CUSTODY AGREEMENT Dated: October 19, 2007 Between UMB BANK, N.A. and THE WESTPORT FUNDS
EX
-
99(g)
Dated:
October 19, 2007
Between
UMB
BANK, N.A.
and
THE
WESTPORT FUNDS
TABLE
OF CONTENTS
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SECTION
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PAGE
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1.
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Appointment of Custodian
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1
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2.
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Definitions
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1
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(a) Securities
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1
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(b) Assets
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1
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(c) Instructions and Special Instructions
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1
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3.
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Delivery of Corporate Documents
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2
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4.
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Powers and Duties of Custodian and Domestic Subcustodian
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2
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(a) Safekeeping
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3
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(b) Manner of Holding Securities
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3
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(c) Free Delivery of Assets
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4
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(d) Exchange of Securities
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4
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(e) Purchases of Assets
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5
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(f) Sales of Assets
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5
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(g) Options
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6
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(h) Futures Contracts
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6
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(i) Segregated Accounts
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6
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(j) Depositary Receipts
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7
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(k) Corporate Actions, Put Bonds, Called Bonds, Etc.
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7
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(l) Interest Bearing Deposits
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7
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(m) Foreign Exchange Transactions
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7
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(n) Pledges or Loans of Securities
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8
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(o) Stock Dividends, Rights, Etc.
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8
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(p) Routine Dealings
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8
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(q) Collections
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9
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(r) Bank Accounts
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9
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(s) Dividends, Distributions and Redemptions
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9
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(t) Proceeds from Shares Sold
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9
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(u) Proxies and Notices; Compliance with the Shareholders
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Communication Act of 1985
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9
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(v) Books and Records
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10
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(w) Opinion of Fund's Independent Certified Public Accountants
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10
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(x) Reports by Independent Certified Public Accountants
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10
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(y) Bills and Others Disbursements
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10
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5.
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Subcustodians
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10
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(a) Domestic Subcustodians
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10
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(b) Foreign Subcustodians
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11
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(c) Interim Subcustodians
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11
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(d) Special Subcustodians
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11
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(e) Termination of a Subcustodian
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12
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(f) Certification Regarding Foreign Subcustodians
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12
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6.
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Standard of Care
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12
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(a) General Standard of Care
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12
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(b) Actions Prohibited by Applicable Law, Events Beyond Custodian’s Control, Armed
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12
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Conflict, Sovereign Risk, etc.
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(c) Liability for Past Records
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13
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(d) Advice of Counsel
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13
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(e) Advice of the Fund and Others
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13
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(f) Instructions Appearing to be Genuine
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13
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(g) Exceptions from Liability
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13
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7.
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Liability of the Custodian for Actions of Others
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14
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(a) Domestic Subcustodians
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14
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(b) Liability for Acts and Omissions of Foreign Subcustodians
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14
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(c) Securities Systems, Interim Subcustodians, Special Subcustodians, Securities
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14
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Depositories and Clearing Agencies
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(d) Defaults or Insolvency’s of Brokers, Banks, Etc.
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14
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(e) Reimbursement of Expenses
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15
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8.
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Indemnification
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15
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(a) Indemnification by Fund
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15
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(b) Indemnification by Custodian
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15
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9.
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Advances
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15
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10.
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Liens
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16
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11.
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Compensation
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16
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12.
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Powers of Attorney
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16
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13.
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Termination and Assignment
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16
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14.
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Cooperation
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17
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15.
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Additional Funds
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17
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16
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Notices
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17
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17
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Miscellaneous
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17
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This
agreement made as of this 19th day of October, 2007, between UMB Bank, n.a.,
a
national banking association with its principal place of business located in
Kansas City, Missouri (hereinafter "Custodian"), and The Westport Funds, a
Delaware statutory trust (hereinafter, the “Trust”).
WITNESSETH:
WHEREAS,
The
Trust is registered as an open-end management investment company under the
Investment Company Act of 1940, as amended (“1940 Act”), and is authorized to
issue shares of beneficial interest (“Shares”) in separate series with each such
series representing interests in a separate portfolio of securities and other
assets (each such series, a “Fund”); and
WHEREAS,
The
Trust desires to appoint Custodian as its custodian for the custody of Assets
(as hereinafter defined) owned by its Funds, which Assets are to be held in
such
accounts as the Trust may establish from time to time on behalf of its Funds;
and
WHEREAS,
Custodian is willing to accept such appointment on the terms and conditions
hereof.
NOW,
THEREFORE,
in
consideration of the mutual promises contained herein, the parties hereto,
intending to be legally bound, mutually covenant and agree as
follows:
1.
APPOINTMENT
OF CUSTODIAN.
The
Trust
hereby constitutes and appoints the Custodian as custodian of Assets belonging
to each Fund set forth on Appendix B and which have been or may be from time
to
time delivered to the Custodian. Custodian accepts such appointment as a
custodian and agrees to perform the duties and responsibilities of Custodian
as
set forth herein on the conditions set forth herein.
2.
DEFINITIONS.
For
purposes of this Agreement, the following terms shall have the meanings so
indicated:
(a)
"Security" or "Securities" shall mean stocks, bonds, bills, rights, scrip,
warrants, interim certificates and all negotiable or nonnegotiable paper and
other instruments or obligations commonly known as Securities.
(b)
"Assets" shall mean Securities, monies and other property held by the Custodian
for the benefit of a Fund.
(c)(1)
"Instructions", as used herein, shall mean: (i) a tested telex, a written
(including, without limitation, facsimile transmission) request, direction,
instruction or certification signed or initialed by or on behalf of a Fund
by an
Authorized Person; (ii) a telephonic or other oral communication from a person
the Custodian reasonably believes to be an Authorized Person (as defined in
Section 3 of this Agreement); or (iii) a communication effected directly between
an electro-mechanical or electronic device or system (including, without
limitation, computers) on behalf of a Fund. Custodian recommends that any
Instructions transmitted by a Fund via email be done so only through a secure
system or process. Custodian can make available to Fund a secure email system
if
Fund so desires. Instructions in the form of oral communications shall be
confirmed by the appropriate Fund by tested telex or in writing in the manner
set forth in clause (i) above, but the lack of such confirmation shall in no
way
affect any action taken by the Custodian in reliance upon such oral Instructions
prior to the Custodian's receipt of such confirmation. Each Fund authorizes
the
Custodian to record any and all telephonic or other oral Instructions
communicated to the Custodian.
(c)(2)
"Special Instructions", as used herein, shall mean Instructions countersigned
or
confirmed in writing by the Treasurer or any Assistant Treasurer of a Fund
or
any other person designated by the Treasurer of such Fund in writing, which
countersignature or confirmation shall be included on the same instrument
containing the Instructions or on a separate instrument relating
thereto.
1
(c)(3)
Instructions and Special Instructions shall be delivered to the Custodian at
the
address and/or telephone, facsimile transmission or telex number agreed upon
from time to time by the Custodian and each Fund.
(c)(4)
Where appropriate and, in which case, unless otherwise specified, Instructions
and Special Instructions shall be continuing instructions.
3.
DELIVERY
OF ORGANIZATIONAL DOCUMENTS; REPRESENTATIONS.
Each
of
the parties to this Agreement represents that its execution does not violate
any
of the provisions of its respective charter, articles of incorporation, articles
of association, declaration of trust or bylaws and all required corporate action
to authorize the execution and delivery of this Agreement has been
taken.
The
Trust
has furnished the Custodian with copies, properly certified or authenticated,
with all amendments or supplements thereto, of the following
documents:
(a)
Declaration of Trust of the Trust as in effect on the date hereof;
(b)
By-Laws of the Trust as in effect on the date hereof;
(c)
Resolutions of the Board of Trustees of the Trust appointing the Custodian
and
approving the form of this Agreement; and
(d)
The
Funds’ current prospectus and statement of additional information.
The
Trust
shall promptly furnish the Custodian with copies of any updates, amendments
or
supplements to the foregoing documents.
