Exhibit No. EX-99.g
CUSTODY AGREEMENT
THIS AGREEMENT is made and entered into as of the 31st day of December,
2007, by and between ACADEMY FUNDS TRUST, a Delaware statutory trust (the
"Trust"), and U.S. BANK NATIONAL ASSOCIATION, a national banking association
organized and existing under the laws of the United States of America with its
principal place of business at Cincinnati, Ohio (the "Custodian").
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as an open-end management investment company, and
is authorized to issue shares of beneficial interest in separate series, with
each such series representing interests in a separate portfolio of securities
and other assets;
WHEREAS, the Custodian is a bank having the qualifications prescribed in
Section 26(a)(1) of the 1940 Act;
WHEREAS, the Trust desires to retain the Custodian to act as custodian of
the cash and securities of each series of the Trust listed on Exhibit C hereto
(as amended from time to time) (each a "Fund" and collectively, the "Funds");
and
WHEREAS, the Board of Trustees of the Trust has delegated to the Custodian
the responsibilities set forth in Rule 17f-5(c) under the 1940 Act and the
Custodian is willing to undertake the responsibilities and serve as the foreign
custody manager for the Company.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto, intending to be legally bound,
do hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Whenever used in this Agreement, the following words and phrases shall have
the meanings set forth below unless the context otherwise requires:
1.1 "Authorized Person" means any Officer or other person duly authorized by
resolution of the Board of Trustees to give Oral Instructions and Written
Instructions on behalf of the Fund and named in Exhibit A hereto or in such
resolutions of the Board of Trustees, certified by an Officer, as may be
received by the Custodian from time to time.
1.2 "Board of Trustees" shall mean the trustees from time to time serving under
the Trust's declaration of trust, as amended from time to time.
1.3 "Book-Entry System" shall mean a federal book-entry system as provided in
Subpart O of Treasury Circular Xx. 000, 00 XXX 306, in Subpart B of 31 CFR
Part 350, or in such book-entry regulations of federal agencies as are
substantially in the form of such Subpart O.
1.4 "Business Day" shall mean any day recognized as a settlement day by The New
York Stock Exchange, Inc., and any other day for which the Trust computes
the net asset value of Shares of the Fund.
1.5 "Eligible Securities Depository" shall mean a system for the central
handling of securities as that term is defined in Rule 17f-4 and 17f-7
under the 1940 Act.
1.6 "Fund Custody Account" shall mean any of the accounts in the name of the
Trust, which is provided for in Section 3.2 below.
1.7 "IRS" shall mean the Internal Revenue Service.
1.8 "NASD" shall mean The National Association of Securities Dealers, Inc.
1.9 "Officer" shall mean the Chairman, President, any Vice President, any
Assistant Vice President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer of the Trust.
1.10 "Oral Instructions" shall mean instructions orally transmitted to and
accepted by the Custodian because such instructions are: (i) reasonably
believed by the Custodian to have been given by any two Authorized Persons,
(ii) recorded and kept among the records of the Custodian made in the
ordinary course of business, and (iii) orally confirmed by the Custodian.
The Trust shall cause all Oral Instructions to be confirmed by Written
Instructions prior to the end of the next Business Day. If such Written
Instructions confirming Oral Instructions are not received by the Custodian
prior to a transaction, it shall in no way affect the validity of the
transaction or the authorization thereof by the Trust. If Oral Instructions
vary from the Written Instructions that purport to confirm them, the
Custodian shall notify the Trust of such variance but such Oral
Instructions will govern unless the Custodian has not yet acted.
1.11 "Proper Instructions" shall mean Oral Instructions or Written Instructions.
1.12 "SEC" shall mean the Securities and Exchange Commission.
1.13 "Securities" shall include, without limitation, common and preferred
stocks, bonds, call options, put options, debentures, notes, bank
certificates of deposit, bankers' acceptances, mortgage-backed securities
or other obligations, and any certificates, receipts, warrants or other
instruments or documents representing rights to receive, purchase or
subscribe for the same, or evidencing or representing any other rights or
interests therein, or any similar property or assets that the Custodian or
its agents have the facilities to clear and service.
1.14 "Securities Depository" shall mean The Depository Trust Company and any
other clearing agency registered with the SEC under Section 17A of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), which acts as
a system for the central handling of Securities where all Securities of any
particular class or series of an issuer deposited within the system are
treated as fungible and may be transferred or pledged by bookkeeping entry
without physical delivery of the Securities.
1.15 "Shares" shall mean, with respect to a Fund, the units of beneficial
interest issued by the Trust on account of the Fund.
1.16 "Sub-Custodian" shall mean and include (i) any branch of a "U.S. bank," as
that term is defined in Rule 17f-5 under the 1940 Act, and (ii) any
"eligible foreign custodian," as that term is defined in Rule 17f-5 under
the 1940 Act, having a contract with the Custodian which the Custodian has
determined will provide reasonable care of assets of the Fund based on the
standards specified in Section 3.3 below. Such contract shall be in writing
and shall include provisions that provide: (i) for indemnification or
insurance arrangements (or any combination of the foregoing) such that the
Fund will be adequately protected against the risk of loss of assets held
in accordance with such contract; (ii) that the Fund's assets will not be
subject to any right, charge, security interest, lien or claim of any kind
in favor of the Sub-Custodian or its creditors except a claim of payment
for their safe custody or administration, in the case of cash deposits,
liens or rights in favor of creditors of the Sub-Custodian arising under
bankruptcy, insolvency, or similar laws; (iii) that beneficial ownership
for the Fund's assets will be freely transferable without the payment of
money or value other than for safe custody or administration; (iv) that
adequate records will be maintained identifying the assets as belonging to
the Fund or as being held by a third party for the benefit of the Fund; (v)
that the Fund's independent public accountants will be given access to
those records or confirmation of the contents of those records; and (vi)
that the Fund will receive periodic reports with respect to the safekeeping
of the Fund's assets, including, but not limited to, notification of any
transfer to or from a Fund's account or a third party account containing
assets held for the benefit of the Fund. Such contract may contain, in lieu
of any or all of the provisions specified in (i)-(vi) above, such other
provisions that the Custodian determines will provide, in their entirety,
the same or a greater level of care and protection for Fund assets as the
specified provisions.
1.17 "Written Instructions" shall mean (i) written communications actually
received by the Custodian and signed by any an Authorized Person, (ii)
communications by telex or any other such system from one or more persons
reasonably believed by the Custodian to be Authorized Persons, or (iii)
communications between electro-mechanical or electronic devices provided
that the use of such devices and the procedures for the use thereof shall
have been approved by resolutions of the Board of Trustees, a copy of
which, certified by an Officer, shall have been delivered to the Custodian.
ARTICLE II
APPOINTMENT OF CUSTODIAN
2.1 Appointment. The Trust hereby appoints the Custodian as custodian of all
Securities and cash owned by or in the possession of the Fund at any time
during the period of this Agreement, on the terms and conditions set forth
in this Agreement, and the Custodian hereby accepts such appointment and
agrees to perform the services and duties set forth in this Agreement. The
services and duties of the Custodian shall be confined to those matters
expressly set forth herein, and no implied duties are assumed by or may be
asserted against the Custodian hereunder.
2.2 Documents to be Furnished. The following documents, including any
amendments thereto, will be provided contemporaneously with the execution
of the Agreement to the Custodian by the Trust:
(a) A copy of the Trust's declaration of trust, certified by the
Secretary;
(b) A copy of the Trust's bylaws, certified by the Secretary;
(c) A copy of the resolution of the Board of Trustees of the Trust
appointing the Custodian, certified by the Secretary;
(d) A copy of the current prospectus of the Fund (the "Prospectus");
(e) A certification of the Chairman or the President and the Secretary of
the Trust setting forth the names and signatures of the current
Officers of the Trust and other Authorized Persons; and (f) An
executed authorization required by the Shareholder Communications Act
of 1985, attached hereto as Exhibit E.
