the
Custodian has the facilities to clear and to service.
1.12 "SHARES" shall mean, with respect to a Fund, the units of
beneficial interest issued by the Trust on account of such Fund.
1.13 "WRITTEN INSTRUCTIONS" shall mean (i) written communications
actually received by the Custodian and signed by one or more persons as the
Board of Trustees shall have from time to time authorized, or (ii)
communications by telex or any other such system from a person or persons
reasonably believed by the Custodian to be Authorized, or (iii) communications
transmitted electronically through the Institutional Delivery System (IDS), or
any other similar electronic
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instruction system acceptable to Custodian and approved by resolutions of the
Board of Trustees, a copy of which, certified by an Officer, shall have been
delivered to the Custodian.
ARTICLE II
APPOINTMENT OF CUSTODIAN
2.1 APPOINTMENT. The Trust hereby constitutes and appoints the
Custodian as custodian of all Securities and cash owned by or in the possession
of the Trust at any time during the period of this Agreement, provided that such
Securities or cash belong to one of the Funds.
2.2 ACCEPTANCE. The Custodian hereby accepts appointment as such
custodian and agrees to perform the duties thereof as hereinafter set forth.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
3.1 SEGREGATION. All Securities and non-cash property held by the
Custodian for the account of a Fund, except Securities maintained in a
Securities Depository or Book-Entry System, shall be physically segregated from
other Securities and non-cash property of the other Fund) and shall be
identified as subject to this Agreement.
3.2 FUND CUSTODY ACCOUNTS. As to each Fund, the Custodian shall open
and maintain in its trust department a custody account in the name of the Trust
coupled with the name of such 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 APPOINTMENT OF AGENTS. In its discretion, the Custodian may
appoint, and at any time remove, any domestic bank or trust company, which has
been approved by the Board of Trustees and is qualified to act as a custodian
under the 1940 Act, as sub-custodian to hold Securities and cash of the Funds
and to carry out such other provisions of this Agreement as it may determine,
and may also open and maintain one or more banking accounts with such a bank or
trust company (any such accounts to be in the name of the Custodian on behalf of
its customers and subject only to its draft or order pursuant to the terms of
this Agreement), provided, however, that the appointment of any such agent shall
not relieve the Custodian of any of its obligations or liabilities under this
Agreement.
3.4 DELIVERY OF ASSETS TO CUSTODIAN. The Trust shall deliver, or cause
to be delivered, to the Custodian all of the Funds' Securities, cash and other
assets, including (a) all payments of income, payments of principal and capital
distributions received by the Funds with respect to such Securities, cash or
other assets owned by the Funds at any time during the period of this Agreement,
and (b) all cash received by the Funds for the issuance, at any time during such
period, of Shares.
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Except as otherwise set forth herein the Custodian shall not be responsible for
such Securities, cash or other assets until actually received by it.
3.5 SECURITIES DEPOSITORIES AND BOOK-ENTRY SYSTEMS. The Custodian may
deposit and/or maintain Securities of the Funds in a Securities Depository or in
a Book-Entry System, subject to the following provisions:
(a) Prior to a deposit of Securities of the funds in any
Securities Depository or Book-Entry System, the Trust
shall deliver to the Custodian a resolution of the
Board of Trustees, certified by an Officer,
authorizing and instructing the Custodian on an
on-going basis to deposit in such Securities
Depository or Book-Entry System all Securities
eligible for deposit therein and to make use of such
Securities Depository or Book-Entry System to the
extent possible and practical in connection with its
performance hereunder, including, without limitation,
in connection with settlements of purchases and sales
of Securities, loans of Securities, and deliveries
and returns of collateral consisting of Securities.
So long as such Securities Depository or Book-Entry
System shall continue to be employed for the deposit
of Securities of the Funds, the Trust shall annually
re-adopt such resolution and deliver a copy thereof,
certified by an Officer, to the Custodian.
