Exhibit No. EX-99.g.1
CUSTODIAN SERVICING AGREEMENT
THIS AGREEMENT is made and entered into as of the 27th day of August, 1999,
between Jacob Internet Fund, a Maryland Corporation (hereinafter called the
"Company"), on behalf of its separate series of shares ("Series"), and Firstar
Bank Milwaukee, N.A., a corporation organized under the laws of the State of
Wisconsin (hereinafter called "Custodian").
WHEREAS, the Company is an open-end management investment company which is
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, Custodian is a federally regulated banking institution; and
WHEREAS, the Company desires that its securities and cash shall be
hereafter held and administered by Custodian pursuant to the terms of this
Agreement;
NOW, THEREFORE, in consideration of the mutual agreements herein made, the
Company and Custodian agree as follows:
1. Definitions
The word "securities" as used herein includes stocks, shares, bonds,
debentures, notes, mortgages or other obligations, and any certificates,
receipts, warrants or other instruments representing rights to receive, purchase
or subscribe for the same, or evidencing or representing any other rights or
interests therein, or in any property or assets.
The words "officers' certificate" shall mean a request or direction or
certification in writing signed in the name of the Company by any two of the
President, a Vice President, the Secretary and the Treasurer of the Company, or
any other persons duly authorized to sign by the Board of Directors of the
Company.
The word "Board" shall mean Board of Directors of the Company.
2. Names, Titles, and Signatures of the Company's Officers
An officer of the Company will certify to Custodian the names and
signatures of those persons authorized to sign the officers' certificates
described in Section 1 hereof, and the names of the members of the Board of
Directors, together with any changes which may occur from time to time.
3. Additional Series
The Company is authorized to issue separate Series of shares of beneficial
interest representing interests in separate investment portfolios ("Series").
The parties intend that each Series established by the Company, now or in the
future, be covered by the terms and conditions of this agreement.
4. Receipt and Disbursement of Money
A. Custodian shall open and maintain a separate account or accounts in the
name of each Series of the Company, subject only to draft or order by Custodian
acting pursuant to the terms of this Agreement. Custodian shall hold in such
account or accounts, subject to the provisions hereof, all cash received by it
from or for the account of the relevant Series. Custodian shall make payments of
cash to, or for the account of, the relevant Series from such cash only:
(a) for the purchase of securities for the portfolio of the Series
upon the delivery of such securities to Custodian, registered in
the name of the Series or of the nominee of Custodian referred to
in Section 8 or in proper form for transfer;
(b) for the purchase or redemption of shares of beneficial interest
of the Series upon delivery thereof to Custodian, or upon proper
instructions from the Company;
(c) for the payment of interest, dividends, taxes, investment
adviser's fees or operating expenses (including, without
limitation thereto, fees for legal, accounting, auditing and
custodian services and expenses for printing and postage);
(d) for payments in connection with the conversion, exchange or
surrender of securities owned or subscribed to by the Series held
by or to be delivered to Custodian; or
(e) for other proper corporate purposes certified by resolution of
the Board of Directors of the Company.
Before making any such payment, Custodian shall receive (and may rely upon)
an officers' certificate requesting such payment and stating that it is for a
purpose permitted under the terms of item (a), (b), (c), or (d) of this
Subsection A, and also, in respect of item (e), upon receipt of an officers'
certificate specifying the amount of such payment, setting forth the purpose for
which such payment is to be made, declaring such purpose to be a proper business
purpose, and naming the person or persons to whom such payment is to be made,
provided, however, that an officers' certificate need not precede the
disbursement of cash for the purpose of purchasing a money market instrument, or
any other security with same or next-day settlement, if the President, a Vice
President, the Secretary or the Treasurer of the Company issues appropriate oral
or facsimile instructions to Custodian and an appropriate officers' certificate
is received by Custodian within two business days thereafter.
B. Custodian is hereby authorized to endorse and collect all checks, drafts
or other orders for the payment of money received by Custodian for the account
of the Series of the Company.
