CUSTODY AGREEMENT
Exhibit g
THIS
AGREEMENT is made and entered into as of the last date on the
signature page by and between PROCURE ETF TRUST I, a Delaware trust
(the “Trust”), and U.S.
BANK NATIONAL ASSOCIATION, a national banking association
organized and existing under the laws of the United States of
America (the “Custodian”).
WHEREAS, the Trust
is registered under the Investment Company Act of 1940, as amended
(the “1940 Act”), as an open-end management investment
company, and is authorized to issue shares of beneficial interest
in separate series, with each such series representing interests in
a separate portfolio of securities and other assets;
WHEREAS,
the Custodian is a bank having the qualifications prescribed in
Section 26(a)(1) of the 1940 Act; and
WHEREAS, the Trust
desires to retain the Custodian to act as custodian of the cash and
securities of each series of the Trust listed on Exhibit B hereto (as amended
from time to time) (each a “Fund” and collectively, the
“Funds”); and
WHEREAS, the Board
of Trustees of the Trust has delegated to the Custodian the
responsibilities set forth in Rule 17f-5(c) under the 1940 Act and
the Custodian is willing to undertake the responsibilities and
serve as the foreign custody manager for the Trust.
NOW,
THEREFORE, in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereto,
intending to be legally bound, do hereby agree as
follows:
ARTICLE I.
CERTAIN DEFINITIONS
Whenever used in
this Agreement, the following words and phrases shall have the
meanings set forth below unless the context otherwise
requires:
1.01 “Authorized
Person” means any Officer or person who has been
authorized by the Trust’s Board of Trustees and designated as
such by written notice and named in Exhibit A and delivered to the
Custodian by the Trust, or if the Trust has notified the Custodian
in writing that it has an authorized investment manager or other
agent, delivered to the Custodian by the Trust’s investment
advisor or other agent. Such Officer or person shall continue to be
an Authorized Person until such time as the Custodian receives
Written Instructions from the Trust or the Trust’s investment
advisor or other agent that any such person is no longer an
Authorized Person.
1.02 “Board
of Trustees” shall mean the trustees from time to time
serving under the Trust’s declaration of trust, as amended
from time to time.
1.03 “Book-Entry
System” shall mean a Federal Reserve/ Treasury
book-entry system for receiving and delivering securities, its
successors and nominees.
1.04 “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 Shares of the
Fund.
1.05 “Depository” shall
include (a) the Book-Entry System, (b) the Depository Trust
Company, (c) any other
clearing agency or securities depository registered with the
Securities and Exchange Commission identified to the Trust
from time to time, and (d) the respective successors and nominees
of the foregoing
1.06 “Eligible
Foreign Custodian” has the meaning set forth in Rule
17f-5(a)(1), including a majority-owned or indirect subsidiary of a
U.S. Bank (as defined in Rule 17f-5), a bank holding company
meeting the requirements of an Eligible Foreign Custodian (as set
forth in Rule 17f-5 or by other appropriate action of the SEC), or
a foreign branch of a Bank (as defined in Section 2(a)(5) of the
0000 Xxx) meeting the requirements of a custodian under Section
17(f) of the 1940 Act; the term does not include any Eligible
Securities Depository.
1.07 “Eligible
Securities Depository” shall mean a system for the
central handling of securities as that term is defined in Rule
17f-4 and 17f-7 under the 1940 Act.
1.08 “Foreign
Depository” shall
mean (a) Euroclear, (b) Clearstream Banking, societe anonyme, (c)
each Eligible Securities Depository as defined in Rule 17f-7 under
the Investment Company Act of 1940, as amended, identified to the
Trust from time to time, and (d) the respective successors and nominees of
the foregoing.
1.09
“Foreign
Securities” means any of the Fund’s investments
(including foreign currencies) for which the primary market is
outside the United States and such cash and cash equivalents as are
reasonably necessary to effect the Fund’s transactions in
such investments.
1.10 “Fund
Custody Account” shall mean any of the accounts in the
name of the Trust, which is provided for in Section 3.2
below.
1.11 “IRS”
shall mean the Internal Revenue Service.
1.12 “FINRA”
shall mean the Financial Industry Regulatory Authority,
Inc.
1.13 “Officer”
shall mean the Chairman, President, any Vice President, any
Assistant Vice President, the Secretary, any Assistant Secretary,
the Treasurer, or any Assistant Treasurer of the
Trust.
1.14 “SEC”
shall mean the Securities and Exchange Commission.
1.15
“Series” shall
mean the various Funds of the Trust listed on Schedule B hereto,
and if none are listed references to Series shall be references to
the Trust.
1.16
“ Securities” shall include, without limitation, any
common, preferred stocks, and other equity securities, bonds,
debentures, notes, bank certificates of deposit, bankers'
acceptances, mortgage-backed securities or other obligations, call
options, put options, 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 or its agents have the facilities to
clear and service.
1.17
“Securities
Depository” shall mean The Depository Trust Company and any
other clearing agency registered with the SEC under Section 17A of
the Securities Exchange Act of 1934, as amended (the “1934
Act”), which acts as a system for the central handling of
Securities where all Securities of any particular class or series
of an issuer deposited within the system are treated as fungible
and may be transferred or pledged by bookkeeping entry without
physical delivery of the Securities.
1.18
“Shares” shall
mean, with respect to a Fund, the units of beneficial interest
issued by the Trust on account of the Fund.
1.19
“Sub-Custodian”
shall mean and include (i) any branch of a “U.S. bank,”
as that term is defined in Rule 17f-5 under the 1940 Act, and (ii)
any “Eligible Foreign Custodian” having a contract with
the Custodian which the Custodian has determined will provide
reasonable care of assets of the Fund based on the standards
specified in Section 3.3 below. Such contract shall be in writing
and shall include provisions that provide: (i) for indemnification
or insurance arrangements (or any combination of the foregoing)
such that the Fund will be adequately protected against the risk of
loss of assets held in accordance with such contract; (ii) that the
Foreign Securities will not be subject to any right, charge,
security interest, lien or claim of any kind in favor of the
Sub-Custodian or its creditors except a claim of payment for their
safe custody or administration, in the case of cash deposits, liens
or rights in favor of creditors of the Sub-Custodian arising under
bankruptcy, insolvency, or similar laws; (iii) that beneficial
ownership for the Foreign Securities will be freely transferable
without the payment of money or value other than for safe custody
or administration; (iv) that adequate records will be maintained
identifying the assets as belonging to the Fund or as being held by
a third party for the benefit of the Fund; (v) that the
Fund’s independent public accountants will be given access to
those records or confirmation of the contents of those records; and
(vi) that the Fund will receive periodic reports with respect to
the safekeeping of the Fund’s assets, including, but not
limited to, notification of any transfer to or from a Fund's
account or a third party account containing assets held for the
benefit of the Fund. Such contract may contain, in lieu of any or
all of the provisions specified in (i)-(vi) above, such other
provisions that the Custodian determines will provide, in their
entirety, the same or a greater level of care and protection for
Fund assets as the specified provisions.