2.3 Notice of Appointment of Transfer Agent. The Trust agrees to notify the
Custodian in writing of the appointment, termination or change in
appointment of any transfer agent of the Fund.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
3.1 Segregation. All Securities and non-cash property held by the Custodian for
the account of the Fund (other than Securities maintained in a Securities
Depository, Eligible Securities Depository or Book-Entry System) shall be
physically segregated from other Securities and non-cash property in the
possession of the Custodian (including the Securities and non-cash property
of the other series of the Trust) and shall be identified as subject to
this Agreement.
3.2 Fund Custody Accounts. As to each Fund, the Custodian shall open and
maintain in its trust department a custody account in the name of the Trust
coupled with the name of the Fund, subject only to draft or order of the
Custodian, in which the Custodian shall enter and carry all Securities,
cash and other assets of such Fund which are delivered to it.
3.3 Appointment of Agents.
(a) In its discretion, the Custodian may appoint one or more
Sub-Custodians to establish and maintain arrangements with (i)
Eligible Securities Depositories or (ii) members of the
Sub-Custodian's network to hold Securities and cash of the Fund and to
carry out such other provisions of this Agreement as it may determine;
provided, however, that the appointment of any such agents and
maintenance of any Securities and cash of the Fund shall be at the
Custodian's expense and shall not relieve the Custodian of any of its
obligations or liabilities under this Agreement. The Custodian shall
be liable for the actions of any Sub-Custodians (regardless of whether
assets are maintained in the custody of a Sub-Custodian, a member of
its network or an Eligible Securities Depository) appointed by it as
if such actions had been done by the Custodian.
(b) If, after the initial approval of Sub-Custodians by the Board of
Trustees in connection with this Agreement, the Custodian wishes to
appoint other Sub-Custodians to hold property of the Fund, it will so
notify the Trust and provide it with information reasonably necessary
to determine any such new Sub-Custodian's eligibility under Rule 17f-5
under the 1940 Act, including a copy of the proposed agreement with
such Sub-Custodian. At the meeting of the Board of Trustees next
following receipt of such notice and information, the Trust shall give
its written approval or disapproval of the proposed action.
(c) The agreement between the Custodian and each Sub-Custodian acting
hereunder shall contain the required provisions set forth in Rule
17f-5(c)(2) under the 1940 Act.
(d) At the end of each calendar quarter, the Custodian shall provide
written reports notifying the Board of Trustees of the placement of
the Securities and cash of the Fund with a Sub-Custodian and of any
material changes in the Fund's arrangements. Such reports shall
include an analysis of the custody risks associated with maintaining
assets with any Eligible Securities Depositories. The Custodian shall
promptly take such steps as may be required to withdraw assets of the
Fund from any Sub-Custodian arrangement that has ceased to meet the
requirements of Rule 17f-5 or Rule 17f-7 under the 1940 Act, as
applicable.
(e) With respect to its responsibilities under this Section 3.3, the
Custodian hereby warrants to the Trust that it agrees to exercise
reasonable care, prudence and diligence such as a person having
responsibility for the safekeeping of property of the Fund. The
Custodian further warrants that the Fund's assets will be subject to
reasonable care if maintained with a Sub-Custodian, after considering
all factors relevant to the safekeeping of such assets, including,
without limitation: (i) the Sub-Custodian's practices, procedures, and
internal controls for certificated securities (if applicable), its
method of keeping custodial records, and its security and data
protection practices; (ii) whether the Sub-Custodian has the requisite
financial strength to provide reasonable care for Fund assets; (iii)
the Sub-Custodian's general reputation and standing and, in the case
of a Securities Depository, the Securities Depository's operating
history and number of participants; and (iv) whether the Fund will
have jurisdiction over and be able to enforce judgments against the
Sub-Custodian, such as by virtue of the existence of any offices of
the Sub-Custodian in the United States or the Sub-Custodian's consent
to service of process in the United States.
(f) The Custodian shall establish a system or ensure that its
Sub-Custodian has established a system to monitor (i) the
appropriateness of maintaining the Fund's assets with a Sub-Custodian
or members of a Sub-Custodian's network; (ii) the performance of the
contract governing the Fund's arrangements with such Sub-Custodian or
members of a Sub-Custodian's network; and (iii) the custody risks of
maintaining assets with an Eligible Securities Depository.
(g) The Custodian shall use reasonable commercial efforts to collect all
income and other payments with respect to foreign Securities to which
the Fund shall be entitled and shall credit such income, as collected,
to the Trust. In the event that extraordinary measures are required to
collect such income, the Trust and Custodian shall consult as to the
measures and as to the compensation and expenses of the Custodian
relating to such measures.
3.4 Delivery of Assets to Custodian. The Trust shall deliver, or cause to be
delivered, to the Custodian all of the Fund's Securities, cash and other
investment assets, including (i) all payments of income, payments of
principal and capital distributions received by the Fund with respect to
such Securities, cash or other assets owned by the Fund at any time during
the period of this Agreement, and (ii) all cash received by the Fund for
the issuance of Shares. The Custodian shall not be responsible for such
Securities, cash or other assets until actually received by it.
3.5 Securities Depositories and Book-Entry Systems. The Custodian may deposit
and/or maintain Securities of the Fund in a Securities Depository or in a
Book-Entry System, subject to the following provisions:
(a) The Custodian, on an on-going basis, shall deposit in a Securities
Depository or Book-Entry System all Securities eligible for deposit
therein and shall make use of such Securities Depository or Book-Entry
System to the extent possible and practical in connection with its
performance hereunder, including, without limitation, in connection
with settlements of purchases and sales of Securities, loans of
Securities, and deliveries and returns of collateral consisting of
Securities.
(b) Securities of the Fund kept in a Book-Entry System or Securities
Depository shall be kept in an account ("Depository Account") of the
Custodian in such Book-Entry System or Securities Depository which
includes only assets held by the Custodian as a fiduciary, custodian
or otherwise for customers.
(c) The records of the Custodian with respect to Securities of the Fund
maintained in a Book-Entry System or Securities Depository shall, by
book-entry, identify such Securities as belonging to the Fund.
(d) If Securities purchased by the Fund are to be held in a Book-Entry
System or Securities Depository, the Custodian shall pay for such
Securities upon (i) receipt of advice from the Book-Entry System or
Securities Depository that such Securities have been transferred to
the Depository Account, and (ii) the making of an entry on the records
of the Custodian to reflect such payment and transfer for the account
of the Fund. If Securities sold by the Fund are held in a Book-Entry
System or Securities Depository, the Custodian shall transfer such
Securities upon (i) receipt of advice from the Book-Entry System or
Securities Depository that payment for such Securities has been
transferred to the Depository Account, and (ii) the making of an entry
on the records of the Custodian to reflect such transfer and payment
for the account of the Fund.
(e) The Custodian shall provide the Trust with copies of any report
(obtained by the Custodian from a Book-Entry System or Securities
Depository in which Securities of the Fund are kept) on the internal
accounting controls and procedures for safeguarding Securities
deposited in such Book-Entry System or Securities Depository.
(f) Notwithstanding anything to the contrary in this Agreement, the
Custodian shall be liable to the Trust for any loss or damage to the
Fund resulting from (i) the use of a Book-Entry System or Securities
Depository by reason of any negligence or willful misconduct on the
part of the Custodian or any Sub-Custodian, or (ii) failure of the
Custodian or any Sub-Custodian to enforce effectively such rights as
it may have against a Book-Entry System or Securities Depository. At
its election, the Trust shall be subrogated to the rights of the
Custodian with respect to any claim against a Book-Entry System or
Securities Depository or any other person from any loss or damage to
the Fund arising from the use of such Book-Entry System or Securities
Depository, if and to the extent that the Fund has not been made whole
for any such loss or damage.