C. Custodian shall, upon receipt of proper instructions, make federal funds
available to the Company as of specified times agreed upon from time to time by
the
Company and the Custodian in the amount of checks received in payment for shares
of the Series which are deposited into the relevant Series' account.
5. Segregated Accounts
Upon receipt of proper instructions, the Custodian shall establish and
maintain a segregated account(s) for and on behalf of each Series, into which
account(s) may be transferred cash and/or securities.
6. Transfer, Exchange, Redelivery, etc. of Securities
Custodian shall have sole power to release or deliver any portfolio
securities of the Series of the Company held by it pursuant to this Agreement.
Custodian agrees to transfer, exchange or deliver securities held by it
hereunder only:
(a) for sales of such securities for the account of the Series of the
Company upon receipt by Custodian of payment therefore;
(b) when such securities are called, redeemed or retired or otherwise
become payable;
(c) for examination by any broker selling any such securities in
accordance with "street delivery" custom;
(d) in exchange for, or upon conversion into, other securities alone
or other securities and cash whether pursuant to any plan of
merger, consolidation, reorganization, recapitalization or
readjustment, or otherwise;
(e) upon conversion of such securities pursuant to their terms into
other securities;
(f) upon exercise of subscription, purchase or other similar rights
represented by such securities;
(g) for the purpose of exchanging interim receipts or temporary
securities for definitive securities;
(h) for the purpose of redeeming in kind shares of beneficial
interest of the Series of the Company upon delivery thereof to
Custodian; or
(i) for other proper business purposes.
As to any deliveries made by Custodian pursuant to items (a), (b), (d),
(e), (f), and (g), securities or cash receivable in exchange therefore shall be
deliverable to Custodian.
Before making any such transfer, exchange or delivery, Custodian shall
receive (and may rely upon) an officers' certificate requesting such transfer,
exchange or delivery, and stating that it is for a purpose permitted under the
terms of items (a), (b), (c), (d), (e), (f), (g), or (h) of this Section and
also, in respect of item (i), upon receipt of an officers' certificate
specifying the securities to be delivered, setting forth the purpose for which
such delivery is to be made, declaring such purpose to be a proper corporate
purpose, and naming the person or persons to whom delivery of such securities
shall be made, provided, however, that an officers' certificate need not precede
any such transfer, exchange or delivery of a money market instrument, or any
other security with same or next-day settlement, if the President, a Vice
President, the Secretary or the Treasurer of the Company issues appropriate oral
or facsimile instructions to Custodian and an appropriate officers' certificate
is received by Custodian within two business days thereafter.
7. Custodian's Acts Without Instructions
Unless and until Custodian receives an officers' certificate to the
contrary, Custodian shall: (a) present for payment all coupons and other income
items held by it for the account of the relevant Series of the Company, which
call for payment upon presentation and hold the cash received by it upon such
payment for the account of the Company; (b) collect interest and cash dividends
received, with notice to the Company, for the account of the Company; (c) hold
for the account of the Company hereunder all stock dividends, rights and similar
securities issued with respect to any securities held by it hereunder; and (d)
execute, as agent on behalf of the Company, all necessary ownership certificates
required by the Internal Revenue Code or the Income Tax Regulations of the
United States Treasury Department or under the laws of any state now or
hereafter in effect, inserting the Company's name on such certificates as the
owner of the securities covered thereby, to the extent it may lawfully do so.
8. Registration of Securities
Except as otherwise directed by an officers' certificate, Custodian shall
register all securities, except such as are in bearer form, in the name of a
registered nominee of Custodian as defined in the Internal Revenue Code and any
Regulations of the Treasury Department issued hereunder or in any provision of
any subsequent federal tax law exempting such transaction from liability for
stock transfer taxes, and shall execute and deliver all such certificates in
connection therewith as may be required by such laws or regulations or under the
laws of any state. Custodian shall use its best efforts to the end that the
specific securities held by it hereunder shall be at all times identifiable in
its records.
The Company shall from time to time furnish to Custodian appropriate
instruments to enable Custodian to hold or deliver in proper form for transfer,
or to register in the name of its registered nominee, any securities which it
may hold for the account of the Series of the Company and which may from time to
time be registered in the name of the Series of the Company.
