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GLOBAL
CUSTODIAL SERVICES AGREEMENT
FORUM FUNDS
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TABLE OF CONTENTS
1. DEFINITIONS AND INTERPRETATION .......................................1
2. ESTABLISHMENT OF ACCOUNTS.............................................2
3. CUSTODY ACCOUNT PROCEDURES............................................2
4. CASH ACCOUNT PROCEDURES...............................................3
5. INSTRUCTIONS..........................................................3
6. PERFORMANCE BY THE CUSTODIAN..........................................4
7. TAX STATUS/WITHHOLDING TAXES..........................................4
8. USE OF THIRD PARTIES..................................................5
9. REPRESENTATIONS.......................................................7
10. SCOPE OF RESPONSIBILITY...............................................7
11 SUBROGATION...........................................................9
12. INDEMNITY.............................................................9
13. LIEN AND SET OFF......................................................9
14. FEES AND EXPENSES.....................................................9
15. CITIGROUP ORGANIZATION INVOLVEMENT...................................10
16. RECORDS AND ACCESS...................................................10
17. INFORMATION..........................................................10
18. ADVERTISING..........................................................10
19. TERMINATION..........................................................10
20. GOVERNING LAW AND JURISDICTION.......................................11
21. MISCELLANEOUS........................................................11
SIGNATURES...........................................................12
SCHEDULES:
o Schedule A
o Fee Schedule
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THIS GLOBAL CUSTODIAL SERVICES AGREEMENT is made on April __, 2005, by and
between Forum Funds, a statutory trust organized under the laws of Delaware,
(the "CLIENT ") and Citibank, N.A. acting through its offices located at 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "CUSTODIAN").
WHEREAS, the Custodian represents to the Client that it is eligible to serve as
a custodian for a management investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), and
WHEREAS, the Client is a management investment company registered under the 1940
Act with separate portfolios as listed on Schedule A to this Agreement (each of
the funds being hereinafter referred to as the "Fund"), with each Fund acting on
its own behalf separately from all the other Funds and not jointly or jointly
and severally with any of the other funds, and
WHEREAS, the Client wishes to appoint the Custodian as the custodian for the
Funds,
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties agree as follows:
1. DEFINITIONS AND INTERPRETATION
(A) DEFINITIONS.
"AUTHORIZED PERSON" means the Client or any person (including any
individual or entity) authorized by the Client to act on Client's behalf or
on behalf of the applicable Fund in the performance of any act, discretion
or duty under this Agreement (including, for the avoidance of doubt, any
officer or employee of such person) in a notice reasonably acceptable to
the Custodian.
"CASH" means all cash or cash equivalents in any currency received and held
on the terms of this Agreement.
"CITIGROUP ORGANIZATION" means Citigroup, Inc. and any company or other
entity of which Citigroup, Inc. is directly or indirectly a shareholder or
owner. For purposes of this Agreement, each branch of Citibank, N.A. shall
be a separate member of the Citigroup Organization.
"CLEARANCE SYSTEM" means any clearing agency, settlement system or
depository (including any entity that acts as a system for the central
handling of Securities in the country where it is incorporated or organized
or that acts as a transnational system for the central handling of
Securities) used in connection with transactions relating to Securities and
any nominee of the foregoing.
"FEE SCHEDULE" means the schedule referred to in Section 14, as annexed
hereto.
"INSTRUCTIONS" means any and all instructions (including approvals,
consents and notices) received by the Custodian from, or reasonably
believed by the Custodian to be from, any Authorized Person, including any
instructions communicated through any manual or electronic medium or system
agreed between the Client and the Custodian.
"SECURITIES" means any financial asset (other than Cash) from time to time
held for the benefit of the Fund on the terms of this Agreement.
"TAXES" means all taxes, levies, imposts, charges, assessments, deductions,
withholdings and related liabilities, including additions to tax, penalties
and interest imposed on or in respect of (i) Securities or Cash, (ii) the
transactions effected under this Agreement or (iii) the Client or a Fund;
provided that "Taxes" does not include income or franchise taxes imposed on
or measured by the net income of the Custodian or its agents.
(B) INTERPRETATION.
References in this Agreement to the Client shall mean the Client acting
individually and separately on behalf of each Fund. The appointment of the
Custodian subject to the terms and provisions of this Agreement shall
constitute a separate appointment by the Client on behalf of each Fund.
Except as
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otherwise agreed, each reference herein to Accounts and to Securities and
Cash shall mean the Accounts, Securities and Cash maintained, received,
delivered and held separately for a Fund and not on an omnibus basis or
aggregate basis for all of the Funds. The Client and the Custodian agree
that the Client shall be the primary obligor with respect to any
obligations of the Client or any Fund specified in this Agreement;
provided, however, the obligations of the Client with respect to a Fund
shall be limited to the extent such obligations relate to the Accounts or
transactions of that Fund. Custodian may seek to enforce the obligations of
the Client in respect to a Fund's Accounts and transactions effected under
this Agreement directly against the Accounts and the Securities and Cash
held hereunder for the Fund but only to the extent such obligations relate
to the Accounts or transactions of that Fund. Upon request, the Client
shall reasonably identify how any obligation of the Client provided under
this Agreement should be allocated to a Fund or to any Accounts maintained
hereunder for such Fund.