(g) With respect to its responsibilities under this Section 3.5 and
pursuant to Rule 17f-4 under the 1940 Act, the Custodian hereby
warrants to the Trust that it agrees to (i) exercise due care in
accordance with reasonable commercial standards in discharging its
duty as a securities intermediary to obtain and thereafter maintain
such assets, (ii) provide, promptly upon request by the Trust, such
reports as are available concerning the Custodian's internal
accounting controls and financial strength, and (iii) require any
Sub-Custodian to exercise due care in accordance with reasonable
commercial standards in discharging its duty as a securities
intermediary to obtain and thereafter maintain assets corresponding to
the security entitlements of its entitlement holders.
3.6 Disbursement of Moneys from Fund Custody Account. Upon receipt of Proper
Instructions, the Custodian shall disburse moneys from the Fund Custody
Account but only in the following cases:
(a) For the purchase of Securities for the Fund but only in accordance
with Section 4.1 of this Agreement and only (i) in the case of
Securities (other than options on Securities, futures contracts and
options on futures contracts), against the delivery to the Custodian
(or any Sub-Custodian) of such Securities registered as provided in
Section 3.9 below or in proper form for transfer, or if the purchase
of such Securities is effected through a Book-Entry System or
Securities Depository, in accordance with the conditions set forth in
Section 3.5 above; (ii) in the case of options on Securities, against
delivery to the Custodian (or any Sub-Custodian) of such receipts as
are required by the customs prevailing among dealers in such options;
(iii) in the case of futures contracts and options on futures
contracts, against delivery to the Custodian (or any Sub-Custodian) of
evidence of title thereto in favor of the Fund or any nominee referred
to in Section 3.9 below; and (iv) in the case of repurchase or reverse
repurchase agreements entered into between the Trust and a bank which
is a member of the Federal Reserve System or between the Trust and a
primary dealer in U.S. Government securities, against delivery of the
purchased Securities either in certificate form or through an entry
crediting the Custodian's account at a Book-Entry System or Securities
Depository with such Securities;
(b) In connection with the conversion, exchange or surrender, as set forth
in Section 3.7(f) below, of Securities owned by the Fund;
(c) For the payment of any dividends or capital gain distributions
declared by the Fund;
(d) In payment of the redemption price of Shares as provided in Section
5.1 below;
(e) For the payment of any expense or liability incurred by the Fund,
including, but not limited to, the following payments for the account
of the Fund: interest; taxes; administration, investment advisory,
accounting, auditing, transfer agent, custodian, director and legal
fees; and other operating expenses of the Fund; in all cases, whether
or not such expenses are to be in whole or in part capitalized or
treated as deferred expenses;
(f) For transfer in accordance with the provisions of any agreement among
the Trust, the Custodian and a broker-dealer registered under the 1934
Act and a member of the NASD, relating to compliance with rules of the
Options Clearing Corporation and of any registered national securities
exchange (or of any similar organization or organizations) regarding
escrow or other arrangements in connection with transactions by the
Fund;
(g) For transfer in accordance with the provisions of any agreement among
the Trust, the Custodian and a futures commission merchant registered
under the Commodity Exchange Act, relating to compliance with the
rules of the Commodity Futures Trading Commission and/or any contract
market (or any similar organization or organizations) regarding
account deposits in connection with transactions by the Fund;
(h) For the funding of any uncertificated time deposit or other
interest-bearing account with any banking institution (including the
Custodian), which deposit or account has a term of one year or less;
and
(i) For any other proper purpose, but only upon receipt, in addition to
Proper Instructions, of a copy of a resolution of the Board of
Trustees, certified by an Officer, specifying the amount and purpose
of such payment, declaring such purpose to be a proper corporate
purpose, and naming the person or persons to whom such payment is to
be made.
3.7 Delivery of Securities from Fund Custody Account. Upon receipt of Proper
Instructions, the Custodian shall release and deliver, or cause the
Sub-Custodian to release and deliver, Securities from the Fund Custody
Account but only in the following cases:
(a) Upon the sale of Securities for the account of the Fund but only
against receipt of payment therefor in cash, by certified or cashiers
check or bank credit;
(b) In the case of a sale effected through a Book-Entry System or
Securities Depository, in accordance with the provisions of Section
3.5 above;
(c) To an offeror's depository agent in connection with tender or other
similar offers for Securities of the Fund; provided that, in any such
case, the cash or other consideration is to be delivered to the
Custodian;
(d) To the issuer thereof or its agent (i) for transfer into the name of
the Fund, the Custodian or any Sub-Custodian, or any nominee or
nominees of any of the foregoing, or (ii) for exchange for a different
number of certificates or other evidence representing the same
aggregate face amount or number of units; provided that, in any such
case, the new Securities are to be delivered to the Custodian;
(e) To the broker selling the Securities, for examination in accordance
with the "street delivery" custom;
(f) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the
issuer of such Securities, or pursuant to provisions for conversion
contained in such Securities, or pursuant to any deposit agreement,
including surrender or receipt of underlying Securities in connection
with the issuance or cancellation of depository receipts; provided
that, in any such case, the new Securities and cash, if any, are to be
delivered to the Custodian;
(g) Upon receipt of payment therefor pursuant to any repurchase or reverse
repurchase agreement entered into by the Fund;
(h) In the case of warrants, rights or similar Securities, upon the
exercise thereof, provided that, in any such case, the new Securities
and cash, if any, are to be delivered to the Custodian;
(i) For delivery in connection with any loans of Securities of the Fund,
but only against receipt of such collateral as the Trust shall have
specified to the Custodian in Proper Instructions;
(j) For delivery as security in connection with any borrowings by the Fund
requiring a pledge of assets by the Trust, but only against receipt by
the Custodian of the amounts borrowed;
(k) Pursuant to any authorized plan of liquidation, reorganization,
merger, consolidation or recapitalization of the Trust;
(l) For delivery in accordance with the provisions of any agreement among
the Trust, the Custodian and a broker-dealer registered under the 1934
Act and a member of the NASD, relating to compliance with the rules of
the Options Clearing Corporation and of any registered national
securities exchange (or of any similar organization or organizations)
regarding escrow or other arrangements in connection with transactions
by the Fund;
(m) For delivery in accordance with the provisions of any agreement among
the Trust, the Custodian and a futures commission merchant registered
under the Commodity Exchange Act, relating to compliance with the
rules of the Commodity Futures Trading Commission and/or any contract
market (or any similar organization or organizations) regarding
account deposits in connection with transactions by the Fund;
(n) For any other proper corporate purpose, but only upon receipt, in
addition to Proper Instructions, of a copy of a resolution of the
Board of Trustees, certified by an Officer, 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; or
(o) To brokers, clearing banks or other clearing agents for examination or
trade execution in accordance with market custom; provided that in any
such case the Custodian shall have no responsibility or liability for
any loss arising from the delivery of such securities prior to
receiving payment for such securities except as may arise from the
Custodian's own negligence or willful misconduct.
3.8 Actions Not Requiring Proper Instructions. Unless otherwise instructed by
the Trust, the Custodian shall with respect to all Securities held for the
Fund:
(a) Subject to Section 9.4 below, collect on a timely basis all income and
other payments to which the Fund is entitled either by law or pursuant
to custom in the securities business;
(b) Present for payment and, subject to Section 9.4 below, collect on a
timely basis the amount payable upon all Securities which may mature
or be called, redeemed, or retired, or otherwise become payable;
(c) Endorse for collection, in the name of the Fund, checks, drafts and
other negotiable instruments;
(d) Surrender interim receipts or Securities in temporary form for
Securities in definitive form;
(e) Execute, as custodian, any necessary declarations or certificates of
ownership under the federal income tax laws or the laws or regulations
of any other taxing authority now or hereafter in effect, and prepare
and submit reports to the IRS and the Trust at such time, in such
manner and containing such information as is prescribed by the IRS;
(f) Hold for the Fund, either directly or, with respect to Securities held
therein, through a Book-Entry System or Securities Depository, all
rights and similar Securities issued with respect to Securities of the
Fund; and
(g) In general, and except as otherwise directed in Proper Instructions,
attend to all non-discretionary details in connection with the sale,
exchange, substitution, purchase, transfer and other dealings with
Securities and other assets of the Fund.