9. Voting and Other Action
Neither Custodian nor any nominee of Custodian shall vote any of the
securities held hereunder by or for the account of the Series of the Company,
except in accordance with the instructions contained in an officers'
certificate. Custodian shall deliver, or cause to be executed and delivered, to
the Corporation all notices, proxies and proxy soliciting materials with
relation to such securities, such proxies to be executed by the registered
holder of such securities (if registered otherwise than in the name of the
Series
of the Company), but without indicating the manner in which such proxies are to
be voted.
10. Transfer Tax and Other Disbursements
The Series of the Company shall pay or reimburse Custodian from time to
time for any transfer taxes payable upon transfers of securities made hereunder,
and for all other necessary and proper disbursements and expenses made or
incurred by Custodian in the performance of this Agreement.
Custodian shall execute and deliver such certificates in connection with
securities delivered to it or by it under this Agreement as may be required
under the provisions of the Internal Revenue Code and any Regulations of the
Treasury Department issued thereunder, or under the laws of any state, to exempt
from taxation any exemptable transfers and/or deliveries of any such securities.
11. Concerning Custodian
Custodian shall be paid as compensation for its services pursuant to this
Agreement such compensation as may from time to time be agreed upon in writing
between the two parties. Until modified in writing, such compensation shall be
as set forth in Exhibit A attached hereto.
Custodian shall not be liable for any action taken in good faith upon any
certificate herein described or certified copy of any resolution of the Board,
and may rely on the genuineness of any such document which it may in good faith
believe to have been validly executed.
The Company agrees to indemnify and hold harmless Custodian and its nominee
from all taxes, charges, expenses, assessments, claims and liabilities
(including counsel fees) incurred or assessed against it or by its nominee in
connection with the performance of this Agreement, except such as may arise from
its or its nominee's own negligent action, negligent failure to act or willful
misconduct. Custodian is authorized to charge any account of the relevant Series
of the Company for such items.
In the event of any advance of cash for any purpose made by Custodian
resulting from orders or instructions of the Company, or in the event that
Custodian or its nominee shall incur or be assessed any taxes, charges,
expenses, assessments, claims or liabilities in connection with the performance
of this Agreement, except such as may arise from its or its nominee's own
negligent action, negligent failure to act or willful misconduct, any property
at any time held for the account of the Series of the Company shall be security
therefore.
Custodian agrees to indemnify and hold harmless the Company from all
charges, expenses, assessments, and claims/liabilities (including counsel fees)
incurred or assessed against it in connection with the performance of this
agreement, except such as may arise from the Company's own negligent action,
negligent failure to act, or willful misconduct.
12. Subcustodians
Custodian is hereby authorized to engage another bank or trust company as a
Subcustodian for all or any part of the Company's assets, so long as any such
bank or trust company organized under the laws of any state of the United
States, having an aggregate capital, surplus and undivided profit, as shown by
its last published report, of not less than Two Million Dollars ($2,000,000) and
provided further that, if the Custodian utilizes the services of a Subcustodian,
the Custodian shall obtain preapproval by the Company and remain fully liable
and responsible for any losses caused to the Company by the Subcustodian as
fully as if the Custodian was directly responsible for any such losses under the
terms of the Custodian Agreement.
Notwithstanding anything contained herein, if the Company requires the
Custodian to engage specific Subcustodians for the safekeeping and/or clearing
of assets, the Company agrees to indemnify and hold harmless Custodian from all
claims, expenses and liabilities incurred or assessed against it in connection
with the use of such Subcustodian in regard to the Company's assets, except as
may arise from its own negligent action, negligent failure to act or willful
misconduct.
13. Reports by Custodian
Custodian shall furnish the Company periodically as agreed upon with a
statement summarizing all transactions and entries for the account of Company.
Custodian shall furnish to the Company, at the end of every month, a list of the
portfolio securities showing the aggregate cost of each issue. The books and
records of Custodian pertaining to its actions under this Agreement shall be
open to inspection and audit at reasonable times by officers of, and by auditors
employed by, the Company.
