Exhibit (g)(22)
The RBB Fund, Inc.
Bellevue Park Corporate Center
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
PFPC Trust Company
Xxxxxxxx Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Re: Rule 17f-5 ("Rule 17f-5") and Rule 17f-7 ("Rule 17f-7") Under
the Investment Company Act of 1940 (the "1940 Act")
Dear Sirs:
Reference is made to the Subcustodial Services Agreement dated as of January 10,
1996 (the "Foreign Custody Agreement"), as amended, by and between Citibank,
N.A. ("Custodian"), Citicorp and PFPC Trust Company ("PFPC") with respect to the
custody of assets by Custodian for the account of PFPC on behalf of certain
customers of PFPC, including those RBB Funds as are set forth on Exhibit A
hereto (each a "Fund" and collectively the "Funds"). Reference is also made to
the custodian agreement dated as of August 16, 1988, as amended (the "Fund
Custody Agreement") by and between PFPC and The RBB Fund, Inc.
1. Rule 17f-5
1.1. With respect to the "Foreign Assets" (as defined in Rule 17f-5(a)(2))
in such jurisdictions as Custodian provides custody services under the Foreign
Custody Agreement for a Fund, each Fund hereby delegates to Custodian and
Custodian hereby accepts the delegation to it, of the obligation to serve as the
Fund's "Foreign Custody Manager" (as defined in Rule 17f-5(a)(3)). As Foreign
Custody Manager, Custodian shall:
a. select "Eligible Foreign Custodians" (as defined in Rule
17f-5(a)(1)) to serve as foreign custodians and place and
maintain each Fund's Foreign Assets with such Eligible Foreign
Custodians;
b. in selecting an Eligible Foreign Custodian, first determine that
Foreign Assets placed and maintained in the care of the Eligible
Foreign Custodian shall be subject to reasonable care, based on
the standards applicable to custodians in the relevant market,
after having considered all factors relevant to the safekeeping
of such Foreign Assets including, without limitation, those
factors set forth in Rule 17f-5(c)(l)(i)-(iv);
c. enter into a written contract with each Eligible Foreign
Custodian selected by Custodian hereunder;
d. determine that the written contract with each Eligible Foreign
Custodian will provide reasonable care for the Foreign Assets,
based on the standards applicable to custodians in the relevant
market and after having considered all factors relevant to the
safekeeping of such Foreign Assets (including,
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without limitation, those factors set forth in Rule
17f-5(c)(1)(i)-(iv)), and that each such contract satisfies the
requirements of Rule 17f-5(c)(2);
e. provide written reports (i) notifying the Board or similar
governing body (the "Board") of The RBB Fund, Inc. of the
placement of the Funds' Foreign Assets with a particular Eligible
Foreign Custodian, such reports to be provided at such time as
the Board deems reasonable and appropriate, but not less often
than quarterly, and (ii) promptly notifying the Board of any
material change in the arrangements with an Eligible Foreign
Custodian; and
f. have established a system to monitor (i) the appropriateness of
maintaining a Fund's Foreign Assets with a particular Eligible
Foreign Custodian selected hereunder and (ii) the performance of
the governing contractual arrangements; it being understood,
however, that in the event Custodian shall determine that the
arrangement with any Eligible Foreign Custodian would no longer
afford a Fund's Foreign Assets reasonable care (as defined in
Section 1.1(b) above) or would no longer be governed by a written
contract providing for such care, Custodian shall promptly so
advise such Fund.
Without limiting any duties set forth in the Foreign Custody Agreement,
Custodian shall not be responsible for the duties described in this Section
1.1 with respect to any foreign securities depository or foreign clearing
agency.