1.20
“Written
Instructions” shall mean (i) written communications
actually received by the Custodian and signed by an Authorized
Person, or (ii) communications by facsimile or Internet electronic
e-mail or any other such system from one or more persons reasonably
believed by the Custodian to be an Authorized Person.
ARTICLE II.
APPOINTMENT OF CUSTODIAN
2.01
Appointment. The
Trust hereby appoints the Custodian as custodian of all Securities
and cash owned by or in the possession of the Fund at any time
during the period of this Agreement, on the terms and conditions
set forth in this Agreement, and the Custodian hereby accepts such
appointment and agrees to perform the services and duties set forth
in this Agreement, including to
establish and maintain one or more securities accounts and cash
accounts for each Fund in which Custodian will hold Securities and
cash as provided herein. The Trust hereby delegates to the
Custodian, subject to Rule 17f-5(b), the responsibilities with
respect to the Fund’s Foreign Securities, and the Custodian
hereby accepts such delegation as foreign custody manager with
respect to the Fund. Custodian shall
maintain books and records segregating the assets of each Fund from
the assets of any other Fund. Such accounts (each, an
“Account”; collectively, the “Accounts”)
shall be in the name of the Trust.
The services
and duties of the Custodian shall be confined to those matters
expressly set forth herein, and no implied duties are assumed by or
may be asserted against the Custodian hereunder.
2.02
Documents to be
Furnished. The following documents, including any amendments
thereto, will be provided contemporaneously with the execution of
the Agreement to the Custodian by the Trust:
(b)
A copy of the
Trust’s bylaws, certified by the Secretary;
(c)
A copy of the
resolutions of the Board of Trustees of the Trust appointing the
Custodian, certified by the Secretary;
(d)
A copy of the
current prospectuses and statements of additional information of
the Trust (the “Prospectus”);
(e)
A certification of
the Chairman or the President and the Secretary of the Trust
setting forth the names and signatures of the current Officers of
the Trust and other Authorized Persons; and
(f)
An executed
authorization required by the Shareholder Communications Act of
1985, attached hereto as Exhibit D.
2.03
Notice of Appointment of
Transfer Agent. The Trust agrees to notify the Custodian in
writing of the appointment, termination or change in appointment of
any transfer agent of the Fund.
ARTICLE III.
CUSTODY OF CASH AND SECURITIES
3.01
Segregation. All
Securities and non-cash property held by the Custodian for the
account of each Fund (other than Securities maintained in a
Securities Depository, Eligible Securities Depository or Book-Entry
System) shall be physically segregated from other Securities and
non-cash property in the possession of the Custodian (including the
Securities and non-cash property of the other Funds, if applicable)
and shall be identified as subject to this Agreement.
3.02
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 each 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.
3.03
Appointment of
Agents.
(a)
In its
discretion, the Custodian may appoint pursuant to a written
agreement, one or more Sub-Custodians to establish and maintain
arrangements with (i) Eligible Securities Depositories or (ii)
Eligible Foreign Custodians who are members of the
Sub-Custodian’s network to hold Securities and cash of any
Fund and to carry out such other provisions of this Agreement as it
may determine; provided, however, that the appointment of any such
agents and maintenance of any Securities and cash of such Fund
shall be at the Custodian's expense and shall not relieve the
Custodian of any of its obligations or liabilities under this
Agreement. The Custodian shall be liable for the actions of any
Sub-Custodians (regardless of whether assets are maintained in the
custody of a Sub-Custodian, a member of its network or an Eligible
Securities Depository) appointed by it as if such actions had been
done by the Custodian.
(b)
If,
after the initial appointment of Sub-Custodians by the Board of
Trustees in connection with this Agreement, the Custodian wishes to
appoint other Sub-Custodians to hold property of the Fund, it will
so notify the Trust and make the necessary determinations as to any
such new Sub-Custodian's eligibility under Rule 17f-5 under the
1940 Act.
(c)
In
performing its delegated responsibilities as foreign custody
manager to place or maintain a Fund’s assets with a
Sub-Custodian, the Custodian will determine that such Fund’s
assets will be subject to reasonable care, based on the standards
applicable to custodians in the country in which such Fund’s
assets will be held by that Sub-Custodian, after considering all
factors relevant to safekeeping of such assets, including, without
limitation the factors specified in Rule 17f-5(c)(1).
(d)
The written
agreement between
the Custodian and each Sub-Custodian acting hereunder shall contain
the required provisions set forth in Rule 17f-5(c)(2) under the
1940 Act.
(e)
At the
end of each calendar quarter, the Custodian shall provide written
reports notifying the Board of Trustees of the withdrawal or
placement of the Securities and cash of each Fund with a
Sub-Custodian and of any material changes in each Fund’s
arrangements. Such reports shall include an analysis of the custody
risks associated with maintaining assets with any Eligible
Securities Depositories. The Custodian shall promptly take such
steps as may be required to withdraw assets of any Fund from any
Sub-Custodian arrangement that has ceased to meet the requirements
of Rule 17f-5 or Rule 17f-7 under the 1940 Act, as
applicable.
(f)
With
respect
to its responsibilities under this Section 3.03, the Custodian
hereby warrants to the Trust that it agrees to exercise reasonable
care, prudence and diligence such as a person having responsibility
for the safekeeping of property of each Fund. The Custodian further
warrants that each Fund's assets will be subject to reasonable care
if maintained with a Sub-Custodian, after considering all factors
relevant to the safekeeping of such assets, including, without
limitation: (i) the Sub-Custodian's practices, procedures, and
internal controls for certificated securities (if applicable), its
method of keeping custodial records, and its security and data
protection practices; (ii) whether the Sub-Custodian has the
requisite financial strength to provide reasonable care for Fund
assets; (iii) the Sub-Custodian's general reputation and standing
and, in the case of a Securities Depository, the Securities
Depository's operating history and number of participants; and (iv)
whether the Fund will have jurisdiction over and be able to enforce
judgments against the Sub-Custodian, such as by virtue of the
existence of any offices of the Sub-Custodian in the United States
or the Sub-Custodian's consent to service of process in the United
States.
(g)
The
Custodian shall establish a system or ensure that its Sub-Custodian
has established a system to monitor on a continuing basis (i) the
appropriateness of maintaining each Fund’s assets with a
Sub-Custodian or Eligible Foreign Custodians who are members of a
Sub-Custodian’s network; (ii) the performance of the contract
governing the Fund’s arrangements with such Sub-Custodian or
Eligible Foreign Custodian’s members of a
Sub-Custodian’s network; and (iii) the custody risks of
maintaining assets with an Eligible Securities Depository. The
Custodian must promptly notify each Fund or its investment adviser
of any material change in these risks.
(h)
The
Custodian shall use commercially reasonable efforts to collect all
income and other payments with respect to Foreign Securities to
which a Fund shall be entitled and shall credit such income, as
collected, to the Trust. In the event that extraordinary measures
are required to collect such income, the Trust and Custodian shall
consult as to the measures and as to the compensation and expenses
of the Custodian relating to such measures.