(b) Securities of the Funds kept in a Book-Entry System
or Securities Depository shall be kept in an account
("Depository Account") of the Custodian in such
Book-Entry System or Securities Depository which
includes only assets held by the Custodian as a
fiduciary, custodian or otherwise for customers.
(c) The records of the Custodian with respect to
Securities of a Fund maintained in a Book-Entry
System or Securities Depository shall, by book-entry,
identify such Securities as belonging to such Fund.
(d) If Securities purchases by a Fund are to be held in a
Book-Entry System or Securities Depository, the
Custodian shall pay for such Securities upon (i)
receipt of advice from the Book-Entry System or
Securities Depository that such Securities have been
transferred to the Depository Account, and (ii) the
making of an entry on the records of the Custodian to
reflect such payment and transfer for the account of
such Fund. If Securities sold by a 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 such Fund.
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(e) Upon request, the Custodian shall provide the Trust
with copies of any report (obtained by the Custodian
from a Book-Entry System or Securities Depository in
which Securities of the Funds are kept) on the
internal accounting controls and procedures for
safeguarding Securities deposited in such Book-Entry
System or Securities Depository.
(f) Anything to the contrary in this Agreement
notwithstanding, the Custodian shall be liable to the
Trust for any loss or damage to a 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
sub-custodian appointed pursuant to Section 3.3 above
or any of its or their employees, or (ii) from
failure of Custodian or any such sub-custodian to
enforce effectively such rights as it may have
against a Book-Entry System or Securities Depository.
At its election,the Trust shall be subrogated to the
rights of the Custodian with respect to any claim
against a Book-Entry System or Securities Depository
or any other person for any loss or damage to the
Funds arising from the use of such Book-Entry System
or Securities Depository, if and to the extent that
the Funds have not been made whole for any such loss
or damage.
(g) The Custodian shall collect on a timely basis all
income and other payments with respect to registered
securities held hereunder to which each 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 each 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. The
collection of income due the Funds on securities loan
pursuant to the provisions of Section 3.7(i) shall be
the responsibility of the Trust. The Custodian will
have no duty or responsibility in connection
therewith, other than to provide the Trust with such
information or data as may be necessary to assist the
Trust in arranging for the timely delivery to the
Custodian of the income to which each Fund is
properly entitled.
The Custodian shall promptly notify the Trust
whenever income due on securities is not collected in
due course and will provide the Trust with monthly
reports of the status of past due income.
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3.6 DISBURSEMENT OF MONEYS FROM FUND CUSTODY ACCOUNTS. Upon receipt of
Proper Instructions, the Custodian shall disburse moneys from a Fund Custody
Account but only in the following cases:
(a) For the purchase of Securities for the Fund but only
(i) in the case of Securities (other than options on
Securities, futures contracts and options on futures
contracts), against the delivery to the Custodian (or
any sub-custodian appointed pursuant to Section 3.3
above) of such Securities to be registered as
provided in Section 3.9 below in proper form for
transfer, or if the purchase of such Securities is
effected through a Book-Entry System or Securities
Depository, in accordance with the conditions set
forth in Section 3.5 above; (ii) in the case of
options on Securities, against delivery to the
Custodian (or such sub-custodian) of such receipts as
are required by the customers prevailing among
dealers in such options; (iii) in the case of futures
contracts and options on futures contracts, against
delivery to the Custodian (or such sub-custodian) of
evidence of title thereto in favor of the Fund or any
nominee referred to in Section 3.9 below; and (iv) in
the case of repurchase or reverse repurchase
agreements entered into between the Trust and any
other party, against delivery of the purchased
Securities either in certificate form or through an
entry crediting the Custodian's account at a
Book-Entry System or Securities Depository with such
Securities;
(b) In connection with the conversion, exchange or
surrender, as set forth in Section 3.7(f) below, of
Securities owned by the Fund;
(c) For the payment of any dividends or capital gain
distributions declared by the Fund;
(d) In payment of the redemption price of Shares as
provided in Section 5.1 below;
(e) For the payment of any expense or liability incurred
