Exhibit No. EX-99.g.1
CUSTODY AGREEMENT
Dated October 30, 1995
Between
UMB BANK, N.A.
and
THE SCOUT FUNDS
TABLE OF CONTENTS
SECTION PAGE
1. Appointment of Custodian 1
2. Definitions 1
(a) Securities 1
(b) Assets 2
(c) Instructions and Special Instructions 2
3. Delivery of Corporate Documents 2
4. Powers and Duties of Custodian and Domestic Subcustodian 3
(a) Safekeeping 4
(b) Manner of Holding Securities 4
(c) Free Delivery of Assets 5
(d) Exchange of Securities 6
(e) Purchases of Assets 6
(f) Sales of Assets 7
(g) Options 7
(h) Futures Contracts 8
(i) Segregated Accounts 9
(j) Depository Receipts 9
(k) Corporate Actions, Put Bonds, Called Bonds, Etc. 9
(l) Interest Bearing Deposits 10
(m) Foreign Exchange Transactions 10
(n) Pledges or Loans of Securities 11
(o) Stock Dividends, Rights, Etc. 12
(p) Routine Dealings 12
(q) Collections 12
(r) Bank Accounts 13
(s) Dividends, Distributions and Redemptions 13
(t) Proceeds from Shares Sold 13
(u) Proxies and Notices; Compliance with the Shareholders
Communication Act of 1985 13
(v) Books and Records 14
(w) Opinion of Fund's Independent Certified Public Accountants 14
(x) Reports by Independent Certified Public Accountants 14
(y) Bills and Others Disbursements 14
5. Subcustodians 15
(a) Domestic Subcustodians 15
(b) Foreign Subcustodians 15
(c) Interim Subcustodians 16
(d) Special Subcustodians 16
(e) Termination of a Subcustodian 17
(f) Certification Regarding Foreign Subcustodians 17
6. Standard of Care 17
(a) General Standard of Care 17
(b) Actions Prohibited by Applicable Law, Events Beyond
Custodian's Control, Armed Conflict, Sovereign Risk, etc. 17
(c) Liability for Past Records 18
(d) Advice of Counsel 18
(e) Advice of the Fund and Others 18
(f) Instructions Appearing to be Genuine 18
(g) Exceptions from Liability 19
7. Liability of the Custodian for Actions of Others 19
(a) Domestic Subcustodians 19
(b) Liability for Acts and Omissions of Foreign Subcustodians 19
(c) Securities Systems, Interim Subcustodians, Special
Subcustodians, Securities Depositories and Clearing Agencies 20
(d) Defaults or Insolvencies of Brokers, Banks, Etc. 20
(e) Reimbursement of Expenses 20
8. Indemnification 20
(a) Indemnification by Fund 20
(b) Indemnification by Custodian 21
9. Advances 21
10. Liens 21
11. Compensation 22
12. Powers of Attorney 22
13. Termination and Assignment 22
14. Additional Funds 23
15. Notices 23
16. Miscellaneous 23
CUSTODY AGREEMENT
This agreement made as of this 30th day of October, 1995, between UMB Bank,
n.a., a national banking association with its principal place of business
located at Kansas City, Missouri (hereinafter "Custodian"), and each of the
Funds which have executed the signature page hereof together with such
additional Funds which shall be made parties to this Agreement by the execution
of a separate signature page hereto (individually, a "Fund" and collectively,
the "Funds").
WITNESSETH:
WHEREAS, each Fund is registered as an open-end management investment company
under the Investment Company Act of 1940, as amended; and
WHEREAS, each Fund desires to appoint Custodian as its custodian for the custody
of Assets (as hereinafter defined) owned by such Fund which Assets are to be
held in such accounts as such Fund may establish from time to time; and
WHEREAS, Custodian is willing to accept such appointment on the terms and
conditions hereof.
NOW, THEREFORE, in consideration of the mutual promises contained herein, the
parties hereto, intending to be legally bound, mutually covenant and agree as
follows:
1. APPOINTMENT OF CUSTODIAN.
Each Fund hereby constitutes and appoints the Custodian as custodian of Assets
belonging to each such Fund which have been or may be from time to time
deposited with the Custodian. Custodian accepts such appointment as a custodian
and agrees to perform the duties and responsibilities of Custodian as set forth
herein on the conditions set forth herein.
2. DEFINITIONS.
For purposes of this Agreement, the following terms shall have the meanings so
indicated:
(a) "Security" or "Securities" shall mean stocks, bonds, bills, rights, script,
warrants, interim certificates and all negotiable or nonnegotiable paper
commonly known as Securities and other instruments or obligations.
(b) "Assets" shall mean Securities, monies and other property held by the
Custodian for the benefit of a Fund.
(c)(1) "Instructions", as used herein, shall mean: (i) a tested telex, a written
(including, without limitation, facsimile transmission) request, direction,
instruction or certification signed or initialed by or on behalf of a Fund by an
Authorized Person; (ii) a telephonic or other oral communication from a person
the Custodian reasonably believes to be an Authorized Person; or (iii) a
communication effected directly between an electro-mechanical or electronic
device or system (including, without limitation, computers) on behalf of a Fund.
Instructions in the form of oral communications shall be confirmed by the
appropriate Fund by tested telex or in writing in the manner set forth in clause
(i) above, but the lack of such confirmation shall in no way affect any action
taken by the Custodian in reliance upon such oral Instructions prior to the
Custodian's receipt of such confirmation. Each Fund authorizes the Custodian to
record any and all telephonic or other oral Instructions communicated to the
Custodian.
(c)(2) "Special Instructions", as used herein, shall mean Instructions
countersigned or confirmed in writing by the Treasurer or any Assistant
Treasurer of a Fund or any other person designated by the Treasurer of such Fund
in writing, which countersignature or confirmation shall be included on the same
instrument containing the Instructions or on a separate instrument relating
thereto.
(c)(3) Instructions and Special Instructions shall be delivered to the Custodian
at the address and/or telephone, facsimile transmission or telex number agreed
upon from time to time by the Custodian and each Fund.
(c)(4) Where appropriate, Instructions and Special Instructions shall be
continuing instructions.
3. DELIVERY OF CORPORATE DOCUMENTS.
Each of the parties to this Agreement represents that its execution does not
violate any of the provisions of its respective charter, articles of
incorporation, articles of association or bylaws and all required corporate
action to authorize the execution and delivery of this Agreement has been taken.
Each Fund has furnished the Custodian with copies, properly certified or
authenticated, with all amendments or supplements thereto, of the following
documents:
(a) Certificate of Incorporation (or equivalent document) of the Fund as in
effect on the date hereof;
(b) By-Laws of the Fund as in effect on the date hereof;
(c) Resolutions of the Board of Directors of the Fund appointing the Custodian
and approving the form of this Agreement; and
(d) The Fund's current prospectus and statements of additional information.
Each Fund shall promptly furnish the Custodian with copies of any updates,
amendments or supplements to the foregoing documents.