3.04
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 investment assets, including (i) all payments of income,
payments of principal and capital distributions received by the
Trust with respect to such Securities, cash or other assets owned
by the Funds at any time during the period of this Agreement, and
(ii) all cash received by the Funds for the issuance of Shares. The
Custodian shall not be responsible for such Securities, cash or
other assets until actually received by it.
3.05
Securities Depositories
and Book-Entry Systems. The Custodian may deposit and/or
maintain Securities of the Fund in a Securities Depository or in a
Book-Entry System, subject to the following
provisions:
(a)
The
Custodian, on an on-going basis, shall deposit in a Securities
Depository or Book-Entry System all Securities eligible for deposit
therein and shall 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.
(b)
Securities
of any
Fund kept in a Book-Entry System or Securities Depository shall be
kept in an account (“Depository Account”) of the
Custodian in such Book-Entry System or Securities Depository which
includes only assets held by the Custodian as a fiduciary,
custodian or otherwise for customers.
(c)
The
records of the Custodian with respect to Securities of each Fund
maintained in a Book-Entry System or Securities Depository shall,
by book-entry, identify such Securities as belonging to the
Fund.
(d)
If
Securities purchased by any 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 any 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.
(e)
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 each Fund are kept) on the
internal accounting controls and procedures for safeguarding
Securities deposited in such Book-Entry System or Securities
Depository.
(f)
Not
withstanding
anything to the contrary in this Agreement, the Custodian shall be
liable to the Trust for any loss or damage to any Fund resulting
from (i) the use of a Book-Entry System or Securities Depository by
reason of any negligence or willful misconduct on the part of the
Custodian or any Sub-Custodian, or (ii) failure of the Custodian or
any 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 from any loss or damage
to any Fund arising from the use of such Book-Entry System or
Securities Depository, if and to the extent that such Fund has not
been made whole for any such loss or damage.
(g)
With
respect
to its responsibilities under this Section 3.05 and pursuant
to Rule 17f-4 under the 1940 Act, the Custodian hereby
warrants to the Trust that it agrees to (i) exercise due care
in accordance with reasonable commercial standards in discharging
its duty as a securities intermediary to obtain and thereafter
maintain such assets, (ii) provide, promptly upon request by
the Trust, such reports as are available concerning the
Custodian’s internal accounting controls and financial
strength, and (iii) require any Sub-Custodian to exercise due
care in accordance with reasonable commercial standards in
discharging its duty as a securities intermediary to obtain and
thereafter maintain assets corresponding to the security
entitlements of its entitlement holders.
3.06
Disbursement of Moneys
from Fund Custody Account. Upon receipt of Written
Instructions, the Custodian shall disburse moneys from the Fund
Custody Accounts but only in the following cases:
(a)
For the
purchase of Securities for each Fund but only in accordance with
Section 4.01 of this Agreement and only (i) in the case of
Securities (other than options on Securities, futures contracts and
options on futures contracts), against the delivery to the
Custodian (or any Sub-Custodian) of such Securities registered as
provided in Section 3.09 below or in proper form for transfer, or
if the purchase of such Securities is effected through a Book-Entry
System or Securities Depository, in accordance with the conditions
set forth in Section 3.05 above; (ii) in the case of options on
Securities, against delivery to the Custodian (or any
Sub-Custodian) of such receipts as are required by the customs
prevailing among dealers in such options; (iii) in the case of
futures contracts and options on futures contracts, against
delivery to the Custodian (or any Sub-Custodian) of evidence of
title thereto in favor of the Trust or any nominee referred to in
Section 3.09 below; and (iv) in the case of repurchase or reverse
repurchase agreements entered into between the Trust and a bank
which is a member of the Federal Reserve System or between the
Trust and a primary dealer in U.S. Government securities, 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 4.07(f) below, of Securities owned by any
Fund;
(c)
For the
payment of any dividends or capital gain distributions declared by
any Fund;
(d)
In
payment of the redemption price of Shares as provided in Section
4.01 below;
(e)
For the
payment of any expense or liability incurred by each Fund,
including, but not limited to, the following payments for the
account of such Fund: interest; taxes; administration, investment
advisory, accounting, auditing, transfer agent, custodian, trustee
and legal fees; and other operating expenses of such 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
1934 Act and a member of FINRA, relating to compliance with rules
of the Options Clearing Corporation and of any registered national
securities exchange (or of any similar organization or
organizations) regarding escrow or other arrangements in connection
with transactions by such 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 any
Fund;
(h)
For the
funding of any uncertificated time deposit or other
interest-bearing account with any banking institution (including
the Custodian), which deposit or account has a term of one year or
less; and
(i)
For any
other proper purpose, but only upon receipt of Written
Instructions, specifying the amount and purpose of such payment,
declaring such purpose to be a proper trust purpose, and naming the
person or persons to whom such payment is to be made.
3.07
Delivery of Securities
from Funds’ Custody Accounts. Upon receipt of Written
Instructions, the Custodian shall release and deliver, or cause the
Sub-Custodian to release and deliver, Securities from each Fund
Custody Account but only in the following cases:
(a)
Upon
the
sale of Securities for the account of the Fund but only against
receipt of payment therefor in cash, by certified or
cashier’s check or bank credit;
(b)
In the
case of a sale effected through a Book-Entry System or Securities
Depository, in accordance with the provisions of Section 3.05
above;
(c)
To an
offeror’s depository agent in connection with tender or other
similar offers for Securities of each Fund; provided that, in any
such case, the cash or other consideration is to be delivered to
the Custodian;
(d)
To the
issuer thereof or its agent (i) for transfer into the name of a
Fund, the Custodian or any Sub-Custodian, or any nominee or
nominees of any of the foregoing, or (ii) for exchange for a
different number of certificates or other evidence representing the
same aggregate face amount or number of units; provided that, in
any such case, the new Securities are to be delivered to the
Custodian;
(e)
To the
broker selling the Securities, for examination in accordance with
the “street delivery” custom;
(f)
For
exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of
the issuer of such Securities, or pursuant to provisions for
conversion contained in such Securities, or pursuant to any deposit
agreement, including surrender or receipt of underlying Securities
in connection with the issuance or cancellation of depository
receipts; provided that, in any such case, the new Securities and
cash, if any, are to be delivered to the Custodian;
(g)
Upon
receipt
of payment therefor pursuant to any repurchase or reverse
repurchase agreement entered into by any Fund;
(h)
In the
case of warrants, rights or similar Securities, upon the exercise
thereof, provided that, in any such case, the new Securities and
cash, if any, are to be delivered to the Custodian;
(i)
For
delivery in connection with any loans of Securities of any Fund,
but only against receipt of such collateral as the Trust shall have
specified to the Custodian in Written Instructions;
(j)
For
delivery as security in connection with any borrowings by any Fund
requiring a pledge of assets by the Trust, but only against receipt
by the Custodian of the amounts borrowed;
(k)
Pursuant
to any
authorized plan of liquidation, reorganization, merger,
consolidation or recapitalization of the Trust;
(l)
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 FINRA, 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 any Fund;
(m)
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 similar organization or organizations)
regarding account deposits in connection with transactions by any
Fund;
(n)
For any
other proper trust purpose, but only upon receipt of Written
Instructions, 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 trust purpose, and naming the person or
persons to whom delivery of such Securities shall be made;
or
(o)
To
brokers, clearing banks or other clearing agents for examination or
trade execution in accordance with market custom; provided that in
any such case the Custodian shall have no responsibility or
liability for any loss arising from the delivery of such securities
prior to receiving payment for such securities except as may arise
from the Custodian’s own negligence or willful
misconduct.