2. ESTABLISHMENT OF ACCOUNTS
(A) ACCOUNTS. The Client authorizes the Custodian to establish on its books,
pursuant to the terms of this Agreement, (i) a custody account or accounts
(the "Custody Account") and (ii) a cash account or accounts (the "Cash
Account"). The Custody Account will be a custody account for the receipt,
safekeeping and maintenance of Securities, and the Cash Account will be a
current account for Cash.
(B) ACCEPTANCE OF SECURITIES AND CASH. The Custodian will determine in its
reasonable discretion whether to accept (i) for custody in the Custody
Account, Securities of any kind and (ii) for deposit in the Cash Account,
Cash in any currency.
(C) DESIGNATION OF ACCOUNTS.
(i) The Custody Account will be in the name of the Fund or such other name as
the Client may reasonably designate and will indicate that Securities do
not belong to the Custodian and are segregated from the Custodian's assets.
(ii) The Cash Account will be in the name of the Fund or such other name as the
Client may reasonably designate and will be held by the Custodian as
banker.
(D) SEGREGATION.
(i) To the extent reasonably practicable, the Custodian will hold Securities
with a sub custodian only in an account which holds exclusively assets held
by the Custodian for its customers. The Custodian will direct each sub
custodian to identify on its books that Securities are held for the account
of the Custodian as custodian for its customers. The Custodian will direct
each sub custodian, to the extent practicable, to hold Securities in a
Clearance System only in an account of the sub custodian which holds
exclusively assets held by the sub custodian for its customers.
(ii) Any Securities deposited by the Custodian with a sub custodian will be
subject only to the instructions of the Custodian, and any Securities held
in a Clearance System for the account of a sub custodian will be subject
only to the instructions of the sub custodian.
(iii)The Custodian shall require the sub custodian to agree that Securities
will not be subject to any right, charge, security interest, lien or claim
of any kind in favor of the sub custodian.
3. CUSTODY ACCOUNT PROCEDURES
(A) CREDITS TO THE CUSTODY ACCOUNT. The Custodian is not obligated to credit
Securities to the Custody Account before receipt of such Securities by
final settlement.
(B) DEBITS TO THE CUSTODY ACCOUNT. If the Custodian has received Instructions
that would result in the delivery of Securities exceeding credits to the
Custody Account for that Security, the Custodian may reject the
Instructions or may decide which deliveries it will make (in whole or in
part and in the order it selects).
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(C) DENOMINATION OF SECURITIES. The Client and the applicable Fund shall bear
the risk and expense associated with investing in Securities denominated in
any currency.
4. CASH ACCOUNT PROCEDURES
(A) CREDITS AND DEBITS TO THE CASH ACCOUNT. The Custodian is not obliged to
make a credit or debit to the Cash Account before receipt by the Custodian
of a corresponding and final payment in cleared funds. If the Custodian
makes a credit or debit before such receipt, the Custodian may at any time
reverse all or part of the credit or debit (including any interest
thereon), make an appropriate entry to the Cash Account, and if it
reasonably so decides, require repayment of any amount corresponding to any
debit.
(B) DEBIT BALANCES IN THE CASH ACCOUNT. The Custodian is not obliged to make
any debit to the Cash Account which might result in or increase a debit
balance. The Custodian may make any debit to the Cash Account even if this
results in (or increases) a debit balance. If the total amount of debits to
the Cash Account at any time would otherwise result in a debit balance or
exceed the immediately available funds credited to the Cash Account, the
Custodian may decide which debits it will make (in whole or in part and in
the order it selects).
(C) PAYMENTS. The Custodian may at any time cancel any extension of credit. The
Client will transfer to the Custodian on closure of the Cash Account and
otherwise on demand from the Custodian sufficient immediately available
funds to cover any debit balance on the Cash Account or any other extension
of credit and any interest, fees and other amounts owed.
(D) FOREIGN CURRENCY RISKS. The Client and the applicable Fund shall bear the
risk and expense associated with Cash denominated in any currency.
5. INSTRUCTIONS
The Custodian is entitled to rely and act upon Instructions of any
Authorized Person until the Custodian has received notice of any change
from the Client and has had a reasonable time to note and implement such
change. The Custodian is authorized to rely upon any Instructions received
by any means, provided that the Custodian and the Client have agreed upon
the means of transmission and the method of identification for the
Instructions. In particular:
(i) The Client and the Custodian will comply with security procedures designed
to verify the origination of Instructions.
