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Exhibit (8)(f)
, 1996
Mercantile Bank of St. Louis National Association
One Mercantile Center
St. Louis, Missouri 63101
RE: Custody Fees for the ARCH Equity Index and ARCH
Bond Index Portfolios
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Gentlemen:
This letter constitutes our agreement with respect to
compensation to be paid to Mercantile Bank of St. Louis National Association
("Mercantile") with respect to the ARCH Equity Index Portfolio (comprised of
Class P, Class P - Special Series 1 and Class P - Special Series 2 shares) and
the ARCH Bond Index Portfolio (comprised of Class Q, Class Q - Special Series 1
and Class O - Special Series 2 shares) (each class a "Series") under the terms
of the Custodian Agreement dated as of April 1, 1992 (the "Custodian Agreement")
between The ARCH Fund, Inc. (the "Fund") and Mercantile. Pursuant to Paragraph
23 of the Custodian Agreement, and in consideration of the services to be
provided by you, we will pay Mercantile the following:
1. An annual custody fee (exclusive of any transaction charges),
which shall be calculated daily and paid monthly (in arrears) for each Series as
follows:
- The ARCH Equity Index Portfolio - the greater of $6,000.00 or
$.30 for each $1,000.00 of the Series' average daily net
assets; and
- The ARCH Bond Index Portfolio - the greater of $6,000.00 or
$.30 for each $1,000.00 of the Series' average daily net
assets.
2. A transaction charge of $15.00 for each purchase, sale or
delivery of a security upon its maturity date, $50.00 for each interest
collection or claim item, $20.00 for each transaction involving GNMA, tax-free
or other non-depository registered items with monthly dividends or interest,
$30.00 for each purchase, sale or expiration of an option contract, $50.00 for
each purchase, sale or expiration of a futures contract, and $15.00
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Mercantile Bank of St. Louis, N.A.
, 1996
Page Two
for each repurchase trade with an institution other than Mercantile;
3. Mercantile's incremental costs in providing foreign custody services
for foreign denominated and held securities; and
4. Mercantile's out-of-pocket expenses, including but not limited to
postage, telephone, telex, Federal Express and Federal Reserve wire fees, on
behalf of the Series.
The fee and expenses attributable to each Series shall be the
obligation of that Series and not of any other portfolio of the Fund. The fee
for the period from the day of the year this agreement is entered into until the
end of that fiscal year of the Series, or for any portion of a fiscal year
immediately prior to its termination, shall be pro-rated according to the
proportion which such period bears to the full annual period.
If the foregoing accurately sets forth our agreement and you
intend to be legally bound thereby, please execute a copy of this letter and
return it to us.
Very truly yours,
THE ARCH FUND, INC.
By:
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Xxxxx X. Xxxxxxx, President
ACCEPTED: MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION
By:
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Xxxxxx X. Xxxxxx, Senior Vice President
Dated as of: , 1996