3.08
Actions Not Requiring
Written Instructions. Unless otherwise instructed by the
Trust, the Custodian shall with respect to all Securities held for
each Fund:
(a)
Subject
to
Section 9.04 below, collect on a timely basis all income and other
payments to which such Fund is entitled either by law or pursuant
to custom in the securities business;
(b)
Present
for
payment and, subject to Section 9.04 below, collect on a timely
basis the amount payable upon all Securities which may mature or be
called, redeemed, or retired, or otherwise become
payable;
(c)
Endorse
for
collection, in the name of such Fund, checks, drafts and other
negotiable instruments;
(d)
Surrender
interim
receipts or Securities in temporary form for Securities in
definitive form;
(e)
Execute
as
custodian, any necessary declarations or certificates of ownership
under the federal income tax laws or the laws or regulations of any
other taxing authority now or hereafter in effect, and prepare and
submit reports to the IRS and the Trust at such time, in such
manner and containing such information as is prescribed by the
IRS;
(f)
Hold
for
such Fund, either directly or, with respect to Securities held
therein, through a Book-Entry System or Securities Depository, all
rights and similar Securities issued with respect to Securities of
such Fund; and
(g)
In
general, and except as otherwise directed in Written Instructions,
attend to all non-discretionary details in connection with the
sale, exchange, substitution, purchase, transfer and other dealings
with Securities and other assets of such Fund.
3.09
Registration and Transfer
of Securities. All Securities held for each 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 such Fund may be registered in the name of such
Fund, the Custodian, a Sub-Custodian or any nominee thereof, or in
the name of a Book-Entry System, Securities Depository or any
nominee of either thereof. The records of the Custodian with
respect to foreign securities of such Fund that are maintained with
a Sub-Custodian in an account that is identified as belonging to
the Custodian for the benefit of its customers shall identify those
securities as belonging to such Fund. 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 referred to above or in the name of a
Book-Entry System or Securities Depository, any Securities
registered in the name of such Fund.
3.10
Records.
(a)
The
Custodian shall maintain complete and accurate records with respect
to Securities, cash or other property held for each Fund, including
(i) journals or other records of original entry containing an
itemized daily record in detail of all receipts and deliveries of
Securities and all receipts and disbursements of cash; (ii) ledgers
(or other records) reflecting (A) Securities in transfer, (B)
Securities in physical possession, (C) monies and Securities
borrowed and monies and Securities loaned (together with a record
of the collateral therefor and substitutions of such collateral),
(D) dividends and interest received, and (E) dividends receivable
and interest receivable; (iii) canceled checks and bank records
related thereto; and (iv) all records relating to its activities
and obligations under this Agreement. The Custodian shall keep such
other books and records of such Fund as the Trust shall reasonably
request, or as may be required by the 1940 Act, including, but not
limited to, Section 31 of the 1940 Act and Rule 31a-2 promulgated
thereunder.
(b)
All
such books and records maintained by the Custodian shall (i) be
maintained in a form acceptable to the Trust and in compliance with
the rules and regulations of the SEC, (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 SEC, and (iii) if required to be maintained by
Rule 31a-1 under the 1940 Act, be preserved for the periods
prescribed in Rules 31a-1 and 31a-2 under the 1940
Act.
3.11
Fund Reports by
Custodian. The Custodian shall furnish the Trust with a
daily activity statement and a summary of all transfers to or from
each Fund Custody Account on the day following such transfers. At
least monthly, the Custodian shall furnish the Trust with a
detailed statement of the Securities and moneys held by the
Custodian and the Sub-Custodians for each Fund under this
Agreement.
3.12
Other Reports by
Custodian. As the Trust may reasonably request from time to
time, the Custodian shall provide the Trust with reports on the
internal accounting controls and procedures for safeguarding
Securities which are employed by the Custodian or any
Sub-Custodian.
3.13
Proxies and Other
Materials. The Custodian shall cause all proxies relating to
Securities which are not registered in the name of a 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 relating to such
Securities. With respect to the foreign Securities, the Custodian
will use reasonable commercial efforts to facilitate the exercise
of voting and other shareholder rights, subject to the laws,
regulations and practical constraints that may exist in the country
where such securities are issued. The Trust acknowledges that local
conditions, including lack of regulation, onerous procedural
obligations, lack of notice and other factors may have the effect
of severely limiting the ability of the Trust to exercise
shareholder rights.
3.14
Information on Corporate
Actions. The Custodian shall promptly deliver to the Trust
all information received by the Custodian and pertaining to
Securities being held by each Fund with respect to optional tender
or exchange offers, calls for redemption or purchase, or expiration
of rights. If the Trust desires to take action with respect to any
tender offer, exchange offer or 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. The
Trust will provide or cause to be provided to the Custodian all
relevant information for any Security which has unique put/option
provisions at least three Business Days prior to the beginning date
of the tender period.
ARTICLE IV.
PURCHASE AND SALE OF INVESTMENTS OF THE TRUST
4.01
Purchase of
Securities. Promptly upon each purchase of Securities for
each Fund, Written Instructions shall be delivered to the
Custodian, specifying (i) the name of the issuer or writer of such
Securities, and the title or other description thereof, (ii) the
number of shares, principal amount (and accrued interest, if any)
or other units purchased, (iii) the date of purchase and
settlement, (iv) the purchase price per unit, (v) the total amount
payable upon such purchase, and (vi) the name of the person to whom
such amount is payable. The Custodian shall upon receipt of such
Securities purchased by each Fund pay out of the moneys held for
the account of such Fund the total amount specified in such Written
Instructions to the person named therein. The Custodian shall not
be under any obligation to pay out moneys to cover the cost of a
purchase of Securities for a Fund, if in the Fund Custody Account
there is insufficient cash available to such Fund for which such
purchase was made.
4.02
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 and in the absence of specified Written Instructions to
so pay in advance, the Custodian shall be liable to such Fund for
such payment.
4.03
Sale of Securities.