14. Termination or Assignment
This Agreement may be terminated by the Company, or by Custodian, on ninety
(90) days notice prior to the two year anniversary, given in writing and sent by
registered mail to Custodian at Firstar Trust Company, 000 Xxxx Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxx 00000, or to the Company at 0000 Xxxxxxxx, Xxx Xxxx, XX
00000, as the case may be. Upon any termination of this Agreement, pending
appointment of a successor to Custodian or a vote of the shareholders of the
Series of the Company to dissolve or to function without a custodian of its
cash, securities and other property, Custodian shall not deliver cash,
securities or other property of the Company to the Company, but may deliver them
to a bank or trust company of its own selection, having an aggregate capital,
surplus and undivided profits, as shown by its last published report of not less
than Two Million Dollars ($2,000,000) as a Custodian for the Company to be held
under terms similar to those of this Agreement, provided, however, that
Custodian shall not be required to make any such delivery or payment until full
payment shall have been made by the Company of all liabilities constituting a
charge on or against the properties then held by Custodian or on or against
Custodian, and until full payment shall have been made to Custodian of all its
fees, compensation, costs and expenses, subject to the provisions of Section 10
of this Agreement.
This Agreement may not be assigned by Custodian without the consent of the
Company, authorized or approved by a resolution of its Board of Directors.
15. Deposits of Securities in Securities Depositories
No provision of this Agreement shall be deemed to prevent the use by
Custodian of a central securities clearing agency or securities depository,
provided, however, that Custodian and the central securities clearing agency or
securities depository meet all applicable federal and state laws and
regulations, and the Board of Directors of the Company approves by resolution
the use of such central securities clearing agency or securities depository.
16. Records
To the extent that Custodian in any capacity prepares or maintains any
records required to be maintained and preserved by the Company pursuant to the
provisions of the Investment Company Act of 1940, as amended, or the rules and
regulations promulgated thereunder, Custodian agrees to make any such records
available to the Company upon request and to preserve such records for the
periods prescribed in Rule 31 a-2 under the Investment Company Act of 1940, as
amended.
17. Notices
Notices of any kind to be given by either party to the other party shall be
in writing and shall be duly given if mailed or delivered as follows: Notice to
Custodian shall be sent to:
Firstar Bank Milwaukee, N.A.
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Company shall be sent to:
Jacob Internet Fund
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and their respective corporate seals to be affixed hereto as of the
date first above written by their respective officers thereunto duly authorized.
This agreement may be executed in several counterparts, each of which is an
original.
Jacob Internet Fund Firstar Bank Milwaukee, N.A.
Sign: /s/ Xxxx Xxxxx Sign: /s/ Xxxx Rock
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Print: Xxxx Xxxxx Print: Xxxx Rock
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Title: Chairman Title: Vice President
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Date: 7-13-99 Date: 7-13-99
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Attest: /s/ Xxxxxxx Xxxxxx Attest:
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Schedule A
Mutual Fund Custodial Agent Service
Domestic Portfolios
Annual Fee Schedule
Jacob Internet Fund
o Annual fee based upon market value of assets:
o $0.20 per $1,000 (2.0 basis points)
o Minimum annual fee per Fund - $3,000
o Investment transactions: (purchase, sale, exchange, tender, redemption,
maturity, receipt delivery)
o $12.00 per book entry security (depository or Federal Reserve system)
o $25.00 per definitive security (physical)
o $75.00 per Euroclear
o $8.00 per principal reduction on pass-through certificates
o $35.00 per option/future contracts
o Variable Amount Notes: Used as a short-term investment, variable amount
notes offer safety and prevailing high interest rates. Our charge, which is
1/4 of 1%, is deducted from the variable amount note income at the time is
credited to your account.
o Extraordinary expenses: Based on time and complexity involved.
o Out-of-pocket expenses: Charged to the account, including but not limited
to:
o $10.00 per variation margin transaction
o $10.00 per Fed wire deposit or withdrawal
o Fees are billed monthly, based on market value at the beginning of the
month.