(ii) The Custodian is not responsible for errors or omissions made by the Client
or resulting from fraud or the duplication of any Instruction by the
Client, and the Custodian may act on any Instruction by reference to an
account number only, even if any account name is provided.
(iii)The Custodian may act on an Instruction if it reasonably believes it
contains sufficient information.
(iv) The Custodian may decide not to act on an Instruction where it reasonably
doubts its contents, authorization, origination or compliance with any
security procedures and will promptly notify the Client of its decision.
(v) If the Custodian acts on any Instruction sent manually (including facsimile
or telephone), then, if the Custodian complies with the security
procedures, the Client and the applicable Fund will be responsible for any
loss the Custodian may incur in connection with that Instruction. The
Client expressly acknowledges that the Client is aware that the use of
manual forms of communication to convey Instructions increases the risk of
error, security and privacy issues and fraudulent activities.
(vi) Instructions are to be given in the English language.
(vii)The Custodian is obligated to act on Instructions only within applicable
cut-off times on banking days when the Custodian and the applicable
financial markets are open for business.
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(viii) In some securities markets, securities deliveries and payments
therefore may not be or are not customarily made simultaneously.
Accordingly, notwithstanding the Client's Instruction to deliver Securities
against payment or to pay for Securities against delivery, the Custodian
may make or accept payment for or delivery of Securities at such time and
in such form and manner as is in accordance with relevant local law and
practice or with the customs prevailing in the relevant market.
6. PERFORMANCE BY THE CUSTODIAN
(A) CUSTODIAL DUTIES REQUIRING INSTRUCTIONS. The Custodian shall carry out the
following actions only upon receipt of and in accordance with specific
Instructions:
(i) make payment for and/or receive any Securities or deliver or dispose of any
Securities except as otherwise specifically provided for in this Agreement;
(ii) deal with rights, conversions, options, warrants and other similar
interests or any other discretionary right in connection with Securities;
and
(iii)carry out any action affecting Securities or the Custody Account or Cash
or the Cash Account other than those specified in Section 6(B) below, but
in each instance subject to the agreement of the Custodian.
(B) NON-DISCRETIONARY CUSTODIAL DUTIES. Absent a contrary Instruction, the
Custodian shall carry out the following without further Instructions:
(i) in the Client's or a Fund's name or on their behalf, sign any affidavits,
certificates of ownership and other certificates and documents relating to
Securities which may be required (i) to obtain any Securities or Cash or
(ii) by any tax or regulatory authority;
(ii) collect, receive, and/or credit the Custody Account or Cash Account, as
appropriate, with all income, payments and distributions in respect of
Securities and any capital arising out of or in connection with Securities
(including all Securities received by the Custodian as a result of a stock
dividend, bonus issue, share sub-division or reorganization, capitalization
of reserves or otherwise) and take any action necessary and proper in
connection therewith;
(iii)exchange interim or temporary receipts for definitive certificates, and
old or overstamped certificates for new certificates;
(iv) notify the Client of notices, circulars, reports and announcements which
the Custodian has received, in the course of acting in the capacity of
custodian, concerning Securities held on the Client's behalf that require
discretionary action;
(v) make any payment by debiting the Cash Account or any other designated
account of the Client or a Fund with the Custodian as required to effect
any Instruction; and
(vi) attend to all non-discretionary matters in connection with anything
provided in this Section 6(B) or any Instruction.
7. TAX STATUS/WITHHOLDING TAXES
(A) INFORMATION. The Client will provide the Custodian, from time to time and
in a timely manner, with information and proof (copies or originals) as the
Custodian reasonably requests, as to the Fund's tax status or residence.
Information and proof may include, as appropriate, executing certificates,
making representations and warranties, or providing other information or
documents in respect of Securities, as the Custodian deems necessary or
proper to fulfill obligations under applicable law.
(B) PAYMENT. If any Taxes become payable with respect to any payment to be made
to the Client or a Fund, such Taxes will be payable by the Client or a Fund
and the Custodian may withhold the Taxes from such payment. The Custodian
may withhold any Cash held or received with respect to the Cash Account and
apply such Cash in satisfaction of such Taxes. If any Taxes become payable
with respect to any prior
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payment made to the Client or a Fund by the Custodian, the Custodian may
withhold any Cash in satisfaction of such prior Taxes. The Client and the
Fund shall remain liable for any deficiency.
(C) TAX RELIEF. In the event the Client requests that the Custodian provide tax
relief services and the Custodian agrees to provide such services, the
Custodian shall apply for appropriate tax relief (either by way of reduced
tax rates at the time of an income payment or retrospective tax reclaims in
certain markets as agreed from time to time); provided the Client provides
to the Custodian such documentation and information as to it or its
underlying beneficial owner clients as is necessary to secure such tax
relief. However, in no event shall the Custodian be responsible, or liable,
for any Taxes resulting from the inability to secure tax relief, or for the
failure of the Fund to obtain the benefit of credits, on the basis of
foreign taxes withheld, against any income tax liability.