Promptly upon each sale of Securities by each Fund, Written
Instructions shall be delivered to the Custodian, specifying (i)
the name of the issuer or writer of such Securities, and the title
or other description thereof, (ii) the number of shares, principal
amount (and accrued interest, if any), or other units sold, (iii)
the date of sale and settlement, (iv) the sale price per unit, (v)
the total amount payable upon such sale, and (vi) the person to
whom such Securities are to be delivered. Upon receipt of the total
amount payable to the Fund as specified in such Written
Instructions, the Custodian shall deliver such Securities to the
person specified in such Written Instructions. Subject to the
foregoing, the Custodian may accept payment in such form as shall
be satisfactory to it, and may deliver Securities and arrange for
payment in accordance with the customs prevailing among dealers in
Securities.
4.04
Delivery of Securities
Sold. Notwithstanding Section 4.03 above or any other
provision of this Agreement, the Custodian, when instructed to
deliver Securities against payment, shall be entitled, if in
accordance with generally accepted market practice, to deliver such
Securities prior to actual receipt of final payment therefor. In
any such case, each Fund shall bear the risk that final payment for
such Securities may not be made or that such Securities may be
returned or otherwise held or disposed of by or through the person
to whom they were delivered, and the Custodian shall have no
liability for any for the foregoing.
4.05
Payment for Securities
Sold. In its sole discretion and from time to time, the
Custodian may credit each 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 each Fund, and (iii) income from cash, Securities or
other assets of such 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
each 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 such Fund Custody
Account.
4.06
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 any 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
5.01
Transfer of Funds.
From such funds as may be available for the purpose in the relevant
Fund Custody Account, and upon receipt of Written Instructions
specifying that the funds are required to redeem Shares of the
Fund, the Custodian shall wire each amount specified in such
Written Instructions to or through such bank or broker-dealer as
the Trust may designate.
5.02
No Duty Regarding Paying
Banks. Once the Custodian has wired amounts to a bank or
broker-dealer pursuant to Section 5.01 above, the Custodian
shall not be under any obligation to effect any further payment or
distribution by such bank or broker-dealer.
ARTICLE VI.
SEGREGATED ACCOUNTS
6.01
Upon receipt of Written Instructions, the Custodian shall establish
and maintain a segregated account or accounts for and on behalf of
each 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 FINRA (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
such Fund;
(b)
for
purposes of segregating cash or Securities in connection with
securities options purchased or written by such Fund or in
connection with financial futures contracts (or options thereon)
purchased or sold by such Fund;
(c)
which
constitute
collateral for loans of Securities made by such Fund;
(d)
for purposes of
compliance by such Fund with requirements under the 1940 Act for
the maintenance of segregated accounts by registered investment
companies in connection with reverse repurchase agreements and
when-issued, delayed delivery and firm commitment transactions;
and
(e)
for
other proper trust purposes, but only upon receipt of Written
Instructions, setting forth the purpose or purposes of such
segregated account and declaring such purposes to be proper trust
purposes.
Each
segregated account established under this Article VI shall be
established and maintained for each Fund only. All Written
Instructions relating to a segregated account shall specify such
Fund.
ARTICLE VII.
COMPENSATION OF CUSTODIAN
7.01
Compensation. The
Custodian shall be compensated for providing the services set forth
in this Agreement in accordance with the fee schedule set forth on
Exhibit C hereto
(as amended from time to time). The Custodian shall also be
reimbursed for such miscellaneous expenses (e.g., telecommunication
charges, postage and delivery charges, and reproduction charges) as
are reasonably incurred by the Custodian in performing its duties
hereunder. The Trust shall pay all such fees and reimbursable
expenses within 30 calendar days following receipt of the billing
notice, except for any fee or expense subject to a good faith
dispute. The Trust shall notify the Custodian in writing within 30
calendar days following receipt of each invoice if the Trust is
disputing any amounts in good faith. The Trust shall pay such
disputed amounts within 10 calendar days of the day on which the
parties agree to the amount to be paid. With the exception of any
fee or expense the Trust is disputing in good faith as set forth
above, unpaid invoices shall accrue a finance charge of 1½%
per month after the due date. Notwithstanding anything to the
contrary, amounts owed by the Trust to the Custodian shall only be
paid out of the assets and property of the particular Fund
involved.
7.02
Overdrafts. The
Trust is responsible for maintaining an appropriate level of short
term cash investments to accommodate cash outflows. The Trust may
obtain a formal line of credit for potential overdrafts of its
custody account. In the event of an overdraft or in the event the
line of credit is insufficient to cover an overdraft, the overdraft
amount or the overdraft amount that exceeds the line of credit will
be charged in accordance with the fee schedule set forth on
Exhibit C hereto
(as amended from time to time).
ARTICLE VIII.
REPRESENTATIONS AND WARRANTIES
8.01
Representations and
Warranties of the Trust. The Trust hereby represents and
warrants to the Custodian, which representations and warranties
shall be deemed to be continuing throughout the term of this
Agreement, that:
(a)
It is
duly organized and existing under the laws of the jurisdiction of
its organization, with full power to carry on its business as now
conducted, to enter into this Agreement and to perform its
obligations hereunder;
(b)
This
Agreement has been
duly authorized, executed and delivered by the Trust in accordance
with all requisite action and constitutes a valid and legally
binding obligation of the Trust, enforceable in accordance with its
terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the
rights and remedies of creditors and secured parties;
and
(c)
It is
conducting its business in compliance in all material respects with
all applicable laws and regulations, both state and federal, and
has obtained all regulatory approvals necessary to carry on its
business as now conducted; there is no statute, rule, regulation,
order or judgment binding on it and no provision of its charter,
bylaws or any contract binding it or affecting its property which
would prohibit its execution or performance of this
Agreement.
8.02
Representations and
Warranties of the Custodian. The Custodian hereby represents
and warrants to the Trust, which representations and warranties
shall be deemed to be continuing throughout the term of this
Agreement, that:
(a)
It is
duly organized and existing under the laws of the jurisdiction of
its organization, with full power to carry on its business as now
conducted, to enter into this Agreement and to perform its
obligations hereunder;
(b)
It is a
U.S. Bank as defined in section (a)(7) of Rule 17f-5.
(c)
This
Agreement has been
duly authorized, executed and delivered by the Custodian in
accordance with all requisite action and constitutes a valid and
legally binding obligation of the Custodian, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and secured parties;
and
(d)
It is
conducting its business in compliance in all material respects with
all applicable laws and regulations, both state and federal, and
has obtained all regulatory approvals necessary to carry on its
business as now conducted; there is no statute, rule, regulation,
order or judgment binding on it and no provision of its charter,
bylaws or any contract binding it or affecting its property which
would prohibit its execution or performance of this
Agreement.
ARTICLE IX.
CONCERNING
THE CUSTODIAN
9.01
Standard of Care.
The Custodian shall exercise reasonable care in the performance of
its duties under this Agreement. The Custodian shall not be liable
for any error of judgment or mistake of law or for any loss
suffered by the Trust in connection with its duties under this
Agreement, except a loss arising out of or relating to the
Custodian’s (or a Sub-Custodian’s) refusal or failure
to comply with the terms of this Agreement (or any sub-custody
agreement) or from its (or a Sub-Custodian’s) bad faith,
negligence or willful misconduct in the performance of its duties
under this Agreement (or any sub-custody agreement). The Custodian
shall be entitled to rely on and may act upon advice of counsel on
all matters, and shall be without liability for any action
reasonably taken or omitted pursuant to such advice. The Custodian
shall promptly notify the Trust of any action taken or omitted by
the Custodian pursuant to advice of counsel.