In
addition, the Trust has delivered or will promptly deliver to the Custodian,
copies of the Resolution(s) of its Board of Trustees and all amendments or
supplements thereto, properly certified or authenticated, designating certain
officers or employees of the Trust who will have continuing authority to certify
to the Custodian: (a) the names, titles, signatures and scope of authority
of
all persons authorized to give Instructions or any other notice, request,
direction, instruction, certificate or instrument on behalf of each Fund, and
(b) the names, titles and signatures of those persons authorized to countersign
or confirm Special Instructions on behalf of each Fund (in both cases
collectively, the "Authorized Persons" and individually, an "Authorized
Person"). Such Resolutions and certificates may be accepted and relied upon
by
the Custodian as conclusive evidence of the facts set forth therein and shall
be
considered to be in full force and effect until delivery to the Custodian of
a
similar Resolution or certificate to the contrary. Upon delivery of a
certificate which deletes or does not include the name(s) of a person previously
authorized to give Instructions or to countersign or confirm Special
Instructions, such person shall no longer be considered an Authorized Person
authorized to give Instructions or to countersign or confirm Special
Instructions. Unless the certificate specifically requires that the approval
of
anyone else will first have been obtained, the Custodian will be under no
obligation to inquire into the right of the person giving such Instructions
or
Special Instructions to do so beyond making a reasonable review to confirm
that
the Instructions or Special Instructions are within the scope of the authority
provided to the person under the certificate or Resolutions authorizing the
person to give Instructions or Special Instructions and making an appropriate
inquiry in the event of manifest error; provided, that the Resolutions and/or
certificate contains sufficient specificity to permit the Custodian to make
the
review. Notwithstanding any of the foregoing, no authorization, Instructions
or
Special Instructions received by the Custodian from the Trust will be deemed
to
authorize or permit any director, trustee, officer, employee, or agent of the
Trust to withdraw any of the Assets of a Fund upon the mere receipt of such
authorization, Special Instructions or Instructions from such director, trustee,
officer, employee or agent.
The
Custodian represents, warrants and agrees that (i) it is and will remain
throughout the term of this Agreement a bank that meets the requirements of
Section 17(f) of the 1940 Act and the rules and regulations thereunder to serve
as a custodian of the Funds’ Assets and (ii) it will comply with all laws, rules
and regulations applicable to it in connection with the provision of the
custodial services contemplated by this Agreement.
2
4.
POWERS
AND DUTIES OF CUSTODIAN AND DOMESTIC SUBCUSTODIAN.
Except
for Assets held by any Subcustodian appointed pursuant to Sections 5(b), (c),
or
(d) of this Agreement, the Custodian shall have and perform the powers and
duties hereinafter set forth in this Section 4. For purposes of this Section
4
all references to powers and duties of the "Custodian" shall also refer to
any
Domestic Subcustodian appointed pursuant to Section 5(a).
(a)
Safekeeping.
The
Custodian will keep safely the Assets of each Fund which are delivered to it
from time to time. The Custodian shall not be responsible for any property
of a
Fund held or received by such Fund and not delivered to the
Custodian.
(b)
Manner
of Holding Securities.
(1)
The
Custodian shall at all times hold Securities of each Fund either: (i) by
physical possession of the share certificates or other instruments representing
such Securities in registered or bearer form; or (ii) in book-entry form by
a
Securities System (as hereinafter defined) in accordance with the provisions
of
sub-paragraph (3) below.
(2)
The
Custodian may hold registrable portfolio Securities which have been delivered
to
it in physical form, by registering the same in the name of the appropriate
Fund
or its nominee, or in the name of the Custodian or its nominee, for whose
actions such Fund and Custodian, respectively, shall be fully responsible.
Upon
the receipt of Instructions, the Custodian shall hold such Securities in street
certificate form, so called, with or without any indication of fiduciary
capacity. However, unless it receives Instructions to the contrary, the
Custodian will register all such portfolio Securities in the name of the
Custodian's authorized nominee. All such Securities shall be held in an account
of the Custodian containing only assets of the appropriate Fund or only assets
held by the Custodian as a fiduciary, provided that the records of the Custodian
shall indicate at all times the Fund or other customer for which such Securities
are held in such accounts and the respective interests therein.
(3)
The
Custodian may deposit and/or maintain domestic Securities owned by a Fund in,
and each Fund hereby approves use of: (a) The Depository Trust Company; and
(b)
any book-entry system as provided in (i) Subpart O of Treasury Circular ▇▇.
▇▇▇,
▇▇ ▇▇▇ 306.115, (ii) Subpart B of Treasury Circular Public Debt Series ▇▇.
▇▇-▇▇, ▇▇ ▇▇▇ 350.2, or (iii) the book-entry regulations of federal agencies
substantially in the form of 31 CFR 306.115. Upon the receipt of Special
Instructions, the Custodian may deposit and/or maintain domestic Securities
owned by a Fund in any other domestic clearing agency registered with the
Securities and Exchange Commission ("SEC") under Section 17A of the Securities
Exchange Act of 1934 (or as may otherwise be authorized by the SEC to serve
in
the capacity of depository or clearing agent for the Securities or other assets
of registered investment companies) which acts as a Securities depository.
Each
of the foregoing shall be referred to in this Agreement as a "Securities
System", and all such Securities Systems shall be listed on the attached
Appendix A. Use of a Securities System shall be in accordance with all
applicable Federal Reserve Board and SEC rules and regulations, if any, and
subject to the following provisions:
(i)
The
Custodian may deposit the Securities directly or through one or more agents
or
Subcustodians which are also qualified to act as custodians for registered,
open-end investment companies.
(ii)
The
Custodian shall deposit and/or maintain the Securities in a Securities System,
provided that such Securities are represented in an account ("Account") of
the
Custodian in the Securities System that includes only assets held by the
Custodian as a fiduciary, custodian or otherwise for customers.
(iii)
The
books and records of the Custodian shall at all times identify by book entry
those Securities belonging to a Fund maintained in a Securities System as
belonging to the Fund.
3
(iv)
The
Custodian shall pay for Securities purchased for the account of a Fund only
upon
(a) receipt of advice from the Securities System that such Securities have
been
transferred to the Account of the Custodian in accordance with the rules of
the
Securities System, and (b) the making of an entry on the records of the
Custodian to reflect such payment and transfer for the account of such Fund.
The
Custodian shall transfer Securities sold for the account of a Fund only upon
(a)
receipt of advice from the Securities System that payment for such Securities
has been transferred to the Account of the Custodian in accordance with the
rules of the Securities System, and (b) the making of an entry on the records
of
the Custodian to reflect such transfer and payment for the account of such
Fund.
Copies of all advices from the Securities System relating to transfers of
Securities for the account of a Fund shall be maintained for such Fund by the
Custodian. The Custodian shall deliver to a Fund on the next succeeding business
day daily transaction reports that shall include each day's transactions in
the
Securities System for the account of such Fund. Such transaction reports shall
be delivered to such Fund or any agent designated by such Fund pursuant to
Instructions, by computer or in such other manner as such Fund and Custodian
may
agree.
(v)
The
Custodian shall, if requested by a Fund pursuant to Instructions, provide such
Fund with reports obtained by the Custodian or any Subcustodian with respect
to
a Securities System's accounting system, internal accounting control and
procedures for safeguarding Securities deposited in the Securities
System.
(vi)
Upon
receipt of Special Instructions, the Custodian shall terminate the use of any
Securities System on behalf of a Fund as promptly as practicable and shall
take
all actions reasonably practicable to safeguard the Securities of such Fund
maintained with such Securities System.
(vii)
At
the election of the Trust (and if not explicitly prohibited by the relevant
agreement with the Securities System or applicable law, rule or regulation),
the
Trust shall be entitled to be subrogated to the rights of the Custodian with
respect to any claim against the Securities System or any other person which
the
Custodian may have as a consequence of any loss or damage caused by the
Securities System if and to the extent that the Trust or a Fund has not been
made whole for any such loss or damage; provided, however, (1) the Trust shall
have no greater rights than the Custodian with respect to such claim; (2) the
Custodian shall have no duty to be a party to such claim; and (3) if the Trust:
(a) suffers a loss or damage in connection with the activities contemplated
by
this Agreement; (b) receives a payment from the Custodian in partial
reimbursement for the loss or damage suffered by the Trust; (c) elects to be
subrogated to the rights of the Custodian with respect to one or more claims
against one or more Securities Systems or other persons; and (d) receives total
payments from the Custodian and any Securities Systems or other persons in
connection with the loss or damage such that the aggregate payments received
by
the Trust in reimbursement of such loss or damage from the Custodian and any
Securities Systems and other persons exceed the sum of the amount of (x) the
loss or damage and (y) the Trust’s total cost of recovery, all as determined in
reasonable judgment of the Trust, the Trust shall pay the Custodian such excess
amount. Upon the reasonable request of the Custodian, the Trust shall furnish
the Custodian with documentation substantiating the calculations described
in
(d) above.
(c)
Free
Delivery of Assets.
Notwithstanding
any other provision of this Agreement and except as provided in Section 3
hereof, the Custodian, upon receipt of Special Instructions, will undertake
to
make free delivery of Assets, provided such Assets are on hand and available,
in
connection with a Fund's transactions and to transfer such Assets to such
broker, dealer, Subcustodian, bank, agent, Securities System or otherwise as
specified in such Special Instructions.
(d)
Exchange
of Securities.
Upon
receipt of Instructions, the Custodian will exchange portfolio Securities held
by it for a Fund for other Securities or cash paid in connection with any
reorganization, recapitalization, merger, consolidation, or conversion of
convertible Securities, and will deposit any such Securities in accordance
with
the terms of any reorganization or protective plan.