In addition, each Fund has delivered or will promptly deliver to the Custodian,
copies of the Resolution(s) of its Board of Directors or Trustees and all
amendments or supplements thereto, properly certified or authenticated,
designating certain officers or employees of each such Fund who will have
continuing authority to certify to the Custodian: (a) the names, titles,
signatures and scope of authority of all persons authorized to give Instructions
or any other notice, request, direction, instruction, certificate or instrument
on behalf of each Fund, and (b) the names, titles and signatures of those
persons authorized to countersign or confirm Special Instructions on behalf of
each Fund (in both cases collectively, the "Authorized Persons" and
individually, an "Authorized Person"). Such Resolutions and certificates may be
accepted and relied upon by the Custodian as conclusive evidence of the facts
set forth therein and shall be considered to be in full force and effect until
delivery to the Custodian of a similar Resolution or certificate to the
contrary. Upon delivery of a certificate which deletes or does not include the
name(s) of a person previously authorized to give Instructions or to countersign
or confirm Special Instructions, such persons shall no longer be considered an
Authorized Person authorized to give Instructions or to countersign or confirm
Special Instructions. Unless the certificate specifically requires that the
approval of anyone else will first have been obtained, the Custodian will be
under no obligation to inquire into the right of the person giving such
Instructions or Special Instructions to do so. Notwithstanding any of the
foregoing, no Instructions or Special Instructions received by the Custodian
from a Fund will be deemed to authorize or permit any director, trustee,
officer, employee, or agent of such Fund to withdraw any of the Assets of such
Fund upon the mere receipt of such authorization, Special Instructions or
Instructions from such director, trustee, officer, employee or agent.
4. POWERS AND DUTIES OF CUSTODIAN AND DOMESTIC SUBCUSTODIAN.
Except for Assets held by any Subcustodian appointed pursuant to Sections 5(b),
(c), or (d) of this Agreement, the Custodian shall have and perform the powers
and duties hereinafter set forth in this Section 4. For purposes of this Section
4 all references to powers and duties of the "Custodian" shall also refer to any
Domestic Subcustodian appointed pursuant to Section 5(a).
(a) Safekeeping.
The Custodian will keep safely the Assets of each Fund which are delivered to it
from time to time. The Custodian shall not be responsible for any property of a
Fund held or received by such Fund and not delivered to the Custodian.
(b) Manner of Holding Securities.
1. The Custodian shall at all times hold Securities of each Fund either: (i) by
physical possession of the share certificates or other instruments representing
such Securities in registered or bearer form; or (ii) in book-entry form by a
Securities System (as hereinafter defined) in accordance with the provisions of
sub-paragraph (3) below.
2. The Custodian may hold registrable portfolio Securities which have been
delivered to it in physical form, by registering the same in the name of the
appropriate Fund or its nominee, or in the name of the Custodian or its nominee,
for whose actions such Fund and Custodian, respectively, shall be fully
responsible. Upon the receipt of Instructions, the Custodian shall hold such
Securities in street certificate form, so called, with or without any indication
of fiduciary capacity. However, unless it receives Instructions to the contrary,
the Custodian will register all such portfolio Securities in the name of the
Custodian's authorized nominee. All such Securities shall be held in an account
of the Custodian containing only assets of the appropriate Fund or only assets
held by the Custodian as a fiduciary, provided that the records of the Custodian
shall indicate at all times the Fund or other customer for which such Securities
are held in such accounts and the respective interests therein.
3. The Custodian may deposit and/or maintain domestic Securities owned by a Fund
in, and each Fund hereby approves use of: (a) The Depository Trust Company; (b)
The Participants Trust Company; and (c) any book-entry system as provided in (i)
Subpart O of Treasury Circular Xx. 000, 00 XXX 306.115, (ii) Subpart B of
Treasury Circular Public Debt Series Xx. 00-00, 00 XXX 350.2, or (iii) the
book-entry regulations of federal agencies substantially in the form of 31 CFR
306.115. Upon the receipt of Special Instructions, the Custodian may deposit
and/or maintain domestic Securities owned by a Fund in any other domestic
clearing agency registered with the Securities and Exchange Commission ("SEC")
under Section 17A of the Securities Exchange Act of 1934 (or as may otherwise be
authorized by the SEC to serve in the capacity of depository or clearing agent
for the Securities or other assets of investment companies) which acts as a
Securities depository. Each of the foregoing shall be referred to in this
Agreement as a "Securities System", and all such Securities Systems shall be
listed on the attached Appendix A. Use of a Securities System shall be in
accordance with applicable Federal Reserve Board and SEC rules and regulations,
if any, and subject to the following provisions:
(i) The Custodian may deposit the Securities directly or through one or
more agents or Subcustodians which are also qualified to act as
custodians for investment companies.
(ii) The Custodian shall deposit and/or maintain the Securities in a
Securities System, provided that such Securities are represented in
an account ("Account") of the Custodian in the Securities System
that includes only assets held by the Custodian as a fiduciary,
custodian or otherwise for customers.
(iii) The books and records of the Custodian shall at all times identify
those Securities belonging to any one or more Funds which are
maintained in a Securities System.
(iv) The Custodian shall pay for Securities purchased for the account of
a Fund only upon (a) receipt of advice from the Securities System
that such Securities have been transferred to the Account of the
Custodian in accordance with the rules of the Securities System, and
(b) the making of an entry on the records of the Custodian to
reflect such payment and transfer for the account of such Fund. The
Custodian shall transfer Securities sold for the account of a Fund
only upon (a) receipt of advice from the Securities System that
payment for such Securities has been transferred to the Account of
the Custodian in accordance with the rules of the Securities System,
and (b) the making of an entry on the records of the Custodian to
reflect such transfer and payment for the account of such Fund.
Copies of all advices from the Securities System relating to
transfers of Securities for the account of a Fund shall be
maintained for such Fund by the Custodian. The Custodian shall
deliver to a Fund on the next succeeding business day daily
transaction reports which shall include each day's transactions in
the Securities System for the account of such Fund. Such transaction
reports shall be delivered to such Fund or any agent designated by
such Fund pursuant to Instructions, by computer or in such other
manner as such Fund and Custodian may agree.
(v) The Custodian shall, if requested by a Fund pursuant to
Instructions, provide such Fund with reports obtained by the
Custodian or any Subcustodian with respect to a Securities System's
accounting system, internal accounting control and procedures for
safeguarding Securities deposited in the Securities System.
(vi) Upon receipt of Special Instructions, the Custodian shall terminate
the use of any Securities System on behalf of a Fund as promptly as
practicable and shall take all actions reasonably practicable to
safeguard the Securities of such Fund maintained with such
Securities System.
(c) Free Delivery of Assets.
Notwithstanding any other provision of this Agreement and except as provided in
Section 3 hereof, the Custodian, upon receipt of Special Instructions, will
undertake to make free delivery of Assets, provided such Assets are on hand and
available, in connection with a Fund's transactions and to transfer such Assets
to such broker, dealer, Subcustodian, bank, agent, Securities System or
otherwise as specified in such Special Instructions.
(d) Exchange of Securities.
Upon receipt of Instructions, the Custodian will exchange portfolio Securities
held by it for a Fund for other Securities or cash paid in connection with any
reorganization, recapitalization, merger, consolidation, or conversion of
convertible Securities, and will deposit any such Securities in accordance with
the terms of any reorganization or protective plan.
Without Instructions, the Custodian is authorized to exchange Securities held by
it in temporary form for Securities in definitive form, to surrender Securities
for transfer into a name or nominee name as permitted in Section 4(b)(2), to
effect an exchange of shares in a stock split or when the par value of the stock
is changed, to sell any fractional shares, and, upon receiving payment therefor,
to surrender bonds or other Securities held by it at maturity or call.
(e) Purchases of Assets.