by the Fund, including but not limited to the
following payments for the account of the Fund:
interest; taxes; administration, investment
management, investment advisory, accounting,
auditing, transfer agent, custodian, trustee and
legal fees; 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 Trust, the Custodian and a
broker-dealer registered under the Securities
Exchange Act of 1934 (the "1934 Act") and a member of
the NASD, relating to compliance with rules of The
Options Clearing Corporation and of any
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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 provisions of any
agreement among the Trust, the Custodian, and a
futures commission merchant registered under the
Commodity Exchange Act, relating to compliance with
the rules of the Commodity Futures Trading Commission
and/or any contract market (or any similar
organization or organizations) regarding account
deposits in connection with transactions by the Fund;
(h) For the fund of any uncertificated time deposit or
other interest-bearing account with any banking
institution (including the Custodian), which deposit
or account has a term of one year or less; and
(i) For any other proper purposes, but only upon receipt,
in addition to Proper Instructions, of a copy of a
resolution of the Board of Trustees, certified by an
Officer, specifying the amount and purpose of such
payment, declaring such purpose to be a proper
corporate purpose, and naming the person or persons
to whom such payment is to be made.
3.7 DELIVERY OF SECURITIES FROM FUND CUSTODY ACCOUNTS. Upon receipt of
Proper Instructions, the Custodian shall release and deliver Securities from a
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;
(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 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;
(e) To the issuer thereof or its agent (i) for transfer
into the name of the Fund, the Custodian or any
sub-custodian appointed pursuant to Section 3.3
above, or of any nominee or nominees of any of the
foregoing, or (ii) for exchange for a different
number of certificates or other evidence representing
the same
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aggregate face amount or number of units; provided
that, in any such case, the new Securities are to be
delivered to the Custodian;
(f) To the broker selling Securities, for examination in
accordance with the "street delivery" custom;
(g) For exchange or conversion pursuant to any plan of
merger, consolidation, recapitalization, readjustment
of the securities, 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;
(h) Upon receipt of payment therefor pursuant to any
repurchase or reverse repurchase agreement entered
into by the Trust;
(i) In the case of warrants, rights or similar
Securities, upon the exercise thereof, provided that,
in any such case, the new Securities and cash, if
any, are to be delivered to the Custodian;
(j) For delivery in connection with any loans of
Securities of the Fund, buy only against receipt of
such collateral as the Trust shall have specified to
the Custodian in Proper Instructions;
(k) For delivery as security in connection with any
borrowings by the Fund requiring a pledge of assets
by the Trust, but only against receipt by the
Custodian of the amounts borrowed;
(l) Pursuant to any authorized plan of liquidation,
reorganization, merger, consolidation or
recapitalization of the Trust;
(m) For delivery in accordance with the provisions of any
agreement among the Trust, the Custodian and a
broker-dealer registered under the 1934 Act and a
member of the NASD, relating to compliance with the
rules of The Options Clearing Corporation and of any
registered national securities exchange (or of any
similar organization or organizations) regarding
escrow or other arrangements in connection with
transactions by the Fund;
(n) For delivery in accordance with the provisions of any
agreement among the Trust, the Custodian, and a
futures commission merchant registered under the
Commodity Exchange Act, relating to compliance with
the rules of the Commodity Futures Trading commission
and/or any contract market (or any
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similar organization or organizations) regarding
account deposits in connection with transactions by
the Fund; or
(o) Upon receipt of instructions from the transfer agent
for a Fund, for delivery to such transfer agent or to
the holders of Shares in connection with
distributions in kind, in satisfaction of requests by
holders of Shares for repurchase or redemption;
(p) For any other proper corporate purposes, but only
upon receipt, in addition to Proper Instructions, of
a copy of a resolution of the Board of Trustees,
certified by an Officer, specifying the Securities to
be delivered, setting forth the purpose for which
such delivery is to be made, declaring such purpose
to be a proper corporate purpose, and naming the
person or persons to whom delivery of such Securities
shall be made.