Without
Instructions, the Custodian is authorized to exchange Securities held by it
in
temporary form for Securities in definitive form, to surrender Securities for
transfer into a name or nominee name as permitted in Section 4(b)(2), to effect
an exchange of shares in a stock split or when the par value of the stock is
changed, to sell any fractional shares, and, upon receiving payment therefor,
to
surrender bonds or other Securities held by it at maturity or
call.
4
(e)
Purchases
of Assets.
(1)
Securities
Purchases.
In
accordance with Instructions, the Custodian shall, with respect to a purchase
of
Securities, pay for such Securities out of monies held for a Fund's account
for
which the purchase was made, but only insofar as monies are available therein
for such purpose, and receive the portfolio Securities so purchased. Unless
the
Custodian has received Special Instructions to the contrary, such payment will
be made only upon receipt of Securities by the Custodian, a clearing corporation
of a national Securities exchange of which the Custodian is a member, or a
Securities System in accordance with the provisions of Section 4(b)(3) hereof.
Notwithstanding the foregoing, upon receipt of Instructions: (i) in connection
with a repurchase agreement, the Custodian may release funds to a Securities
System prior to the receipt of advice from the Securities System that the
Securities underlying such repurchase agreement have been transferred by
book-entry into the Account maintained with such Securities System by the
Custodian, provided that the Custodian's instructions to the Securities System
require that the Securities System may make payment of such funds to the other
party to the repurchase agreement only upon transfer by book-entry of the
Securities underlying the repurchase agreement into such Account; (ii) in the
case of Interest Bearing Deposits, currency deposits, and other deposits,
foreign exchange transactions, futures contracts or options, pursuant to
Sections 4(g), 4(h), 4(l), and 4(m) hereof, the Custodian may make payment
therefor before receipt of an advice of transaction; and (iii) in the case
of
Securities as to which payment for the Security and receipt of the instrument
evidencing the Security are under generally accepted trade practice or the
terms
of the instrument representing the Security expected to take place in different
locations or through separate parties, such as commercial paper which is indexed
to foreign currency exchange rates, derivatives and similar Securities, the
Custodian may make payment for such Securities prior to delivery thereof in
accordance with such generally accepted trade practice or the terms of the
instrument representing such Security. In any and every case in which payment
for purchase of Securities for the account of a Fund is made by the Custodian
on
behalf of a Fund in advance of receipt of the Securities purchased, and in
the
absence both of a provision in this paragraph or elsewhere in this Agreement
authorizing such a payment in advance and, if required by the applicable
provision of this Agreement, the delivery of the applicable Instructions or
Specific Instructions, as the case may be, the Custodian shall be absolutely
liable to the Fund for such Securities to the same extent as if the Securities
had been received by the Custodian.
(2)
Other
Assets Purchased.
Upon
receipt of Instructions and except as otherwise provided herein, the Custodian
shall pay for and receive other Assets for the account of a Fund as provided
in
Instructions.
(f)
Sales
of Assets.
(1)
Securities
Sold.
In
accordance with Instructions, the Custodian will, with respect to a sale,
deliver or cause to be delivered the Securities thus designated as sold to
the
broker or other person specified in the Instructions relating to such sale.
Unless the Custodian has received Special Instructions to the contrary, such
delivery shall be made only upon receipt of payment therefor in the form of:
(a)
cash, certified check, bank cashier's check, bank credit, or bank wire transfer;
(b) credit to the account of the Custodian with a clearing corporation of a
national Securities exchange of which the Custodian is a member; or (c) credit
to the Account of the Custodian with a Securities System, in accordance with
the
provisions of Section 4(b)(3) hereof. Notwithstanding the foregoing, Securities
held in physical form may be delivered and paid for in accordance with "street
delivery custom" to a broker or its clearing agent, against delivery to the
Custodian of a receipt for such Securities, provided that the Custodian shall
have taken reasonable steps to ensure prompt collection of the payment for,
or
return of, such Securities by the broker or its clearing agent, and provided
further that the Custodian shall not be responsible for the selection of or
the
failure or inability to perform of such broker or its clearing agent or for
any
related loss arising from delivery or custody of such Securities prior to
receiving payment therefor.
(2)
Other
Assets Sold.
Upon
receipt of Instructions and except as otherwise provided herein, the Custodian
shall receive payment for and deliver other Assets for the account of a Fund
as
provided in Instructions.
5
(g)
Options.
(1)
Upon
receipt of Instructions relating to the purchase of an option or sale of a
covered call option, the Custodian shall: (a) receive and retain confirmations
or other documents, if any, evidencing the purchase or writing of the option
by
a Fund; (b) if the transaction involves the sale of a covered call option,
deposit and maintain in a segregated account the Securities (either physically
or by book-entry in a Securities System) subject to the covered call option
written on behalf of such Fund; and (c) pay, release and/or transfer such
Securities, cash or other Assets in accordance with any notices or other
communications evidencing the expiration, termination or exercise of such
options which are furnished to the Custodian by the Options Clearing Corporation
(the "OCC"), the securities or options exchanges on which such options were
traded, or such other organization as may be responsible for handling such
option transactions.
(2)
Upon
receipt of Instructions relating to the sale of a naked option (including stock
index and commodity options), the Custodian, the Trust and the broker-dealer
shall enter into an agreement to comply with the rules of the OCC or of any
registered national securities exchange or similar organizations(s). Pursuant
to
that agreement and the Trust's Instructions, the Custodian shall: (a) receive
and retain confirmations or other documents, if any, evidencing the writing
of
the option; (b) deposit and maintain in a segregated account, Securities (either
physically or by book-entry in a Securities System), cash and/or other Assets;
and (c) pay, release and/or transfer such Securities, cash or other Assets
in
accordance with any such agreement and with any notices or other communications
evidencing the expiration, termination or exercise of such option which are
furnished to the Custodian by the OCC, the securities or options exchanges
on
which such options were traded, or such other organization as may be responsible
for handling such option transactions. The Trust and the broker-dealer shall
be
responsible for determining the quality and quantity of assets held in any
segregated account established in compliance with applicable margin maintenance
requirements and the performance of other terms of any option
contract.
(h)
Futures
Contracts.
Upon
receipt of Instructions, the Custodian shall enter into a futures margin
procedural agreement among the appropriate Fund, the Custodian and the
designated futures commission merchant (a "Procedural Agreement"). Under the
Procedural Agreement the Custodian shall: (a) receive and retain confirmations,
if any, evidencing the purchase or sale of a futures contract or an option
on a
futures contract by such Fund; (b) deposit and maintain in a segregated account
cash, Securities and/or other Assets designated as initial, maintenance or
variation "margin" deposits intended to secure such Fund's performance of its
obligations under any futures contracts purchased or sold, or any options on
futures contracts written by such Fund, in accordance with the provisions of
the
Procedural Agreement designed to comply with the provisions of the Commodity
Futures Trading Commission and/or any commodity exchange or contract market
(such as the Chicago Board of Trade), or any similar organization(s), regarding
such margin deposits; and (c) release Assets from and/or transfer Assets into
such margin accounts only in accordance with any the Procedural Agreement.
The
Trust and such futures commission merchant shall be responsible for determining
the type and amount of Assets held in the segregated account or paid to the
broker-dealer in compliance with applicable margin maintenance requirements
and
the performance of any futures contract or option on a futures contract in
accordance with its terms.
(i)
Segregated
Accounts.
Upon
receipt of Instructions, the Custodian shall establish and maintain on its
books
a segregated account or accounts for and on behalf of a Fund, into which account
or accounts may be transferred Assets of such Fund, including Securities
maintained by the Custodian in a Securities System pursuant to Paragraph (b)(3)
of this Section 4, said account or accounts to be maintained (i) for the
purposes set forth in Sections 4(g), 4(h) and 4(n) and (ii) for the purpose
of
compliance by such Fund with the procedures required by the SEC Investment
Company Act Release Number 10666 or any subsequent release or releases relating
to the maintenance of segregated accounts by registered investment companies,
or
(iii) for such other purposes as may be set forth, from time to time, in Special
Instructions. The Custodian shall not be responsible for the determination
of
the type or amount of Assets to be held in any segregated account referred
to in
this paragraph, or for compliance by the Fund with required procedures noted
in
(ii) above.
6
(j)
Depositary
Receipts.
Upon
receipt of Instructions, the Custodian shall surrender or cause to be
surrendered Securities to the depositary used for such Securities by an issuer
of American Depositary Receipts or International Depositary Receipts
(hereinafter referred to, collectively, as "ADRs"), against a written receipt
therefor adequately describing such Securities and written evidence satisfactory
to the organization surrendering the same that the depositary has acknowledged
receipt of instructions to issue ADRs with respect to such Securities in the
name of the Custodian or a nominee of the Custodian, for delivery in accordance
with such instructions.