1. Securities Purchases. In accordance with Instructions, the Custodian shall,
with respect to a purchase of Securities, pay for such Securities out of monies
held for a Fund's account for which the purchase was made, but only insofar as
monies are available therein for such purpose, and receive the portfolio
Securities so purchased. Unless the Custodian has received Special Instructions
to the contrary, such payment will be made only upon receipt of Securities by
the Custodian, a clearing corporation of a national Securities exchange of which
the Custodian is a member, or a Securities System in accordance with the
provisions of Section 4(b)(3) hereof. Notwithstanding the foregoing, upon
receipt of Instructions: (i) in connection with a repurchase agreement, the
Custodian may release funds to a Securities System prior to the receipt of
advice from the Securities System that the Securities underlying such repurchase
agreement have been transferred by book-entry into the Account maintained with
such Securities System by the Custodian, provided that the Custodian's
instructions to the Securities System require that the Securities System may
make payment of such funds to the other party to the repurchase agreement only
upon transfer by book-entry of the Securities underlying the repurchase
agreement into such Account; (ii) in the case of Interest Bearing Deposits,
currency deposits, and other deposits, foreign exchange transactions, futures
contracts or options, pursuant to Sections 4(g), 4(h), 4(l), and 4(m) hereof,
the Custodian may make payment therefor before receipt of an advice of
transaction; and (iii) in the case of Securities as to which payment for the
Security and receipt of the instrument evidencing the Security are under
generally accepted trade practice or the terms of the instrument representing
the Security expected to take place in different locations or through separate
parties, such as commercial paper which is indexed to foreign currency exchange
rates, derivatives and similar Securities, the Custodian may make payment for
such Securities prior to delivery thereof in accordance with such generally
accepted trade practice or the terms of the instrument representing such
Security.
2. Other Assets Purchased. Upon receipt of Instructions and except as otherwise
provided herein, the Custodian shall pay for and receive other Assets for the
account of a Fund as provided in Instructions.
(f) Sales of Assets.
1. Securities Sold. In accordance with Instructions, the Custodian will, with
respect to a sale, deliver or cause to be delivered the Securities thus
designated as sold to the broker or other person specified in the Instructions
relating to such sale. Unless the Custodian has received Special Instructions to
the contrary, such delivery shall be made only upon receipt of payment therefor
in the form of: (a) cash, certified check, bank cashier's check, bank credit, or
bank wire transfer; (b) credit to the account of the Custodian with a clearing
corporation of a national Securities exchange of which the Custodian is a
member; or (c) credit to the Account of the Custodian with a Securities System,
in accordance with the provisions of Section 4(b)(3) hereof. Notwithstanding the
foregoing, Securities held in physical form may be delivered and paid for in
accordance with "street delivery custom" to a broker or its clearing agent,
against delivery to the Custodian of a receipt for such Securities, provided
that the Custodian shall have taken reasonable steps to ensure prompt collection
of the payment for, or return of, such Securities by the broker or its clearing
agent, and provided further that the Custodian shall not be responsible for the
selection of or the failure or inability to perform of such broker or its
clearing agent or for any related loss arising from delivery or custody of such
Securities prior to receiving payment therefor.
2. Other Assets Sold. Upon receipt of Instructions and except as otherwise
provided herein, the Custodian shall receive payment for and deliver other
Assets for the account of a Fund as provided in Instructions.
(g) Options.
1. Upon receipt of Instructions relating to the purchase of an option or sale of
a covered call option, the Custodian shall: (a) receive and retain confirmations
or other documents, if any, evidencing the purchase or writing of the option by
a Fund; (b) if the transaction involves the sale of a covered call option,
deposit and maintain in a segregated account the Securities (either physically
or by book-entry in a Securities System) subject to the covered call option
written on behalf of such Fund; and (c) pay, release and/or transfer such
Securities, cash or other Assets in accordance with any notices or other
communications evidencing the expiration, termination or exercise of such
options which are furnished to the Custodian by the Options Clearing Corporation
(the "OCC"), the securities or options exchanges on which such options were
traded, or such other organization as may be responsible for handling such
option transactions.
2. Upon receipt of Instructions relating to the sale of a naked option
(including stock index and commodity options), the Custodian, the appropriate
Fund and the broker-dealer shall enter into an agreement to comply with the
rules of the OCC or of any registered national securities exchange or similar
organizations(s). Pursuant to that agreement and such Fund's Instructions, the
Custodian shall: (a) receive and retain confirmations or other documents, if
any, evidencing the writing of the option; (b) deposit and maintain in a
segregated account, Securities (either physically or by book-entry in a
Securities System), cash and/or other Assets; and (c) pay, release and/or
transfer such Securities, cash or other Assets in accordance with any such
agreement and with any notices or other communications evidencing the
expiration, termination or exercise of such option which are furnished to the
Custodian by the OCC, the securities or options exchanges on which such options
were traded, or such other organization as may be responsible for handling such
option transactions. The appropriate Fund and the broker-dealer shall be
responsible for determining the quality and quantity of assets held in any
segregated account established in compliance with applicable margin maintenance
requirements and the performance of other terms of any option contract.
(h) Futures Contracts.
Upon receipt of Instructions, the Custodian shall enter into a futures margin
procedural agreement among the appropriate Fund, the Custodian and the
designated futures commission merchant (a "Procedural Agreement"). Under the
Procedural Agreement the Custodian shall: (a) receive and retain confirmations,
if any, evidencing the purchase or sale of a futures contract or an option on a
futures contract by such Fund; (b) deposit and maintain in a segregated account
cash, Securities and/or other Assets designated as initial, maintenance or
variation "margin" deposits intended to secure such Fund's performance of its
obligations under any futures contracts purchased or sold, or any options on
futures contracts written by such Fund, in accordance with the provisions of any
Procedural Agreement designed to comply with the provisions of the Commodity
Futures Trading Commission and/or any commodity exchange or contract market
(such as the Chicago Board of Trade), or any similar organization(s), regarding
such margin deposits; and (c) release Assets from and/or transfer Assets into
such margin accounts only in accordance with any such Procedural Agreements. The
appropriate Fund and such futures commission merchant shall be responsible for
determining the type and amount of Assets held in the segregated account or paid
to the broker-dealer in compliance with applicable margin maintenance
requirements and the performance of any futures contract or option on a futures
contract in accordance with its terms.
(i) Segregated Accounts.
Upon receipt of Instructions, the Custodian shall establish and maintain on its
books a segregated account or accounts for and on behalf of a Fund, into which
account or accounts may be transferred Assets of such Fund, including Securities
maintained by the Custodian in a Securities System pursuant to Paragraph (b)(3)
of this Section 4, said account or accounts to be maintained (i) for the
purposes set forth in Sections 4(g), 4(h) and 4(n) and (ii) for the purpose of
compliance by such Fund with the procedures required by the SEC Investment
Company Act Release Number 10666 or any subsequent release or releases relating
to the maintenance of segregated accounts by registered investment companies, or
(iii) for such other purposes as may be set forth, from time to time, in Special
Instructions. The Custodian shall not be responsible for the determination of
the type or amount of Assets to be held in any segregated account referred to in
this paragraph, or for compliance by the Fund with required procedures noted in
(ii) above.
(j) Depository Receipts.
Upon receipt of Instructions, the Custodian shall surrender or cause to be
surrendered Securities to the depository used for such Securities by an issuer
of American Depository Receipts or International Depository Receipts
(hereinafter referred to, collectively, as "ADRs"), against a written receipt
therefor adequately describing such Securities and written evidence satisfactory
to the organization surrendering the same that the depository has acknowledged
receipt of instructions to issue ADRs with respect to such Securities in the
name of the Custodian or a nominee of the Custodian, for delivery in accordance
with such instructions.