3.9 Registration and Transfer of Securities. All Securities held for the Fund
that are issued or issuable only in bearer form shall be held by the
Custodian in that form, provided that any such Securities shall be held in
a Book-Entry System if eligible therefor. All other Securities held for the
Fund may be registered in the name of the Fund, the Custodian, a
Sub-Custodian or any nominee thereof, or in the name of a Book-Entry
System, Securities Depository or any nominee of either thereof. The records
of the Custodian with respect to foreign securities of the Fund that are
maintained with a Sub-Custodian in an account that is identified as
belonging to the Custodian for the benefit of its customers shall identify
those securities as belonging to the Fund. The Trust shall furnish to the
Custodian appropriate instruments to enable the Custodian to hold or
deliver in proper form for transfer, or to register in the name of any of
the nominees referred to above or in the name of a Book-Entry System or
Securities Depository, any Securities registered in the name of the Fund.
3.10 Records.
(a) The Custodian shall maintain complete and accurate records with
respect to Securities, cash or other property held for the Fund,
including (i) journals or other records of original entry containing
an itemized daily record in detail of all receipts and deliveries of
Securities and all receipts and disbursements of cash; (ii) ledgers
(or other records) reflecting (A) Securities in transfer, (B)
Securities in physical possession, (C) monies and Securities borrowed
and monies and Securities loaned (together with a record of the
collateral therefor and substitutions of such collateral), (D)
dividends and interest received, and (E) dividends receivable and
interest receivable; and (iii) canceled checks and bank records
related thereto. The Custodian shall keep such other books and records
of the Fund as the Trust shall reasonably request, or as may be
required by the 1940 Act, including, but not limited to, Section 31 of
the 1940 Act and Rule 31a-2 promulgated thereunder.
(b) All such books and records maintained by the Custodian shall (i) be
maintained in a form acceptable to the Trust and in compliance with
the rules and regulations of the SEC, (ii) be the property of the
Trust and at all times during the regular business hours of the
Custodian be made available upon request for inspection by duly
authorized officers, employees or agents of the Trust and employees or
agents of the SEC, and (iii) if required to be maintained by Rule
31a-1 under the 1940 Act, be preserved for the periods prescribed in
Rules 31a-1 and 31a-2 under the 1940 Act.
3.11 Fund Reports by Custodian. The Custodian shall furnish the Trust with a
daily activity statement and a summary of all transfers to or from each
Fund Custody Account on the day following such transfers. At least monthly,
the Custodian shall furnish the Trust with a detailed statement of the
Securities and moneys held by the Custodian and the Sub-Custodians for the
Fund under this Agreement.
3.12 Other Reports by Custodian. As the Trust may reasonably request from time
to time, the Custodian shall provide the Trust with reports on the internal
accounting controls and procedures for safeguarding Securities which are
employed by the Custodian or any Sub-Custodian.
3.13 Proxies and Other Materials. The Custodian shall cause all proxies relating
to Securities which are not registered in the name of the Fund to be
promptly executed by the registered holder of such Securities, without
indication of the manner in which such proxies are to be voted, and shall
promptly deliver to the Trust such proxies, all proxy soliciting materials
and all notices relating to such Securities. With respect to the foreign
Securities, the Custodian will use reasonable commercial efforts to
facilitate the exercise of voting and other shareholder rights, subject to
the laws, regulations and practical constraints that may exist in the
country where such securities are issued. The Trust acknowledges that local
conditions, including lack of regulation, onerous procedural obligations,
lack of notice and other factors may have the effect of severely limiting
the ability of the Trust to exercise shareholder rights.
3.14 Information on Corporate Actions. The Custodian shall promptly deliver to
the Trust all information received by the Custodian and pertaining to
Securities being held by the Fund with respect to optional tender or
exchange offers, calls for redemption or purchase, or expiration of rights
as described in the Standards of Service Guide attached as Exhibit B. If
the Trust desires to take action with respect to any tender offer, exchange
offer or other similar transaction, the Trust shall notify the Custodian at
least three Business Days prior to the date on which the Custodian is to
take such action. The Trust will provide or cause to be provided to the
Custodian all relevant information for any Security which has unique
put/option provisions at least three Business Days prior to the beginning
date of the tender period.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND
4.1 Purchase of Securities. Promptly upon each purchase of Securities for the
Fund, Written Instructions shall be delivered to the Custodian, specifying
(i) the name of the issuer or writer of such Securities, and the title or
other description thereof, (ii) the number of shares, principal amount (and
accrued interest, if any) or other units purchased, (iii) the date of
purchase and settlement, (iv) the purchase price per unit, (v) the total
amount payable upon such purchase, and (vi) the name of the person to whom
such amount is payable. The Custodian shall upon receipt of such Securities
purchased by the Fund pay out of the moneys held for the account of the
Fund the total amount specified in such Written Instructions to the person
named therein. The Custodian shall not be under any obligation to pay out
moneys to cover the cost of a purchase of Securities for the Fund, if in
the Fund Custody Account there is insufficient cash available to the Fund
for which such purchase was made.
4.2 Liability for Payment in Advance of Receipt of Securities Purchased. In any
and every case where payment for the purchase of Securities for the Fund is
made by the Custodian in advance of receipt of the Securities purchased and
in the absence of specified Written Instructions to so pay in advance, the
Custodian shall be liable to the Fund for such payment.
4.3 Sale of Securities. Promptly upon each sale of Securities by the Fund,
Written Instructions shall be delivered to the Custodian, specifying (i)
the name of the issuer or writer of such Securities, and the title or other
description thereof, (ii) the number of shares, principal amount (and
accrued interest, if any), or other units sold, (iii) the date of sale and
settlement, (iv) the sale price per unit, (v) the total amount payable upon
such sale, and (vi) the person to whom such Securities are to be delivered.
Upon receipt of the total amount payable to the Fund as specified in such
Written Instructions, the Custodian shall deliver such Securities to the
person specified in such Written Instructions. Subject to the foregoing,
the Custodian may accept payment in such form as shall be satisfactory to
it, and may deliver Securities and arrange for payment in accordance with
the customs prevailing among dealers in Securities.
4.4 Delivery of Securities Sold. Notwithstanding Section 4.3 above or any other
provision of this Agreement, the Custodian, when instructed to deliver
Securities against payment, shall be entitled, if in accordance with
generally accepted market practice, to deliver such Securities prior to
actual receipt of final payment therefor. In any such case, the Fund shall
bear the risk that final payment for such Securities may not be made or
that such Securities may be returned or otherwise held or disposed of by or
through the person to whom they were delivered, and the Custodian shall
have no liability for any for the foregoing.
4.5 Payment for Securities Sold. In its sole discretion and from time to time,
the Custodian may credit the Fund Custody Account, prior to actual receipt
of final payment thereof, with (i) proceeds from the sale of Securities
which it has been instructed to deliver against payment, (ii) proceeds from
the redemption of Securities or other assets of the Fund, and (iii) income
from cash, Securities or other assets of the Fund. Any such credit shall be
conditional upon actual receipt by Custodian of final payment and may be
reversed if final payment is not actually received in full. The Custodian
may, in its sole discretion and from time to time, permit the Fund to use
funds so credited to the Fund Custody Account in anticipation of actual
receipt of final payment. Any such funds shall be repayable immediately
upon demand made by the Custodian at any time prior to the actual receipt
of all final payments in anticipation of which funds were credited to the
Fund Custody Account.