3.8 BANK ACCOUNTS. The Custodian may open and maintain a separate bank
account or accounts in the name of each Fund, subject only to draft or order by
the Custodian acting pursuant to the terms of this Agreement, and shall hold in
such account or accounts, subject to the provisions hereof, all cash received by
it from or for the account of each Fund, other than cash maintained in a joint
repurchase account with other affiliated funds or by a particular Fund in a bank
account established and used in accordance Rule 17f-3 under the Investment
Company Act of 1940. Funds held by the Custodian for a 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 such bank or trust company and the funds to be deposited with each
such bank or trust company shall be approved by the vote of a majority of the
Board of Trustees of the Trust. Such funds shall be deposited by the Custodian
in its capacity as Custodian for the Fund and shall be withdrawable by the
Custodian only in that capacity. If requested by the Trust, the Custodian shall
furnish the Trust, not later than twenty (20) days after the last business day
of each month, an internal reconciliation of the closing balance as of that day
in all accounts described in this section to the balance shown on the daily cash
report for that day rendered to the Trust.
3.9 PAYMENTS FOR SHARES. The Custodian shall make such arrangements
with the transfer agent of each Fund, as will enable the Custodian to receive
the cash consideration due to each Fund and will deposit into each Fund's
account such payments as are received from the transfer agent. The Custodian
will provide timely notification to the Trust and the transfer agent of any
receipt by it of payments for Shares of the respective Fund.
3.10 AVAILABILITY OF FEDERAL FUNDS. Upon mutual agreement between the
Trust and the Custodian, the Custodian shall make federal funds available to the
Funds as of specified times agreed upon from time to time by the Trust and the
Custodian in the amount of checks, clearing house
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funds, and other non-federal funds received in payment for Share of the Funds
which are deposited into the Funds' accounts.
3.11 ACTIONS NOT REQUIRING PROPER INSTRUCTIONS. Unless otherwise
instructed by the Trust, the Custodian shall with respect to all Securities held
for a Fund;
(a) Endorse for collection, in the name of the Fund,
checks, drafts and other negotiable instruments;
(b) Surrender interim receipts or Securities in temporary
form for Securities in definitive form;
(c) Execute, as custodian, any necessary declarations or
certificates of ownership under the federal income
tax laws or the laws or regulations of any other
taxing authority now or hereafter in effect, and
prepare and submit reports to the Internal Revenue
Service ("IRS") and to the Trust at such time, in
such manner and containing such information as is
prescribed by the IRS;
(d) Hold of the Fund, either director 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
(e) In general, and except as otherwise directed in
Proper Instructions, attend to all non-discretionary
details in connection with sale, exchange,
substitution, purchase, transfer and other dealings
with Securities and assets of the Fund.
3.12 REGISTRATION AND TRANSFER OF SECURITIES. All Securities held for a
Fund that are issued or issuable only in bearer form shall be held by the
Custodian in that form, provided that any such Securities shall be held in a
Book-Entry System if eligible therefor. All other Securities held for a Fund may
be registered in the name of such Fund, the Custodian, or any sub-custodian
appointed pursuant to Section 3.3 above, or in the name of any nominee of any of
them, or in the name of a Book-Entry System, Securities Depository or any
nominee of either thereof. The Trust shall furnish to the Custodian appropriate
instruments to enable the Custodian to hold or deliver in proper form for
transfer, or to register in the name of any of the nominees hereinabove referred
to or in the name of a Book-Entry System or Securities Depository, any
Securities registered in the name of a Fund.