8. USE OF THIRD PARTIES
(A) GENERAL AUTHORITY.
(i) The Custodian is hereby authorised to appoint sub custodians and
administrative support providers as its delegates and to use or participate
in market infrastructures and Clearance Systems to perform any of the
duties of the Custodian under this Agreement.
(ii) Sub custodians are those persons utilized by the Custodian for the
safe-keeping, clearance and settlement of Securities.
(iii)Administrative support providers are those persons utilized by the
Custodian to perform ancillary services of a purely administrative nature
such as couriers, messengers or other commercial transport systems.
(iv) Market infrastructures are public utilities, external telecommunications
facilities and other common carriers of electronic and other messages, and
external postal services. Market infrastructures are not delegates of the
Custodian.
(v) Securities deposited with Clearance Systems hereunder will be subject to
the laws, rules, statements of principle and practices of such Clearance
Systems. Clearance Systems are not delegates of the Custodian.
(B) RESPONSIBILITY.
(i) The Custodian shall act in good faith and use reasonable care in the
selection and continued appointment of subcustodians and administrative
support providers. The Custodian shall be liable for the actions of such
subcustodians to the same extent the Custodian would be liable under
Section 10(B).
(ii) The Custodian may deposit or procure the deposit of Securities with any
Clearance System as required by law, regulation or best market practice.
The Custodian has no responsibility for selection or appointment of, or for
performance by, any Clearance System or market infrastructure.
(iii)The Custodian agrees that any subcustodian will be a bank as defined in
Section 2(a)(5) of the 1940 Act meeting the requirements of a custodian
under Section 17(f) of the 1940 Act or a "Qualified Foreign Bank" meeting
the requirements of an "Eligible Foreign Custodian" as specified in Rule
17f-5 under the 1940 Act. With regard to each Eligible Foreign Custodian,
the Custodian agrees to accept the responsibility it would have assumed if
it had been delegated responsibility to serve as the Fund's "Foreign
Custody Manager" as defined in Rule 17f-5(a)(3) under the 1940 Act, in
respect to the Client's foreign investments held from time to time by the
Custodian with any subcustodian that is an Eligible Foreign Custodian.
Foreign investments are any Securities for which the primary market is
outside the United States of America.
In regard to each selection and appointment of a subcustodian that is an
Eligible Foreign Custodian, the Custodian shall:
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(1) select the Eligible Foreign Custodian to serve as foreign custodian
and place and maintain the Fund's foreign investments with respect to
the relevant market with such foreign custodian;
(2) in selecting an Eligible Foreign Custodian, first determine that
foreign investments placed and maintained in the safekeeping of the
Eligible Foreign Custodian shall be subject to reasonable care, based
on the standards applicable to custodians in the relevant market,
after having considered all factors relevant to the safekeeping of
such investments including, without limitation, those factors set
forth in Rule 17f-5;
(3) enter into written agreements with the Eligible Foreign Custodian
selected by the Custodian hereunder;
(4) determine that the written contract with the Eligible Foreign
Custodian requires that the Eligible Foreign Custodian will provide
reasonable care for the foreign investments, based on the standards
applicable to custodians in the relevant market, and that all such
contracts, rules, practices and procedures satisfy the requirements of
Rule 17f-5;
(5) provide written reports (x) notifying the Client of the placement of
foreign investments with the Eligible Foreign Custodian, such reports
to be provided at such time as the Client deems reasonable and
appropriate, but not less than quarterly, and (y) promptly notifying
the Client of the occurrence of any material change in the
arrangements with the Eligible Foreign Custodian; and
(6) monitor the continued appropriateness of (x) maintaining the foreign
investments with the Eligible Foreign Custodian selected hereunder and
(y) the governing contractual arrangement; it being understood,
however, that in the event the Custodian shall determine that the
Eligible Foreign Custodian would no longer afford the foreign
investments reasonable care, the Custodian shall promptly so advise
the Client and shall then act in accordance with Instructions (as
defined in the Agreement) with respect to the disposition of the
foreign investments; and
Nothing in this paragraph shall relieve the Custodian of any responsibility
otherwise provided in the Agreement for loss or damage suffered by the
Client or the Fund from an act of negligence or willful misconduct on the
part of the Custodian.
Nothing in this Agreement shall require the Custodian to make any selection
that would entail consideration of any factor reasonably related to the
systemic risk of holding assets in a particular country including, but not
limited to, such country's financial infrastructure and prevailing
settlement practices. The Custodian agrees to provide to the Client such
information relating to such risk as the Client shall reasonably request
from time to time and such other information as the Custodian generally
makes available to customers with regard to such countries and risk.
(iv) The Custodian agrees that in connection with Securities settled within the
United States it will meet the requirements specified in Rule 17f-4 under
the 1940 Act with respect to the use of Clearance Systems. The Custodian
may deposit and/or maintain assets of the Fund that consist of foreign
investments only in a Clearance System located outside of the United States
of America that the Custodian has determined satisfies the requirements of
Rule 17f-7(b)(1) as an Eligible Securities Depository, as defined therein.