Upon receipt of Instructions, the Custodian shall surrender or cause to be
surrendered ADRs to the issuer thereof, against a written receipt therefor
adequately describing the ADRs surrendered and written evidence satisfactory to
the organization surrendering the same that the issuer of the ADRs has
acknowledged receipt of instructions to cause its depository to deliver the
Securities underlying such ADRs in accordance with such instructions.
(k) Corporate Actions, Put Bonds, Called Bonds, Etc.
Upon receipt of Instructions, the Custodian shall: (a) deliver warrants, puts,
calls, rights or similar Securities to the issuer or trustee thereof (or to the
agent of such issuer or trustee) for the purpose of exercise or sale, provided
that the new Securities, cash or other Assets, if any, acquired as a result of
such actions are to be delivered to the Custodian; and (b) deposit Securities
upon invitations for tenders thereof, provided that the consideration for such
Securities is to be paid or delivered to the Custodian, or the tendered
Securities are to be returned to the Custodian.
Notwithstanding any provision of this Agreement to the contrary, the Custodian
shall take all necessary action, unless otherwise directed to the contrary in
Instructions, to comply with the terms of all mandatory or compulsory exchanges,
calls, tenders, redemptions, or similar rights of security ownership, and shall
notify the appropriate Fund of such action in writing by facsimile transmission
or in such other manner as such Fund and Custodian may agree in writing.
The Fund agrees that if it gives an Instruction for the performance of an act on
the last permissible date of a period established by any optional offer or on
the last permissible date for the performance of such act, the Fund shall hold
the Bank harmless from any adverse consequences in connection with acting upon
or failing to act upon such Instructions.
(l) Interest Bearing Deposits.
Upon receipt of Instructions directing the Custodian to purchase interest
bearing fixed term and call deposits (hereinafter referred to, collectively, as
"Interest Bearing Deposits") for the account of a Fund, the Custodian shall
purchase such Interest Bearing Deposits in the name of such Fund with such banks
or trust companies, including the Custodian, any Subcustodian or any subsidiary
or affiliate of the Custodian (hereinafter referred to as "Banking
Institutions"), and in such amounts as such Fund may direct pursuant to
Instructions. Such Interest Bearing Deposits may be denominated in U.S. dollars
or other currencies, as such Fund may determine and direct pursuant to
Instructions. The responsibilities of the Custodian to a Fund for Interest
Bearing Deposits issued by the Custodian shall be that of a U.S. bank for a
similar deposit. With respect to Interest Bearing Deposits other than those
issued by the Custodian, (a) the Custodian shall be responsible for the
collection of income and the transmission of cash to and from such accounts; and
(b) the Custodian shall have no duty with respect to the selection of the
Banking Institution or for the failure of such Banking Institution to pay upon
demand.
(m) Foreign Exchange Transactions.
(l) Each Fund hereby appoints the Custodian as its agent in the execution of all
currency exchange transactions. The Custodian agrees to provide exchange rate
and U.S. Dollar information, in writing, to the Funds. Such information shall be
supplied by the Custodian at least by the business day prior to the value date
of the foreign exchange transaction, provided that the Custodian receives the
request for such information at least two business days prior to the value date
of the transaction.
(2) Upon receipt of Instructions, the Custodian shall settle foreign exchange
contracts or options to purchase and sell foreign currencies for spot and future
delivery on behalf of and for the account of a Fund with such currency brokers
or Banking Institutions as such Fund may determine and direct pursuant to
Instructions. If, in its Instructions, a Fund does not direct the Custodian to
utilize a particular currency broker or Banking Institution, the Custodian is
authorized to select such currency broker or Banking Institution as it deems
appropriate to execute the Fund's foreign currency transaction.
(3) Each Fund accepts full responsibility for its use of third party foreign
exchange brokers and for execution of said foreign exchange contracts and
understands that the Fund shall be responsible for any and all costs and
interest charges which may be incurred as a result of the failure or delay of
its third party broker to deliver foreign exchange. The Custodian shall have no
responsibility or liability with respect to the selection of the currency
brokers or Banking Institutions with which a Fund deals or the performance of
such brokers or Banking Institutions.
(4) Notwithstanding anything to the contrary contained herein, upon receipt of
Instructions the Custodian may, in connection with a foreign exchange contract,
make free outgoing payments of cash in the form of U.S. Dollars or foreign
currency prior to receipt of confirmation of such foreign exchange contract or
confirmation that the countervalue currency completing such contract has been
delivered or received.
(5) The Custodian shall not be obligated to enter into foreign exchange
transactions as principal. However, if the Custodian has made available to a
Fund its services as a principal in foreign exchange transactions and subject to
any separate agreement between the parties relating to such transactions, the
Custodian shall enter into foreign exchange contracts or options to purchase and
sell foreign currencies for spot and future delivery on behalf of and for the
account of the Fund, with the Custodian as principal.
(n) Pledges or Loans of Securities.
(1) Upon receipt of Instructions from a Fund, the Custodian will release or
cause to be released Securities held in custody to the pledgees designated in
such Instructions by way of pledge or hypothecation to secure loans incurred by
such Fund with various lenders including but not limited to UMB Bank, n.a.;
provided, however, that the Securities shall be released only upon payment to
the Custodian of the monies borrowed, except that in cases where additional
collateral is required to secure existing borrowings, further Securities may be
released or delivered, or caused to be released or delivered for that purpose
upon receipt of Instructions. Upon receipt of Instructions, the Custodian will
pay, but only from funds available for such purpose, any such loan upon
re-delivery to it of the Securities pledged or hypothecated therefor and upon
surrender of the note or notes evidencing such loan. In lieu of delivering
collateral to a pledgee, the Custodian, on the receipt of Instructions, shall
transfer the pledged Securities to a segregated account for the benefit of the
pledgee.
(2) Upon receipt of Special Instructions, and execution of a separate Securities
Lending Agreement, the Custodian will release Securities held in custody to the
borrower designated in such Instructions and may, except as otherwise provided
below, deliver such Securities prior to the receipt of collateral, if any, for
such borrowing, provided that, in case of loans of Securities held by a
Securities System that are secured by cash collateral, the Custodian's
instructions to the Securities System shall require that the Securities System
deliver the Securities of the appropriate Fund to the borrower thereof only upon
receipt of the collateral for such borrowing. The Custodian shall have no
responsibility or liability for any loss arising from the delivery of Securities
prior to the receipt of collateral. Upon receipt of Instructions and the loaned
Securities, the Custodian will release the collateral to the borrower.
(o) Stock Dividends, Rights, Etc.
The Custodian shall receive and collect all stock dividends, rights, and other
items of like nature and, upon receipt of Instructions, take action with respect
to the same as directed in such Instructions.
(p) Routine Dealings.
The Custodian will, in general, attend to all routine and mechanical matters in
accordance with industry standards in connection with the sale, exchange,
substitution, purchase, transfer, or other dealings with Securities or other
property of each Fund except as may be otherwise provided in this Agreement or
directed from time to time by Instructions from any particular Fund. The
Custodian may also make payments to itself or others from the Assets for
disbursements and out-of-pocket expenses incidental to handling Securities or
other similar items relating to its duties under this Agreement, provided that
all such payments shall be accounted for to the appropriate Fund.
(q) Collections.