Upon
receipt of Instructions, the Custodian shall surrender or cause to be
surrendered ADRs to the issuer thereof, against a written receipt therefor
adequately describing the ADRs surrendered and written evidence satisfactory
to
the organization surrendering the same that the issuer of the ADRs has
acknowledged receipt of instructions to cause its depository to deliver the
Securities underlying such ADRs in accordance with such
instructions.
(k)
Corporate
Actions, Put Bonds, Called Bonds, Etc.
Upon
receipt of Instructions, the Custodian shall: (a) deliver warrants, puts, calls,
rights or similar Securities to the issuer or trustee thereof (or to the agent
of such issuer or trustee) for the purpose of exercise or sale, provided that
the new Securities, cash or other Assets, if any, acquired as a result of such
actions are to be delivered to the Custodian; and (b) deposit Securities upon
invitations for tenders thereof, provided that the consideration for such
Securities is to be paid or delivered to the Custodian, or the tendered
Securities are to be returned to the Custodian.
Notwithstanding
any provision of this Agreement to the contrary, the Custodian shall take all
necessary action, unless otherwise directed to the contrary in Instructions,
to
comply with the terms of all mandatory or compulsory exchanges, calls, tenders,
redemptions, or similar rights of security ownership of which the Custodian
receives notice through publications to which it normally subscribes, and shall
notify the appropriate Fund of such action in writing by facsimile transmission
or in such other manner as such Fund and Custodian may agree in
writing.
The
Fund
agrees that if it gives an Instruction for the performance of an act on the
last
permissible date of a period established by any optional offer or on the last
permissible date for the performance of such act, the Fund shall hold the
Custodian harmless from any adverse consequences in connection with acting
upon
or failing to act upon such Instruction.
(l)
Interest
Bearing Deposits.
Upon
receipt of Instructions directing the Custodian to purchase interest bearing
fixed term and call deposits (hereinafter referred to, collectively, as
"Interest Bearing Deposits") for the account of a Fund, the Custodian shall
purchase such Interest Bearing Deposits in the name of such Fund with such
banks
or trust companies, including Subcustodians, but not including the Custodian
or
any subsidiary, parent or affiliate of the Custodian (unless the Trust and
the
Custodian mutually agree), (hereinafter collectively referred to as "Banking
Institutions"), and in such amounts as such Fund may direct pursuant to
Instructions. Such Interest Bearing Deposits may be denominated in U.S. dollars
or other currencies, as such Fund may determine and direct pursuant to
Instructions. With respect to Interest Bearing Deposits (other than those issued
by the Custodian), (a) the Custodian shall be responsible for the collection
of
income and the transmission of cash to and from such accounts; and (b) the
Custodian shall have no duty with respect to the selection of the Banking
Institution or for the failure of such Banking Institution to pay upon
demand.
(m)
Foreign
Exchange Transactions.
(l)
Each
Fund hereby appoints the Custodian as its agent in the execution of all currency
exchange transactions. The Custodian agrees to provide exchange rate and U.S.
Dollar information, in writing, to the Funds. Such information shall be supplied
by the Custodian at least by the business day prior to the value date of the
foreign exchange transaction, provided that the Custodian receives the request
for such information at least two business days prior to the value date of
the
transaction.
7
(2)
Upon
receipt of Instructions, the Custodian shall settle foreign exchange contracts
or options to purchase and sell foreign currencies for spot and future delivery
on behalf of and for the account of a Fund with such currency brokers or Banking
Institutions as such Fund may determine and direct pursuant to Instructions. If,
in its Instructions, a Fund does not direct the Custodian to utilize a
particular currency broker or Banking Institution, the Custodian is authorized
to select such currency broker or Banking Institution as it deems appropriate
to
execute the Fund's foreign currency transaction.
(3)
Each
Fund accepts full responsibility for its use of third party foreign exchange
brokers and for execution of said foreign exchange contracts and understands
that the Fund shall be responsible for any and all costs and interest charges
which may be incurred as a result of the failure or delay of its third party
broker to deliver foreign exchange. The Custodian shall have no responsibility
or liability with respect to the selection of the currency brokers or Banking
Institutions with which a Fund deals or the performance of such brokers or
Banking Institutions.
(4)
Notwithstanding anything to the contrary contained herein, upon receipt of
Instructions the Custodian may, in connection with a foreign exchange contract,
make free outgoing payments of cash in the form of U.S. Dollars or foreign
currency prior to receipt of confirmation of such foreign exchange contract
or
confirmation that the countervalue currency completing such contract has been
delivered or received.
(n)
Pledges
or Loans of Securities.
(1)
Upon
receipt of Instructions from a Fund, the Custodian will release or cause to
be
released Securities held in custody to the pledgees designated in such
Instructions by way of pledge or hypothecation to secure loans incurred by
such
Fund with various lenders including but not limited to UMB Bank, n.a.; provided,
however, that the Securities shall be released only upon payment to the
Custodian of the monies borrowed, except that in cases where additional
collateral is required to secure existing borrowings, further Securities may
be
released or delivered, or caused to be released or delivered for that purpose
upon receipt of Instructions. Upon receipt of Instructions, the Custodian will
pay, but only from funds available for such purpose, any such loan upon
re-delivery to it of the Securities pledged or hypothecated therefor and upon
surrender of the note or notes evidencing such loan. In lieu of delivering
collateral to a pledgee, the Custodian, on the receipt of Instructions, shall
transfer the pledged Securities to a segregated account for the benefit of
the
pledgee.
(2)
Upon
receipt of Special Instructions, the Custodian shall enter into a Subcustodian
Agreement with a securities lending agent appointed by a Fund ("Agent"), whereby
Agent is appointed as Special Subcustodian for the purpose of effecting
transactions on behalf of the Fund in connection with a Securities Lending
Agency Agreement between the Fund and Agent. The Custodian and Agent agree
to
act upon Instructions and Special Instructions from the Fund in connection
with
the Subcustodian Agreement and this Agreement in order to effect securities
lending transactions on behalf of the Fund. The Custodian shall have no
responsibility or liability for any losses arising in connection with Agent's
actions or omissions, including but not limited to the delivery of Securities
prior to the receipt of collateral, in the absence of negligence, bad faith,
misfeasance or willful misconduct on the part of the Custodian.
(o)
Stock
Dividends, Rights, Etc.
The
Custodian shall receive and collect all stock dividends, rights, and other
items
of like nature and, upon receipt of Instructions, take action with respect
to
the same as directed in such Instructions.
(p)
Routine
Dealings.
The
Custodian will, in general, attend to all routine and mechanical matters in
accordance with industry standards in connection with the sale, exchange,
substitution, purchase, transfer, or other dealings with Securities or other
property of each Fund except as may be otherwise provided in this Agreement
or
directed from time to time by Instructions from any particular Fund. The
Custodian may also make payments to itself or others from the Assets for
disbursements and out-of-pocket expenses incidental to handling Securities
or
other similar items relating to its duties under this Agreement, provided that
all such payments shall be accounted for to the appropriate
Fund.
8
(q)
Collections.
The
Custodian shall (a) collect amounts due and payable to each Fund with respect
to
portfolio Securities and other Assets; (b) promptly credit to the account of
the
appropriate Fund all income and other payments relating to portfolio Securities
and other Assets held by the Custodian hereunder on behalf of the Fund upon
Custodian's receipt of such income or payments or as otherwise agreed in writing
by the Custodian and the Trust; (c) promptly endorse and deliver any instruments
required to effect such collection; and (d) promptly execute ownership and
other
certificates and affidavits for all federal, state, local and foreign tax
purposes in connection with receipt of income or other payments with respect
to
portfolio Securities and other Assets, or in connection with the transfer of
such Securities or other Assets; provided, however, that with respect to
portfolio Securities registered in so-called street name, or physical Securities
with variable interest rates, the Custodian shall use its best efforts to
collect amounts due and payable to any such Fund. The Custodian shall notify
a
Fund in writing by facsimile transmission or in such other manner as such Fund
and Custodian may agree in writing if any amount payable with respect to
portfolio Securities or other Assets is not received by the Custodian when
due.
The Custodian shall not be responsible for the collection of amounts due and
payable with respect to portfolio Securities or other Assets that are in
default.
(r)
Bank
Accounts.
Upon
Instructions, the Custodian shall open and operate a bank account or accounts
on
the books of the Custodian; provided that such bank account(s) shall be in
the
name of the Custodian or a nominee thereof, for the account of one or more
Funds, and shall be subject only to draft or order of the Custodian. The
responsibilities of the Custodian to any one or more such Funds for deposits
accepted on the Custodian's books shall be that of a U.S. bank for a similar
deposit.
(s)
Dividends,
Distributions and Redemptions.