4.6 Advances by Custodian for Settlement. The Custodian may, in its sole
discretion and from time to time, advance funds to the Trust to facilitate
the settlement of a Fund's transactions in the Fund Custody Account. Any
such advance shall be repayable immediately upon demand made by Custodian.
ARTICLE V
REDEMPTION OF FUND SHARES
5.1 Transfer of Funds. From such funds as may be available for the purpose in
the relevant Fund Custody Account, and upon receipt of Proper Instructions
specifying that the funds are required to redeem Shares of the Fund, the
Custodian shall wire each amount specified in such Proper Instructions to
or through such bank or broker-dealer as the Trust may designate.
5.2 No Duty Regarding Paying Banks. Once the Custodian has wired amounts to a
bank or broker-dealer pursuant to Section 5.1 above, the Custodian shall
not be under any obligation to effect any further payment or distribution
by such bank or broker-dealer.
ARTICLE VI
SEGREGATED ACCOUNTS
6.1 Upon receipt of Proper Instructions, the Custodian shall establish and
maintain a segregated account or accounts for and on behalf of the Fund,
into which account or accounts may be transferred cash and/or Securities,
including Securities maintained in a Depository Account:
(a) in accordance with the provisions of any agreement among the Trust,
the Custodian and a broker-dealer registered under the 1934 Act and a
member of the NASD (or any futures commission merchant registered
under the Commodity Exchange Act), relating to compliance with the
rules of the Options Clearing Corporation and of any registered
national securities exchange (or the Commodity Futures Trading
Commission or any registered contract market), or of any similar
organization or organizations, regarding escrow or other arrangements
in connection with transactions by the Fund;
(b) for purposes of segregating cash or Securities in connection with
securities options purchased or written by the Fund or in connection
with financial futures contracts (or options thereon) purchased or
sold by the Fund;
(c) which constitute collateral for loans of Securities made by the Fund;
(d) for purposes of compliance by the Fund with requirements under the
1940 Act for the maintenance of segregated accounts by registered
investment companies in connection with reverse repurchase agreements
and when-issued, delayed delivery and firm commitment transactions;
and
(e) for other proper corporate purposes, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a resolution of
the Board of Trustees, certified by an Officer, setting forth the
purpose or purposes of such segregated account and declaring such
purposes to be proper corporate purposes.
6.2 Each segregated account established under this Article VI shall be
established and maintained for the Fund only. All Proper Instructions
relating to a segregated account shall specify the Fund.
ARTICLE VII
COMPENSATION OF CUSTODIAN
7.1 Compensation. The Custodian shall be compensated for providing the services
set forth in this Agreement in accordance with the fee schedule set forth
on Exhibit D hereto (as amended from time to time). The Custodian shall
also be compensated for such out-of-pocket expenses (e.g.,
telecommunication charges, postage and delivery charges, and reproduction
charges) as are reasonably incurred by the Custodian in performing its
duties hereunder. The Trust shall pay all such fees and reimbursable
expenses within 30 calendar days following receipt of the billing notice,
except for any fee or expense subject to a good faith dispute. The Trust
shall notify the Custodian in writing within 30 calendar days following
receipt of each invoice if the Trust is disputing any amounts in good
faith. The Trust shall pay such disputed amounts within 10 calendar days of
the day on which the parties agree to the amount to be paid. With the
exception of any fee or expense the Trust is disputing in good faith as set
forth above, unpaid invoices shall accrue a finance charge of 1 1/2% per
month after the due date. Notwithstanding anything to the contrary, amounts
owed by the Trust to the Custodian shall only be paid out of the assets and
property of the particular Fund involved.
7.2 Overdrafts. The Trust is responsible for maintaining an appropriate level
of short term cash investments to accommodate cash outflows. The Trust may
obtain a formal line of credit for potential overdrafts of its custody
account. In the event of an overdraft or in the event the line of credit is
insufficient to cover an overdraft, the overdraft amount or the overdraft
amount that exceeds the line of credit will be charged in accordance with
the fee schedule set forth on Exhibit D hereto (as amended from time to
time).
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
8.1 Representations and Warranties of the Trust. The Trust hereby represents
and warrants to the Custodian, which representations and warranties shall
be deemed to be continuing throughout the term of this Agreement, that:
(a) It is duly organized and existing under the laws of the jurisdiction
of its organization, with full power to carry on its business as now
conducted, to enter into this Agreement and to perform its obligations
hereunder;
(b) This Agreement has been duly authorized, executed and delivered by the
Trust in accordance with all requisite action and constitutes a valid
and legally binding obligation of the Trust, enforceable in accordance
with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the rights
and remedies of creditors and secured parties; and
(c) It is conducting its business in compliance in all material respects
with all applicable laws and regulations, both state and federal, and
has obtained all regulatory approvals necessary to carry on its
business as now conducted; there is no statute, rule, regulation,
order or judgment binding on it and no provision of its charter,
bylaws or any contract binding it or affecting its property which
would prohibit its execution or performance of this Agreement.
8.2 Representations and Warranties of the Custodian. The Custodian hereby
represents and warrants to the Trust, which representations and warranties
shall be deemed to be continuing throughout the term of this Agreement,
that:
(a) It is duly organized and existing under the laws of the jurisdiction
of its organization, with full power to carry on its business as now
conducted, to enter into this Agreement and to perform its obligations
hereunder;
(b) This Agreement has been duly authorized, executed and delivered by the
Custodian in accordance with all requisite action and constitutes a
valid and legally binding obligation of the Custodian, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and secured parties;
and
(c) It is conducting its business in compliance in all material respects
with all applicable laws and regulations, both state and federal, and
has obtained all regulatory approvals necessary to carry on its
business as now conducted; there is no statute, rule, regulation,
order or judgment binding on it and no provision of its charter,
bylaws or any contract binding it or affecting its property which
would prohibit its execution or performance of this Agreement.
ARTICLE IX
CONCERNING THE CUSTODIAN
9.1 Standard of Care. The Custodian shall exercise reasonable care in the
performance of its duties under this Agreement. The Custodian shall not be
liable for any error of judgment or mistake of law or for any loss suffered
by the Trust in connection with its duties under this Agreement, except a
loss arising out of or relating to the Custodian's (or a Sub-Custodian's)
refusal or failure to comply with the terms of this Agreement (or any
sub-custody agreement) or from its (or a Sub-Custodian's) bad faith,
negligence or willful misconduct in the performance of its duties under
this Agreement (or any sub-custody agreement). The Custodian shall be
entitled to rely on and may act upon advice of counsel on all matters, and
shall be without liability for any action reasonably taken or omitted
pursuant to such advice. The Custodian shall promptly notify the Trust of
any action taken or omitted by the Custodian pursuant to advice of counsel.
9.2 Actual Collection Required. The Custodian shall not be liable for, or
considered to be the custodian of, any cash belonging to the Fund or any
money represented by a check, draft or other instrument for the payment of
money, until the Custodian or its agents actually receive such cash or
collect on such instrument.
9.3 No Responsibility for Title, etc. So long as and to the extent that it is
in the exercise of reasonable care, the Custodian shall not be responsible
for the title, validity or genuineness of any property or evidence of title
thereto received or delivered by it pursuant to this Agreement.
9.4 Limitation on Duty to Collect. Custodian shall not be required to enforce
collection, by legal means or otherwise, of any money or property due and
payable with respect to Securities held for the Fund if such Securities are
in default or payment is not made after due demand or presentation.
9.5 Reliance Upon Documents and Instructions. The Custodian shall be entitled
to rely upon any certificate, notice or other instrument in writing
received by it and reasonably believed by it to be genuine. The Custodian
shall be entitled to rely upon any Oral Instructions and any Written
Instructions actually received by it pursuant to this Agreement.