In such manner as the Custodian deems reasonable, the Custodian shall give
the Client prompt notice of any material change known to the Custodian that
would adversely effect the Custodian's determination that a Clearance
System is an Eligible Securities Depository. The Custodian shall provide
the Client with an analysis (in form and substance as reasonably determined
by the Custodian) of the custody risks associated with maintaining
securities with each Eligible Securities Depository in accordance with Rule
17f-7. The Custodian shall monitor such custody risks on a continuing basis
and in such manner as the Custodian deems reasonable and shall promptly
notify the Client of any adverse material changes in such risks in
accordance with Rule.
(1) In performing its obligations under this Section 8(B)(iv), the
Custodian may obtain information from sources the Custodian believes
to be reliable, but the Custodian does not warrant its completeness or
accuracy and has no duty to verify or confirm any such information.
The Custodian is not obligated to make any determination regarding
whether any Eligible
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Securities Depository provides reasonable care for foreign investments
or to provide any information or evaluation comparing any Eligible
Securities Depository to any other Clearance System or any existing or
proposed standards for securities depositories.
(2) Upon the receipt of Instructions, the Custodian shall withdraw
securities from any Clearance System to the extent and as soon as
reasonably practicable; provided, however, the Custodian shall have no
obligation to obtain, safekeep or provide any services in respect of
any certificated or physical security in any jurisdiction where the
Custodian does not offer or provide such services generally to
customers within that jurisdiction.
Notwithstanding the foregoing and pursuant to Section 10, the Custodian
shall be responsible for the negligence, willful misconduct or fraud of any
branch or affiliate of the Custodian that is a subcustodian or
administrative support provider.
(C) SHAREHOLDERS VOTING. The Custodian's only obligation in regard to any
matter where the Client may exercise shareholder voting rights will be to
provide shareholder voting services as specified in a separate proxy
services letter between the Custodian and the Client.
9. REPRESENTATIONS
(A) GENERAL. The Client and the Custodian each represents at the date this
Agreement is entered into and any custodial service is used or provided
that:
(i) It is duly organized and in good standing in every jurisdiction where it is
required so to be;
(ii) It has the power and authority to sign and to perform its obligations under
this Agreement;
(iii)This Agreement is duly authorized and signed and is its legal, valid and
binding obligation;
(iv) Any consent, authorization or instruction required in connection with its
execution and performance of this Agreement has been provided by any
relevant third party;
(v) Any act required by any relevant governmental or other authority to be done
in connection with its execution and performance of this Agreement has been
or will be done (and will be renewed if necessary); and
(vi) Its performance of this Agreement will not violate or breach any applicable
law, regulation, contract or other requirement.
(B) CLIENT. The Client also represents at the date this Agreement is entered
into and any custodial service is used or provided that:
(i) It has authority to deposit the Securities received in the Custody Account
and the Cash in the Cash Account and there is no claim or encumbrance that
adversely affects any delivery of Securities or payment of Cash made in
accordance with this Agreement;
(ii) Where it acts as an agent on behalf of any of its own customers, whether or
not expressly identified to the Custodian from time to time, any such
customers shall not be customers or indirect customers of the Custodian;
and
(iii)It has not relied on any oral or written representation made by the
Custodian or any person on its behalf.
10. SCOPE OF RESPONSIBILITY
(A) STANDARD OF CARE. The Custodian shall exercise the due care of a
professional custodian for hire.
(B) LIMITATIONS ON LOSSES. The Custodian will not be responsible for any loss
or damage suffered by the Client or the Fund except as provided in this
Section 10(B). The Custodian agrees to indemnify, defend
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and hold the Client, the Fund and each of their respective principals,
members, officers, employees, agents, representatives and affiliates
harmless from all losses, costs, damages and expenses (including reasonable
legal fees) and liabilities for any claims, demands or actions (each
referred to as a "Loss"), incurred by the Client or the Fund resulting from
the Custodian's or branches' or affiliates' negligence, willful misconduct
or fraud; provided, however, the Custodian's liability in regard to any
Loss resulting from any negligence or willful misconduct of the Custodian
or any branch or affiliate shall not exceed the lesser of (i) replacement
of any Securities lost as a result of such negligence or willful misconduct
or the payment to the Client or the Fund of the market value of the
Securities at the time the Client reasonably should have been aware of the
loss based on review of the account statements provided by the Custodian
and (ii) the replacement of Cash lost as a result of such negligence or
willful misconduct, plus (iii) compensatory interest up to that time at the
rate applicable to the base currency of the Cash Account and (iv)
reasonable legal fees. Under no circumstances will the Custodian be liable
to the Client or the Fund for consequential loss or damage, even if advised
of the possibility of such loss or damage.