To
enable
each Fund to pay dividends or other distributions to shareholders of each such
Fund and to make payment to shareholders who have requested repurchase or
redemption of their Shares, the Custodian shall release cash or Securities
insofar as available. In the case of cash, the Custodian shall, upon the receipt
of Instructions, transfer such funds by check or wire transfer to any account
at
any bank or trust company designated by each such Fund in such Instructions.
In
the case of Securities, the Custodian shall, upon the receipt of Special
Instructions, make such transfer to any entity or account designated by each
such Fund in such Special Instructions.
(t)
Proceeds
from Shares Sold.
The
Custodian shall receive funds representing cash payments received for shares
issued or sold from time to time by each Fund, and shall credit such funds
to
the account of the appropriate Fund. The Custodian shall notify the appropriate
Fund of Custodian's receipt of cash in payment for shares issued by such Fund
by
facsimile transmission or in such other manner as the Trust and the Custodian
shall agree. Upon receipt of Instructions, the Custodian shall: (a) deliver
all
federal funds received by the Custodian in payment for Shares as may be set
forth in such Instructions and at a time agreed upon between the Custodian
and
the Trust; and (b) make federal funds available to a Fund as of specified times
agreed upon from time to time by the Trust and the Custodian, in the amount
of
checks received in payment for Shares which are deposited to the accounts of
such Fund.
(u)
Proxies
and Notices; Compliance with the Shareholders Communication Act of
1985.
The
Custodian shall deliver or cause to be delivered to the appropriate Fund all
forms of proxies, all notices of meetings, and any other notices or
announcements affecting or relating to Securities owned by such Fund that are
received by the Custodian, any Subcustodian, or any nominee of either of them,
and, upon receipt of Instructions, the Custodian shall execute and deliver,
or
cause such Subcustodian or nominee to execute and deliver, such proxies or
other
authorizations as may be required. Except as directed pursuant to Instructions,
neither the Custodian nor any Subcustodian or nominee shall vote upon any such
Securities, or execute any proxy to vote thereon, or give any consent or take
any other action with respect thereto.
9
The
Custodian will not release the identity of any Fund to an issuer which requests
such information pursuant to the Shareholder Communications Act of 1985 for
the
specific purpose of direct communications between such issuer and any such
Fund
unless a particular Fund directs the Custodian otherwise in
writing.
(v)
Books
and Records.
The
Custodian shall maintain such records relating to its activities under this
Agreement with respect to each Fund as are required to be maintained by the
Trust and the Custodian in connection with the services provided by the
Custodian in accordance with applicable laws, rules and regulations, including
Rule 31a-1 under the 1940 Act, and to preserve them for the periods prescribed
by applicable laws, rules and regulations, including, as applicable, Rule 31a-2
under the 1940 Act. These records shall be open for inspection by duly
authorized officers, employees or agents (including independent public
accountants) of the appropriate Fund during normal business hours of the
Custodian.
The
Custodian shall provide accountings relating to its activities under this
Agreement as shall be agreed upon by each Fund and the Custodian.
(w)
Opinion
of Fund's Independent Certified Public Accountants.
The
Custodian shall take all reasonable action as each Fund may request to obtain
from year to year favorable opinions from each such Fund's independent certified
public accountants with respect to the Custodian's activities hereunder and
in
connection with the preparation of each such Fund's periodic reports to the
SEC
and with respect to any other requirements of the SEC.
(x)
Reports
by Independent Certified Public Accountants.
At
the
request of a Fund, the Custodian shall deliver to such Fund a written report
prepared by the Custodian's independent certified public accountants with
respect to the services provided by the Custodian under this Agreement,
including, without limitation, the Custodian's accounting system, internal
accounting control and procedures for safeguarding cash, Securities and other
Assets, including cash, Securities and other Assets deposited and/or maintained
in a Securities System or with a Subcustodian. Such report shall be of
sufficient scope and in sufficient detail as may reasonably be required by
such
Fund and as may reasonably be obtained by the Custodian.
(y)
Bills
and Other Disbursements.
Upon
receipt of Instructions, the Custodian shall pay, or cause to be paid, all
bills, statements, or other obligations of a Fund.
5.
SUBCUSTODIANS.
From
time
to time, in accordance with the relevant provisions of this Agreement, the
Custodian may appoint one or more Domestic Subcustodians, Foreign Subcustodians,
Special Subcustodians, or Interim Subcustodians (as each are hereinafter
defined) to act on behalf of any one or more Funds. A Domestic Subcustodian,
in
accordance with the provisions of this Agreement, may also appoint a Foreign
Subcustodian, Special Subcustodian, or Interim Subcustodian to act on behalf
of
any one or more Funds. For purposes of this Agreement, all Domestic
Subcustodians, Foreign Subcustodians, Special Subcustodians and Interim
Subcustodians shall be referred to collectively as "Subcustodians".
(a)
Domestic
Subcustodians.
The
Custodian may, at any time and from time to time, and subject to prior written
approval by the Trust, appoint any bank as defined in Section 2(a)(5) of the
1940 Act or any trust company or other entity, any of which meet the
requirements of a custodian under Section 17(f) of the 1940 Act and the rules
and regulations thereunder, to act for the Custodian on behalf of any one or
more Funds as a subcustodian for purposes of holding Assets of such Fund(s)
and
performing other functions of the Custodian within the United States (a
"Domestic Subcustodian"). An appointment of a Domestic Subcustodian shall not
be
effective without such prior written approval of the Fund(s). Each such duly
approved Domestic Subcustodian shall be listed on Appendix A attached hereto,
as
it may be amended, from time to time, and the Trust hereby approves each
Domestic Subcustodian set forth in Exhibit A..
10
(b)
Foreign
Subcustodians.
The
Custodian may at any time appoint, or cause a Domestic Subcustodian to appoint,
any bank, trust company or other entity meeting the requirements of an "eligible
foreign custodian" under Section 17(f) of the 1940 Act and the rules and
regulations thereunder to act for the Custodian on behalf of any one or more
Funds as a subcustodian or sub-subcustodian (if appointed by a Domestic
Subcustodian) for purposes of holding Assets of the Fund(s) and performing
other
functions of the Custodian in countries other than the United States of America
(hereinafter referred to as a "Foreign Subcustodian" in the context of either
a
subcustodian or a sub-subcustodian); provided that the Custodian shall have
obtained prior written confirmation from the Trust of the approval of the Board
of Trustees of the Trust (which approval may be withheld in the sole discretion
of such Board of Trustees) with respect to (i) the identity of any proposed
Foreign Subcustodian (including branch designation), (ii) the country or
countries in which, and the securities depositories or clearing agencies
(hereinafter "Securities Depositories and Clearing Agencies"), if any, through
which, the Custodian or any proposed Foreign Subcustodian is authorized to
hold
Securities and other Assets of each such Fund, and (iii) the form and terms
of
the subcustodian agreement to be entered into with such proposed Foreign
Subcustodian. Each such duly approved Foreign Subcustodian and the countries
where and the Securities Depositories and Clearing Agencies through which they
may hold Securities and other Assets of the Fund(s) shall be listed on Appendix
A attached hereto, as it may be amended, from time to time. Each Fund shall
be
responsible for informing the Custodian sufficiently in advance of a proposed
investment which is to be held in a country in which no Foreign Subcustodian
is
authorized to act, in order that there shall be sufficient time for the
Custodian, or any Domestic Subcustodian, to effect the appropriate arrangements
with a proposed Foreign Subcustodian, including obtaining approval as provided
in this Section 5(b). In connection with the appointment of any Foreign
Subcustodian, the Custodian shall, or shall cause the Domestic Subcustodian
to,
enter into a subcustodian agreement with the Foreign Subcustodian in form and
substance approved by the Trust. The Custodian shall not consent to the
amendment of, and shall cause any Domestic Subcustodian not to consent to the
amendment of, any agreement entered into with a Foreign Subcustodian, which
materially affects any Fund's rights under such agreement, except upon prior
written approval of the Trust pursuant to Special Instructions.
(c)
Interim
Subcustodians.
Notwithstanding
the foregoing, in the event that a Fund shall purchase an Asset to be held
in a
country in which no Foreign Subcustodian is authorized to act, the Custodian
shall notify such Fund in writing by facsimile transmission or in such other
manner as such Fund and the Custodian shall agree in writing of the
unavailability of an approved Foreign Subcustodian in such country; and upon
the
receipt of Special Instructions from such Fund, the Custodian shall, or shall
cause its Domestic Subcustodian to, appoint or approve an entity (referred
to
herein as an "Interim Subcustodian") designated in such Special Instructions
to
hold such Security or other Asset.
(d)
Special
Subcustodians.