9.02
Actual Collection
Required. The Custodian shall not be liable for, or
considered to be the custodian of, any cash belonging to any 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.
9.03
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.
9.04
Limitation on Duty to
Collect. Custodian shall not be required to enforce
collection, by legal means or otherwise, of any money or property
due and payable with respect to Securities held for any Fund if
such Securities are in default or payment is not made after due
demand or presentation.
9.05
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 Written Instructions
actually received by it pursuant to this Agreement.
9.06
Cooperation. The
Custodian shall cooperate with and supply necessary information to
the entity or entities appointed by the Trust to keep the books of
account of each Fund and/or compute the value of the assets of each
Fund. 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 (i) the preparation of the Trust's reports on Form
N-1A and Form N-SAR and any other reports required by the SEC, and
(ii) the fulfillment by the Trust of any other requirements of the
SEC.
ARTICLE
X.
INDEMNIFICATION
10.01
Indemnification by
Trust. The Trust shall indemnify and hold harmless the
Custodian, any Sub-Custodian and any nominee thereof (each, an
“Indemnified Party” and collectively, the
“Indemnified Parties”) from and against any and all
claims, demands, losses, expenses and liabilities of any and every
nature (including reasonable attorneys' fees) that an Indemnified
Party may sustain or incur or that may be asserted against an
Indemnified Party by any person arising directly or indirectly (i)
from the fact that Securities are registered in the name of any
such nominee, (ii) from any action taken or omitted to be taken by
the Custodian or such Sub-Custodian (a) at the request or direction
of or in reliance on the advice of the Trust, or (b) upon Written
Instructions received from the Trust, or (iii) from the performance
of its obligations under this Agreement or any sub-custody
agreement, provided that neither the Custodian nor any such
Sub-Custodian shall be indemnified and held harmless from and
against any such claim, demand, loss, expense or liability arising
out of or relating to its refusal or failure to comply with the
terms of this Agreement (or any sub-custody agreement), or from its
bad faith, negligence or willful misconduct in the performance of
its duties under this Agreement (or any sub-custody agreement).
This indemnity shall be a continuing obligation of the Trust, its
successors and assigns, notwithstanding the termination of this
Agreement. As used in this paragraph, the terms
“Custodian” and “Sub-Custodian” shall
include their respective directors, officers and
employees.
10.02
Indemnification by
Custodian. The Custodian shall indemnify and hold harmless
the Trust from and against any and all claims, demands, losses,
expenses, and liabilities of any and every nature (including
reasonable attorneys’ fees) that the Trust may sustain or
incur or that may be asserted against the Trust by any person
arising directly or indirectly out of any action taken or omitted
to be taken by an Indemnified Party as a result of the Indemnified
Party’s refusal or failure to comply with the terms of this
Agreement (or any sub-custody agreement), or from its bad faith,
negligence or willful misconduct in the performance of its duties
under this Agreement (or any sub-custody agreement). This indemnity
shall be a continuing obligation of the Custodian, its successors
and assigns, notwithstanding the termination of this Agreement. As
used in this paragraph, the term “Trust” shall include
the Trust’s trustees, officers and employees.
10.03
Security. If the
Custodian advances cash or Securities to any 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 claim, demand, loss, expense or liability (including reasonable
attorneys' fees) (except such as may arise from its or its
nominee's bad faith, negligence 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.
10.4
Miscellaneous.
(a)
either
party
to this Agreement shall be liable to the other party for
consequential, special or punitive damages under any provision of
this Agreement.
(b)
the
indemnity provisions of this Article shall indefinitely survive the
termination and/or assignment of this Agreement.
(c)
In
order that the indemnification provisions contained in this Article
X shall apply, it is understood that if in any case the indemnitor
may be asked to indemnify or hold the indemnitee harmless, the
indemnitor shall be fully and promptly advised of all pertinent
facts concerning the situation in question, and it is further
understood that the indemnitee will use all reasonable care to
notify the indemnitor promptly concerning any situation that
presents or appears likely to present the probability of a claim
for indemnification. The indemnitor shall have the option to defend
the indemnitee against any claim that may be the subject of this
indemnification. In the event that the indemnitor so elects, it
will so notify the indemnitee and thereupon the indemnitor shall
take over complete defense of the claim, and the indemnitee shall
in such situation initiate no further legal or other expenses for
which it shall seek indemnification under this Article X. The
indemnitee shall in no case confess any claim or make any
compromise in any case in which the indemnitor will be asked to
indemnify the indemnitee except with the indemnitor’s prior
written consent.
ARTICLE
XI.
FORCE
MAJEURE
11.01
Neither the Custodian nor the Trust shall be liable for any failure
or delay in performance of its obligations under this Agreement
arising out of or caused, directly or indirectly, by circumstances
beyond its reasonable control, including, without limitation, acts
of God; earthquakes; fires; floods; wars; civil or military
disturbances; acts of terrorism; sabotage; strikes; epidemics;
riots; power failures; computer failure and any such circumstances
beyond its reasonable control as may cause interruption, loss or
malfunction of utility, transportation, computer (hardware or
software) or telephone communication service; accidents; labor
disputes; acts of civil or military authority; governmental
actions; or inability to obtain labor, material, equipment or
transportation; provided, however, that in the event of a failure
or delay, the Custodian (i) shall not discriminate against the
Trust or any of its Funds in favor of any other customer of the
Custodian in making computer time and personnel available to input
or process the transactions contemplated by this Agreement, and
(ii) shall use its best efforts to ameliorate the effects of any
such failure or delay.
ARTICLE XII
PROPRIETARY
AND CONFIDENTIAL INFORMATION
12.01
The Custodian agrees on behalf of itself and its directors,
officers, and employees to treat confidentially and as proprietary
information of the Trust, all records and other information
relative to the Trust and prior, present, or potential shareholders
of the Trust (and clients of said shareholders), and not to use
such records and information for any purpose other than the
performance of its responsibilities and duties hereunder, except
(i) after prior notification to and approval in writing by the
Trust, which approval shall not be unreasonably withheld and may
not be withheld where the Custodian may be exposed to civil or
criminal contempt proceedings for failure to comply, (ii) when
requested to divulge such information by duly constituted
authorities although the Custodian will promptly report such
disclosure to the Trust if disclosure is permitted by applicable
law and regulation, or (iii) when so requested by the Trust.
Records and other information which have become known to the public
through no wrongful act of the Custodian or any of its employees,
agents or representatives, and information that was already in the
possession of the Custodian prior to receipt thereof from the Trust
or its agent, shall not be subject to this paragraph.