(C) LIMITATIONS ON THE CUSTODIAN'S RESPONSIBILITY.
(i) GENERAL. The Custodian is responsible for the performance of only those
duties as are expressly set forth herein, including the performance of any
Instruction given in accordance with this Agreement. The Custodian shall
have no implied duties or obligations.
(ii) SOLE OBLIGATIONS OF THE CUSTODIAN. The Client understands and agrees that
(i) the obligations and duties of the Custodian will be performed only by
the Custodian and are not obligations or duties of any other member of the
Citigroup Organization (including any branch or office of the Custodian)
and (ii) the rights of the Client and the Fund with respect to the
Custodian extend only to such Custodian and, except as provided by law, do
not extend to any other member of the Citigroup Organization.
(iii)NO LIABILITY FOR THIRD PARTIES. Except as provided in Section 8 hereof,
the Custodian is not responsible for the acts, omissions, defaults or
insolvency of any third party including, but not limited to, any broker,
counterparty or issuer of Securities.
(IV) PERFORMANCE SUBJECT TO LAWS. The Client understands and agrees that the
Custodian's performance of this Agreement is subject to the relevant local
laws, regulations, decrees, orders and government acts, and the rules,
operating procedures and practices of any relevant stock exchange,
Clearance System or market where or through which Instructions are to be
carried out and to which the Custodian is subject and as exist in the
country in which any Securities or Cash are held.
(v) PREVENTION OF PERFORMANCE. The Custodian will not be responsible for any
failure to perform any of its obligations (nor will it be responsible for
any unavailability of funds credited to the Cash Account) if such
performance is prevented, hindered or delayed by a Force Major Event, in
such case its obligations will be suspended for so long as the Force Major
Event continues. "Force Major Event" means any event due to any cause
beyond the reasonable control of the Custodian, such as restrictions on
convertibility or transferability, requisitions, involuntary transfers,
unavailability of communications system, sabotage, fire, flood, explosion,
acts of God, civil commotion, strikes or industrial action of any kind,
riots, insurrection, war or acts of government.
(vi) CLIENT'S REPORTING OBLIGATIONS. The Client or the Fund shall be solely
responsible for all filings, tax returns and reports on any transactions in
respect of Securities or Cash or relating to Securities or Cash as may be
required by any relevant authority, whether governmental or otherwise.
(vii)VALIDITY OF SECURITIES. The Custodian shall exercise reasonable care in
receiving Securities but does not warrant or guarantee the form,
authenticity, value or validity of any Security received by the Custodian.
If the Custodian becomes aware of any defect in title or forgery of any
Security, the Custodian shall promptly notify the Client.
(viii) CAPACITY OF CUSTODIAN. The Custodian is not acting under this Agreement
as an investment manager, nor as an investment, legal or tax adviser to the
Client or the Fund, and the Custodian's duty is solely to act as a
Custodian in accordance with the terms of this Agreement.
(ix) FORWARDED INFORMATION. The Custodian is not responsible for the form,
accuracy or content of any notice, circular, report, announcement or other
material provided under Section 6(B)(iv) of this
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Agreement not prepared by the Custodian including the accuracy or
completeness of any translation provided by the Custodian in regard to such
forwarded communication.
11. SUBROGATION
To the extent permissible by law or regulation and upon the Client's
request, the Client and the Fund shall be subrogated to the rights of the
Custodian with respect to any claim for any loss, damage or claim suffered
by the Client or the Fund, in each case to the extent that the Custodian
fails to pursue any such claim or the Client is not made whole in respect
of such loss, damage or claim. Notwithstanding any other provision hereof,
in no event is the Custodian obliged to bring suit in its own name or to
allow suit to be brought in its name.
12. INDEMNITY
(A) INDEMNITY TO THE CUSTODIAN. The Client agrees to indemnify the Custodian
and to defend and hold the Custodian harmless from all losses, costs,
damages and expenses (including reasonable legal fees) and liabilities for
any claims, demands or actions (each referred to as a "Loss"), incurred by
the Custodian in connection with this Agreement, except any Loss resulting
from the Custodian's negligence, wilful misconduct or fraud. Under no
circumstances will the Client be liable to the Custodian for consequential
loss or damage, even if advised of the possibility of such loss or damage.
(B) CLIENT'S DIRECT LIABILITY. The disclosure by the Client to the Custodian
that the Client has entered into this Agreement as the agent or
representative of another person shall not relieve the Client of any of its
obligations under this Agreement.
(C) CUSTODIAN'S DIRECT LIABILITY. Subject to Section 8(B)(i), the appointment
by the Custodian of subcustodians, administrative support providers and
other service providers, and the delegation by the Custodian of its
obligations hereunder, shall not relieve the Custodian of any of its
obligations or liabilities under this Agreement.