1.2. In acting as a Foreign Custody Manager, Custodian shall exercise
reasonable care, prudence and diligence such as a person having responsibility
for the safekeeping of Foreign Assets would exercise in each jurisdiction where
Custodian acts as subcustodian for assets of a Fund. Custodian shall reimburse
and pay each Fund for any loss or damage suffered by the Fund as a result of the
performance of Custodian's duties under this Section 1 where such loss or damage
results from an act of negligence or willful misconduct on the part of Custodian
hereunder; provided that where such loss or damage relates to a loss of assets
the liability of Custodian hereunder shall not exceed the fair market value of
any loss of assets resulting from such negligence or willful misconduct, at the
time of such negligence or willful misconduct (together with replacement costs
consisting of broker fees, transfer fees or similar expenses required to effect
replacement of any asset at such fair market value). Any payment to a Fund under
this Section 1.2 shall limit the Fund's right and ability to enforce any rights
under the Foreign Custody Agreement for loss of such assets. Notwithstanding
anything else in this document, Custodian shall not be liable to a Fund for any
indirect, special, consequential or general damages (which damages do not
include the fair market value of any loss of assets resulting from an act of
negligence or willful misconduct on the part of Custodian hereunder (measured at
the time of such negligence or willful misconduct) nor the replacement costs
referenced above) or from reasons or causes beyond its control. PFPC shall be
indemnified by a Fund for any damages PFPC may incur in connection with the
provision by Custodian of the services set forth in this Section 1 with respect
to such Fund (provided PFPC will not be indemnified for damages which are the
result of PFPC's negligence or willful misconduct and provided PFPC will not be
indemnified for indirect, special or consequential damages or losses suffered by
PFPC). In no event shall PFPC have responsibility or liability for any action or
inaction of Custodian under Section 1 hereof.
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1.3. In acting as a Foreign Custody Manager, Custodian shall not supervise,
recommend or advise PFPC or any Fund relative to the investment, purchase, sale,
retention or disposition of any assets in any particular country, including with
respect to prevailing country risks.
2. Rule 17f-7
2.1. (a) Each Fund and PFPC appoint Custodian to provide the Fund (or its
duly- authorized investment manager or investment adviser) with an analysis (in
form and substance as reasonably determined by Custodian) of the custody risks
associated with maintaining assets with each foreign securities depository or
foreign clearing agency listed on Exhibit B hereto (as the same may be changed
by Custodian from time to time) in accordance with Rule 17f-7(a)(1)(i)(A).
Custodian shall monitor such custody risks on a continuing basis, and shall
promptly notify each applicable Fund (or its duly-authorized investment manager
or investment adviser) of any material changes in such risks in accordance with
Rule 17f-7(a)(1)(i)(B).
(b) Only an entity that Custodian has determined satisfies the
requirements of Rule 17f-7(b)(1) as an "Eligible Securities Depository" (as
defined in Rule 17f-7(b)(1)) will be included by Custodian on Exhibit B hereto
(as the same may be changed by Custodian from time to time). In such manner as
Custodian deems reasonable, Custodian shall give each Fund prompt notice of any
material change known to Custodian that would affect Custodian's determination
that an entity listed on Exhibit B hereto is an Eligible Securities Depository.
2.2. In performing its obligations under this Section 2, Custodian may
obtain information from sources Custodian reasonably believes to be reliable,
but Custodian does not warrant its completeness or accuracy and has no duty to
verify or confirm any such information. Custodian is not obligated to make any
determination regarding whether any Eligible Securities Depository provides
reasonable care for Foreign Assets or to provide any information or evaluation
comparing any Eligible Securities Depository to any other securities depository
or any existing or proposed standards for securities depositories.
2.3. The Funds acknowledge that they may maintain assets only at the
foreign securities depositories or foreign clearing agencies listed on Exhibit B
hereto (as the same may be changed by Custodian from time to time). If a Fund
maintains assets at a foreign securities depository or foreign clearing agency
listed on Exhibit B (including assets maintained by the Fund at the time this
document is entered into) or a Fund enters into a transaction with respect to
assets that as a matter of practice are or may be maintained at a foreign
securities depository or foreign clearing agency listed on Exhibit B, such
action will (unless the Fund provides written notice to Custodian and PFPC
specifically stating that a particular foreign securities depository or foreign
clearing agency is not acceptable to it) serve as the Fund's acknowledgement
that such foreign securities depository or foreign clearing agency is acceptable
to it.