Upon
receipt of Special Instructions, the Custodian shall, on behalf of a Fund,
appoint one or more banks, trust companies or other entities designated in
such
Special Instructions to act for the Custodian on behalf of such Fund as a
subcustodian for purposes of: (i) effecting third-party repurchase transactions
with banks, brokers, dealers or other entities through the use of a common
custodian or subcustodian; (ii) providing depository and clearing agency
services with respect to certain variable rate demand note Securities, (iii)
providing depository and clearing agency services with respect to dollar
denominated Securities, (iv) effecting securities lending transactions on behalf
of a Fund; and (v) effecting any other transactions designated by such Fund
in
such Special Instructions. Each such designated subcustodian (hereinafter
referred to as a "Special Subcustodian") shall be listed on Appendix A attached
hereto, as it may be amended from time to time. In connection with the
appointment of any Special Subcustodian, the Custodian shall enter into a
subcustodian agreement with the Special Subcustodian in form and substance
approved by the appropriate Fund in Special Instructions. The Custodian shall
not amend any subcustodian agreement entered into with a Special Subcustodian,
or waive any rights under such agreement, except upon prior approval pursuant
to
Special Instructions.
11
(e)
Termination
of a Subcustodian.
The
Custodian may, at any time in its discretion upon notification to the
appropriate Fund(s), terminate any Subcustodian of such Fund(s) in accordance
with the termination provisions under the applicable subcustodian agreement,
and
upon the receipt of Special Instructions, the Custodian will terminate any
Subcustodian in accordance with the termination provisions under the applicable
subcustodian agreement.
(f)
Certification
Regarding Foreign Subcustodians.
Upon
request of a Fund, the Custodian shall deliver to such Fund a certificate
stating: (i) the identity of each Foreign Subcustodian then acting on behalf
of
the Custodian; (ii) the countries in which and the Securities Depositories
and
Clearing Agencies through which each such Foreign Subcustodian is then holding
cash, Securities and other Assets of such Fund; and (iii) such other information
as may be requested by such Fund, and as the Custodian shall be reasonably
able
to obtain, to evidence compliance with rules and regulations under the 1940
Act.
6.
STANDARD
OF CARE.
(a)
General
Standard of Care.
The
Custodian shall be held to a standard of reasonable care and diligence in
providing the services contemplated by this Agreement, and shall be liable
to
each Fund for all losses, damages and reasonable costs and expenses suffered
or
incurred by such Fund resulting from the negligence,
bad faith, misfeasance or willful misconduct of
the
Custodian; provided, however, in no event shall either party be liable for
special, indirect or consequential damages arising under or in connection with
this Agreement.
(b)
Actions
Prohibited by Applicable Law, Events Beyond Custodian's Control,
Sovereign Risk, Etc.
In
no
event shall the Trust, Custodian or any Domestic Subcustodian incur liability
hereunder (i) if the Trust, Custodian or any Subcustodian or Securities System,
or any subcustodian, Securities System, Securities Depository or Clearing Agency
utilized by the Custodian or any such Subcustodian, or any nominee of the
Custodian or any Subcustodian (individually, a "Person") is prevented, forbidden
or delayed from performing, or omits to perform, any act or thing which this
Agreement provides shall be performed or omitted to be performed, by reason
of:
(a) any provision of any present or future law or regulation or order of the
United States of America, or any state thereof, or of any foreign country,
or
political subdivision thereof or of any court of competent jurisdiction (and
neither the Custodian nor any other Person shall be obligated to take any action
contrary thereto); or (b) any event beyond the control of the Custodian or
other
Person such as armed conflict, riots, strikes, lockouts and labor disputes
at
unaffiliated companies, equipment or transmission failures (other than of
equipment of the Custodian or any Subcustodian), natural disasters, or failure
of the mails, transportation, communications or power supply; or (ii) for any
loss, damage, cost or expense resulting from "Sovereign Risk." A "Sovereign
Risk" shall mean nationalization, expropriation, currency devaluation,
revaluation or fluctuation, confiscation, seizure, cancellation, destruction
or
similar action by any governmental authority, de facto or de jure; or enactment,
promulgation, imposition or enforcement by any such governmental authority
of
currency restrictions, exchange controls, taxes, levies or other charges
affecting a Fund's Assets; or acts of armed conflict, terrorism, insurrection
or
revolution; or any other act or event beyond the Custodian's or such other
Person's reasonable control.
The
Custodian shall maintain a comprehensive business continuity plan that is
commercially reasonable and complies with applicable laws, rules and
regulations. The Custodian shall provide an executive summary of such plan
upon
reasonable request of the Trust. The Custodian shall test the adequacy of the
business continuity plan at least annually. In the event of business disruption
that materially impacts the Custodian’s provision of services under this
Agreement, the Custodian will seek to mitigate damages, promptly notify the
Trust of the disruption and brief the Trust on the steps being taken to respond
to the disruption.
12
(c)
Liability
for Past Records.
The
Custodian, together with any Domestic Subcustodian, shall be entitled to rely
upon records that were maintained and services provided for a Fund by entities
other than the Custodian or any Domestic Subcustodian. Neither the Custodian
nor
any Domestic Subcustodian shall have any liability in respect of any loss,
damage or expense suffered by a Fund, insofar as such loss, damage or expense
arises from the performance of the Custodian or any Domestic Subcustodian in
reliance upon records that were maintained for such Fund by entities other
than
the Custodian or any Domestic Subcustodian prior to the Custodian's employment
hereunder, or for the actions or omissions of any such entity, provided that
the
loss, damage or expense is not the result of the Custodian’s negligence, bad
faith, misfeasance or willful misconduct.
(d)
Advice
of Counsel.
The
Custodian and all Domestic Subcustodians shall be entitled to receive and act
upon advice of counsel that is mutually acceptable to the Custodian and/or
Domestic Subcustodian (as the case may be) and the Trust on all matters. The
Custodian and all Domestic Subcustodians shall be without liability for any
actions taken or omitted in good faith pursuant to the advice of such
counsel.
(e)
Advice
of the Fund and Others.
The
Custodian and any Domestic Subcustodian may rely upon the advice of any Fund
and
upon statements of such Fund's accountants and other persons believed by it
in
good faith to be expert in matters upon which they are consulted, and neither
the Custodian nor any Domestic Subcustodian shall be liable for any actions
taken or omitted, in good faith, pursuant to such advice or
statements.
(f)
Instructions
Appearing to be Genuine.
The
Custodian and all Domestic Subcustodians shall be fully protected and
indemnified in acting as a custodian hereunder pursuant to and in reliance
upon
any Resolutions of the Board of Trustees of the Trust, Instructions, Special
Instructions, advice, notice, request, consent, certificate, instrument or
paper
reasonably appearing to it to be genuine and to have been properly executed
and
shall, unless otherwise specifically provided herein, be entitled to receive
as
conclusive proof of any fact or matter required to be ascertained from any
Fund
hereunder a certificate signed by any officer of such Fund authorized to
countersign or confirm Special Instructions. The Custodian shall have no
liability for any losses, damages, or expenses incurred by a Fund arising from
the use by the Fund of a non-secure form of email or other non-secure electronic
system or process.
(g)
Exceptions
from Liability.
Without
limiting the generality of any other provisions hereof, neither the Custodian
nor any Domestic Subcustodian shall be under any duty or obligation to inquire
into, nor be liable for:
(i)
the
validity of the issue of any Securities purchased by or for any Fund, the
legality of the purchase thereof or evidence of ownership required to be
received by any such Fund, or the propriety of the decision to purchase or
amount paid therefor;
(ii)
the
legality of the sale of any Securities by or for any Fund, or the propriety
of
the amount for which the same were sold; or
(iii)
any
other expenditures, encumbrances of Securities, borrowings or similar actions
with respect to any Fund's Assets;
13
and
may,
until notified to the contrary, presume that all Instructions or Special
Instructions received by it are not in conflict with or in any way contrary
to
any provisions of any such Fund's Declaration of Trust or By-Laws or votes
or
proceedings of the shareholders, trustees, partners or directors of any such
Fund, or any such Fund's currently effective Registration Statement on file
with
the SEC.
7.
LIABILITY
OF THE CUSTODIAN FOR ACTIONS OF OTHERS.
(a)
Domestic
Subcustodians
The
Custodian shall be liable for the acts or omissions of any Domestic Subcustodian
to the same extent as if such actions or omissions were performed by the
Custodian itself.
(b)
Liability
for Acts and Omissions of Foreign Subcustodians.