3.13 RECORDS.
(a) The Custodian shall maintain, by Fund, complete and
accurate records with respect to Securities, cash or
other property held for the Funds, including (i)
journals or other records of original entry
containing an itemized daily record in detail of all
receipts and
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deliveries of Securities and all receipts and
disbursements of cash; (ii) ledgers (or other
records) reflecting (A) Securities in transfer, (B)
Securities in physical possession, (C) monies and
Securities borrowed and monies and Securities loaned
(together with a record of the collateral therefor
and substitutions of such collateral), (D) dividends
and interest received, and (E) dividends receivable
and interest accrued; and (iii) cancelled checks and
bank records related thereto. The Custodian shall
keep such other books and records of the Funds as the
Trust shall reasonably request.
(b) All such books and records maintained by the
Custodian shall (i) be maintained in a form
acceptable to the Trust and in compliance with rules
and regulations of the Securities and Exchange
Commission, (ii) be the property of the Trust and at
all times during the regular business hours of the
Custodian be made available upon request for
inspection by duly authorized officers, employees or
agents of the Trust and employees or agents of the
Securities and Exchange Commission, and (iii) if
required to be maintained by Rule 31a-1 under the
1940 Act, be preserved for the periods prescribed in
Rule 31a-2 under the 1940 Act.
3.14 FUND REPORTS BY CUSTODIAN. The Custodian shall furnish the Trust
with a daily activity statement by Fund and a summary of all transfers to or
from each Fund Custody Account on the day following such transfers. At least
monthly and from time to time, the Custodian shall furnish the Trust with a
detailed statement, by Fund, of the Securities and moneys held for the Funds
under this Agreement.
3.15 OTHER REPORTS BY CUSTODIAN. The Custodian shall provide the Trust,
at such times as the Trust may reasonably require, with reports by independent
public accountants for each Fund on the accounting system, internal accounting
control and procedures for safeguarding securities, future contracts and options
on future contracts including securities deposited and/or maintained in a
Securities System, relating to the services provided by the Custodian for the
Fund under this Contract; such reports shall be of sufficient scope and in
sufficient detail as may reasonably be required by the Trust to provide
reasonable assurance that any material inadequacies would be disclosed by such
examination, and, if there are not such inadequacies, the reports shall so
state.
3.16 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 Trust such proxies, all proxy soliciting materials and
all notices to such Securities.
3.17 INFORMATION ON CORPORATE ACTIONS. The Custodian shall transmit
promptly to the Trust 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 to
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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 Funds. With respect to tender or exchange offers, the Custodian
shall transmit promptly to the Trust all written information received by the
Custodian from the issuers of the securities whose tender or exchange offer. If
the Trust desires to take action with respect to any tender offer, exchange
offer, or any other similar transaction, the Trust shall notify the Custodian at
least three business days prior to the date on which the Custodian is to take
such action. However, the Custodian shall nevertheless exercise its best efforts
to take such action in the event that notification is received three business
days or less prior to the date on which action is required.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
4.1 PURCHASE OF SECURITIES. Promptly upon each purchase of Securities
for a Fund, Proper Instructions shall be delivered to the Custodian, specifying
(a) the Fund for which the purchase was made, (b) the name of the issuer or
writer of such Securities, and the title or other description thereof, (c) the
number of shares, principal amount (and accrued interest, if any) or other units
purchased, (d) the date of purchase and settlement, (e) the purchase price per
unit, (f) the total amount payable upon such purchase, and (g) the name of the
person to whom such amount is payable. The Custodian shall upon receipt of such
Securities purchased by a Fund pay out of the moneys held for the account of
such Fund the total amount specified in such Proper Instructions to the person
named therein. The Custodian shall not be under any obligation to pay out moneys
to cover the cost of a purchase of Securities for a Fund, if in the relevant
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 a Fund is made by the Custodian in advance of receipt of the Securities
purchased but in the absence of specific Written or Oral Instructions to so pay
in advance, the Custodian shall be liable to the Fund for such Securities to the
same extent as if the Securities had been received by the Custodian.