2.4. Custodian shall exercise reasonable care, prudence and diligence in
performing its duties pursuant to Section 2 hereof. Custodian shall reimburse
and pay each Fund for any loss or damage suffered by the Fund as a result of the
performance of Custodian's duties under this Section 2 where such loss or damage
results from an act of negligence or willful misconduct on the part of Custodian
hereunder; provided that where such loss or damage relates to a loss of assets
the liability of Custodian hereunder shall not exceed the fair market value of
any loss of
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assets resulting from such negligence or willful misconduct, at the time of such
negligence or willful misconduct (together with replacement costs consisting of
broker fees, transfer fees or similar expenses required to effect replacement of
any asset at such fair market value). Any payment to a Fund under this Section
2.4 shall limit the Fund's right and ability to enforce any rights under the
Foreign Custody Agreement for loss of such assets. Notwithstanding anything else
in this document, Custodian shall not be liable to a Fund for any indirect,
special, consequential or general damages (which damages do not include the fair
market value of any loss of assets resulting from an act of negligence or
willful misconduct on the part of Custodian hereunder (measured at the time of
such negligence or willful misconduct) nor the replacement costs referenced
above) or from reasons or causes beyond its control. PFPC shall be indemnified
by a Fund for any damages PFPC may incur in connection with the provision by
Custodian of the services set forth in this Section 2 with respect to such Fund
(provided PFPC will not be indemnified for damages which are the result of
PFPC's negligence or willful misconduct and provided PFPC will not be
indemnified for indirect, special or consequential damages or losses suffered by
PFPC). Each Fund and PFPC agrees that PFPC's obligation to exercise reasonable
care, prudence and diligence in providing for the services set forth in Section
2.1 above is satisfied by the appointment of Custodian hereunder to provide
those services. In no event shall PFPC have responsibility or liability for any
action or inaction of Custodian under Section 2 hereof.
3. General
3.1. A. For clarity, the Funds are not a party to this Section 3.1.A. The
Custodian and PFPC agree to amend and restate Section 7(a) of the Foreign
Custody Agreement in its entirety with respect to the Funds as follows:
"(a)
The Bank may maintain investments (including foreign currencies) for
which the primary market is outside the United States (and such cash
and cash equivalents as are reasonably necessary to effect
transactions in such investments) (collectively, "Foreign Securities")
and which are maintained hereunder in subcustody accounts which have
been established by the Bank with (x) branches of "U.S. banks" as
defined in Rule 17f-5 under the Investment Company Act (as effective
June 12, 2000) ("Rule 17f-5") ("Branches"), or (y) foreign custodians
that meet the definition of "eligible foreign custodian" under Rule
17f-5(a)(1) and which the Bank has determined are eligible to maintain
assets pursuant to the requirements of Rule 17f-5 (such Branches and
such foreign custodians, collectively, "Eligible Foreign Custodians").
The Bank or an Eligible Foreign Custodian is authorized to hold
Foreign Securities of a particular investment portfolio of a Fund in
an account with any foreign securities depository or foreign clearing
agency (provided the same are "eligible securities depositories" as
defined in Rule 17f-7(b)(1) under the Investment Company Act) which is
listed on Exhibit B hereto (as the same may be amended from time to
time), provided that the particular foreign securities depository or
foreign clearing agency is acceptable for that particular investment
portfolio (each such foreign securities depository or foreign clearing
agency, an "Eligible Foreign Securities Depository"). Any Property
held by an Eligible Foreign Custodian or Eligible Foreign Securities
Depository shall be subject to applicable laws, regulations, decrees,
orders, government acts, restrictions, customs, procedures and market
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practices (the "Laws") (i) to which such Eligible Foreign Custodian or
Eligible Foreign Securities Depository is subject, (ii) as exist in
the country in which such Property is held and (iii) of the country of
the currency in which the Property is denominated. The Customer
acknowledges that, as is normally the case with respect to deposits
outside the United States, deposits with Citibank London and any other
entity authorized to hold Property pursuant to this Agreement are not
insured by the Federal Deposit Insurance Corporation."
B. For clarity, the Funds are not a party to this Section 3.1.B. The
Custodian and PFPC agree to amend and restate the final sentence of Section 7(b)
of the Foreign Custody Agreement in its entirety with respect to the Funds as
follows:
"Notwithstanding any of the foregoing provisions of this subsection (b) of
this Section 7, the Bank's undertaking to provide to the Customer, or at
the direction of the Customer to the Fund, the information referred to in
this subsection (b) of this Section 7 shall neither increase the Bank's
duty of care nor reduce any other entity's responsibility to determine for
itself the prudence of entrusting its assets to any particular foreign
securities depository."
C. For clarity, the Funds are not a party to this Section 3.1.C. The
Custodian and PFPC agree to amend and restate Section 9 of the Foreign Custody
Agreement to insert the word "Eligible" before the words "Foreign Securities
Depositories."
D. For clarity, the Funds are not a party to this Section 3.1.D. The
Custodian and PFPC agree to delete the fifth paragraph of Section 4 of the
Foreign Custody Agreement.