The
Custodian shall be liable to a Fund for any loss or damage to such Fund caused
by or resulting from the acts or omissions of any Foreign Subcustodian to the
extent that, under the terms set forth in the subcustodian agreement between
the
Custodian or a Domestic Subcustodian and such Foreign Subcustodian, the Foreign
Subcustodian has failed to perform in accordance with the standard of conduct
imposed under such subcustodian agreement and the Custodian or Domestic
Subcustodian recovers from the Foreign Subcustodian under the applicable
subcustodian agreement. At the election of the Trust (and if not explicitly
prohibited by the relevant agreement with the applicable Domestic Subcustodian
or Foreign Subcustodian), the Trust shall be entitled to be subrogated to the
rights of the Custodian with respect to any claim against the applicable
Domestic Subcustodian, Foreign Subcustodian or any other person which the
Custodian may have as a consequence of any loss or damage caused by the
applicable Domestic Subcustodian or Foreign Subcustodian if and to the extent
that the Trust or a Fund has not been made whole for any such loss or damage;
provided, however, (1) the Trust shall have no greater rights than the Custodian
with respect to such claim; (2) the Custodian shall have no duty to be a party
to such claim; and (3) if the Trust: (a) suffers a loss or damage caused by
or
resulting from the acts or omissions of the applicable Domestic Subcustodian
or
Foreign Subcustodian acting in such capacity; (b) receives a payment from the
Custodian in partial reimbursement for the loss or damage suffered by the Trust;
(c) elects to be subrogated to the rights of the Custodian with respect to
one
or more claims against the applicable Domestic Subcustodian and/or one or more
Foreign Subcustodians or other persons as contemplated herein; and (d) receives
total payments from the Custodian, the applicable Domestic Subcustodian, any
Foreign Subcustodians or other persons in connection with the loss or damage
such that the aggregate payments received by the Trust in reimbursement of
such
loss or damage from the Custodian, the applicable Domestic Subcustodian, any
Foreign Subcustodians and other persons exceed the sum of the amount of (x)
the
loss or damage and (y) the Trust’s total cost of recovery, all as determined in
reasonable judgment of the Trust, the Trust shall pay the Custodian such excess
amount.
(c)
Securities
Systems, Interim Subcustodians, Special Subcustodians, Securities Depositories
and Clearing Agencies.
The
Custodian shall not be liable to any Fund for any loss, damage or expense
suffered or incurred by such Fund resulting from or occasioned by the actions
or
omissions of a Securities System, Interim Subcustodian, Special Subcustodian
(including but not limited to a securities lending agent as described in Section
4(n)), or Securities Depository and Clearing Agency unless such loss, damage
or
expense is caused by, or results from, the negligence, bad faith, misfeasance
or
willful misconduct of the Custodian.
(d)
Default
or Insolvency of Brokers, Banks, Etc.
The
Custodian shall not be liable for any loss, damage or expense suffered or
incurred by any Fund resulting from or occasioned by the actions, omissions,
neglects, defaults or insolvency of any broker, bank, trust company
or
any
other person with whom the Custodian may deal (other than any of such entities
acting as a Subcustodian, Securities System or Securities Depository and
Clearing Agency, for whose actions the liability of the Custodian is set out
elsewhere in this Agreement) unless such loss, damage or expense is caused
by,
or results from, the negligence, bad faith, misfeasance or willful misconduct
of
the Custodian.
14
(e)
Reimbursement
of Expenses.
Each
Fund
agrees to reimburse the Custodian for all reasonable out-of-pocket expenses
incurred by the Custodian in connection with this Agreement, but excluding
salaries and usual overhead expenses. Upon request, the Custodian will provide
to a Fund reasonable documentation in regard to such expenses.
8.
INDEMNIFICATION.
(a)
Indemnification
by Fund.
Subject
to the limitations set forth in this Agreement, each Fund agrees to indemnify
and hold harmless the Custodian and its nominees from all losses, damages and
expenses (including reasonable attorneys' fees) suffered or incurred by the
Custodian or its nominee caused by or arising from actions taken by the
Custodian, its employees or agents in the performance of its duties and
obligations under this Agreement, including, but not limited to, any
indemnification obligations undertaken by the Custodian under any relevant
subcustodian agreement; provided, however, that such indemnity shall not apply
to the extent the Custodian is liable under Sections 6 or 7 hereof.
If
any
Fund requires the Custodian to take any action with respect to Securities,
which
action involves the payment of money or which may, in the opinion of the
Custodian, result in the Custodian or its nominee assigned to such Fund being
liable for the payment of money or incurring liability of some other form,
such
Fund, as a prerequisite to requiring the Custodian to take such action, shall
provide indemnity to the Custodian in an amount and form reasonably satisfactory
to it.
(b)
Indemnification
by Custodian.
Subject
to the limitations set forth in this Agreement and in addition to the
obligations provided in Sections 6 and 7, the Custodian agrees to indemnify
and
hold harmless each Fund from all losses, damages and expenses (including
reasonable attorneys’ fees) suffered or incurred by each such Fund, its
trustees, officers, employees or agents caused by the failure of the Custodian
or any Domestic Subcustodian to satisfy the standard of care set forth in
Section 6 above, or the negligence, bad faith, misfeasance or willful misconduct
of the Custodian or any Domestic Subcustodian.
9.
ADVANCES.
In
the
event that, pursuant to Instructions, the Custodian or any Subcustodian,
Securities System, or Securities Depository or Clearing Agency acting either
directly or indirectly under agreement with the Custodian (each of which for
purposes of this Section 9 shall be referred to as "Custodian"), makes any
payment or transfer of funds on behalf of any Fund as to which there would
be,
at the close of business on the date of such payment or transfer, insufficient
funds held by the Custodian on behalf of any such Fund, the Custodian may,
in
its discretion without further Instructions, provide an advance ("Advance")
to
any such Fund in an amount sufficient to allow the completion of the transaction
by reason of which such payment or transfer of funds is to be made. In addition,
in the event the Custodian is directed by Instructions to make any payment
or
transfer of funds on behalf of any Fund as to which it is subsequently
determined that such Fund has overdrawn its cash account with the Custodian
as
of the close of business on the date of such payment or transfer, said overdraft
shall constitute an Advance. Any Advance shall be payable by the Fund on behalf
of which the Advance was made on demand by Custodian, unless otherwise agreed
by
such Fund and the Custodian, and shall accrue interest from the date of the
Advance to the date of payment by such Fund to the Custodian at a rate agreed
upon in writing from time to time by the Custodian and such Fund. It is
understood that any transaction in respect of which the Custodian shall have
made an Advance, including but not limited to a foreign exchange contract or
transaction in respect of which the Custodian is not acting as a principal,
is
for the account of and at the risk of the Fund on behalf of which the Advance
was made, and not, by reason of such Advance, deemed to be a transaction
undertaken by the Custodian for its own account and risk. The Custodian and
each
of the Funds which are parties to this Agreement acknowledge that the purpose
of
Advances is to finance temporarily the purchase or sale of Securities for prompt
delivery in accordance with the settlement terms of such transactions or to
meet
emergency expenses not reasonably foreseeable by a Fund. The Custodian shall
promptly notify the appropriate Fund of any Advance. Such notification shall
be
sent by facsimile transmission or in such other manner as such Fund and the
Custodian may agree.
15
10.
LIENS.
The
Custodian shall have a lien on the Property in the Custody Account to secure
payment of fees and expenses for the services rendered under this Agreement.
If
the Custodian advances cash or securities to the Fund for any purpose or in
the
event that the Custodian or its nominee shall incur or be assessed any taxes,
charges, expenses, assessments, claims or liabilities in connection with the
performance of its duties hereunder, except such as may arise from its or its
nominee's negligent action, negligent failure to act or willful misconduct,
any
Property at any time held for the Custody Account shall be security therefor
and
the Fund hereby grants a security interest therein to the Custodian. The Fund
shall promptly reimburse the Custodian for any such advance of cash or
securities or any such taxes, charges, expenses, assessments, claims or
liabilities upon request for payment, but should the Fund fail to so reimburse
the Custodian, the Custodian shall be entitled to dispose of such Property
to
the extent necessary to obtain reimbursement. The Custodian shall be entitled
to
debit any account of the Fund with the Custodian including, without limitation,
the Custody Account, in connection with any such advance and any interest on
such advance as the Custodian deems reasonable.
11.
COMPENSATION.
Each
Fund
will pay to the Custodian such compensation as is agreed to in writing by the
Custodian and each such Fund from time to time. Such compensation, together
with
all amounts for which the Custodian is to be reimbursed in accordance with
Section 7(e), shall be billed to each such Fund and paid in cash to the
Custodian.
12.
POWERS
OF ATTORNEY.
Upon
request, each Fund shall deliver to the Custodian such proxies, powers of
attorney or other instruments as may be reasonable and necessary or desirable
in
connection with the performance by the Custodian or any Subcustodian of their
respective obligations under this Agreement or any applicable subcustodian
agreement.
13.
TERMINATION
AND ASSIGNMENT.
Either
party may terminate this Agreement by notice in writing, delivered or mailed,
postage prepaid (certified mail, return receipt requested) to the other not
less
than 90 days prior to the date upon which such termination shall take effect.