4.3 SALE OF SECURITIES. Promptly upon each sale of Securities by a
Fund, Proper Instructions shall be delivered to the Custodian, specifying (a)
the Fund for which the sale was made, (b) the name of the issuer or writer of
such Securities, and title or other description thereof, (c) the number of
shares, principal amount (and accrued interest, if any), or other units sold,
(d) the date of sale and settlement (e) the sale price per unit, (f) the total
amount payable upon such sale, and (g) the person to whom such Securities are to
be delivered. Upon receipt of the total amount payable to the Fund as specified
in such Proper 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 customers prevailing among
dealers in Securities.
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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 accordance with "a 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 failure
to act in accordance with the standard of reasonable care or any higher standard
of care imposed upon the Custodian by any applicable law or resolution if such
above-stated standard of reasonable care were not part of this contract.
4.5 PAYMENT FOR SECURITIES SOLD, ETC. In its sole discretion and from
time to time, the Custodian may credit the relevant 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. The Custodian
may, in its sole discretion and from time to time, permit a Fund to use funds so
credited to its 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 Trust to facilitate
the settlement of a Fund's transactions in its Fund Custody Account. Any such
advance shall be repayable immediately upon demand made by Custodian.
ARTICLE V
REDEMPTION 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 redeem Shares of a Fund,
the Custodian shall wire each amount specified in such Proper Instructions to or
through such bank as the Trust may designate with respect to such amount in such
Proper Instructions.
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 above of any amount paid by the
Custodian to such bank in accordance with such Proper Instructions.
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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 a Fund, into
which account or accounts may be transferred cash and/or Securities, including
Securities maintained in a Depository Account,
(a) in accordance with the provisions of any agreement among the
Trust, the Custodian and a broker-dealer registered under the
1934 Act and a member of the NASD (or any futures commission
merchant registered under the Commodity Exchange Act),
relating to compliance with the rules of The Options Clearing
Corporation and of any registered national securities exchange
(or the Commodity Futures Trading commission or any registered
contract market), or of any similar organization or
organizations, regarding escrow or other arrangements in
connection with transactions by the 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,
(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 other similar transactions,
and
(e) for other proper corporate purposes, but only upon receipt of,
in addition to Proper Instructions, a certified copy of a
resolution of the Board of Trustees, certified by an Officer,
setting forth the purpose or purposes of such segregated
account and declaring such purposes to be proper corporate
purposes.
ARTICLE VII
CONCERNING THE CUSTODIAN
7.1 STANDARD OF CARE. The Custodian shall be held to a standard of
reasonable care in carrying out the provisions of this Agreement;
provided,however, that the Custodian shall be held to any higher standard of
care which would be imposed upon the Custodian by an applicable law or
regulation if such above-stated standard of reasonable care was not part of this
Agreement. The Custodian shall be entitled to rely on and may act upon advice of
counsel (who may be counsel for
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the Trust) on all matters, and shall be without liability for any action
reasonably taken or omitted pursuant to such advice, provided that such action
is not in violation of applicable federal or state laws or regulations, and is
in good faith and without negligence. Subject to the limitations set forth in
Article hereof, the Custodian shall be kept indemnified by the Trust and be
without liability for any action taken or thing done by it in carrying out the
terms and provisions of this Agreement in accordance with the above standards.
7.2 ACTUAL COLLECTION REQUIRED. The custodian shall not be liable for,
or considered to be the custodian of, any cash belonging to a 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. Except as set forth in Section
3.5(g), 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 a 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 upon any certificate, notice or other instrument in writing
received by it and reasonably believed by it to be genuine. The Custodian shall
be entitled to rely upon any Oral Instructions and/or any Written Instructions
actually received by it pursuant to this Agreement.
7.6 EXPRESS DUTIES ONLY. The Custodian shall have no duties or
obligations whatsoever except such duties and obligations as are specifically
set forth in this Agreement, and no covenant or obligation shall be implied in
this Agreement against the Custodian.