3.2. For clarity, the Funds are not a party to this Section 3.2. The duties
of Custodian set forth herein are in addition to the duties of Custodian under
the Foreign Custody Agreement.
3.3. Notwithstanding the provisions of any arrangements between The RBB
Fund, Inc. and PFPC or otherwise, each Fund hereby agrees that assets may be
maintained with any Eligible Foreign Custodian referred to in Section 1.1 hereof
and any foreign securities depository or foreign clearing agency which is
acceptable to it pursuant to Section 2.3 above (without the need to comply with
any notice or consent or other requirements which may be set forth in any such
arrangements). PFPC will not be deemed to have chosen any such Eligible Foreign
Custodians or any such foreign securities depositories or foreign clearing
agencies.
3.4. Each Fund shall be entitled to enforce its rights directly against
Custodian with respect to any action or omission of Custodian taken or omitted
hereunder, notwithstanding any other agreement to the contrary. If a Fund is
able to effectively enforce its rights against Custodian hereunder, PFPC will
not also seek to enforce such rights against Custodian under the Foreign Custody
Agreement.
3.5. This document shall apply only to the Funds on Exhibit A hereto (as
the same may be amended from time to time on written agreement of Custodian,
PFPC and The RBB Fund, Inc.), and shall not apply to any other customer of PFPC.
3.6. With respect to the terms of this document, Custodian shall comply
with the requirements of Rule 17f-5 and Rule 17f-7 that are applicable to the
obligations of Custodian
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specified in this document and PFPC shall comply with the requirements of Rule
17f-5 and Rule 17f-7 that are applicable to the obligations of PFPC specified in
this document.
3.7. Custodian and PFPC agree that no amendment to Section 22 of the
Foreign Custody Agreement shall be effective with respect to any Fund unless
such amendment is approved in writing by The RBB Fund, Inc.
3.8 Each party hereto represents that it has taken all requisite action
(corporate or otherwise) to authorize the execution and delivery of this
document.
3.9 This document shall be construed in accordance with the laws of the
State of New York, without regard to its conflicts of laws principles. This
document may be executed by one or more of the parties hereto in any number of
separate counterparts, and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.
If the foregoing corresponds to your understanding of our agreement, please
indicate your acceptance by signing below.
Very truly yours,
CITIBANK, N.A.
By: /s/ Xxxx X. Xxxxx
---------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
Agreed and Accepted:
PFPC TRUST COMPANY
By: /s/ Xxxxxxx Xxxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
THE RBB FUND, INC.
By: /s/ Xxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxx X. Xxxxx
Title: President and Treasurer
Dated: September 13, 2005
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Exhibit A
Xxxxxxxxx Value Fund
Xxxxxxxxx Small Cap Value Fund
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Country Depositories
Argentina Caja de Valores S.A. (CDV)
Argentina Central de Registration y de Instrumentos de Endeamiento
Publico (CRYL)
Australia Austraclear
Australia ASX Settlement and Transfer Corporation (ASTC)
Austria Oesterreichische Kontrollbank AG (OeKB)
Bahrain Bahrain Stock Exchange
Bangladesh Central Depository Bangladesh Limited
Belgium Euronext Brussels - CIK
Belgium National Bank of Belgium (NBB)
Bermuda Bermuda Securities Depository (BSD)
Botswana Bank of Botswana
Brazil Companhia Brasileira de Liquidacao e Custodia (CBLC)
Brazil Central of Custody and Financial Settlement of Securities (CETIP)
Brazil Central Bank / Sestema Especial de Liquidacoa e Custodia (SELIC)
Bulgaria Central Securities Depository AD (CDAD)
Bulgaria Bulgarian National Bank's Government Securities Settlement
System (BNB)
Canada Canadian Depository for Securities Ltd.
Chile Deposito Central de Valores SA (DCV)
China China Securities Depository and Clearing Corporation Limited
China China Securities Depository and Clearing Corporation Limited
Colombia Deposito Central de Valores (DCV)
Colombia Deposito Centralizado de Valores (DECEVAL)
Costa Rica Central de Valores de la Bolsa Nacional de Valores (CEVAL)
Croatia Central Depository Agency Inc. - Sredisnja Depozitarna
Agencija (SDA)
Croatia Ministry of Finance (MoF)
Czech Czech National Bank (CNB)
Czech Stredisko Cennych Papiru (SCP)
Denmark Vaerdipapircentralen (VP)
Egypt Misr for Clearing Settlement and Central Depository (MCSD)
Egypt Bank of Egypt
Estonia Estonian Central Depository for Securities
Euroclear Euroclear S.A./N.V.