The Custodian shall (a) collect amounts due and payable to each Fund with
respect to portfolio Securities and other Assets; (b) promptly credit to the
account of each Fund all income and other payments relating to portfolio
Securities and other Assets held by the Custodian hereunder upon Custodian's
receipt of such income or payments or as otherwise agreed in writing by the
Custodian and any particular Fund; (c) promptly endorse and deliver any
instruments required to effect such collection; and (d) promptly execute
ownership and other certificates and affidavits for all federal, state, local
and foreign tax purposes in connection with receipt of income or other payments
with respect to portfolio Securities and other Assets, or in connection with the
transfer of such Securities or other Assets; provided, however, that with
respect to portfolio Securities registered in so-called street name, or physical
Securities with variable interest rates, the Custodian shall use its best
efforts to collect amounts due and payable to any such Fund. The Custodian shall
notify a Fund in writing by facsimile transmission or in such other manner as
such Fund and Custodian may agree in writing if any amount payable with respect
to portfolio Securities or other Assets is not received by the Custodian when
due. The Custodian shall not be responsible for the collection of amounts due
and payable with respect to portfolio Securities or other Assets that are in
default.
(r) Bank Accounts.
Upon Instructions, the Custodian shall open and operate a bank account or
accounts on the books of the Custodian; provided that such bank account(s) shall
be in the name of the Custodian or a nominee thereof, for the account of one or
more Funds, and shall be subject only to draft or order of the Custodian. The
responsibilities of the Custodian to any one or more such Funds for deposits
accepted on the Custodian's books shall be that of a U.S. bank for a similar
deposit.
(s) Dividends, Distributions and Redemptions.
To enable each Fund to pay dividends or other distributions to shareholders of
each such Fund and to make payment to shareholders who have requested repurchase
or redemption of their shares of each such Fund (collectively, the "Shares"),
the Custodian shall release cash or Securities insofar as available. In the case
of cash, the Custodian shall, upon the receipt of Instructions, transfer such
funds by check or wire transfer to any account at any bank or trust company
designated by each such Fund in such Instructions. In the case of Securities,
the Custodian shall, upon the receipt of Special Instructions, make such
transfer to any entity or account designated by each such Fund in such Special
Instructions.
(t) Proceeds from Shares Sold.
The Custodian shall receive funds representing cash payments received for shares
issued or sold from time to time by each Fund, and shall credit such funds to
the account of the appropriate Fund. The Custodian shall notify the appropriate
Fund of Custodian's receipt of cash in payment for shares issued by such Fund by
facsimile transmission or in such other manner as such Fund and the Custodian
shall agree. Upon receipt of Instructions, the Custodian shall: (a) deliver all
federal funds received by the Custodian in payment for shares as may be set
forth in such Instructions and at a time agreed upon between the Custodian and
such Fund; and (b) make federal funds available to a Fund as of specified times
agreed upon from time to time by such Fund and the Custodian, in the amount of
checks received in payment for shares which are deposited to the accounts of
such Fund.
(u) Proxies and Notices; Compliance with the Shareholders Communication Act of
1985.
The Custodian shall deliver or cause to be delivered to the appropriate Fund all
forms of proxies, all notices of meetings, and any other notices or
announcements affecting or relating to Securities owned by such Fund that are
received by the Custodian, any Subcustodian, or any nominee of either of them,
and, upon receipt of Instructions, the Custodian shall execute and deliver, or
cause such Subcustodian or nominee to execute and deliver, such proxies or other
authorizations as may be required. Except as directed pursuant to Instructions,
neither the Custodian nor any Subcustodian or nominee shall vote upon any such
Securities, or execute any proxy to vote thereon, or give any consent or take
any other action with respect thereto.
The Custodian will not release the identity of any Fund to an issuer which
requests such information pursuant to the Shareholder Communications Act of 1985
for the specific purpose of direct communications between such issuer and any
such Fund unless a particular Fund directs the Custodian otherwise in writing.
(v) Books and Records.
The Custodian shall maintain such records relating to its activities under this
Agreement as are required to be maintained by Rule 31a-1 under the Investment
Company Act of 1940 ("xxx 0000 Xxx") and to preserve them for the periods
prescribed in Rule 31a-2 under the 1940 Act. These records shall be open for
inspection by duly authorized officers, employees or agents (including
independent public accountants) of the appropriate Fund during normal business
hours of the Custodian.
The Custodian shall provide accountings relating to its activities under this
Agreement as shall be agreed upon by each Fund and the Custodian.
(w) Opinion of Fund's Independent Certified Public Accountants.
The Custodian shall take all reasonable action as each Fund may request to
obtain from year to year favorable opinions from each such Fund's independent
certified public accountants with respect to the Custodian's activities
hereunder and in connection with the preparation of each such Fund's periodic
reports to the SEC and with respect to any other requirements of the SEC.
(x) Reports by Independent Certified Public Accountants.
At the request of a Fund, the Custodian shall deliver to such Fund a written
report prepared by the Custodian's independent certified public accountants with
respect to the services provided by the Custodian under this Agreement,
including, without limitation, the Custodian's accounting system, internal
accounting control and procedures for safeguarding cash, Securities and other
Assets, including cash, Securities and other Assets deposited and/or maintained
in a Securities System or with a Subcustodian. Such report shall be of
sufficient scope and in sufficient detail as may reasonably be required by such
Fund and as may reasonably be obtained by the Custodian.
(y) Bills and Other Disbursements.
Upon receipt of Instructions, the Custodian shall pay, or cause to be paid, all
bills, statements, or other obligations of a Fund.
5. SUBCUSTODIANS.
From time to time, in accordance with the relevant provisions of this Agreement,
the Custodian may appoint one or more Domestic Subcustodians, Foreign
Subcustodians, Special Subcustodians, or Interim Subcustodians (as each are
hereinafter defined) to act on behalf of any one or more Funds. A Domestic
Subcustodian, in accordance with the provisions of this Agreement, may also
appoint a Foreign Subcustodian, Special Subcustodian, or Interim Subcustodian to
act on behalf of any one or more Funds. For purposes of this Agreement, all
Domestic Subcustodians, Foreign Subcustodians, Special Subcustodians and Interim
Subcustodians shall be referred to collectively as "Subcustodians".
(a) Domestic Subcustodians.
The Custodian may, at any time and from time to time, appoint any bank as
defined in Section 2(a)(5) of the 1940 Act or any trust company or other entity,
any of which meet the requirements of a custodian under Section 17(f) of the
1940 Act and the rules and regulations thereunder, to act for the Custodian on
behalf of any one or more Funds as a subcustodian for purposes of holding Assets
of such Fund(s) and performing other functions of the Custodian within the
United States (a "Domestic Subcustodian"). Each Fund shall approve in writing
the appointment of the proposed Domestic Subcustodian; and the Custodian's
appointment of any such Domestic Subcustodian shall not be effective without
such prior written approval of the Fund(s). Each such duly approved Domestic
Subcustodian shall be listed on Appendix A attached hereto, as it may be
amended, from time to time.
(b) Foreign Subcustodians.