7.7 CO-OPERATION. The Custodian shall cooperate with and supply
necessary information, by Fund, to the entity or entities appointed by the Trust
to keep the books of account of the Funds and/or compute the value of the assets
of the Funds. The Custodian shall take all such reasonable actions as the Trust
may from time to time request to enable the Trust to obtain, from year to year,
favorable opinions from the Trust's independent accountants with respect to the
Custodian's activities hereunder in connection with (a) the preparation of the
Trust's report on Form N-1A and Form E-SAR and any other reports required by the
Securities and Exchange Commission, and (b) the fulfillment by the Trust of any
other requirements of the Securities and Exchange Commission.
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ARTICLE VIII
INDEMNIFICATION
8.1 INDEMNIFICATION. The Trust shall indemnify and hold harmless the
Custodian and any sub-custodian appointed pursuant to Section 3.3 above, and any
nominee of the Custodian or of such sub-custodian from and against any loss,
damage, cost, expense (including attorneys' fees and disbursements), liability
(including, without limitation, liability arising under the Securities Act of
1933, the 1934 Act, the 1940 Act, and any state or foreign securities and/or
banking laws) or claim arising directly or indirectly (a) from the fact that
Securities are registered in the name of any such nominee, or (b) from any
action or inaction by the Custodian or such sub-custodian (i) at the request or
direction of or in reliance on the advice of the Trust, or (ii) upon Proper
Instructions, or (c) generally, from the performance of its obligations under
this Agreement or any sub-custody agreement with a sub-custodian, from the
performance of its obligations under such sub-custody agreement, provided that
neither the Custodian nor any such sub-custodian shall be indemnified and held
harmless from and against any such loss, damage, cost, expense, liability or
claim arising from the Custodian's or such sub-custodian's failure to act in
accordance with the standard of reasonable care or any higher standard which may
be applicable pursuant to Section 7.1.
8.2 INDEMNITY TO BE PROVIDED. If the Trust requests the Custodian to
take any action with respect to Securities, which may, in the opinion of the
Custodian, result in the Custodian or its nominee becoming liable for the
payment of money or incurring liability of some other form, the Custodian shall
not be required to take such action until the Trust shall have provided
indemnity therefor to the Custodian in an amount and form satisfactory to the
Custodian.
8.3 SECURITY. If the Custodian advances cash or Securities to a Fund
for any purpose, either at the Trust's request or as otherwise contemplated in
this Agreement, or in the event that the Custodian or its nominee incurs, in
connection with its performance under this Agreement, any loss, damage, cost
expense (including attorneys' fees and disbursements), liability or claim
(except such as may arise from its or its nominee's gross negligence, bad faith
or willful misconduct), then, in any such event, any property at any time held
for the account of such Fund shall be security therefor, and should such 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
EFFECTIVE PERIOD; TERMINATION
9.1 EFFECTIVE PERIOD. This Agreement shall become effective as of its
execution and shall continue in full force and effect until terminated as
hereinafter provided.
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9.2 TERMINATION. Either party hereto may terminate this Agreement by
giving to the other party a notice in writing specifying the date of such
termination, which shall be not less than ninety (90) days after the date of the
giving of such notice. If a successor custodian shall have been appointed by the
Board of Trustees, the Custodian shall, upon receipt of a notice of acceptance
by the successor custodian, on such specified date of termination (a) deliver
directly to the successor custodian all Securities (other than Securities held
in a Book-Entry System or Securities Depository) and cash then owned by the
Funds 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 Funds at the successor custodian, provided that the Trust shall
have paid to the Custodian all fees, expenses and other amounts to the payment
or reimbursement of which it shall then be entitled. Upon such delivery and
transfer, the Custodian shall be relieved of all obligations under this
Agreement. The Trust may at any time immediately terminate this Agreement in the
event of the appointment of a conservator or receiver for the Custodian by
regulatory authorities in the State of Ohio or upon the happening of a like
event at the direction of an appropriate regulatory agency or court of competent
jurisdiction.