The Trust may terminate this Agreement with respect to one or more Funds by
notice in writing, delivered or mailed, postage prepaid (certified mail, return
receipt requested) to the other not less than 90 days prior to the date upon
which such termination shall take effect. Following notice of termination but
prior to and including the actual termination of this Agreement, the same terms
and conditions set forth elsewhere in this Agreement shall apply to the
relationship between the parties. The Custodian shall maintain the same level
of
service provided to the Trust prior to termination following notice of
termination by the Trust.
Upon
termination of this Agreement with respect to a Fund, (a) the Fund shall pay
to
the Custodian such fees as may be due the Custodian hereunder as well as its
reimbursable disbursements, costs and expenses paid or incurred and (b) the
Custodian shall deliver, at the terminating party's expense, all Assets held
by
it hereunder to the Fund or as otherwise designated by Trust by Special
Instructions. Upon such delivery, the Custodian shall have no further
obligations or liabilities under this Agreement with respect to the Fund except
as to the final resolution of matters relating to activity occurring prior
to
the effective date of termination. The termination of this Agreement as to
less
than all of the Funds shall not affect the obligations of the Custodian and
the
Trust with respect to the remaining Funds hereunder as set forth in Appendix
B
as revised from time to time.
This
Agreement may not be assigned by a party without the respective consent of
the
other, duly authorized by a resolution by its Board of Directors or
Trustees.
16
14.
COOPERATION
Upon
the
reasonable written request of the Trust, the Custodian shall grant the Trust’s
duly authorized officers (including the Trust’s Chief Compliance Officer),
investment adviser, agents and independent registered public accounting firm
access, during normal business hours, to the facilities, records and personnel
of the Custodian to the extent such facilities, records and personnel are used
in connection with or relate to the services to be provided hereunder by the
Custodian, for purposes of: (i) conducting a due diligence review of the
facilities, recordkeeping and personnel of the Custodian; (ii) facilitating
the
preparation and audit, as applicable of the Funds’ financial statements; (iii)
complying with any regulatory requirements applicable to the Trust; and (iv)
conducting compliance reviews or audits, provided, however, that access to
any
such records shall be limited to those records pertaining to the
Funds.
Upon
request, the Custodian will provide sub-certifications to the Trust and/or
its
officers with respect to its services provided hereunder to support: (i) the
Trust’s compliance program and/or (ii) the certifications required of the
principal executive officer and principal financial officer of the Trust under
the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and implementing rules and regulations, in
substantially the form or forms set forth in Appendix C hereto.
The
Custodian shall provide the Trust with a copy of the reports (if any) of the
Custodian prepared as a result of “agreed-upon-procedures” or in compliance with
the requirements of Statement of Auditing Standards No. 70 issued by the
American Institute of Certified Public Accountants, as it may be amended from
time to time.
15.
ADDITIONAL
FUNDS.
An
additional Fund or Funds may become subject to this Agreement after the date
hereof if each party hereto signs an amended Appendix B, adding such Fund or
Funds.
16.
NOTICES.
As
to
each Fund, notices, requests, instructions and other writings delivered to
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, postage prepaid, or to such other address
as the Trust may have designated to the Custodian in writing, shall be deemed
to
have been properly delivered or given to a Fund.
Notices,
requests, instructions and other writings delivered to the Securities
Administration department of the Custodian at its office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇.,
▇▇▇
▇▇▇▇▇, Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, postage prepaid,
or to
such other addresses as the Custodian may have designated to the Trust in
writing, shall be deemed to have been properly delivered or given to the
Custodian hereunder; provided, however, that procedures for the delivery of
Instructions and Special Instructions shall be governed by Section 2(c)
hereof.
17.
MISCELLANEOUS.
(a)
This
Agreement is executed and delivered in the State of Missouri and shall be
governed by the laws of such state.
(b)
All
of the terms and provisions of this Agreement shall be binding upon, and inure
to the benefit of, and be enforceable by the respective successors and assigns
of the parties hereto.
(c)
No
provisions of this Agreement may be amended, modified or waived, in any manner
except in writing, properly executed by both parties hereto; provided, however,
Appendix A may be amended from time to time as Domestic Subcustodians, Foreign
Subcustodians, Special Subcustodians, and Securities Depositories and Clearing
Agencies are approved or terminated according to the terms of this
Agreement.
(d)
The
captions in this Agreement are included for convenience of reference only,
and
in no way define or delimit any of the provisions hereof or otherwise affect
their construction or effect.
17
(e)
This
Agreement shall be effective as of the date of execution hereof.
(f)
This
Agreement may be executed simultaneously in two or more counterparts, each
of
which will be deemed an original, but all of which together will constitute
one
and the same instrument.
(g)
The
following terms are defined terms within the meaning of this Agreement, and
the
definitions thereof are found in the following sections of the
Agreement:
|
Term
|
Section
|
|
Account
|
4(b)(3)(ii)
|
|
ADR'S
|
4(j)
|
|
Advance
|
9
|
|
Assets
|
2(b)
|
|
Authorized
Person
|
3
|
|
Banking
Institution
|
4(1)
|
|
Domestic
Subcustodian
|
5(a)
|
|
Foreign
Subcustodian
|
5(b)
|
|
Instruction
|
2(c)(1)
|
|
Interim
Subcustodian
|
5(c)
|
|
Interest
Bearing Deposit
|
4(1)
|
|
Liens
|
10
|
|
OCC
|
4(g)(1)
|
|
Person
|
6(b)
|
|
Procedural
Agreement
|
4(h)
|
|
SEC
|
4(b)(3)
|
|
Securities
|
2(a)
|
|
Securities
Depositories and Clearing Agencies
|
5(b)(ii)
|
|
Securities
System
|
4(b)(3)
|
|
Shares
|
First
Whereas clause
|
|
Sovereign
Risk
|
6(b)
|
|
Special
Instruction
|
2(c)(2)
|
|
Special
Subcustodian
|
5(d)
|
|
Subcustodian
|
5
|
|
1940
Act
|
First
Whereas clause
|
(h)
If
any part, term or provision of this Agreement is held to be illegal, in conflict
with any law or otherwise invalid by any court of competent jurisdiction, the
remaining portion or portions shall be considered severable and shall not be
affected, and the rights and obligations of the parties shall be construed
and
enforced as if this Agreement did not contain the particular part, term or
provision held to be illegal or invalid.
(i)
This
Agreement constitutes the entire understanding and agreement of the parties
hereto with respect to the subject matter hereof, and accordingly supersedes,
as
of the effective date of this Agreement, any custodian agreement heretofore
in
effect between the Fund and the Custodian.
(j)
This
Agreement is executed by the Trust with respect to each of the Funds and the
obligations hereunder are not binding on any of the trustees, officers or
shareholders of the Trust individually but are binding only upon the Fund to
which such obligations pertain and the assets and property of such Fund. All
obligations of the Trust under this Agreement shall apply only on a Fund-by-Fund
basis, and the assets of one Fund shall not be liable for the obligation of
another Fund.
18
IN
WITNESS WHEREOF,
the
parties hereto have caused this Custody Agreement to be executed by their
respective duly authorized officers.
|
THE
WESTPORT FUNDS
|
||
|
Attest:
|
By:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
|
|
Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
||
|
Title:
President
|
||
|
Date:
October 19, 2007
|
||
|
UMB
BANK, N.A.
|
||
|
Attest:
|
By:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
|
|
Name:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
||
|
Title:
Vice President
|
||
|
Date:
October 19, 2007
|
19
APPENDIX
A
DOMESTIC
SUBCUSTODIANS:
None
SECURITIES
SYSTEMS:
Federal
Book Entry
Depository
Trust Company
SPECIAL
SUBCUSTODIANS:
SECURITIES
DEPOSITORIES
|
COUNTRIES
|
FOREIGN
SUBCUSTODIANS
|
CLEARING
AGENCIES
|
|
None
|
None
|
None
|
|
THE
WESTPORT FUNDS
|
UMB
BANK, N.A.
|
|
|
By:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
By:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
|
|
Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
|
Name:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
|
|
Title:
President
|
Title:
Vice President
|
|
|
Date:
October 19, 2007
|
Date:
October 19, 2007
|
|
20
APPENDIX
B
The
following series of The Westport Funds, an open-end management investment
company, ("Funds") are hereby made parties to the Custody Agreement dated
October 19, 2007, between UMB Bank, n.a. and Westport Funds:
Westport
Fund
Westport
Select Cap Fund
|
THE
WESTPORT FUNDS
|
||
|
Attest:
|
By:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
|
|
Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
||
|
Title:
President
|
||
|
Date:
October 19, 2007
|
||
|
UMB
BANK, N.A.
|
||
|
Attest:
|
By:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
|
|
Name:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
|
||
|
Title:
Vice President
|
||
|
Date:
October 19, 2007
|
21
APPENDIX
C
22