13. LIEN AND SET OFF
(A) LIEN. In addition to any other remedies available to the Custodian under
applicable law, the Custodian shall have, and the Client hereby grants on
behalf of each Fund, a continuing general lien on all Securities until the
satisfaction of liabilities arising under this Agreement of the Client or
the Fund to the Custodian in respect to any fees and expenses or credit
exposures incurred in the performance of services under this Agreement.
(B) SET OFF. To the extent permitted by applicable law and in addition to any
other remedies available to the Custodian under applicable law, the
Custodian may, without prior notice to the Client or the Fund, set off any
payment obligation owed to it by the Client or the Fund in connection with
all liabilities arising under this Agreement against any payment obligation
owed by it to the Fund under this Agreement regardless of the place of
payment or currency of either obligation (and for such purpose may make any
currency conversion necessary).
14. FEES AND EXPENSES
The Client agrees to pay all fees, charges and obligations incurred from time
to time for any services pursuant to this Agreement as determined in
accordance with the terms of the Fee Schedule, which may be changed from
time to time by the Custodian upon prior written notice to the Client,
together with any other amounts payable to the Custodian under this
Agreement. The Custodian may debit the Cash Account to pay any such fees,
charges and obligations with regard to the applicable Fund.
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15. CITIGROUP ORGANIZATION INVOLVEMENT
The Client agrees and understands that any member of the Citigroup
Organization can engage as principal or otherwise in any transaction
effected by the Client or by any person for its account and benefit, or by
or on behalf of any counterparty or issuer. When instructed to effect any
transactions (particularly foreign exchange transactions), the Custodian is
entitled to effect any transaction by or with itself or any member of the
Citigroup Organization and to pay or keep any fee, commissions or
compensation as specified in the Client's Instruction or, if no
specification is provided, any charges, fees, commissions or similar
payments generally in effect from time to time with regard to such or
similar transactions.
16. RECORDS AND ACCESS
(A) EXAMINATION OF STATEMENTS. The Client shall examine each statement sent by
the Custodian and notify the Custodian in writing within sixty (60) days of
the date of such statement of any discrepancy between Instructions given by
the Client and the position shown on the statement and of any other errors
known to the Client. Absent such notification, the Custodian's liability
for any loss or damage in regard to such discrepancy or errors shall not
accrue beyond such sixty (60) days.
(B) ACCESS TO RECORDS. The Custodian shall allow the Client and the Fund and
its independent public accountants, agents or regulators reasonable access
to the records of the Custodian relating to Securities or Cash as is
required by the Client or the Fund in connection with an examination of the
books and records pertaining to the affairs of the Client and will seek to
obtain such access from each sub custodian and Clearance System.
17. INFORMATION
The Custodian will treat information related to the Client and the Fund as
confidential but, unless prohibited by law, the Client and the Fund
authorizes the transfer or disclosure of any information relating to the
Client and the Fund to and between the branches, subsidiaries,
representative offices, affiliates and agents of the Custodian and third
parties selected by any of them, wherever situated, for confidential use in
connection with the provision of services to the Client and the Fund
(including for data processing, statistical and risk analysis purposes),
and further acknowledges that any such branch, subsidiary, representative
office, affiliate, agent or third party may transfer or disclose any such
information as required by any law, court, regulator or legal process.
The Client will treat the terms of this Agreement, including any Fee
Schedule, as confidential unless otherwise required by law, including the
requirement that the agreement be part of publicly available filings.
18. ADVERTISING
Neither the Client nor the Custodian shall display the name, trade xxxx or
service xxxx of the other without the prior written approval of the other,
nor will the Client display that of Citigroup, Inc. or any subsidiary of
Citigroup, Inc. without prior written approval from Citigroup, Inc. or the
subsidiary concerned. The Client shall not advertise or promote any service
provided by the Custodian without the Custodian's prior written consent.
19. TERMINATION
(A) DATE OF TERMINATION. Any party may terminate this Agreement in whole or as
between itself and the other parties hereto by giving not less than sixty
(60) days' prior written notice to such other parties.
(B) EFFECT ON PROPERTY. The Custodian shall deliver the Securities and Cash as
instructed by the Client. If by the termination date the Client has not
given instructions to deliver any Securities or Cash, the Custodian will
continue to safekeep such Securities and/or Cash until the Client provides
instructions to
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effect a free delivery of such. However, the Custodian will provide no
other services as regard to any such Securities except to collect and hold
any cash distributions. Notwithstanding termination of this Agreement or
any Instruction, the Custodian may retain sufficient Securities or Cash to
close out or complete any transaction that the Custodian will be required
to settle on the Client's of the Fund's behalf.
(C) SURVIVING TERMS. The rights and obligations contained in Sections 7, 10,
12, 13, 17, 18 and 20 of this Agreement shall survive the termination of
this Agreement.
20. GOVERNING LAW AND JURISDICTION
(A) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws (and not the laws of conflicts) of the
country in which the Custodian is located and performs its obligations
hereunder.