The Custodian may at any time appoint, or cause a Domestic Subcustodian to
appoint, any bank, trust company or other entity meeting the requirements of an
"eligible foreign custodian" under Section 17(f) of the 1940 Act and the rules
and regulations thereunder to act for the Custodian on behalf of any one or more
Funds as a subcustodian or sub-subcustodian (if appointed by a Domestic
Subcustodian) for purposes of holding Assets of the Fund(s) and performing other
functions of the Custodian in countries other than the United States of America
(hereinafter referred to as a "Foreign Subcustodian" in the context of either a
subcustodian or a sub-subcustodian); provided that the Custodian shall have
obtained written confirmation from each Fund of the approval of the Board of
Directors or other governing body of each such Fund (which approval may be
withheld in the sole discretion of such Board of Directors or other governing
body or entity) with respect to (i) the identity of any proposed Foreign
Subcustodian (including branch designation), (ii) the country or countries in
which, and the securities depositories or clearing agencies (hereinafter
"Securities Depositories and Clearing Agencies"), if any, through which, the
Custodian or any proposed Foreign Subcustodian is authorized to hold Securities
and other Assets of each such Fund, and (iii) the form and terms of the
subcustodian agreement to be entered into with such proposed Foreign
Subcustodian. Each such duly approved Foreign Subcustodian and the countries
where and the Securities Depositories and Clearing Agencies through which they
may hold Securities and other Assets of the Fund(s) shall be listed on Appendix
A attached hereto, as it may be amended, from time to time. Each Fund shall be
responsible for informing the Custodian sufficiently in advance of a proposed
investment which is to be held in a country in which no Foreign Subcustodian is
authorized to act, in order that there shall be sufficient time for the
Custodian, or any Domestic Subcustodian, to effect the appropriate arrangements
with a proposed Foreign Subcustodian, including obtaining approval as provided
in this Section 5(b). In connection with the appointment of any Foreign
Subcustodian, the Custodian shall, or shall cause the Domestic Subcustodian to,
enter into a subcustodian agreement with the Foreign Subcustodian in form and
substance approved by each such Fund. The Custodian shall not consent to the
amendment of, and shall cause any Domestic Subcustodian not to consent to the
amendment of, any agreement entered into with a Foreign Subcustodian, which
materially affects any Fund's rights under such agreement, except upon prior
written approval of such Fund pursuant to Special Instructions.
(c) Interim Subcustodians.
Notwithstanding the foregoing, in the event that a Fund shall invest in an Asset
to be held in a country in which no Foreign Subcustodian is authorized to act,
the Custodian shall notify such Fund in writing by facsimile transmission or in
such other manner as such Fund and the Custodian shall agree in writing of the
unavailability of an approved Foreign Subcustodian in such country; and upon the
receipt of Special Instructions from such Fund, the Custodian shall, or shall
cause its Domestic Subcustodian to, appoint or approve an entity (referred to
herein as an "Interim Subcustodian") designated in such Special Instructions to
hold such Security or other Asset.
(d) Special Subcustodians.
Upon receipt of Special Instructions, the Custodian shall, on behalf of a Fund,
appoint one or more banks, trust companies or other entities designated in such
Special Instructions to act for the Custodian on behalf of such Fund as a
subcustodian for purposes of: (i) effecting third-party repurchase transactions
with banks, brokers, dealers or other entities through the use of a common
custodian or subcustodian; (ii) providing depository and clearing agency
services with respect to certain variable rate demand note Securities, (iii)
providing depository and clearing agency services with respect to dollar
denominated Securities, and (iv) effecting any other transactions designated by
such Fund in such Special Instructions. Each such designated subcustodian
(hereinafter referred to as a "Special Subcustodian") shall be listed on
Appendix A attached hereto, as it may be amended from time to time. In
connection with the appointment of any Special Subcustodian, the Custodian shall
enter into a subcustodian agreement with the Special Subcustodian in form and
substance approved by the appropriate Fund in Special Instructions. The
Custodian shall not amend any subcustodian agreement entered into with a Special
Subcustodian, or waive any rights under such agreement, except upon prior
approval pursuant to Special Instructions.
(e) Termination of a Subcustodian.
The Custodian may, at any time in its discretion upon notification to the
appropriate Fund(s), terminate any Subcustodian of such Fund(s) in accordance
with the termination provisions under the applicable subcustodian agreement, and
upon the receipt of Special Instructions, the Custodian will terminate any
Subcustodian in accordance with the termination provisions under the applicable
subcustodian agreement.
(f) Certification Regarding Foreign Subcustodians.
Upon request of a Fund, the Custodian shall deliver to such Fund a certificate
stating: (i) the identity of each Foreign Subcustodian then acting on behalf of
the Custodian; (ii) the countries in which and the Securities
Depositories and Clearing Agencies through which each such Foreign Subcustodian
is then holding cash, Securities and other Assets of such Fund; and (iii) such
other information as may be requested by such Fund, and as the Custodian shall
be reasonably able to obtain, to evidence compliance with rules and regulations
under the 1940 Act.
6. STANDARD OF CARE.
(a) General Standard of Care.
The Custodian shall be liable to a Fund for all losses, damages and reasonable
costs and expenses suffered or incurred by such Fund resulting from the
negligence or willful misfeasance of the Custodian; provided, however, in no
event shall the Custodian be liable for special, indirect or consequential
damages arising under or in connection with this Agreement.
(b) Actions Prohibited by Applicable Law, Events Beyond Custodian's Control,
Sovereign Risk, Etc.
In no event shall the Custodian or any Domestic Subcustodian incur liability
hereunder (i) if the Custodian or any Subcustodian or Securities System, or any
subcustodian, Securities System, Securities Depository or Clearing Agency
utilized by the Custodian or any such Subcustodian, or any nominee of the
Custodian or any Subcustodian (individually, a "Person") is prevented, forbidden
or delayed from performing, or omits to perform, any act or thing which this
Agreement provides shall be performed or omitted to be performed, by reason of:
(a) any provision of any present or future law or regulation or order of the
United States of America, or any state thereof, or of any foreign country, or
political subdivision thereof or of any court of competent jurisdiction (and
neither the Custodian nor any other Person shall be obligated to take any action
contrary thereto); or (b) any event beyond the control of the Custodian or other
Person such as armed conflict, riots, strikes, lockouts, labor disputes,
equipment or transmission failures, natural disasters, or failure of the mails,
transportation, communications or power supply; or (ii) for any loss, damage,
cost or expense resulting from "Sovereign Risk." A "Sovereign Risk" shall mean
nationalization, expropriation, currency devaluation, revaluation or
fluctuation, confiscation, seizure, cancellation, destruction or similar action
by any governmental authority, de facto or de jure; or enactment, promulgation,
imposition or enforcement by any such governmental authority of currency
restrictions, exchange controls, taxes, levies or other charges affecting a
Fund's Assets; or acts of armed conflict, terrorism, insurrection or revolution;
or any other act or event beyond the Custodian's or such other Person's control.
(c) Liability for Past Records.
Neither the Custodian nor any Domestic Subcustodian shall have any liability in
respect of any loss, damage or expense suffered by a Fund, insofar as such loss,
damage or expense arises from the performance of the Custodian or any Domestic
Subcustodian in reliance upon records that were maintained for such Fund by
entities other than the Custodian or any Domestic Subcustodian prior to the
Custodian's employment hereunder.
(d) Advice of Counsel.
The Custodian and all Domestic Subcustodians shall be entitled to receive and
act upon advice of counsel of its own choosing on all matters. The Custodian and
all Domestic Subcustodians shall be without liability for any actions taken or
omitted in good faith pursuant to the advice of counsel.
(e) Advice of the Fund and Others.
The Custodian and any Domestic Subcustodian may rely upon the advice of any Fund
and upon statements of such Fund's accountants and other persons believed by it
in good faith to be expert in matters upon which they are consulted, and neither
the Custodian nor any Domestic Subcustodian shall be liable for any actions
taken or omitted, in good faith, pursuant to such advice or statements.
(f) Instructions Appearing to be Genuine.