Finland Finnish Central Securities Depository (FCSD)
France Euroclear France
Germany Clearstream Banking AG (Frankfurt)
Greece Central Securities Depository SA (CSD)
Greece Bank of Greece Securities Settlement System (BOGS)
Hong Xxxx Xxxxxxx XxxxxXxxxxx Xxxx (XXX)
Xxxx Xxxx Xxxx Xxxx Securities Clearing Company Limited (HKSCC)
Hungary The Central Depository and Clearing House Ltd. (KELER Ltd.)
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Exhibit B
Country Depositories
Iceland Icelandic Securities Depository Limited
India National Securities Depository Limited (NSDL)
India Central Depository Services (India) Limited (CDSL)
India Reserve Bank of India (RBI)
Indonesia Penyelesaian Transaksi Pasar Uang - Bank of Indonesia (BoI)
Indonesia PK Kustodia Sentral Efek Indonesia (KSEI)
Ireland Euroclear SA/NV and United Kingdom - Crest
Israel Tel Aviv Stock Exchange-Clearinghouse (SECH)
Italy Monte Titoli (MT)
Japan Bank of Japan (BOJ)
Japan Japan Securities Depository Center (JASDEC)
Xxxxxx Xxxxxx Securities Depository Center
Kazakhstan CJSC Central Securities Depository of the Republic of Kazakhstan
Korea Korea Securities Depository (KSD)
Latvia Bank of Latvia (BOL)
Latvia Latvian Central Depository (LCD)
Lithuania Central Securities Depository of Lithuania (CSDL)
Luxembourg Clearstream Banking (Luxembourg)
Malaysia Bank Negara Malaysia (BNM)
Malaysia Malaysian Central Depository Sdn. Bhd. (MCD)
Mauritius The Central Depository and Settlement Company (CDS)
Mauritius Bank of Mauritius
Mexico S.D. Indeval, S.A de CV
Morocco Maroclear
Netherlands Euroclear Netherlands - Necigef
Netherlands NIEC
New Zealand New Zealand Central Securities Depository (NZCSD)
Norway The Norwegian Central Securities Depository (VPS)
Pakistan State Bank of Pakistan (SBP)
Pakistan Central Depository Company of Pakistan (CDC)
Peru CAVALI ICLV S.A.
Philippines Philippine Depository Trust Corporation)
Philippines Register of Scripless Securities (XxXX)
Poland National Depository for Securities (NDS)
Poland National Bank of Poland (NBP)
Portugal Interbolsa
Romania Bucharest Stock Exchange (BSE)
Romania Societatea Nationala de Compensare, Decontare si Depozitare
Pentru Valori Mobiliare S.A. (SNCDD)
Russia Bank for Foreign trade of the Russian Federation (VTB)
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Exhibit B
Country Depositories
Russia The National Depository Centre (NDC)
Russia Depository Clearing Company (DCC)
Singapore Central Depository Pte. Ltd.
Singapore Monetary Authority of Singapore
Slovakia National Bank of Slovalia (NBS)
Slovakia Stredisko cennych papierov SR,a.s (SCP)
Slovenia Central Securities Clearing and Depository Corporation (KDD)
South Africa Share Transactions Totally Electronic (STRATE)
Spain Servicio de Compensacion y Liquidacion de Valores (SCLV)
Spain Central de Anotaciones de Banco de Espana (XXXX)
Sri Lanka Central Depository Systems Private Limited (CDS)
Sweden Vardepappercentralen (VPC)
Switzerland SIS SegaInterSettle AG
Taiwan Taiwan Securities Central Depository Co. Ltd. (TSCD)
Thailand Thailand Securities Depository Co. Ltd. (TSD)
Thailand Bank of Thailand
Turkey Central Bank of Turkey (CBT)
Turkey Takasbank ISE Settlement and Custody Bank Inc.
UK Central Moneymarkets office (CMO)
UK Crestco Limited
Ukraine Interregional Securities Union (MFS)
Ukraine National Bank of Ukraine (NBU)
United Arab
Emirates Central Depository
Venezuela Caja Venezolana de Valores CA (CVV)
Venezuela Central Bank - Banco Central de Venezuela (BCV)
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