12.02
Further, the Custodian will adhere to the privacy policies adopted
by the Trust pursuant to Title V of the Xxxxx-Xxxxx-Xxxxxx Act, as
may be modified from time to time. In this regard, the Custodian
shall have in place and maintain physical, electronic and
procedural safeguards reasonably designed to protect the security,
confidentiality and integrity of, and to prevent unauthorized
access to or use of, records and information relating to the Trust
and its shareholders.
ARTICLE XIII
EFFECTIVE
PERIOD; TERMINATION
13.01
Effective Period.
This Agreement shall become effective as of the date first written
above and will continue in effect for a period of three
years.
13.02
Termination. This
Agreement may be terminated by either party upon giving 90 days
prior written notice to the other party or such shorter period as
is mutually agreed upon by the parties. Subsequent to the end of
the three (3) year period, this Agreement continues until one party
gives 90 days prior written notice to the other party or such
shorter period as is mutually agreed upon by the parties.
Subsequent to the end of the three (3) year period, this Agreement
continues until one party gives 90 days prior written notice to the
other party or such shorter period as is mutually agreed upon by
the parties. Notwithstanding the foregoing, this Agreement may be
terminated by any party upon the breach of the other party of any
material term of this Agreement if such breach is not cured within
15 days of notice of such breach to the breaching party. In
addition, 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 or upon the
happening of a like event at the direction of an appropriate
regulatory agency or court of competent jurisdiction.
13.03
Early Termination.
In the absence of any material breach
of this Agreement, should the Trust elect to terminate this
Agreement prior to the end of the three year term, the Trust agrees
to pay the following fees:
(a)
All
monthly fees through the life of the Agreement, including
the repayment of any
negotiated discounts;
(b)
All
fees associated with converting services to a successor service
provider;
(c)
All
fees associated with any record retention and/or tax
reporting obligations that
may not be eliminated due to the conversion to a successor service
provider;
(d)
All
miscellaneous costs associated with (a)-(c) above
13.04
Appointment of Successor
Custodian. 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 (i) 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
each Fund and held by the Custodian as custodian, and (ii) transfer
any Securities held in a Book-Entry System or Securities Depository
to an account of or for the benefit of such Fund 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. In addition, the
Custodian shall, at the expense of the Trust, transfer to such
successor all relevant books, records, correspondence, and other
data established or maintained by the Custodian under this
Agreement in a form reasonably acceptable to the Trust (if such
form differs from the form in which the Custodian has maintained
the same, the Trust shall pay any expenses associated with
transferring the data to such form), and will cooperate in the
transfer of such duties and responsibilities, including provision
for assistance from the Custodian’s personnel in the
establishment of books, records, and other data by such successor.
Upon such delivery and transfer, the Custodian shall be relieved of
all obligations under this Agreement.
13.05
Failure to Appoint
Successor Custodian. If a successor custodian is not
designated by the Trust on or before the date of termination of
this Agreement, then the Custodian shall have the right to deliver
to a bank or trust company of its own selection, which bank or
trust company (i) is a “bank” as defined in the 1940
Act, and (ii) has aggregate capital, surplus and undivided profits
as shown on its most recent published report of not less than $25
million, all Securities, cash and other property held by Custodian
under this Agreement and to transfer to an account of or for each
Fund 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. In addition, under these
circumstances, all books, records and other data of the Trust shall
be returned to the Trust.
ARTICLE XIV.
CLASS ACTIONS
14.01
The Custodian shall use its best efforts to identify and file
claims for the Fund(s) involving any class action litigation that
impacts any security the Fund(s) may have held during the class
period. The Trust agrees that the Custodian may file such claims on
its behalf and understands that it may be waiving and/or releasing
certain rights to make claims or otherwise pursue class action
defendants who settle their claims. Further, the Trust acknowledges
that there is no guarantee these claims will result in any payment
or partial payment of potential class action proceeds and that the
timing of such payment, if any, is uncertain.
14.02
However, the Trust may instruct the
Custodian to distribute class action notices and other relevant
documentation to the Fund(s) or its designee and, if it so elects,
will relieve the Custodian from any and all liability and
responsibility for filing class action claims on behalf of the
Fund(s).
ARTICLE XV.
MISCELLANEOUS
15.01
Compliance with Laws. The Trust
has and retains primary responsibility for all compliance matters
relating to the Trust, including but not limited to compliance with
the 1940 Act, the Internal Revenue Code of 1986, the Xxxxxxxx-Xxxxx
Act of 2002, the USA Patriot Act of 2001 and the policies and
limitations of the Trust relating to its portfolio investments as
set forth in its Prospectus and statement of additional
information. The Custodian’s services hereunder shall not
relieve the Trust of its responsibilities for assuring such
compliance or the Board of Trustee’s oversight responsibility
with respect thereto.
15.02
Amendment. This
Agreement may not be amended or modified in any manner except by
written agreement executed by the Custodian and the Trust, and
authorized or approved by the Board of Trustees.
15.03
Assignment. This
Agreement shall extend to and be binding upon the parties hereto
and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable by the Trust without
the written consent of the Custodian, or by the Custodian without
the written consent of the Trust accompanied by the authorization
or approval of the Board of Trustees.
15.04
Governing Law. This Agreement
shall be governed by and construed in accordance with the laws of
the State of Delaware, without regard to conflicts of law
principles. To the extent that the applicable laws of the State of
Delaware, or any of the provisions herein, conflict with the
applicable provisions of the 1940 Act, the latter shall control,
and nothing herein shall be construed in a manner inconsistent with
the 1940 Act or any rule or order of the SEC
thereunder.
15.05
No Agency
Relationship. Nothing herein contained shall be deemed to
authorize or empower either party to act as agent for the other
party to this Agreement, or to conduct business in the name, or for
the account, of the other party to this Agreement.
15.06
Services Not
Exclusive. Nothing in this Agreement shall limit or restrict
the Custodian from providing services to other parties that are
similar or identical to some or all of the services provided
hereunder.
15.07
Invalidity. Any
provision of this Agreement which may be determined by competent
authority to be prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. In such
case, the parties shall in good faith modify or substitute such
provision consistent with the original intent of the
parties.
15.08
Notices.
Any notice required or permitted to be given by either party to the
other shall be in writing and shall be deemed to have been given on
the date delivered personally or by courier service, or three days
after sent by registered or certified mail, postage prepaid, return
receipt requested, or on the date sent and confirmed received by
facsimile transmission to the other party’s address set forth
below:
Notice
to the Custodian shall be sent to:
U.S
Bank, N.A.
0000
X. Xxxxxxxxxxx Xx., XX-XX-X000
Xxxxxxxxx,
XX 00000
Attn:
Xxx Xxxxxx
Phone:
000-000-0000
Fax:
000-000-0000
and
notice to the Trust shall be sent to:
c/o
ProcureAM, LLC
00
Xxxxxxxx Xxxx
Xxxxxxxxx,
XX 00000
Attn:
Xxxxxx Xxxx
Phone:
000-000-0000
Fax:
000-000-0000
15.09
Multiple Originals.
This Agreement may be executed on two or more counterparts, each of
which when so executed shall be deemed an original, but such
counterparts shall together constitute but one and the same
instrument.