9.6 Cooperation. The Custodian shall cooperate with and supply necessary
information to the entity or entities appointed by the Trust to keep the
books of account of the Fund and/or compute the value of the assets of the
Fund. The Custodian shall take all such reasonable actions as the Trust may
from time to time request to enable the Trust to obtain, from year to year,
favorable opinions from the Trust's independent accountants with respect to
the Custodian's activities hereunder in connection with (i) the preparation
of the Trust's reports on Form N-1A and Form N-SAR and any other reports
required by the SEC, and (ii) the fulfillment by the Trust of any other
requirements of the SEC.
ARTICLE X
INDEMNIFICATION
10.1 Indemnification by Trust. The Trust shall indemnify and hold harmless the
Custodian, any Sub-Custodian and any nominee thereof (each, an "Indemnified
Party" and collectively, the "Indemnified Parties") from and against any
and all claims, demands, losses, expenses and liabilities of any and every
nature (including reasonable attorneys' fees) that an Indemnified Party may
sustain or incur or that may be asserted against an Indemnified Party by
any person arising directly or indirectly (i) from the fact that Securities
are registered in the name of any such nominee, (ii) from any action taken
or omitted to be taken by the Custodian or such Sub-Custodian (a) at the
request or direction of or in reliance on the advice of the Trust, or (b)
upon Proper Instructions, or (iii) from the performance of its obligations
under this Agreement or any sub-custody agreement, provided that neither
the Custodian nor any such Sub-Custodian shall be indemnified and held
harmless from and against any such claim, demand, loss, expense or
liability arising out of or relating to its refusal or failure to comply
with the terms of this Agreement (or any sub-custody agreement), or from
its bad faith, negligence or willful misconduct in the performance of its
duties under this Agreement (or any sub-custody agreement). This indemnity
shall be a continuing obligation of the Trust, its successors and assigns,
notwithstanding the termination of this Agreement. As used in this
paragraph, the terms "Custodian" and "Sub-Custodian" shall include their
respective directors, officers and employees.
10.2 Indemnification by Custodian. The Custodian shall indemnify and hold
harmless the Trust from and against any and all claims, demands, losses,
expenses, and liabilities of any and every nature (including reasonable
attorneys' fees) that the Trust may sustain or incur or that may be
asserted against the Trust by any person arising out of any action taken or
omitted to be taken by an Indemnified Party as a result of the Indemnified
Party's refusal or failure to comply with the terms of this Agreement (or
any sub-custody agreement), or from its bad faith, negligence or willful
misconduct in the performance of its duties under this Agreement (or any
sub-custody agreement). This indemnity shall be a continuing obligation of
the Custodian, its successors and assigns, notwithstanding the termination
of this Agreement. As used in this paragraph, the term "Trust" shall
include the Trust's directors, officers and employees.
10.3 Security. If the Custodian advances cash or Securities to the Fund for any
purpose, either at the Trust's request or as otherwise contemplated in this
Agreement, or in the event that the Custodian or its nominee incurs, in
connection with its performance under this Agreement, any claim, demand,
loss, expense or liability (including reasonable attorneys' fees) (except
such as may arise from its or its nominee's bad faith, negligence or
willful misconduct), then, in any such event, any property at any time held
for the account of the Fund shall be security therefor, and should the Fund
fail promptly to repay or indemnify the Custodian, the Custodian shall be
entitled to utilize available cash of such Fund and to dispose of other
assets of such Fund to the extent necessary to obtain reimbursement or
indemnification.
10.4 Miscellaneous.
(a) Neither party to this Agreement shall be liable to the other party for
consequential, special or punitive damages under any provision of this
Agreement.
(b) The indemnity provisions of this Article shall indefinitely survive
the termination and/or assignment of this Agreement.
(c) In order that the indemnification provisions contained in this Article
shall apply, it is understood that if in any case the indemnitor may
be asked to indemnify or hold the indemnitee harmless, the indemnitor
shall be fully and promptly advised of all pertinent facts concerning
the situation in question, and it is further understood that the
indemnitee will use all reasonable care to notify the indemnitor
promptly concerning any situation that presents or appears likely to
present the probability of a claim for indemnification. The indemnitor
shall have the option to defend the indemnitee against any claim that
may be the subject of this indemnification. In the event that the
indemnitor so elects, it will so notify the indemnitee and thereupon
the indemnitor shall take over complete defense of the claim, and the
indemnitee shall in such situation initiate no further legal or other
expenses for which it shall seek indemnification under this section.
The indemnitee shall in no case confess any claim or make any
compromise in any case in which the indemnitor will be asked to
indemnify the indemnitee except with the indemnitor's prior written
consent.
ARTICLE XI
FORCE MAJEURE
Neither the Custodian nor the Trust shall be liable for any failure or
delay in performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable control,
including, without limitation, acts of God; earthquakes; fires; floods; wars;
civil or military disturbances; acts of terrorism; sabotage; strikes; epidemics;
riots; power failures; computer failure and any such circumstances beyond its
reasonable control as may cause interruption, loss or malfunction of utility,
transportation, computer (hardware or software) or telephone communication
service; accidents; labor disputes; acts of civil or military authority;
governmental actions; or inability to obtain labor, material, equipment or
transportation; provided, however, that in the event of a failure or delay, the
Custodian (i) shall not discriminate against the Fund in favor of any other
customer of the Custodian in making computer time and personnel available to
input or process the transactions contemplated by this Agreement, and (ii) shall
use its best efforts to ameliorate the effects of any such failure or delay.
ARTICLE XII
PROPRIETARY AND CONFIDENTIAL INFORMATION
The Custodian agrees on behalf of itself and its directors, officers, and
employees to treat confidentially and as proprietary information of the Trust,
all records and other information relative to the Trust and prior, present, or
potential shareholders of the Trust (and clients of said shareholders), and not
to use such records and information for any purpose other than the performance
of its responsibilities and duties hereunder, except (i) after prior
notification to and approval in writing by the Trust, which approval shall not
be unreasonably withheld and may not be withheld where the Custodian may be
exposed to civil or criminal contempt proceedings for failure to comply, (ii)
when requested to divulge such information by duly constituted authorities, or
(iii) when so requested by the Trust. Records and other information which have
become known to the public through no wrongful act of the Custodian or any of
its employees, agents or representatives, and information that was already in
the possession of the Custodian prior to receipt thereof from the Trust or its
agent, shall not be subject to this paragraph.
Further, the Custodian will adhere to the privacy policies adopted by the
Trust pursuant to Title V of the Xxxxx-Xxxxx-Xxxxxx Act, as may be modified from
time to time. In this regard, the Custodian shall have in place and maintain
physical, electronic and procedural safeguards reasonably designed to protect
the security, confidentiality and integrity of, and to prevent unauthorized
access to or use of, records and information relating to the Trust and its
shareholders.
ARTICLE XIII
EFFECTIVE PERIOD; TERMINATION
13.1 Effective Period. This Agreement shall become effective as of the date
first written above and will continue in effect for a period of three (3)
years.
13.2 Termination. Subsequent to the initial three-year term, this Agreement may
be terminated by either party upon giving 90 days prior written notice to
the other party or such shorter period as is mutually agreed upon by the
parties. Notwithstanding the foregoing, this Agreement may be terminated by
any party upon the breach of the other party of any material term of this
Agreement if such breach is not cured within 15 days of notice of such
breach to the breaching party. In addition, the Trust may, at any time,
immediately terminate this Agreement in the event of the appointment of a
conservator or receiver for the Custodian by regulatory authorities or upon
the happening of a like event at the direction of an appropriate regulatory
agency or court of competent jurisdiction.