9.3 FAILURE TO APPOINT SUCCESSOR CUSTODIAN. If a successor custodian is
not designated by the Trust on or before the date of termination specified
pursuant to Section 10.1 above, then the Custodian shall have the right to
deliver to a bank or trust company of its own selection, which is (a) a "Bank"
as defined in the 1940 Act, (b) has aggregate capital, surplus and undivided
profits as shown on its then most recent published report of not less than $100
million, and (c) is doing business in New York, New York, all Securities, cash
and other property held by Custodian under this Agreement and to transfer to an
account of or for the Funds at such bank or trust company all Securities of the
Funds held in a Book-Entry System or Securities Depository. Upon such delivery
and transfer, such bank or trust company shall be the successor custodian under
this Agreement and the Custodian shall be relieved of all obligations under this
Agreement. If, after reasonable inquiry, Custodian cannot find a successor
custodian as contemplated in this Section 10.3, then Custodian shall have the
right to deliver to the Trust all Securities and cash then owned by the Funds
and to transfer any Securities held in a Book-Entry System or Securities
Depository to an account of or for the Trust. Thereafter, the Trust shall be
deemed to be its own custodian with respect to the Funds and the Custodian shall
be relieved of all obligations under this Agreement.
ARTICLE X
COMPENSATION OF CUSTODIAN
The Custodian shall be entitled to compensation as agreed upon from
time to time by the Trust and the Custodian. The fees and other charges in
effect on the date hereof and applicable to the Funds are set forth in Exhibit B
attached hereto.
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ARTICLE XI
LIMITATION OF LIABILITY
It is expressly agreed that the obligations of the Trust hereunder
shall not be binding upon any of the Trustees, shareholders, nominees, officers,
agents or employees of the Trust personally, but shall bind only the trust
property of the Trust as provided in the Trust's Agreement and Declaration of
Trust, dated September 15, 1988, as from time to time amended. The execution and
delivery of this Agreement have been authorized by the Trustees, and this
Agreement has been signed and delivered by an authorized officer of the Trust,
acting as such, and neither such authorization by the Trustees 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 trust property of the Trust as provided in the
above-mentioned Agreement and Declaration of Trust.
ARTICLE XII
NOTICES
Unless otherwise specified herein, all demands, notices, instructions,
and other communications to be given hereunder shall be in writing and shall be
sent or delivered to the receipt at the address set forth after its name herein
below:
To the Trust:
Fountain Square Funds
Federated Investors Xxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: Secretary
To the Custodian:
The Fifth Third Bank
00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attn: Custody Manager - Trust Operations
Telephone: (000) 000-0000
Facsimile: (579-4312
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or at such other address as either party shall have provided to the other by
notice given in accordance with this Article XII. Writing shall include
transmission by or through teletype, facsimile, central processing unit
connection, on-line terminal and magnetic tape.
ARTICLE XIII
MISCELLANEOUS
13.1 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Ohio.
13.2 REFERENCES TO CUSTODIAN. The Trust shall not circulate any printed
matter which contains any reference to Custodian without the prior written
approval of Custodian, excepting printed matter contained in the prospectus or
statement of additional information for a Fund and such other printed matter as
merely identifies Custodian as custodian for one or both Funds. The Trust shall
submit printed matter requiring approval to Custodian in draft form, allowing
sufficient time for review by Custodian and its counsel prior to any deadline
for printing.
13.3 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.
13.4 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.
13.5 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.
13.6 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.
13.7 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.
13.8 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.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed and delivered in its name and on its behalf by its
representatives thereunto duly authorized, all as of the day and year first
above written.
ATTEST: FOUNTAIN SQUARE FUNDS
/s/ Xxxxx X. Xxxxxx By: /s/ J. Xxxxxxxxxxx Xxxxxxx
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Authorized Officer
ATTEST: THE FIFTH THIRD BANK
/s/ Xxxx X. Xxxxxxxxxx By: /s/
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