15.10
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.
15.11
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 any Fund and
such other printed matter as merely identifies Custodian as
custodian for a Fund. 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.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by a duly authorized officer on one or more
counterparts as of the date last written below.
|
|
|
U.S. BANK NATIONAL ASSOCIATION
|
||
|
By:
|
/s/
Xxxxxx Xxxx
|
|
By:
|
/s/
Xxxxx Xxxxxxxxx
|
|
Name:
|
Xxxxxx
Xxxx
|
|
Name:
|
Xxxxx
Xxxxxxxxx
|
|
Title:
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President
|
|
Title
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Sr.
VP
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Date:
|
11/05/19
|
|
Date:
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11/12/19
|
4816-4361-2784
EXHIBIT A
AUTHORIZED PERSONS
Set
forth below are the names and specimen signatures of the persons
authorized by the Trust to administer the Fund Custody
Accounts.
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Name
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Telephone/Fax Number
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Signature
|
|
|
|
|
|
|
|
|
|
Xxxxxx
Xxxx
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000-000-0000
|
/s/
Xxxxxx Xxxx
|
|
|
|
_____________________
|
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|
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______________________
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EXHIBIT B
to the Custody Agreement
|
Name of
Fund
|
|
|
LGBTQ Loyalty 100 Index ETF
|
|
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EXHIBIT C
to the Custody Agreement
Exhibit C to the Custody Agreement
Base Fee for Domestic Custody Services The
following reflects the greater of the basis point fee or annual
minimum for funds in theProcure ETF Trust I. To illustrate, for 5
Funds USBFS will receive the greater of the Annual Minimum per Fund
in the Trust ($24,000/Year) or the calculated Basis Points on the
total AUM in the Trust.
|
Annual
Minimum per Fund
|
|
Basis
Points on Trust AUM
|
|
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Funds
1-10
|
$4,800
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First
$500m
|
1
bp
|
|
Funds
11+
|
$3,000
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Next
$500m
|
0.75
bp
|
|
|
|
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Balance 0.50
bp
|
Exhibit C (continued)
Domestic Custody Services in addition
to the Base Fee1
Portfolio Transaction
Fees2
■
$4.00
– Book entry DTC transaction, Federal Reserve transaction,
principal paydown
■
$7.00
– Repurchase agreement, reverse repurchase agreement, time
deposit/CD or other non-depository transaction
■
$8.00
– Option/SWAPS/future contract written, exercised or
expired
■
$15.00
– Mutual fund trade, Margin Variation Wire and outbound Fed
wire
■
$50.00
– Physical security transaction
■
$5.00
– Check disbursement (waived if U.S. Bancorp is
Administrator)
A transaction is a purchase/sale of a security, free receipt/free
delivery, maturity, tender or exchange.
Miscellaneous Expenses
Including but not limited to expenses incurred in the safekeeping,
delivery and receipt of securities, shipping, transfer fees,
deposit withdrawals at custodian (DWAC) fees, SWIFT charges and
extraordinary expenses based upon complexity.
Additional Services
■
Additional
fees apply for global servicing.
■
$500
per Sub Advisor or Segregated custody account per year
■
No
charge for the initial conversion free receipt.
■
Overdrafts
– charged to the account at prime interest rate plus 2 unless
a line of credit is in place.
1 Fees are calculated pro rata and billed
monthly
2 “Sponsor trades”
are defined as any trades put through the Portfolio, on behalf of
the Fund by any portfolio manager/sub advisor and their affiliates
authorized by the BOT to act on behalf of the Fund, outside of the
create/redeem process. Cash-in-Lieu proceeds received as part of
the create/redeem process, and their related transactions
are not
considered to be “Sponsor
trades.
Exhibit C to the Custody Agreement
Additional Global Sub-Custodial
Services Annual Fee Schedule1
Base Fee
A monthly base fee per account (fund) will apply based on the
number of foreign securities held.
■
1-25
foreign securities: $500
■
26-50
foreign securities: $1,000
■
Over
50 foreign securities: $1,500
■
Euroclear
– Eurobonds only. Eurobonds are held in Euroclear at a
standard rate, but other types of securities (including but not
limited to equities, domestic market debt and mutual funds) will be
subject to a surcharge. In addition, certain transactions that are
delivered within Euroclear or from a Euroclear account to a third
party depository or settlement system, will be subject to a
surcharge.
■
For
all other markets specified above, surcharges may apply if a
security is held outside of the local market.
Plus:
Global Custody Transaction
Fees1
Global Custody transaction fees associate with Sponsor
Trades2.
(See schedule below)
■
A
transaction is defined as any purchase/sale, free receipt / free
delivery, maturity, tender or exchange of a security.
Global Safekeeping and Transaction Fees
(See schedule below)
Tax Reclamation Services
Tax reclaims that have been outstanding for more than 6 (six)
months with the client will be charged $50 per claim.
Miscellaneous Expenses
■
Charges
incurred by U.S. Bank, N.A. directly or through sub-custodians for
account opening fees, local taxes, stamp duties or other local
duties and assessments, stock exchange fees, foreign exchange
transactions, postage and insurance for shipping, facsimile
reporting, extraordinary telecommunications fees, proxy services
and other shareholder communications, recurring administration fees
or other expenses which are unique to a country in which the client
or its clients is investing will be passed along as
incurred.
■
A
surcharge may be added to certain Miscellaneous expenses listed
herein to cover handling, servicing and other administrative costs
associated with the activities giving rise to such expenses. Also,
certain expenses are charged at a predetermined flat
rate.
■
SWIFT
reporting and message fees.
1 Fees are calculated pro rata
and billed monthly
2“Sponsor trades”
are defined as any trades put through the Portfolio, on behalf of
the Fund by any portfolio manager/sub advisor and their affiliates
authorized by the BOT to act on behalf of the Fund, outside of the
create/redeem process. Cash-in-Lieu proceeds received as part of
the create/redeem process, and their related transactions
are not
considered to be “Sponsor
trades.”
Additional Global Sub-Custodial Services Annual Fee
Schedule
EXHIBIT D
SHAREHOLDER COMMUNICATIONS ACT AUTHORIZATION
The
Shareholder Communications Act of 1985 requires banks and trust
companies to make an effort to permit direct communication between
a company which issues securities and the shareholder who votes
those securities.
Unless
you specifically require us to NOT release your name and address to
requesting companies, we are required by law to disclose your name
and address.
Your
“yes” or “no” to disclosure will apply to
all securities U.S. Bank holds for you now and in the future,
unless you change your mind and notify us in writing.
|
___x___
YES
|
|
U.S.
Bank is authorized to provide the Trust’s name, address and
security position to requesting companies whose stock is owned by
the Trust.
|
|
|
|
|
|
______
NO
|
|
U.S.
Bank is NOT authorized to provide the Trust’s name, address
and security position to requesting companies whose stock is owned
by the Trust.
|
By:
___Robert
Tull_________________________
Title:
President
Date:
__11/05/19______________________________