13.3 Early Termination. In the absence of any material breach of this agreement,
should the Trust elect to terminate this agreement prior to the end of the
term, the trust agrees to pay the following fees:
(a) All monthly fees through the life of the contract, including the
rebate of any negotiated discounts;
(b) All fees associated with converting services to successor service
provider;
(c) All fees associated with any record retention and/or tax reporting
obligations that may not be eliminated due to the conversion to a
successor service provider;
(d) All out-of-pocket costs associated with a-c above.
13.4 Appointment of Successor Custodian. If a successor custodian shall have
been appointed by the Board of Trustees, the Custodian shall, upon receipt
of a notice of acceptance by the successor custodian, on such specified
date of termination (i) deliver directly to the successor custodian all
Securities (other than Securities held in a Book-Entry System or Securities
Depository) and cash then owned by the Fund and held by the Custodian as
custodian, and (ii) transfer any Securities held in a Book-Entry System or
Securities Depository to an account of or for the benefit of the Fund at
the successor custodian, provided that the Trust shall have paid to the
Custodian all fees, expenses and other amounts to the payment or
reimbursement of which it shall then be entitled. In addition, the
Custodian shall, at the expense of the Trust, transfer to such successor
all relevant books, records, correspondence, and other data established or
maintained by the Custodian under this Agreement in a form reasonably
acceptable to the Trust (if such form differs from the form in which the
Custodian has maintained the same, the Trust shall pay any expenses
associated with transferring the data to such form), and will cooperate in
the transfer of such duties and responsibilities, including provision for
assistance from the Custodian's personnel in the establishment of books,
records, and other data by such successor. Upon such delivery and transfer,
the Custodian shall be relieved of all obligations under this Agreement.
13.5 Failure to Appoint Successor Custodian. If a successor custodian is not
designated by the Trust on or before the date of termination of this
Agreement, then the Custodian shall have the right to deliver to a bank or
trust company of its own selection, which bank or trust company (i) is a
"bank" as defined in the 1940 Act, and (ii) has aggregate capital, surplus
and undivided profits as shown on its most recent published report of not
less than $25 million, all Securities, cash and other property held by
Custodian under this Agreement and to transfer to an account of or for the
Fund at such bank or trust company all Securities of the Fund held in a
Book-Entry System or Securities Depository. Upon such delivery and
transfer, such bank or trust company shall be the successor custodian under
this Agreement and the Custodian shall be relieved of all obligations under
this Agreement. In addition, under these circumstances, all books, records
and other data of the Trust shall be returned to the Trust.
ARTICLE XIV
MISCELLANEOUS
14.1 Compliance with Laws. The Trust has and retains primary responsibility for
all compliance matters relating to the Fund, including but not limited to
compliance with the 1940 Act, the Internal Revenue Code of 1986, the
Xxxxxxxx-Xxxxx Act of 2002, the USA Patriot Act of 2002 and the policies
and limitations of the Fund relating to its portfolio investments as set
forth in its Prospectus and statement of additional information. The
Custodian's services hereunder shall not relieve the Trust of its
responsibilities for assuring such compliance or the Board of Trustee's
oversight responsibility with respect thereto.
14.2 Amendment. This Agreement may not be amended or modified in any manner
except by written agreement executed by the Custodian and the Trust, and
authorized or approved by the Board of Trustees.
14.3 Assignment. This Agreement shall extend to and be binding upon the parties
hereto and their respective successors and assigns; provided, however, that
this Agreement shall not be assignable by the Trust without the written
consent of the Custodian, or by the Custodian without the written consent
of the Trust accompanied by the authorization or approval of the Board of
Trustees.
14.4 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio, without regard to conflicts
of law principles. To the extent that the applicable laws of the State of
Ohio, or any of the provisions herein, conflict with the applicable
provisions of the 1940 Act, the latter shall control, and nothing herein
shall be construed in a manner inconsistent with the 1940 Act or any rule
or order of the SEC thereunder.
14.5 No Agency Relationship. Nothing herein contained shall be deemed to
authorize or empower either party to act as agent for the other party to
this Agreement, or to conduct business in the name, or for the account, of
the other party to this Agreement.
14.6 Services Not Exclusive. Nothing in this Agreement shall limit or restrict
the Custodian from providing services to other parties that are similar or
identical to some or all of the services provided hereunder.
14.7 Invalidity. Any provision of this Agreement which may be determined by
competent authority to be prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction. In such case, the parties shall in good faith
modify or substitute such provision consistent with the original intent of
the parties.
14.8 Notices. Any notice required or permitted to be given by either party to
the other shall be in writing and shall be deemed to have been given on the
date delivered personally or by courier service, or three days after sent
by registered or certified mail, postage prepaid, return receipt requested,
or on the date sent and confirmed received by facsimile transmission to the
other party's address set forth below:
Notice to the Custodian shall be sent to:
U.S Bank, N.A.
0000 X. Xxxxxxxxxxx Xx., XX-XX-X000
Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
and notice to the Trust shall be sent to:
Academy Funds Trust
c/o Academy Asset Management, LLC
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, XX 00000
14.9 Multiple Originals. This Agreement may be executed on two or more
counterparts, each of which when so executed shall be deemed an original,
but such counterparts shall together constitute but one and the same
instrument.
14.10 No Waiver. No failure by either party hereto to exercise, and no delay by
such party in exercising, any right hereunder shall operate as a waiver
thereof. The exercise by either party hereto of any right hereunder shall
not preclude the exercise of any other right, and the remedies provided
herein are cumulative and not exclusive of any remedies provided at law or
in equity.
14.11 References to Custodian. The Trust shall not circulate any printed matter
which contains any reference to Custodian without the prior written
approval of Custodian, excepting printed matter contained in the prospectus
or statement of additional information for the Fund and such other printed
matter as merely identifies Custodian as custodian for the Fund. The Trust
shall submit printed matter requiring approval to Custodian in draft form,
allowing sufficient time for review by Custodian and its counsel prior to
any deadline for printing.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by a duly authorized officer on one or more counterparts as of the date
first above written.
ACADEMY FUNDS TRUST U.S. BANK NATIONAL ASSOCIATION
By:________________________________ By:______________________________
Name:_____________________________ Name: Xxxxxxx X. XxXxx
Title:______________________________ Title: Vice President
EXHIBIT A
AUTHORIZED PERSONS - Academy Funds Trust
Set forth below are the names and specimen signatures of the persons
authorized by the Trust to administer the Fund Custody Accounts.
Authorized Persons Specimen Signatures
President: Xxxxx Xxxxxxxx
-----------------------------------------
Secretary: Xxxxx X. Xxxxxxxx, Xx.
-----------------------------------------
Treasurer: Xxxxx Xxxxxxxx
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Vice President: Xxxxxxx X. Xxxxx
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Other:
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EXHIBIT B
U.S. Bank Institutional Custody Services
Standards of Service Guide
U.S. Bank, N.A. ("USBank") is committed to providing superior quality
service to all customers and their agents at all times. We have compiled this
guide as a tool for our clients to determine our standards for the processing of
security settlements, payment collection, and capital change transactions.
Deadlines recited in this guide represent the times required for USBank to
guarantee processing. Failure to meet these deadlines will result in settlement
at our client's risk. In all cases, USBank will make every effort to complete
all processing on a timely basis.
USBank is a direct participant of the Depository Trust Company, a direct
member of the Federal Reserve Bank of Cleveland, and utilizes the Bank of New
York as its agent for ineligible and foreign securities.
For corporate reorganizations, USBank utilizes SEI's Reorg Source,
Financial Information, Inc., XCITEK, DTC Important Notices, Capital Changes
Daily (CCH) and the Wall Street Journal.
For bond calls and mandatory puts, USBank utilizes SEI's Bond Source, Xxxxx
Information Systems, Standard & Poor's Corporation, XCITEK, and DTC Important
Notices. USBank will not notify clients of optional put opportunities.