The Custodian and all Domestic Subcustodians shall be fully protected and
indemnified in acting as a custodian hereunder upon any Resolutions of the Board
of Directors or Trustees, Instructions, Special Instructions, advice, notice,
request, consent, certificate, instrument or paper appearing to it to be genuine
and to have been properly executed and shall, unless otherwise specifically
provided herein, be entitled to receive as conclusive proof of any fact or
matter required to be ascertained from any Fund hereunder a certificate signed
by any officer of such Fund authorized to countersign or confirm Special
Instructions.
(g) Exceptions from Liability.
Without limiting the generality of any other provisions hereof, neither the
Custodian nor any Domestic Subcustodian shall be under any duty or obligation to
inquire into, nor be liable for:
(i) the validity of the issue of any Securities purchased by or for any
Fund, the legality of the purchase thereof or evidence of ownership
required to be received by any such Fund, or the propriety of the
decision to purchase or amount paid therefor;
(ii) the legality of the sale of any Securities by or for any Fund, or
the propriety of the amount for which the same were sold; or
(iii) any other expenditures, encumbrances of Securities, borrowings or
similar actions with respect to any Fund's Assets; and may, until
notified to the contrary, presume that all Instructions or Special
Instructions received by it are not in conflict with or in any way
contrary to any provisions of any such Fund's Declaration of Trust,
Partnership Agreement, Articles of Incorporation or By-Laws or votes
or proceedings of the shareholders, trustees, partners or directors
of any such Fund, or any such Fund's currently effective
Registration Statement on file with the SEC.
7. LIABILITY OF THE CUSTODIAN FOR ACTIONS OF OTHERS.
(a) Domestic Subcustodians
The Custodian shall be liable for the acts or omissions of any Domestic
Subcustodian to the same extent as if such actions or omissions were performed
by the Custodian itself.
(b) Liability for Acts and Omissions of Foreign Subcustodians.
The Custodian shall be liable to a Fund for any loss or damage to such Fund
caused by or resulting from the acts or omissions of any Foreign Subcustodian to
the extent that, under the terms set forth in the subcustodian agreement between
the Custodian or a Domestic Subcustodian and such Foreign Subcustodian, the
Foreign Subcustodian has failed to perform in accordance with the standard of
conduct imposed under such subcustodian agreement and the Custodian or Domestic
Subcustodian recovers from the Foreign Subcustodian under the applicable
subcustodian agreement.
(c) Securities Systems, Interim Subcustodians, Special Subcustodians,
Securities Depositories and Clearing Agencies.
The Custodian shall not be liable to any Fund for any loss, damage or expense
suffered or incurred by such Fund resulting from or occasioned by the actions or
omissions of a Securities System, Interim Subcustodian, Special Subcustodian, or
Securities Depository and Clearing Agency unless such loss, damage or expense is
caused by, or results from, the negligence or willful misfeasance of the
Custodian.
(d) Defaults or Insolvencies of Brokers, Banks, Etc.
The Custodian shall not be liable for any loss, damage or expense suffered or
incurred by any Fund resulting from or occasioned by the actions, omissions,
neglects, defaults or insolvency of any broker, bank, trust company or any other
person with whom the Custodian may deal (other than any of such entities acting
as a Subcustodian, Securities System or Securities Depository and Clearing
Agency, for whose actions the liability of the Custodian is set out elsewhere in
this Agreement) unless such loss, damage or expense is caused by, or results
from, the negligence or willful misfeasance of the Custodian.
(e) Reimbursement of Expenses.
Each Fund agrees to reimburse the Custodian for all out-of-pocket expenses
incurred by the Custodian in connection with this Agreement, but excluding
salaries and usual overhead expenses.
8. INDEMNIFICATION.
(a) Indemnification by Fund.
Subject to the limitations set forth in this Agreement, each Fund agrees to
indemnify and hold harmless the Custodian and its nominees from all losses,
damages and expenses (including attorneys' fees) suffered or incurred by the
Custodian or its nominee caused by or arising from actions taken by the
Custodian, its employees or agents in the performance of its duties and
obligations under this Agreement, including, but not limited to, any
indemnification obligations undertaken by the Custodian under any relevant
subcustodian agreement; provided, however, that such indemnity shall not apply
to the extent the Custodian is liable under Sections 6 or 7 hereof.
If any Fund requires the Custodian to take any action with respect to
Securities, which action involves the payment of money or which may, in the
opinion of the Custodian, result in the Custodian or its nominee assigned to
such Fund being liable for the payment of money or incurring liability of some
other form, such Fund, as a prerequisite to requiring the Custodian to take such
action, shall provide indemnity to the Custodian in an amount and form
satisfactory to it.
(b) Indemnification by Custodian.
Subject to the limitations set forth in this Agreement and in addition to the
obligations provided in Sections 6 and 7, the Custodian agrees to indemnify and
hold harmless each Fund from all losses, damages and expenses suffered or
incurred by each such Fund caused by the negligence or willful misfeasance of
the Custodian.
9. ADVANCES.
In the event that, pursuant to Instructions, the Custodian or any Subcustodian,
Securities System, or Securities Depository or Clearing Agency acting either
directly or indirectly under agreement with the Custodian (each of which for
purposes of this Section 9 shall be referred to as "Custodian"), makes any
payment or transfer of funds on behalf of any Fund as to which there would be,
at the close of business on the date of such payment or transfer, insufficient
funds held by the Custodian on behalf of any such Fund, the Custodian may, in
its discretion without further Instructions, provide an advance ("Advance") to
any such Fund in an amount sufficient to allow the completion of the transaction
by reason of which such payment or transfer of funds is to be made. In addition,
in the event the Custodian is directed by Instructions to make any payment or
transfer of funds on behalf of any Fund as to which it is subsequently
determined that such Fund has overdrawn its cash account with the Custodian as
of the close of business on the date of such payment or transfer, said overdraft
shall constitute an Advance. Any Advance shall be payable by the Fund on behalf
of which the Advance was made on demand by Custodian, unless otherwise agreed by
such Fund and the Custodian, and shall accrue interest from the date of the
Advance to the date of payment by such Fund to the Custodian at a rate agreed
upon in writing from time to time by the Custodian and such Fund. It is
understood that any transaction in respect of which the Custodian shall have
made an Advance, including but not limited to a foreign exchange contract or
transaction in respect of which the Custodian is not acting as a principal, is
for the account of and at the risk of the Fund on behalf of which the Advance
was made, and not, by reason of such Advance, deemed to be a transaction
undertaken by the Custodian for its own account and risk. The Custodian and each
of the Funds which are parties to this Agreement acknowledge that the purpose of
Advances is to finance temporarily the purchase or sale of Securities for prompt
delivery in accordance with the settlement terms of such transactions or to meet
emergency expenses not reasonably foreseeable by a Fund. The Custodian shall
promptly notify the appropriate Fund of any Advance. Such notification shall be
sent by facsimile transmission or in such other manner as such Fund and the
Custodian may agree.
10. LIENS.
The Bank shall have a lien on the Property in the Custody Account to secure
payment of fees and expenses for the services rendered under this Agreement. If
the Bank advances cash or securities to the Fund for any purpose or in the event
that the Bank or its nominee shall incur or be assessed any taxes, charges,
expenses, assessments, claims or liabilities in connection with the performance
of its duties hereunder, except such as may arise from its or its nominee's
negligent action, negligent failure to act or willful misconduct, any Property
at any time held for the Custody Account shall be security therefor and the Fund
hereby grants a security interest therein to the Bank. The Fund shall promptly
reimburse the Bank for any such advance of cash or securities or any such taxes,
charges, expenses, assessments, claims or liabilities upon request for payment,
but should the Fund fail to so reimburse the Bank, the Bank shall be entitled to
dispose of such Property to the extent necessary to obtain reimbursement. The
Bank shall be entitled to debit any account of the Fund with the Bank including,
without limitation, the Custody Account, in connection with any such advance and
any interest on such advance as the Bank deems reasonable.