(B) JURISDICTION. The courts of the country in which the Custodian is located
and performs its obligations hereunder (including any appropriate
sub-jurisdiction) shall have non-exclusive jurisdiction to hear any
disputes arising out of or in connection with this Agreement, and the
parties irrevocably submit to the jurisdiction of such courts.
(C) VENUE. Each party hereto waives any objection it may have at any time, to
the laying of venue of any actions or proceedings brought in any court
specified in Section 20(B) hereof, waives any claim that such actions or
proceedings have been brought in an inconvenient forum and further waives
the right to object that such court does not have jurisdiction over such
party.
(D) SOVEREIGN IMMUNITY. The Client and the Custodian each irrevocably waives,
with respect to itself and its revenues and assets, all immunity on the
grounds of sovereignty or similar grounds in respect of its obligations
under this Agreement.
21. MISCELLANEOUS
(A) ENTIRE AGREEMENT; AMENDMENTS. This Agreement consists exclusively of this
document together with the schedules. The Custodian may notify the Client
of terms which are applicable to the provision of services in the location
of a particular office and such terms shall be contained in a schedule and
shall supplement this Agreement in relation to that office. In case of
inconsistency with the rest of this Agreement, such terms shall prevail in
relation to that office.
Except as specified in this Agreement, this Agreement may only be modified
by written agreement of the Client and the Custodian.
(B) SEVERABILITY. If any provision of this Agreement is or becomes illegal,
invalid or unenforceable under any applicable law, the remaining provisions
shall remain in full force and effect (as shall that provision under any
other law).
(C) WAIVER OF RIGHTS. No failure or delay of the Client or the Custodian in
exercising any right or remedy under this Agreement shall constitute a
waiver of that right. Any waiver of any right will be limited to the
specific instance. The exclusion or omission of any provision or term from
this Agreement shall not be deemed to be a waiver of any right or remedy
the Client or the Custodian may have under applicable law.
(D) RECORDINGS. The Client, on behalf of itself and the Fund, and the Custodian
consent to telephonic or electronic recordings for security and quality of
service purposes and agree that either may produce telephonic or electronic
recordings or computer records as evidence in any proceedings brought in
connection with this Agreement.
(E) FURTHER INFORMATION. The Client agrees to execute and to cause the Fund to
execute further documents and provide materials and information as may be
reasonably requested by the Custodian to enable it to perform its duties
and obligations under this Agreement.
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(F) ASSIGNMENT. No party may assign or transfer any of its rights or
obligations under this Agreement without the other's prior written consent,
which consent will not be unreasonably withheld or delayed; provided that
the Custodian may make such assignment or transfer to a branch, subsidiary
or affiliate if it does not materially affect the provision of services to
the Client.
(G) HEADINGS. Titles to Sections of this Agreement are included for convenience
of reference only and shall be disregarded in construing the language
contained in this Agreement.
(H) COUNTERPARTS. This Agreement may be executed in several counterparts, each
of which shall be an original, but all of which together shall constitute
one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized.
CITIBANK, N.A. FORUM FUNDS
By:/s/ Xxxxxxxxx Xxxx By:/s/ Xxxx X. Xxxxxx
Name: Xxxxxxxxx Xxxx Name: Xxxx X. Xxxxxx
------------------------------- -------------------------
Title: Managing Director Title: President
------------------------------- ------------------------
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GLOBAL CUSTODIAL SERVICES AGREEMENT
SCHEDULE A
LIST OF PORTFOLIOS
------------------------------------------------------
Absolute Strategies Fund
------------------------------------------------------
Xxxxx Xxxxxxxx Small Cap Growth Fund
------------------------------------------------------
Austin Global Equity Fund
------------------------------------------------------
Xxxxxx Focus Fund
------------------------------------------------------
Xxxxx Advisory Intermediate Income Fund
------------------------------------------------------
Xxxxx Advisory International Fund
------------------------------------------------------
Xxxxx Advisory Maryland Bond Fund
------------------------------------------------------
Xxxxx Advisory Real Estate Fund
------------------------------------------------------
Dover Responsibility Fund
------------------------------------------------------
XX Xxxx Premier Growth Fund
------------------------------------------------------
Fountainhead Special Value Fund
------------------------------------------------------
Golden Large Core Value Fund
------------------------------------------------------
Golden Small Core Value Fund
------------------------------------------------------
Investors Bond Fund
------------------------------------------------------
Jordan Opportunity Fund
------------------------------------------------------
Xxxxxxxxxxxx Growth Fund
------------------------------------------------------
Merk Hard Currency Fund
------------------------------------------------------
Payson Total Return Fund
------------------------------------------------------
Payson Value Fund
------------------------------------------------------
Polaris Global Value Fund
------------------------------------------------------
Shaker Fund
------------------------------------------------------
Steepleview Fund
------------------------------------------------------
TaxSaver Bond Fund
------------------------------------------------------
Xxxxxxx Xxxxx Growth Fund
------------------------------------------------------
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