Any securities delivered free to USBank or its agents must be received
three (3) business days prior to any payment or settlement in order for the
USBank standards of service to apply.
Should you have any questions regarding the information contained in this
guide, please feel free to contact your account representative.
The information contained in this Standards of Service Guide is subject to
change. Should any changes be made USBank will provide you with an updated copy
of its Standards of Service Guide.
U.S. Bank Trade Settlement Instructions
Transaction Type Delivery Instructions
Depository Trust Company (DTC) DTC Participant #2803 U.S. Bank N.A.
DTC eligible issues Agent #: 93697
Institutional # 93696 (or customer Institutional #
if applicable)
Interested Party: (customer ID number if applicable)
Agent Internal Number: (your U.S. Bank Trust
account number)
Federal Reserve Bank , Cleveland, Ohio For: US Bank Ohio
Federal Reserve Book Entry - eligible issues ABA#: 000000000
Routing Symbol: 1050 Trust
For Account # (your U.S. Bank Trust account number)
Federal Reserve Bank, Cleveland, Ohio For: US Bank Ohio
All Fed-eligible issues delivered as ABA#: 000000000
collateral for repurchase agreements Routing Symbol: 1040 Special
For Account # (your U. S. Bank Trust account number)
Bank of New York Bank of New York
Depository ineligible and physical issues: One Xxxx Xxxxxx- 0xx Xxxxx/Xxxxxx A
Xxx Xxxx, XX 00000
For account: U.S. Bank N.A. #117612
U.S. Bank X.X. X.X. Bank Trust Services
DTC ineligible issues settling in Milwaukee, XX Xxx 0000
Xxxxxxxxx Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Securities Processing
Wire Instructions ABA# 000000000 US Bank Ohio
For trade purposes only BNF US Bank Trust
AC 112950027
OBI Attention: Settlements - (functions) i.e.,
pair off, repo, tri-party
BBI or OBI For further credit to account: (trust
acct. #, contact name & phone number)
USBank Payment Standards
Security Type Income Principal
Equities Payable Date
Municipal Bonds* Payable Date Payable Date
Corporate Bonds* Payable Date Payable Date
Federal Reserve Bank Book Entry* Payable Date Payable Date
PTC GNMA's (P&I) Payable Date + 1 Payable Date + 1
CMOs *
DTC Payable Date + 1 Payable Date + 1
SBA Loan Certificates When Received When Received
Unit Investment Trust Certificates* Payable Date Payable Date
Certificates of Deposit* Payable Date + 1 Payable Date + 1
Limited Partnerships When Received When Received
Foreign Securities When Received When Received
*Variable Rate Securities
Federal Reserve Bank Book Entry Payable Date Payable Date
DTC Payable Date + 1 Payable Date + 1
Bankers Trust Payable Date + 1 Payable Date + 1
NOTE: If a payable date falls on a weekend or bank holiday, payment will be made
on the immediately following business day.
USBank Corporate Reorganization Standards
Type of Action Notification to Client Deadline for Client Instructions Transaction
to USBank Posting
Rights, Warrants, Later of 10 business days prior to 5 business days prior to expiration Upon receipt
and Optional Mergers expiration or receipt of notice
Mandatory Puts with Later of 10 business days prior to 5 business days prior to expiration Upon receipt
Option to Retain expiration or receipt of notice
Class Actions 10 business days prior to expiration date 5 business days prior to expiration Upon receipt
Voluntary Tenders, Later of 10 business days prior to 5 business days prior to expiration Upon receipt
Exchanges, expiration or receipt of notice
and Conversions
Mandatory Puts, Defaults, At posting of funds or securities received None Upon receipt
Liquidations, Bankruptcies,
Stock Splits,
Mandatory Exchanges
Full and Partial Calls Later of 10 business days prior to None Upon receipt
expiration or receipt of notice
NOTE: Fractional shares/par amounts resulting from any of the above will be
sold.
EXHIBIT C
Fund Names
Separate Series of Academy Funds Trust
Name of Series Date Added
Academy Core Equity Fund On or after 12/31/2007
Academy Select Opportunities Fund On or after 12/31/2007
EXHIBIT D - Custody Agreement
Academy Funds Trust
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DOMESTIC CUSTODY SERVICES
FEE SCHEDULE at December, 2007
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Annual Fee Based Upon Market Value Per Complex*
..40 basis point on average daily market value
Minimum annual fee per fund complex - $8,000
(The Fund complex includes 2 no-load funds with one cusip each)
Plus portfolio transaction fees
- Portfolio Transaction Fees
$ 4.00 per book entry DTC transaction
$ 4.00 per principal paydown
$ 6.00 per short sale
$ 7.00 per US Bank repurchase agreement transaction
$ 8.00 per option/future contract written, exercised or expired
$10.00 per book entry Federal Reserve transaction
$15.00 per mutual fund trade
$25.00 per physical security transaction
$50.00 per Cedel/Euroclear transaction
$ 5.00 per disbursement (waived if U.S. Bancorp is Administrator)
$ 6.00 per Fed Wire
$15.00 per margin variation Fed wire
$150.00 per segregated account per year
o A transaction is a purchase/sale of a security, free receipt/free delivery,
maturity, tender or exchange.
o No charge for the initial conversion free receipt.
o Overdrafts - charged to the account at prime interest rate plus 2.
Plus Out-Of-Pocket Expenses - Including but not limited to expenses incurred in
the safekeeping, delivery and receipt of securities, shipping, transfer fees,
extraordinary expenses based upon complexity, and all other out-of-pocket
expenses.
Fees are billed monthly.
* Subject to annual CPI increase, Milwaukee MSA.
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Exhibit D (fees) - continued
Academy Funds Trust
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CHIEF COMPLIANCE OFFICER
SUPPORT SERVICES
FEE SCHEDULE at December, 2007
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Chief Compliance Officer Support Services U.S, Bancorp provides support to the
Chief Compliance Officer (CCO) of each fund serviced either by U.S. Bancorp Fund
Services, LLC or Quasar Distributors, LLC. Indicated below are samples of
functions performed by USBFS in this CCO support role:
o Business Line Functions Supported
o Fund Administration and Compliance
o Transfer Agent and Shareholder Services
o Fund Accounting
o Custody Services
o Securities Lending Services
o Distribution Services
o Daily Resource to Fund CCO, Fund Board, Advisor
o Provide USBFS/USB Critical Procedures & Compliance Controls
o Daily and Periodic Reporting
o Periodic CCO Conference Calls
o Dissemination of Industry/Regulatory Information
o Client & Business Line CCO Education & Training
o Due Diligence Review of USBFS Service Facilities
o Quarterly USBFS Certification
o Board Meeting Presentation and Board Support
o Testing, Documentation, Reporting
Annual Fee Schedule*
o $1,200 per service per year
Fees are billed monthly.
*Subject to annual CPI increase, Milwaukee MSA.
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EXHIBIT E
SHAREHOLDER COMMUNICATIONS ACT AUTHORIZATION
ACADEMY FUNDS TRUST
The Shareholder Communications Act of 1985 requires banks and trust companies to
make an effort to permit direct communication between a company which issues
securities and the shareholder who votes those securities.
Unless you specifically require us to NOT release your name and address to
requesting companies, we are required by law to disclose your name and address.
Your "yes" or "no" to disclosure will apply to all securities U.S. Bank holds
for you now and in the future, unless you change your mind and notify us in
writing.
/X/ YES U.S. Bank is authorized to provide the Trust's name,
address and security position to requesting
companies whose stock is owned by the Trust.
/_/ NO U.S. Bank is NOT authorized to provide the Trust's
name, address and security position to requesting
companies whose stock is owned by the Trust.
ACADEMY FUNDS TRUST
By: __________________________________
Title: ________________________________
Date: ________________________________