11. COMPENSATION.
Each Fund will pay to the Custodian such compensation as is agreed to in writing
by the Custodian and each such Fund from time to time. Such compensation,
together with all amounts for which the Custodian is to be reimbursed in
accordance with Section 7(e), shall be billed to each such Fund and paid in cash
to the Custodian.
12. POWERS OF ATTORNEY.
Upon request, each Fund shall deliver to the Custodian such proxies, powers of
attorney or other instruments as may be reasonable and necessary or desirable in
connection with the performance by the Custodian or any Subcustodian of their
respective obligations under this Agreement or any applicable subcustodian
agreement.
13. TERMINATION AND ASSIGNMENT.
Any Fund or the Custodian may terminate this Agreement by notice in writing,
delivered or mailed, postage prepaid (certified mail, return receipt requested)
to the other not less than 90 days prior to the date upon which such termination
shall take effect. Upon termination of this Agreement, the appropriate Fund
shall pay to the Custodian such fees as may be due the Custodian hereunder as
well as its reimbursable disbursements, costs and expenses paid or incurred.
Upon termination of this Agreement, the Custodian shall deliver, at the
terminating party's expense, all Assets held by it hereunder to the appropriate
Fund or as otherwise designated by such Fund by Special Instructions. Upon such
delivery, the Custodian shall have no further obligations or liabilities under
this Agreement except as to the final resolution of matters relating to activity
occurring prior to the effective date of termination.
This Agreement may not be assigned by the Custodian or any Fund without the
respective consent of the other, duly authorized by a resolution by its Board of
Directors or Trustees.
14. ADDITIONAL FUNDS.
An additional Fund or Funds may become a party to this Agreement after the date
hereof by an instrument in writing to such effect signed by such Fund or Funds
and the Custodian. If this Agreement is terminated as to one or more of the
Funds (but less than all of the Funds) or if an additional Fund or Funds shall
become a party to this Agreement, there shall be delivered to each party an
Appendix #1 or an amended Appendix #1, signed by each of the additional Funds
(if any) and each of the remaining Funds as well as the Custodian, deleting or
adding such Fund or Funds, as the case may be. The termination of this Agreement
as to less than all of the Funds shall not affect the obligations of the
Custodian and the remaining Funds hereunder as set forth on the signature page
hereto and in Appendix #1 as revised from time to time.
15. NOTICES.
As to each Fund, notices, requests, instructions and other writings delivered to
Xxxxx & Xxxxxx, Inc, 000 Xxxxxx Xxxx., Xxxxxx Xxxx, Xxxxxxxx 00000, postage
prepaid, or to such other address as any particular Fund may have designated to
the Custodian in writing, shall be deemed to have been properly delivered or
given to a Fund.
Notices, requests, instructions and other writings delivered to the Securities
Administration Department of the Custodian at its office at 000 Xxxxx Xxxxxx,
Xxxxxx Xxxx, Xxxxxxxx, or mailed postage prepaid, to the Custodian's Securities
Xxxxxxxxxxxxxx Xxxxxxxxxx, Xxxx Xxxxxx Xxx 000, Xxxxxx Xxxx, Xxxxxxxx 00000, or
to such other addresses as the Custodian may have designated to each Fund in
writing, shall be deemed to have been properly delivered or given to the
Custodian hereunder; provided, however, that procedures for the delivery of
Instructions and Special Instructions shall be governed by Section 2(c) hereof.
16. MISCELLANEOUS.
(a) This Agreement is executed and delivered in the State of Missouri and shall
be governed by the laws of such state.
(b) All of the terms and provisions of this Agreement shall be binding upon, and
inure to the benefit of, and be enforceable by the respective successors and
assigns of the parties hereto.
(c) No provisions of this Agreement may be amended, modified or waived, in any
manner except in writing, properly executed by both parties hereto; provided,
however, Appendix A may be amended from time to time as Domestic Subcustodians,
Foreign Subcustodians, Special Subcustodians, and Securities Depositories and
Clearing Agencies are approved or terminated according to the terms of this
Agreement.
(d) The captions in this Agreement are included for convenience of reference
only, and in no way define or delimit any of the provisions hereof or otherwise
affect their construction or effect.
(e) This Agreement shall be effective as of the date of execution hereof.
(f) This Agreement may be executed simultaneously in two or more counterparts,
each of which will be deemed an original, but all of which together will
constitute one and the same instrument.
(g) The following terms are defined terms within the meaning of this Agreement,
and the definitions thereof are found in the following sections of the
Agreement:
Term Section
Account 4(b)(3)(ii)
ADR'S 4(j)
Advance 9
Assets 2(b)
Authorized 3
Banking Institution 4(1)
Domestic Subcustodian 5(a)
Foreign Subcustodian 5(b)
Instruction 2(c)(1)
Interim Subcustodian 5(c)
Interest Bearing Deposit 4(1)
Term Section
Liability 10
OCC 4(g)(2)
Person 6(b)
Procedural Agreement 4(h)
SEC 4(b)(3)
Securities 2(a)
Securities Depositories and
Clearing Agencies 5(b)
Securities System 4(b)(3)
Shares 4(s)
Sovereign Risk 6(b)
Special Instruction 2(c)(2)
Special Subcustodian 5(c)
Subcustodian 5
1940 Act 4(v)
(h) If any part, term or provision of this Agreement is held to be illegal, in
conflict with any law or otherwise invalid by any court of competent
jurisdiction, the remaining portion or portions shall be considered severable
and shall not be affected, and the rights and obligations of the parties shall
be construed and enforced as if this Agreement did not contain the particular
part, term or provision held to be illegal or invalid.
(i) This Agreement constitutes the entire understanding and agreement of the
parties hereto with respect to the subject matter hereof, and accordingly
supersedes, as of the effective date of this Agreement, any custodian agreement
heretofore in effect between the Fund and the Custodian.
IN WITNESS WHEREOF, the parties hereto have caused this Custody Agreement to be
executed by their respective duly authorized officers.
THE SCOUT FUNDS
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: President
Date: October 30, 1995
ATTEST:
/s/ Xxxxxx X. Xxxxxx
UMB BANK, N.A.
By: /s/ Xxxxxxxx X. Xxxxxxxx
Name: Xxxxxxxx X. Xxxxxxxx
Title: Senior Vice President
Date: October 30, 1995
ATTEST:
/s/ R. Wm Bl
APPENDIX A
CUSTODY AGREEMENT
DOMESTIC SUBCUSTODIANS:
United Missouri Trust Company of New York
Xxxxxx Xxxxxxx Trust Company (Foreign Securities Only)
SECURITIES SYSTEMS:
Federal Book Entry
Depository Trust Company
Participant's Trust Company
SPECIAL SUBCUSTODIANS:
SECURITIES DEPOSITORIES
COUNTRIES FOREIGN SUBCUSTODIANS CLEARING AGENCIES
--------- --------------------- -----------------
Euroclear
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: President
Date: October 30, 1995
UMB BANK, N.A.
By: /s/ Xxxxxxxx X. Xxxxxxxx
Name: Xxxxxxxx X. Xxxxxxxx
Title: Senior Vice President
Date: October 30, 1995
